The applicant, the Owners - Unit Plan No 928 (Corporation), is the owners corporation for a unit title complex in Griffith in the Australian Capital Territory (the Complex). The respondent is referred to as 'the Corporation', so as to distinguish it from occasions when these reasons, or quoted legislation, refer to 'a corporation' more generally.
The respondent, Ms Cochaud, is the owner of Unit 2 of the Corporation's units plan (Unit 2). She has owned Unit 2 since 22 February 2011. Unit 2 is currently tenanted by her parents, Dr and Mrs Cochaud (the Tenants), who represented her throughout these proceedings. It is the activities of the Tenants that are the concern of the primary concern of the Corporation.
[2]
Rule 6 of the Corporation's house rules (House Rule 6) reads:
[3]
Use of downstairs garage parking areas are for the use of vehicles only (eg. Cars, motorbikes, scooters, pushbikes, trailers, campervans) and the storage of items is not permitted. If owners do have a necessity from time to time to store items in parking areas or on common property, then they should be kept as neat as possible and for a short time only, not exceeding a month, whilst the residents are seeking an alternative arrangement for those storage items.
[4]
The Tenants have built cabinetry and a wood working bench in the car parking area of their unit. The respondent has not prevented this.
The Corporation contends that the respondent, through the actions of her tenants, and her lack of action in relation thereto, has breached House Rule 6 and "following service of Rule Infringement Notice dated 11 February 2016 (infringement notice) seeks orders pursuant to sections 129(1), 129(2) and 129(3) of the UTM Act" that:
(a) the respondent pay a pecuniary penalty of five penalty units for breaches of the rule infringement notice;
(b) the respondent is to remove the material in the unit subsidiary to Unit 2;
(c) if the respondent does not comply with order (b), that the Corporation or a person associated with the Corporation is authorised to enter the unit subsidiary and remove the material stored in the unit subsidiary and the respondent is to pay the costs of the Owners Corporation in removing the material; and
(d) the respondent is to pay the Owners Corporation's costs of these proceedings.
The respondent does not deny that she and the tenants have failed to comply with the infringement notice. However, she contends that:
(a) House Rule 6 merely provides only that common property cannot be used for storage. The carport is not common property;
(b) the Owners Corporation does not have power to make rules about the use of subsidiaries, as subsidiaries are part of units;
(c) the cabinets do not infringe on others' use or enjoyment of the common property;
(d) the executive committee has not properly considered the extent to which the tenants have minimised their impact on others;
At the hearing there was a further issue, raised by Dr Cochaud, as to the interaction between the Territory lease and the UTM Act. For reasons that will be apparent, I have only had to consider the first two of these grounds. It is not necessary that I consider the lease issue.
In reply the respondent, the applicant says that House Rule 6 is a valid exercise of the Corporation's power to make rules as set out in section 108(1) of the UTM Act. The applicant contends both that:
(a) section 108(1) permits the making of rules about the use of individual units; and
(b) in any case, that House Rule 6 is an exercise of the Corporation's function of "ensuring the enjoyment or amenity of lot owners."[1]
[5]
The Units Plan in this case (Units Plan) was registered on 20 October 1993 and consists of a series of two and three story terraced buildings, with a common grounds and stairwells and underground parking.
Unit 2 consists of the main apartment and five unit subsidiaries:
The unit subsidiary carport for Unit 2 is located in the basement of the Complex. The carport space is 4.96m by 6m, giving it an area of approximately 29 square metres. It is located directly in front of a door into the basement/ground floor level of Unit 2. It is bordered by other carports and by common property.
House Rule 6 was passed by special resolution on 7 February 2011. It was registered on 16 November 2011 (Dealing No 1771653), and took effect from that date.[2] The respondent did not suggest that there anything amiss with this process. She did not at that time seek a merit review of the motion pursuant to section 129(1)(f) of the UTM Act, and has not done so since.
The Tenants moved into the unit in January 2016. Shortly thereafter, Dr Cochaud verbally advised two neighbours that he would be erecting storage furniture and a workbench in his carport. He thereafter installed six cabinets.
On 17 January 2016, Dr Cochaud wrote to the Corporation advising of his intention to install further cabinetry and a workbench.
On 21 January 2016 the Strata Manager issued a 'breach notice' to the respondent, asking that the cabinets be removed. It is not apparent what, if any, steps the respondent took in relation to this notice, but Dr Cochaud did not remove the cabinetry or the workbench.
On 11 February 2016 the executive committee members agreed to issue a rule infringement notice and instructed the manager to do so. The notice was duly issued (Infringement Notice). The respondent acknowledges receipt of the notice.
Thereafter followed further correspondence, but no resolution of the issue.
On 5 July 2016 a general meeting of the owners corporation approved a resolution authorising the executive committee to take action in the ACAT for an order that the respondents, or the Tenants, remove the goods and seek recovery of the costs of removal from the respondent.
Sometime during this process, Dr Cochaud installed a bench used for carpentry and woodwork and a further series of cabinets used for storage.
It is not disputed that neither the respondent nor the Tenants have complied with the rule infringement notice. The storage cabinets and a workbench remain in the parking space. Additionally Dr Cochaud has commenced using the workbench to undertake carpentry activities. This involves the use of power tools, with associated noise and the creation of some amount of dust. There was evidence given at the hearing, which I accept, that the noise of the tools annoys other residents of the complex, and indeed causes some distress to at least one neighbouring resident.
[8]
Issue One: Does House Rule 6 prohibit the storage of material on private lots?
[9]
The respondent argues that on a literal reading of House Rule 6, it does not prohibit the use of private lots for storage. The applicant contends that it self-evidently does.
Section 112 of the UTM Act provides that the Legislation Act 2001 applies to the rules of an owners corporation as if the rules were an Act and as if each rule were a section of an Act. The Legislation Act sets out a series statutory principles of interpretation, and assumes the concurrent operation of common law presumptions.[3] I note in passing that while applying principles of statutory interpretation developed for reading legislation is relatively straightforward when an owners corporation has simply adopted the default rules, or where it has had the benefit of legal assistance, it can be challenging, and sometimes even unhelpful, to apply them when dealing with rules prepared by laypersons with little legal or drafting experience.
Breaking House Rule 6 down, it consists of two separate sentences:
(a) "Use of downstairs garage parking areas are for the use of vehicles only (eg. Cars, motorbikes, scooters, pushbikes, trailers, campervans) and the storage of items is not permitted" (first sentence); and
(b) "If owners do have a necessity from time to time to store items in parking areas or on common property, then they should be kept as neat as possible and for a short time only, not exceeding a month, whilst the residents are seeking an alternative arrangement for those storage items" (second sentence).
The first observation is that there is no definition of a 'parking area'. On the unit plan, the 'parking areas' are actually designated as 'carports'. So what is meant by 'parking areas'?
The first sentence applies to "downstairs garage parking areas". These areas, the rule says, are for the "use of...cars, motorcycles..." etc. Read in context, the phrase 'parking area' appears to be both sufficiently wide to encompass the entirety of the garage area. Still, the issue is not beyond argument. It is possible to read the clause as covering the common areas, such as the common area for access and egress from those parking areas, rather than the carports.
The second sentence is also ambiguous, although for different reasons. It refers to 'parking areas' and 'common property' as alternative things. If one applies the rules of statutory interpretation, then the first sentence must be read in the context of the Act as a whole[4], the use of these two distinct terms would suggest that they mean something different, and hence that the drafters saw the 'common property' as something distinct from the 'parking areas'. I do not think that was the intention - more likely the drafting of House Rule 6 is simply imprecise, and the term 'parking areas' was intended to refer to the whole basement parking area.
On balance, I am on the view that 'parking area' was intended to cover both the private unit property and the common areas. On this basis, Dr Cochaud's construction of a workbench and storage facilities on a parking area is in breach of the first sentence, as worded, as the workbench and storage areas are located in the downstairs garage parking area, and that space is therefore being used for purposes other than parking. Moreover as those items have been in the parking area for more than a month, there is also a breach of the second sentence.
Ultimately, however, it does not matter. House Rule 6 is only effective to proscribe Dr Couchard's activities if it is an effective rule - and for the reasons set out below, I have determined that to the extent that House Rule 6 applies to the carports, it is of no effect.
[10]
Issue Two: Is House Rule 6 of no effect because it is beyond the power of the Corporation to make?
[11]
As I understand the argument advanced by the respondent, through the Tenants, it is that a house rule which simply proscribes certain uses is of no effect because:
(a) section 108(1) of the UTM Act, which sets out an owners corporation's rulemaking power, does not have a general function of making rules about the use of individual units or rules for the 'enjoyment of lot property'; and
(b) section 108(3) of the UTM Act operates to render ineffective any rule that has the effect of giving a function to the corporation that is not incidental or ancillary to its functions under the UTM Act; and
(c) House Rule 6 is not incidental or ancillary to the owners corporation's functions under the UTM Act.
Section 108 reads:
Owners corporation may amend rules
[12]
(1) An owners corporation may, by special resolution, amend its rules.
[13]
_(2) An amendment of the rules of an owners corporation takes effect - _
[14]
(a) on the registration of a copy of the special resolution making the amendment, certified under the seal of the corporation as a true copy; or
[15]
_(3) An amendment to the rules of an owners corporation has no effect to the extent that it results in the rules - _
[16]
(a) being inconsistent with this Act or another territory law; or
[17]
(b) giving a function to the corporation that is not incidental or ancillary to the exercise of its functions under this Act; or
[18]
_(c) prohibiting or restricting any dealing (including devolution, transfer, lease and mortgage) with - _
[19]
(ii) the equitable estate of a unit owner in the common property; or
[20]
(d) prohibiting or restricting the installation, operation or maintenance of sustainability or utility infrastructure.
[21]
amendment, of rules, includes variation, rescission, substitution or addition.
[22]
What is the extent of the power to make or amend rules in section 108?
[23]
The first stated function of an owners corporation is the enforcement of its rules.[5] A corporation's rules are taken to be agreements under seal between the corporation and each of its members, and between each member and each other member, under which the corporation and its members agree to be bound by the rules of the corporation.[6] Both owners and occupiers of a unit in an owners corporation are bound by the valid rules of that corporation, including changes to those rules that pre or post-date their commencement in the complex.[7]
The content of a corporation's rules will vary depending on when the corporation was established and what legislation was in effect at that time, and any amendments made to the rules, but in all cases, section 108(1) of the UTM Act provides that:
[24]
(1) An owners corporation may, by special resolution, amend its rules.
[25]
Section 108(2) goes on to provide that an amendment will take effect from the date it is registered, or such later date as is specified in the rule. It is not in contest that House Rule 6 was validly registered.
What kinds of amendments can be made to the rules? The language used in section 108(1) of the UTM Act is broad, particularly having regard to the meaning of 'unit plan' in section 7 of that Act. Accordingly, the applicant contended in its submissions that the power to amend rules includes the power to make rules about both individual units and common property. The argument was as follows:
[26]
Rather than specifically and prescriptively stating, as section 136 of the Strata Schemes Management Act 2015 (NSW) does "By-laws may be made in relation to the management, administration, control, use or enjoyment of the lots or the common property and lots of a strata scheme" the ACT Legislation simply takes the opposite approach and leaves the field clear for rules to apply to both lot and common property.[8]
[27]
I accept that the power to amend the 'rules' would include the power to amend the rules to include new rules ('making rules'), as well as the power to amend existing rules. However, the power to make or amend rules is not unlimited.
Section 108(1) of the UTM Act must be read subject to section 108(3). Section 108(3) provides that amendments to the rules made under section 108(1) will have "no effect" in certain circumstances, including relevantly, where is has the effect of:
[28]
giving a function to the corporation that is not incidental or ancillary to the exercise of its functions under this Act;
[29]
'Function' is defined in the Legislation Act to include an "authority, duty or power."[9]
The 'functions' of an owners corporation are set out in section 16 of the UTM Act, which provides as follows:
[30]
(1) An owners corporation for a units plan has the following functions:
[31]
(b) the control, management and administration of the common property;
[32]
(c) any other function given to the corporation under this Act or another territory law.
[33]
In other words, to be effective, the any laws made by the owners corporation must be incidental or ancillary to either:
(a) enforcement of its rules;
(b) the control, management and administration of the common property, or
(c) another function given to the corporation under the UTM Act.
[34]
Before considering the nature of an owners corporation's functions, it is first necessary to consider what may be 'ancillary or incidental' to those functions.
Neither party made detailed submissions on the meaning of 'incidental' or 'ancillary'. To the best of my knowledge, no Court or Tribunal has considered the meaning of these terms the context of the UTM Act (at least, no caselaw was brought to my attention). Nonetheless, both terms are frequently used in legislation, including in planning legislation, and there are numerous authorities that consider what the words mean when used in a legislative context.
In Rothmans of Pall Mall (Australia) Ltd v Australian Broadcasting Tribunal[1985] FCA 91 the Full Court of the Federal Court adopted the definition of 'incidental' as defined in the Oxford English Dictionary as follows:
(1) occurring or liable to occur in fortuitous or subordinate conjunction with something else; casual ... (2) casually met with.
[35]
Their Honours' observations about the meaning of 'incidental' were in the context of what is an 'accidental or incidental transmission' for broadcast, which is a very different circumstance to that in the current case, but the definition remains appropriate.
A similar definition can be found in the Macquarie Dictionary, being:
[36]
1. happening or likely to happen in fortuitous or subordinate conjunction with something else. 2. liable to happen or naturally appertaining...
[37]
Drawing upon the discussion in Rothmans, the Queensland Court of Appeal observed in Gallagher v Rainbow & Ors[1992] QCA 375 that:
[38]
It is however well established that the words "connected with" and "incidental to" have a very wide coverage, and that in various contexts a casual connection is sufficient (Rothmans of Pall Mall (Aust.) Ltd. v. Australian Broadcasting Tribunal [1985] FCA 91; 1985 58 A.L.R. 675, 691; Berry v. F.C.T. [1953] HCA 70; 1953 89 C.L.R. 653, 659).
[39]
The construction of a house consistent with its use for domestic purposes would not, in my view, amount to a use of the land exceeding domestic purposes and I should think it immaterial whether the building was constructed by a professional builder, or by the owner himself. The fact that an owner happened to be a professional builder and saw fit to build houses on the newly subdivided allotments would not mean that the domestic limitation was infringed...
[40]
Similarly the sale of a house designed for domestic use is prima facie an act incidental to or connected with domestic use of the tenement...
[41]
In short the words "incidental to domestic use" must include the construction of houses for domestic use and reasonable arrangements for their sale and resale.
[42]
The discussions in Rothmans and Gallagher provide a useful basis for consideration in this case. On the basis of these authorities, I am satisfied that something is 'incidental' to something else if it is connected to it, even if the connection is casual in nature.
'Ancillary', meanwhile, is defined in the Macquarie Dictionary to mean:
[43]
2.an accessory, subsidiary or helping thing or person.
[44]
A practical example of the meaning of an 'ancillary' may be found, in the context of the planning dispute, in Pacific Seven Pty Ltd v Knox CC(1993) 11 AATR 325:
[45]
In general terms there are two types of activities which are commonly considered to be ancillary uses. The first is where the ancillary activity is quite different to the activities constituting the primary use of the property but are a necessary adjunct to the primary use. A common example given is the sixth floor of Myers in Melbourne which is devoted to offices, yet the offices are ancillary to the primary use of the premises as a shop. In such cases there must exist a close association between the principal and ancillary uses. Thus, so long as the office of a business or industry deals with the administration of that business or industry, then it will not be classified as a separate office use but as part of the use constituted by the business or industry. But if other administrative work entirely unrelated to the business or industry in question is carried out, then that aspect of the office activity would cease to be ancillary to the primary use and would become a separate use in its own right which would need to comply with the planning scheme.
[46]
The second type of ancillary uses are those types of activities which grow out of or develop from the primary use and are intended to enhance it. The most common example of these in recent years has been the sale of convenience goods by petrol stations. Petrol stations have always tended to sell items over and above simply motor fuel and oil. At first, such goods were confined to motoring accessories and spare parts. This range expanded to include cigarettes, sweets and drinks for motorists themselves. Gradually the sale of further convenience goods came to be accepted as being ancillary to a petrol station.
[47]
Again, this is a useful discussion. I am satisfied that something is 'ancillary' to something else if it is a necessary adjunct to that thing, or if it grows from that thing or is intended to enhance it.
Hence, in the context of the UTM Act:
(a) something is incidental to the functions of the corporation if it is 'connected with' those functions; or
(b) something is ancillary to the functions of the corporation if it is an adjunct to or a natural result of the exercise of those functions.
So, what kinds of things may be fall within the scope of the owners corporation's functions, or be ancillary or incidental to those functions?
[48]
The function of the enforcement of an owners corporation's rules
[49]
Pursuant to sections 108(1) and 16(1)(a) of the UTM Act, an owners corporation has the power to make rules about, or incidental or ancillary to, the enforcement of its rules. What does this mean?
Certainly, the power to make rules for the enforcement of rules extends to the power to make procedural rules, for example rules about the enforcement process and procedures. It probably extends to making 'ancillary' rules that streamline the enforcement process. On this basis, could a house rule, for example, be passed to make it clear that something is a nuisance and is, accordingly, and prohibited, without the need for any further consideration or deliberation?
The applicant did not suggest that House Rule 6 was a rule directed to enforcing the rules. Accordingly, neither party addressed this ground at the hearing, nor have I had the benefit of submissions on the issue. However, the facts of this matter do raise the question as to whether, for example, a rule could be passed banning the use of power tools in the car park area, because the noise invariably amounts to a nuisance that interferes with use of the common property (if not other lots). One could suggest that such a rule makes clearer what it kinds of conduct are always considered inappropriate, and as such they are a 'natural adjunct' to the power to manage the use of the common property.
Ultimately, given that this issue was not raised before me, I do not, and likely cannot, decide it. However, I make the reflection that, while the owners corporation does have a broad degree of power to make rules that are 'ancillary or incidental' to the enforcement of a rules, that power does not operate so as to make good a rule that would otherwise be of no effect by operation of section 108(3). To find otherwise would give rise to a kind of circular argument, where rules are valid because the rules say they are valid - and for reasons set out below, I am not satisfied that the legislature intended that the owners corporations would have such power.
[50]
The function of the 'control, management or administration of the common property'
[51]
Under the UTM Act, an owners corporation is responsible for the 'control, management and administration' of the 'common property'. Individual units, including their unit subsidiaries, are self-evidently not the 'common property'. But do the functions of controlling, managing and administering the common property necessarily encompass a power to make rules for individual lots where that rule has a broader purpose related to the control, management or administration of the common property? Does a power to make rules about 'managing' or 'administering' the common property extend to making rules about the 'enjoyment' of that property?
The first step in answering these questions is to consider the words of section 108 of the UTM Act.
[52]
The applicant has, in its submissions, expressly relied upon a comparison of the Territory's legislation with that in NSW, although it did not rely on any specific caselaw. Given that the applicant has asked that I have regard to legislation in another jurisdiction, I have undertaken my own, albeit relatively cursory, review of the legislation and case law in other jurisdictions.[10]
Starting with the NSW Legislation, section 136 of the Strata Management Act 2015 (NSW) provides that:
[53]
By-laws may be made in relation to the management, administration, control, use or enjoyment of the lots or the common property and lots of the strata scheme
[54]
Section 108 of the UTM Act may be distinguished from the NSW Legislation in that it contains no express power to make rules about 'lot property', nor to make rules about 'the enjoyment' of either lot property or common property.
The approaches taken in the Northern Territory[11] and South Australia[12] are somewhat more similar to that adopted in the ACT. Both jurisdictions confer a broad power to make or amend the by-laws or articles of a 'corporation', but then place some limitations on that power. Relevantly:
(a) The Northern Territory Act provides that a by-law is invalid to the extent that it, amongst other things, is inconsistent with other legislation, unlawfully restricts the use of a unit, or unlawfully discriminates against a unit owner or unit occupier.[13]
(b) The South Australian Act sets some limitations in relation to rules, for example, to prevent the transfer or leasing of a unit[14], and provides that any article that reduces the value of a unit or unfairly discriminate against a unit holder may be struck out by a Court.[15]
Much like in the ACT, the Northern Territory and South Australian do not confer on corporations an express power to make rules about individual lots or units.
In Queensland, section 169(1)(b) of the Body Corporate and Community Management Act 1997 (Qld) specifically provides for the making of "conditions applying to the use and enjoyment of ... lots included in the scheme." The legislation also places limitations on the kind of rules that can be made. For example, as well as the usual limitations on by-laws that prohibit transmission and transfer and the like, subsections 180(3), (5) and (7) provide that:
[55]
(3) If a lot may lawfully be used for residential purposes, the by-laws can not restrict the type of residential use.":
[56]
(5) A by-law must not discriminate between types of occupiers.
[57]
(7) A by-law must not be oppressive or unreasonable, having regard to the interests of all owners and occupiers of lots included in the scheme and the use of the common property for the scheme.
[58]
In Western Australia their Act specifies what matters a strata company may make rules about. Section 42(1) of the Strata Titles Act 1985 provides that:
[59]
_(1) A strata company may make by-laws, not inconsistent with this Act, for - _
[60]
(c) other matters relating to the management, control, use and enjoyment of the lots and any common property.
[61]
Schedule 2A then sets out a list of specific matters about which by-laws can be made.
The Tasmanian legislation[17] provides for the making of by-laws about:
[62]
(a) the administration, management and control of the common property; and
[63]
(b) the use and enjoyment of the lots and the common property.[18]
[64]
However, the Tasmanian legislation also provides that a rule is void if it is:
[65]
(b) it adversely and unfairly discriminates against any owner or occupier of a lot; or
[66]
(c) it adversely affects the health, welfare or safety of any person; or
[67]
(d) it is inconsistent with the provisions of a scheme.[19]
[68]
Victoria takes a different approach still. Section 138(1) of the Owners Corporations Act 2006 (Vic) expressly limits the kinds of matters that rules can be made about to matters set out in a schedule to the Act, and only then when the rule is for the "purpose of the control, management, administration, use or enjoyment of the common property or of a lot." The schedule is prescriptive. Significantly, the provision also expressly states that rules can be made about individual 'lots'.
As this cursory examination of the different jurisdictional approaches demonstrates, there is no single approach taken to regulating the rule making or amending power of strata corporations. It appears that only the Northern Territory and South Australia legislation is really comparable to that of the ACT, and neither party drew the Tribunal's attention to any decisions from these jurisdictions about the scope of a corporation's rule making power. What is significant, however, is that some jurisdictions give a power to make rules about 'lot property', and some give a power to make rules about the 'enjoyment' of that lot property, and/or the common property. The UTM Act does neither.
I do not accept the applicant's argument that this means I should read the language of section 108 of the UTM Act as broadly 'leaving the field clear' to make any rule. Indeed, if anything, the comparison suggests that I should read it more narrowly, for other jurisdictions that use very similar language ('management, control, use') have evidentially considered it necessary to expressly include a power to make rules about individual lots and the common property. Moreover, those jurisdictions that have included a broader rule making power have also included more express limitations on the exercise of that power.
Of course, caution should always be exercised when comparing legislation across jurisdictions. As was noted by McHugh J in Marshall v Director General, Department of Transport[20]:
[69]
The duty of courts, when construing legislation, is to give effect to the purpose of the legislation. The primary guide to understanding that purpose is the natural and ordinary meaning of the words of the legislation. Judicial decisions on similar or identical legislation in other jurisdictions are guides to, but cannot control, the meaning of the legislation is the Court's jurisdiction.[21]
[70]
Therefore, the analysis of the approaches taken in other jurisdictions, while interesting, is ultimately not decisive. The question is: what does the UTM Act require? It is to this issue we must turn.
[71]
Section 141 of the Legislation Act provides that in working out the meaning of an Act, material not forming part of the Act may be considered. Relevant material that may be considered includes any explanatory statement for the bill that became the Act, or any other relevant document, that was presented to the Legislative Assembly before the Act was passed and any presentation speech made to the Legislative Assembly during the passage of the bill that became the Act.[22]
A starting point for present purposes is the Explanatory Memorandum to the Unit Titles (Management) Bill 2011 (2011 Bill, 2011 EM), the bill which preceded the UTM Act. However, this document does not provide much in the way of background on the policy behind the UTM Act. This was probably because the stated purpose of the 2011 Bill was not to reform unit titles legislation, but rather to reorganise it and make it more user-friendly.[23]
By way of a brief history, prior to the passage of the UTM Act, both the establishment and management of strata title properties were governed by the Unit Titles Act 2001 (UTA 2001). Upon the passage of the 2011 Bill_,_ the provisions of the UTA 2001 that related to managing owners corporations were extracted and replicated in the UTM Act (leaving provisions concerning registration of units plans, subdivisions and the like in the UTA 2001). With few exceptions, the substance of the provisions remained unchanged.[24] Relevantly, for present purposes, section 46 of the UTA 2001 became section 16 of the UTM Act, and section 128 of the UTA 2001 became section 108 of the UTM Act. Other than the renumbering[25], these provisions remain identical.
Notwithstanding the above, one interesting inclusion in the 2011 EM is a discussion of the human rights implications of the 2011 Bill. The discussion is useful both for what it says about the amendments, and also for what it does not say about the Act more broadly. The relevant part is as follows:
[72]
The Bill may have human rights implications in terms of the human right of privacy and reputation under section 12 of the Human Rights Act 2004. A person has a right not to have his or her privacy, family, home or correspondence interfered with unlawfully or arbitrarily.
[73]
The Unit Titles (Management) Bill 2011 provides for rules (previously known as articles) which regulate the rights and obligations a person has when their home is a unit in relation to other unit owners and occupiers in the units plan and the owners corporation. It should be noted that a unit owner voluntarily enters into an owners corporation and his/her rights are subject to the scheme established in relation to that corporation.
[74]
The default rules provide that an executive committee representative of an owners corporation can inspect a unit to investigate breaches of the rules and carry out any maintenance or anything else required to be carried out by the owners corporation under the Act. There is a right for a representative of the executive committee to enter a unit and remain in the unit to carry out these functions.
[75]
However, the executive committee representative is not authorised to do so unless notice has been given to the owner, occupier or user of the unit, unless in an emergency it is essential that the action be taken without the notice.
[76]
A similar provision (section 28, UTA s 51C) permits the owners corporation to enter a unit without notice in the event of an emergency (eg water flowing from 1 unit to another and causing damage, an external glass window in the unit is dislodged and is likely to fall). Otherwise, the owners corporation may enter the unit to inspect or maintain the common property, if the executive committee authorises the entry, and the executive committee gives the owner or occupier at least 7 days written notice.
[77]
The default rules and section 28 do not allow an unlawful or arbitrary interference with a person's home or privacy. The rules are necessary for helping to prevent discord and disputes between unit owners or occupiers with other unit owners or occupiers, and for the effective operation of owners corporations in the ACT. They are also necessary for ensuring the structural integrity of unit title complexes and the safety of unit owners and other occupiers of the units plan.
[78]
This discussion of the human rights implications of the Bill focuses on the two occasions where statutory provisions permit the owners corporation to enter upon a unit holder's property and interfere with their home and privacy. These provisions were not new, but were identified as having potential human rights implications by reason of their potential interference with privacy. The drafters concluded, after an analysis of these provisions only, that the 'default rules' do not allow arbitrary or unlawful interference. There is no discussion in the EM of the rule making power in section 108(1) as providing another basis for intruding on personal rights, other than the recognition that "a unit owner voluntarily enters into an owners corporation and his/her rights are subject to the scheme established in relation to that corporation." The human rights analysis concludes that the rules are necessary to "prevent discord and dispute" and "ensure the structural integrity of the unit." There is no consideration of any human rights implications that may arise from amendments to rules allowing for the control of activities on individual units. If indeed section 108 were intended to authorise the amendment of rules governing the use of private lot property, including for the purposes of "ensuring the enjoyment or amenity" of other lot owners, one would expect that provision to have been subject to the same human rights scrutiny.
But perhaps the drafters of the 2011 EM simply did not turn their minds to human rights implications of the rule making power because the Bill was simply an extraction and reorganisation of existing provisions, such that it did not require any additional scrutiny?
Taking a further step back into legislative history, the UTA 2001 was introduced into the Legislative Assembly as the Unit Titles Bill 2000 (2000 Bill). The 2000 Bill was described in the Minister's second reading speech as a "complete overhaul"[26] of the Unit Titles Act 1970 (UTA 1970). Nonetheless, there remained significant commonality between the schemes, particularly after allowing for changes to drafting techniques.
Of particular relevance to these proceedings, section 36 of the UTA 1970 provided that:
[79]
(a) be responsible for the enforcement of its articles and the control, management and administration of the common property;
[80]
(b) keep in a state of good repair and properly maintain the common property and all chattels in its possession, custody or control;
[81]
(c) maintain in good repair and proper working order and, if renewal is reasonably necessary, renew, all pipes, wires, cables, ducts, and apparatus and equipment of any kind used, or intended, adapted or designed for use, in the provision of services in respect of which easements are created by section 27 of this Ordinance; and
[82]
(d) comply with any requirement made by or under any law in force in the Territory.
[83]
The language in section 36(a) was largely adopted in sections 46(1) and 51(1) of the UTA 2001, and, with some changes in drafting technique, in section 16 of the UTM Act.[27] All three iterations have stated that the corporation is responsible for the "control, management and administration of the common property." According to the 2011 EM, the intention of the legislation remained the same between the UTA 2001 and the UTM Act.[28]
Section 35(2) of the UTA 1970 provided then that "a corporation may do such things as are incidental or ancillary to the performance of its duties or functions or to the exercise of its powers." There is no directly equivalent provision in the UTM Act, but section 196 of the Legislation Act operates similarly, providing that "a provision of a law that gives a function to an entity also gives the entity the powers necessary and convenient to exercise the function." The words 'incidental or ancillary' were adopted in the context of the rule making power in section 108(3) of the UTM Act, although the antecedent to that provision is section 80 of the UTA 1970.
Section 80 of the UTA 1970 dealt with amending the articles of the corporation (as rules were then known) and was almost identical to section 128 of the UTA 2001 and section 108 of the UTM Act, subject to some changes in drafting language. It provided relevantly that:
[84]
80. - (1.) A corporation may by special resolution alter its articles by amending, rescinding or adding to its articles or by making articles in the place of articles so rescinded.
[85]
(3) To the extent that an alteration of the articles of a corporation ...results in a provision of the articles:
[86]
(b) imposing a duty or conferring a power on the corporation which is not incidental or ancillary to the performance of the duties or functions, or the exercise of the powers, imposed or conferred on it by this Ordinance...
[87]
This trek back through previous iterations of the legislation is useful, because it is in the Explanatory Memorandum to the Unit Titles Ordinance 1970 (No 31 of 1970) (1970 EM) that we find a discussion and explanation of the policy intention of the Act at that date. The 1970 EM begins by explaining that:
[88]
The legislation follows broadly the pattern of legislation for similar purposes in all the States. The State legislation has, however, been adapted to fit into the leasehold system of land tenure in the Australian Capital Territory and the system of town planning by means of covenants in leases.
[89]
The corporation is charged with the management of the common property and the provision of services common to all units, and is financed by contributions from the members.
[90]
The rights and duties of holders of unit leases are, as far as practicable, the same as those of holders of ordinary leases in the Australian Capital Territory.
[91]
The rights and duties of lessees and occupiers of units amongst themselves are governed not only by the Unit Titles Ordinance, but also by the articles of the management corporation which can be amended by the members provided the amendments do not conflict with the Ordinance.
[92]
Having regard to the above, it appears to have been the expressed intention of legislature in 1970 that the rights and duties of holders of unit leases would be, "as far as practicable ... the same as those of holders of ordinary leases." This evidences an intention by the legislature to preserve the rights of individual owners, as private property owners, subject to those limitations expressly permitted by the Act. The language of the relevant rule making or rule amending provisions has barely changed over time. There has, at no stage, during any amendment process, and despite two reviews of the legislation, been any indication of an intention by the legislature to change the policy intention of those provisions, such that the owners corporation would be given expanded powers in relation to the management of private lots. At no stage, also, was there an inclusion in the UTM Act, or its predecessors, a power, found in the equivalent provisions in other jurisdictions, to make rules about the "use or enjoyment" of either the common property or the individual units. Indeed, there is no express power to make rules about the use of individual units at all.
A power to make rules about the use of individual units has serious consequences for an owner's personal privacy and the use of their home. I note the observation of Gleeson CJ in Al-Kateb v Godwin[2004] HCA 37; (2004) 208 ALR 124 at 130 that:
[93]
Courts do not impute to the legislature an intention to abrogate or curtail certain human rights or freedoms (of which personal liberty is the most basic) unless such an intention is clearly manifested by unambiguous language, which indicates that the legislature has directed its attention to the rights or freedoms in question, and has consciously decided upon abrogation or curtailment.
[94]
No such intention is manifested in relation to the UTM Act.
It is also opportune to note here the decision of Justice Riordan of the Victorian Supreme Court in Owners Corporation PS 5-1391P v Balcombe[29] (Balcombe), in which his Honour determined that a rule of an owners corporation was invalid by reason of being beyond the scope of the corporation's power to make rules.
In Balcombe, the rule in question was intended to prevent owners from letting their units on a short-term basis, but it provided far more broadly as follows:
[95]
...the Proprietor or Occupier of a residential Lot must not use that Lot or any part of the Common Property for any trade or business nor permit others to do so unless...
[96]
In considering the validity of the rule, His Honour set out a test devised to consider whether the rule fell within the scope of the rule-making power conferred by parliament.[30] I do not need to set out the entirety of the test, but in essence it requires consideration as to whether there is a sufficiently direct connection between the authorising act and the rule in issue, having regard to the character of the rule and circumstances in which the rule will operate and the existence and dimensions of the actual or threatened mischief sought to be addressed.
Having regard to these considerations, Riordan J concluded that:
[97]
(a) A review of the development of strata title legislation indicates the principal role of the body corporate or owners corporation was to manage and administer the common property of a strata subdivision.
[98]
(b) The relevant legislation does not disclose any intention for owners corporations to have power to substantially interfere with lot owners' proprietary rights; or for owners corporations to effectively have an unappellable right to overrule uses permitted under planning legislation.
[99]
(c) A parliamentary intention to provide to owners corporations powers that could substantially inhibit the conduct of lot owners on their own lot would need to be expressed in clear and unambiguous language.[31]
[100]
I note again the cautionary comments of Justice McHugh in Marshall v Director General, Department of Transport, cited at paragraph 75 above, in relation to reliance on decisions from other jurisdictions[32]. I also acknowledge that in Balcombe, Riordan J was both considering a different legislative scheme[33], and was considering the interaction between that scheme and Victorian planning legislation. Balcombe is therefore not directly relevant to the present case. However, Riordan J's observations in relation to the Victorian scheme reflect many of the matters in issue in this case - most particularly his Honour's observation, consistent with Al-Kateb v Godwin, that a power that could substantially inhibit the conduct of lot owners on their own lot would need to be expressed in clear and unambiguous language. This principle should apply equally in relation to the UTM Act.
Having regard to the observations in the 1970 EM, and the human rights scrutiny given the 2011 EM, and the broader legislative context as set out above, I am of the view that, had the legislature at any stage intended a change in policy to provide an owners corporation with greater power over individual lots, it would have expressed this through clear and unambiguous amendments to the Act. This may have been done through an express reference either to a power to make rules about the use of lot property, or some power to make rules about the 'enjoyment' of either the lot or common property, but at the very least, I would have expected some analysis of the human rights consequences of such a power in the EM. No such amendments have been made.
[101]
As noted at paragraph 41, above, an owners corporation's functions, as set out in section 16 of the UTM Act, also include "any other function" given to the corporation under the UTM Act or any other Act. It is useful to consider, at this point what those other functions are, and whether they suggest a broad role for the owners corporation than that established by section 16(1)(b).
Section 7 of the UTM Act provides that the owners corporation for a units plan is responsible for "managing the units plan." The 'units plan' is defined in the Unit Titles Act 2001 (UT Act) by reference to a list of registered documents, which include:
(a) diagrams showing the subdivision; and;
[102]
The diagrams and schedule of unit entitlements for Unit Plan 928 set out both common property and unit property. It seems, therefore, that the term 'units plan' includes all the property identified in the registered documents, and includes both common property and the individual units.
On this basis, an argument could be made that section 7 of the UTM Act imposes upon the owners corporation an obligation, and hence a function, to 'manage' both common and individual property. If accepted, this argument could support the applicant's argument that the corporation's powers in respect of private units should be read broadly, but with the power to make rules about individual units drawn from sections 7 and 16(1)(c), rather than section 16(1)(b). However, I do not accept this argument. This is because the explanatory memorandum provides as follows:
[103]
Section 7 Owners corporation - This new section is included to provide context to existing provisions to do with units plan management. The section clarifies that primary responsibility for managing the units plan lies with the owners corporation. The section includes a note, explaining that the owners corporation may be assisted in its duty to manage the units plan by the executive committee, a manager and/or service contractor/s.
[104]
In other words, the purpose of section 7 is to make it clear that management obligations lie primarily with the corporation, although the corporation may be assisted to perform this duty by other entities mentioned in the UTM Act. On this reading, section 7 is not a separate conferral of power, but a clarification of responsibility. This interpretation is consistent with the express terms of section 16(2) of the UTM Act.
Section 19(1) of the UTM Act provides that an owners corporation "holds the common property" as agent for the owners. Section 20 grants the owners corporation certain powers in relation to "dealings with common property". Section 21 deals with "dealings in property generally", but subsection 21(2) places strict limits on this, and there is no power to deal generally with individual lots (other than easements or registered charges). Section 22 deals with special privileges over common property. Section 23 allows the approval of the installation of sustainability or utility infrastructure on common property only.
Section 24 of the UTM Act sets out the owners corporation's maintenance obligations. Generally, these relate only to the 'common property' or other property held by the corporation, although it does extent to the 'defined parts' of a Class A unit. Broadly, Class A buildings are those with "[a] unit as part of a building, with boundaries defined by reference to the floors, walls and ceilings of the building".[34] The 'defined parts' of a Class A building include the walls, columns, footings, slabs, beams, or any part of a balcony on the building, so long as it is load bearing. This section does impose a clear obligation on a corporation for the maintenance of some part of a building that may be on private property. It is obviously a necessary requirement when the buildings share communal structural walls and the like.
Section 28 of the UTM Act provides a very limited right to the corporation to enter into units with or without notice. The owners corporation may enter without notice in an "emergency"[35], with the examples given as:
[105]
1 water is flowing from 1 unit into another unit and is causing damage
[106]
2 an external glass window in the unit is dislodged and is likely to fall
[107]
The examples focus on situations where there is some form of hazard, danger or risk to other residents that extends beyond the unit.
Section 28 also permits entry by the owners corporation where entry is "required to inspect or maintain the common property". This requires that the corporation give notice[36] and requires some interference with the common property.
Section 29 provides that the owners corporation may, if authorised by an ordinary resolution, enter into and carry out maintenance or the provision or facilities or services to a unit, but this requires the agreement of the owner or occupier of the unit. This appears to be a provision that allows owners to agree that a single entity engaged by the corporation can provide services to several unit owners. No owner can be forced to participate.
It is notable that both sections 28 and 29 are located in the UTM Act - not the default rules. They are not capable of amendment by the corporation. As noted above, these provisions were also the subject of some consideration by the legislature in relation to human rights implications.
Section 32 contains the third example of a power held by the owners corporation over an individual unit. It requires that owners or occupiers seek the consent of the corporation before keeping a pet, with the requirement that the consent not be unreasonably withheld. Although there is no express reference to private units, it is apparent that this provision applies even if the pet is kept exclusively on a private unit. The practical effect of this provision is to give the owners corporation some control over the use of a private lot, although a process for the balancing of interests and independent review by the Tribunal is also provided for in the Act.
Moving to the default rules in Schedule 4, there are clearly a number of rules that impose obligations on individual unit owners. These include the following:
(a) Rule 4(1) requires that an owners seek the express permission of an owners corporations before altering a structure of their unit.
(b) Rule 6 provides that a unit owner must not use the unit, or permit it to be used, so as to cause a hazard to an owner, occupier or user of another unit.
(c) Rule 7(1) provides that a unit owner must not use the unit, or permit it to be used, in a way that causes a nuisance or substantial annoyance to an owner, occupier or user of another unit.
(d) Rule 8(1) provides that a unit owner must not use the unit, or permit it to be used, to contravene a law in force in the ACT.
(e) Rule 9 prohibits the illegal use of a unit.
Having regard to the above rules, which may be amended pursuant to section 108 of the UTM Act, it is apparent that the Legislature intended that the owners corporation have some capacity to control the manner in which individual units are used, and that this must invariably have some impact over individual use of a unit.[37] Perhaps the existence of these rules could be considered a basis for concluding that the owners corporation has broader functions in relation individual units that would otherwise be suggested by section 16(1)(b)?
Two observations can be made in this regard.
First, each of these default rules are concerned with managing the external effects of conduct within the unit that have some affect on the common property.
Second, these rules were specifically legislated. It is certainly open to the owners corporation to amend these rules in accordance with section 108(1), and it would presumably be open to the corporation to revoke or limit their application. It may also be possible to make rules relating to the enforcement of these rules, perhaps by specifying certain conduct that falls within them, where that conduct would in any case be governed by the default rule. However, it does not follow that the owners corporation has the power to amend the rules in such a way that that they have a broader application than that permitted by the UTM Act. The amended rule must still be 'ancillary or incidental' to a function of the corporation.
[108]
I am satisfied that it was, and remains, an intention of the UTM Act that owners have such rights in relation to their individual rights as are as far as practicable the same as those of holders of ordinary leases.
Accordingly, I do not accept the submission of the owners corporation that the function of 'control, management and administration of the common property' should be read to include a function of "...ensuring the enjoyment or amenity of lot owners." I also do not believe that the power in section 108 either expressly or impliedly extends to making or amending rules about the use of individual lots, or rules simply for the enjoyment of lots.
The next question, therefore, is whether such rules that have the effect of governing the use of individual units could be described as 'ancillary or incidental' to 'control, management and administration of the common property', or another function of the owners corporation relevant to the rules. If they cannot meet one of those tests, they are of no effect.
[109]
What is 'ancillary or incidental to' the control, management and administration of the common property?
[110]
Drawing of the definitions considered above, in the context of the UTM Act:
(a) Something is 'incidental' to the functions of an owners corporation if it is 'connected with' the control, management and administration of the common property; or
(b) Something is 'ancillary' to the functions of the owners corporation if it is adjunct to or natural result of the control, management and administration of the common property.
Notwithstanding that the functions of the strata corporation are the 'control, management and administration of the common property', I have little hesitation in concluding that the exercise of these functions will on occasion result in an exercise of power that impacts private units, as well as the common property. As was recognised in the 2011 UTM, persons who voluntarily chose to live in an owners corporation must tolerate such interference in their lives as is necessary and proportionate to ensure harmonious communal living. The UTM Act sets out a democratic means to curtail and control activities that have a direct impact upon the common property the unit complex. Hence, rules that relate to nuisance, hazards or noise within the units plan complex are, if not incidental to the control of the common property, are at least ancillary to them. Accordingly, each iteration of the default rules has included rules for dealing with these things. No default rule, however, has simply dictated the uses to which individual units may or may not be put.
Could House Rule 6, a rule that purports to control the use of both common property and individual units, really be 'incidental' or 'ancillary' to the 'control, management and use of the common property'?
Drawing upon Riordan J's reasoning in Balcombe, a starting point is to consider what the nature and character of House Rule 6 is - that is, what does it actually do?
On the applicant's reading, House Rule 6 operates so as to prohibit the owner of a unit from using a subsidiary area of that unit for any purpose other than parking a vehicle. In particular, it prohibits the use of the area for storage of anything other than, presumably, a vehicle. This is a restriction that would not apply to an ordinary lessee, who is generally free to use their carport, for example, for storage, or leisure activities, or a range of other purposes beyond parking a vehicle.
There is little evidence before me as to the mischief House Rule 6 is designed to address, or the relationship between that mischief and the management or control of the common property.[38] Rules dealing with the hazardous use of a unit, noise or nuisance existed at the time House Rule 6 was passed. These rules would have been adequate to deal with, for example, the use of noisy power tools, the storage of unsafe materials, and any safety issues created by obstructing the view of the garage. In any case, the rule goes well beyond prohibiting these things. Presumably, therefore, House Rule 6 was intended to do more than simply control nuisances, hazards and noise.
The applicant suggested that the rule was to ensure the 'enjoyment' of other residents. On this reasoning, the use of the parking areas for a purpose other than the parking of vehicles may affect another owners 'enjoyment' of their lot, although the applicant did not clearly state how. I assume, on the basis of the some of the evidence and submissions, that what the owners corporation was primarily concerned with was the general tidiness and appearance of what is, in effect, a large and open area beneath the complex. No doubt, the installation of cupboards and storage apparatus may alter the appearance of the individual carports, and hence that of the common parking area as a whole. Were owners allowed to do whatever they pleased in the unit subsidiaries, the garage area could become unsightly. This may have an impact on the ambiance of the complex and perhaps on the resale value of the units within it, as well potentially presenting a danger, inconvenience or nuisance to other users. As such, it may affect an owner's enjoyment of their lot, and indeed their enjoyment of the common property. This may mean that a rule directed at ensuring that carports are kept orderly and tidy is ancillary to the management of the common property.
However, House Rule 6 potentially goes further than just addressing visual nuisance caused by an untidy carport area. It effectively proscribes any use of the area for anything other than parking a vehicle. It would, for example, prohibit such things as:
(a) placing bookcases or drawers flush against the wall and next to the entrance to the unit;
(b) storing clean, well maintained and nearly stacked boxes or crates;
(c) placement of a weight bench in the space, so as to use it as a home gym or recreation area;
(d) erecting a basketball hoop on one wall;
(e) placing yoga mats on the concrete;
(f) placing a shoe rack against the door to store shoes; or
(g) drawing a handball grid on the concrete so that children resident in the building could play a game of handball.
Granted, some of the above scenarios involve the use of the space in a manner that would potentially breach other rules - for example, persons playing ballgames in the carpark may well create a hazard. Moreover, if a general rule were not sufficient to prevent such a hazardous activity, it would be open to the owners corporation to pass a more specific rule clarifying that certain conduct is prohibited - managing hazards on the common property undisputedly being a function of the owners corporation.
On the other hand, however, some of the above scenarios result in no evident impact upon other users at all, other than any affect that results from being able to see something happening in the carport area of another tenant (other than the parking of a vehicle).
Hence, on the applicant's interpretation, the 'character' of House Rule 6 is a restriction on how an owner or occupier may use a part of their private property. Indeed, the rule operates so as to confine a unit owner to using their carport for only one specified purpose, even in circumstances where other purposes may have no impact upon the common property, or indeed upon other residents.
The question is: Is the likely operation of House Rule 6 something that is ancillary or incidental to the management, control or use of the common property? It is not whether any rule about the use of the carports or the storage of materials in those carports may be 'ancillary or incidental' to the management, control or use of the property. No doubt, there will be circumstances where it is necessary to prohibit or regulate activities within the parking area that have external effects - drawing upon the examples above, it may be appropriate, for example, to pass a rule that says that it is not permissible to play ballgames in a carport area due to safety concerns. Even if such a rule does not relate to the management common property, it is incidental to it, because of the potential effect of the use of the carport on the safe use of the common property. Similar conclusions could be drawn about a rule controlling noise, or dust, or the storage of items in a way that creates an eyesore or a traffic hazard.
The difficulty in this case is that I am not presented with a concise rule that it targeted to a particular mischief. Rather, I am presented with a broadly phrased rule that significantly restricts the use to which a unit can be put to a single, defined, purpose. The applicant submitted that this rule was to advance the 'enjoyment' of other owners, but ensuring the happiness and enjoyment of other lot holders that it not a function of the owners corporation of itself. In any case, there was no evidence of a direct detriment to owners to which this rule (which primarily concerns storage) may be directed, as opposed to other rules that specifically deal with nuisances and hazards. At best, the rule was intended to restrict visual clutter within the carport. In practice and effect, it potentially goes much further.
An owner of ordinary leasehold land is entitled to use his or her carport as a storage space or a workshop. The owner of a carport in an owners corporation may not have the same degree of freedom, both because of the potential consequences for other owners, and also because the owners corporation itself will have an obligation to manage and control the use of common property. However, where an owners corporation seeks to exercise its power by making a rule that governs private and well as common property, it must be able to establish that there is a reasonable, rational and proportionate link between the rule and the function of management, control and use of the common property, or some purpose that is incidental or ancillary to that function. No such link was made out in this case.
[111]
Is House Rule 6 incidental or ancillary to the Corporation's other functions?
[112]
Section 16 of the UTM Act provides that a corporation's functions include "any other function given to the corporation under its Act or another Territory law." Many of these obligations are found in the UTM Act. It would certainly be permissible to make laws under section 108(1) that facilitate these functions, or are ancillary or incidental to them.
The applicant did not suggest any statutory functions of the corporation as being relevant to House Rule 6, but in considering this matter, I have nonetheless reviewed each of those powers as set out in the UTM Act, as set out above under the heading 'the Corporation's other powers'.
The three powers in sections 24 (in relation to Class A buildings), section 28 and section 32 do establish that the legislature intended that the owners corporation have some authority over individual units, but no submission was put to me that House Rule 6 was incidental or ancillary to any of the above functions, or any other function in the legislation. Rules facilitating the corporation's functions under these sections may well affect individual lots, but there was no suggestion by the applicant that House Rule 6 facilitates the exercise of any of these functions. Accordingly, I am not satisfied that the rule is ancillary or incidental to any of the functions of the Corporation considered above.
[113]
In summary, I have found that it was not the intention of the drafters of the Territory's unit titles legislation that owners corporations have an unlimited power to make rules about the use of individual units, or rules for the 'enjoyment' of the residents more broadly. To be effective, any such rules must be ancillary or incidental to the control, management or use of the common property or some other stated function of the corporation. House Rule 6 does not meet this test and is therefore of no effect.
I have not reached this conclusion lightly. My findings may well sit at odds with 'accepted wisdom' within the unit title community in Canberra. However, if the intention of the legislature is a broad-ranging 'residential democracy', with powers to make intrusive rules about the use of individual units, then legislative amendment may well be needed to give effect to this goal.
Having regard to the above, I am not the view that House Rule 6, as currently worded, is of no effect to the extent that is applies to private lot property. I am therefore not satisfied that the Infringement Notice was validly issued, and decline to make the orders sought by the applicant. On that basis, I have little choice but to dismiss the application.
That being said, there was, in my view, plenty of evidence at the hearing that attested to the noise, inconvenience and discomfort to other residents caused by Dr Cochaud's use of power tools, and the creation of dust and other debris in shared carparking area. The Unit 2 carport, located as it is in a confined space, and directly outside the entrance other apartments, is an inconvenient and inappropriate location for such a workshop. While I have declined to make the orders sought by the applicant in this case, I have done so simply on the basis that the rule relied upon is not effective. There is nothing to prevent the owners corporation from issuing further infringement notices, under other rules, directly targeting the nuisance and potential hazard caused by Dr Cochaud's activities. There is also nothing to prevent the owners corporation from passing, using the appropriate process, a more targeting house rule. The tenants and the respondent are advised to take appropriate actions to minimise the effect of their activities upon other residents before this becomes necessary.
[10] Noting that section 26 of the ACT Civil and Administrative Tribunal Act 2008 provides that the tribunal may inform itself in any way it considers appropriate in the circumstances
[32] Also note also the comments of the Ruling Tribunal in In the matter of the Ruling Tribunal Section 31 of the Unit Titles Act at [86].
[135]
[33] A scheme which, significantly provides for no right of appeal or review of a rule, in contrast to the merits review process available in under section 129(1)(f) of the UTM Act, and which does not have a ready equivalent to section 108(3) of the UTM Act