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[2013] WASAT 186
General information, not legal advice.
State Administrative Tribunal (WA)
2013-11-15
Original judgment source is linked above.
ACT : STRATA TITLES ACT 1985 (WA)
CITATION : TIPENE and THE OWNERS OF STRATA PLAN NO 9495 [2013] WASAT 186
Jurisdiction - Section 7 and s 103F Strata Titles Act 1985 (WA) - Whether demolition of a building can be approved under s 7(2) of the Strata Titles Act 1985 (WA) Turns on own facts
Interpretation Act 1984 (WA), s 18, s 19
Respondents' application that the Tribunal does not have jurisdiction is successful and the application dated 29 February 2012 is dismissed
The applicants are the owners of four units in a nine lot complex on the corner of Douglas Avenue and Jubilee Street, South Perth.
In February 2011, the applicants applied to the strata company's annual general meeting for approval to redevelop their four units by way of a complete demolition and construction of four new units.
Under the Strata Titles Act 1985 (WA) approval without dissent from all nine owners was required but the application was defeated by five votes to four. The applicants then applied to this Tribunal under s 103F of the Strata Titles Act 1985 for an order that approval should have been given but had been unreasonably withheld.
The respondents, on the other hand, submitted that, as the redevelopment proposal involved demolition of the structure, this Tribunal did not have jurisdiction to dispense with the requirement for approval as the Tribunal's power was limited to situations where an alteration only was applied for, and not demolition.
Following a hearing as to whether the Tribunal had jurisdiction in such circumstances, the Tribunal found that in the circumstances of the present case a plain reading of the word 'alteration' in s 7(2) of the Strata Titles Act 1985 did not include demolition. Further, when looked at in the context of the Strata Titles Act 1985 as a whole, the Tribunal does not have jurisdiction under s 103F of the Strata Titles Act 1985 to dispense with approval under s 7(2) of the Act when the alteration proposed involves demolition of a building.
AGFAGevaert Limited v Collector of Customs and Kodak (Australasia) Pty Ltd (1994) 124 ALR 645
Auckland Trotting Club v Commissioner of Inland Revenue [1968] NZLR 193
In the Matter of the Trustees of the Church of St. Jude, Brighton [1956] SASR 46
R v Parkway Chrysler Plymouth Limited (1976) 32 CCC (2d) 116
Sainty v Minister of Housing and Local Government (1964) 15 P. & C.R. 432
The Owners of Habitat 74 Strata Plan 222 v Western Australian Planning Commission & Ors [2004] WASC 23
1 The strata development the subject of this application is located at No 2 Douglas Avenue and No 2 Jubilee Street, South Perth (site). There are a total of nine lots on the site, the five front lots being single storey and the four rear lots being double storey. It is described in the registered strata plan as being a single and double storey brick and iron residential complex situated on portion of Swan Location 39, Lot 15 on Diagram 27496, and the whole of the land comprised in Certificate of Title Volume 1474 Folio 691.
2 Mr Kevin Tipene, Ms Shelley Tipene, Mr Santos Ezcaray, Ms Sandra Nixon and Inertia Holdings Pty Ltd (applicants) are the registered proprietors of the four rear lots. Mr Clive Annear, Mr John Langford, Ms Helen Hunter and Mr Laurie Hunter, and Biorach Pty Ltd, are the registered proprietors of the front five lots, and together with the strata company, The Owners of Strata Plan No 9495 (Strata Company), are the respondents (respondents).
3 At the Strata Company's Annual General Meeting (AGM) held on 22 February 2011, the applicants applied for approval to redevelop the four rear lots. The agenda for the AGM described what was proposed as the 'Jubilee Street Townhouse Redevelopment Proposal'. It is common cause that Stage 1 of the proposed redevelopment entailed the entire demolition of the four rear townhouses, with Stage 2 being the construction of four new townhouses in their place.
4 At the AGM the proposal was defeated with the four applicants voting in favour and the five respondents, other than the Strata Company which did not have a vote, all voting against. Pursuant to s 7(2)(c) of the Strata Titles Act 1985 (WA) (Strata Titles Act), for the resolution of the type proposed to be successful, it needed to be approved without dissent.
5 Some 12 months later, the applicants filed an application with this Tribunal dated 29 February 2012 seeking an order under s 103F of the Strata Titles Act, dispensing with the need for the Strata Company's approval.
6 Following extensive mediation which failed to resolve the matter, the respondents raised a jurisdictional issue which was refined further in submissions dated 16 April 2013 to read:
The forenamed respondents (Langford and others) contend that the State Administrative Tribunal (the Tribunal) does not have jurisdiction to entertain or determine the application by the applicants brought in terms of ss 103F(1), (2) and (3) of the Strata Titles Act 1985 (WA) (the Act) read with s 7 of that Act.
7 In essence, what the applicants submitted was that s 7(2) of the Strata Titles Act, under which Strata Company approval was sought, applies only to 'the erection, alteration or extension' of a structure, and not to its demolition.
8 Following the filing of submissions, the preliminary question came before the Tribunal for determination on 31 July 2013.
9 On the date of the hearing, the applicants sought to amend the grounds on which the original application to the Tribunal, filed on 29 February 2012, had been made.
10 In the original application paragraph 1 of the grounds stated:
The applicants applied to the Strata Company for Strata Plan 9465 on or about 7 February 2011 for approval to demolish the structures on their respective lots and construct new structures on those lots.
11 The applicants now sought to amend that paragraph to read:
The applicants applied to the Strata Company for Strata Plan 9465 on or about 7 February 2011 for approval to alterations to demolish the structures on their respective lots and construct new structures on those lots.
12 Counsel for the applicants explained the reason for the amendment as follows:
... it was brought to my attention during one of the preliminary hearings when there was a discussion about what was there, and it is obviously my error in drafting perhaps too loose a language, but what I have put there is to actually reflect a resolution that was put to the Strata Company ...
13 An examination of the actual resolution put to the Strata Company confirms that the words 'to demolish the structures', were not used, but rather the words 'alterations to the structures'.
14 The Tribunal confirmed with counsel for the applicants that the redevelopment proposal the subject of the application for review was the same as that put to the Strata Company, in that it proposed the demolition of the current four rear units followed by the construction of four new units.
15 Counsel for the respondents opposed the amendments on the basis that the applicants could not apply for approval of an alteration when the alteration really involves a demolition.
16 The redevelopment application that was before the Strata Company at its AGM in March 2011 was attached to the application to this Tribunal at pages 41 to 53, and clearly sets out the steps in the proposed redevelopment. The applicants do not shy away from the fact that the first step in the redevelopment is the entire demolition of the four rear townhouses, leaving essentially a vacant block, before four new townhouses to be built.
17 The amendment sought brings the application into line with what was actually before the Strata Company, and the Tribunal will allow the amendment to ensure that the application before the Tribunal accurately reflects the actual resolution put to the Strata Company at its AGM, while recognising that the proposed redevelopment seeks approval to demolish some of the current buildings followed by the construction of new buildings.
18 In any event, both parties' submissions concentrated almost entirely on the issue of whether the word 'alteration' in s 7(2) of the Strata Titles Act can include 'demolition' which is the question the Tribunal must decide.
19 As particular sections and definitions of the Strata Titles Act are relevant in determining this matter, for ease of reference, the Tribunal now sets out those sections and definitions. The Long Title of the Strata Titles Act states:
An act to facilitate the horizontal and vertical subdivision of land the disposition of titles thereto, to provide for incidental and connected purposes and to reveal the Strata Titles Act 1966.
Terms used
(1) In this Act unless the contrary intention appears
...
floor plan means a plan, consisting of one or more sheets, which
(a) defines by lines (in paragraph (c) referred to as base lines) the base of each vertical boundary of every cubic space forming the whole of a proposed lot, or the whole of any part of a proposed lot, to which the plan relates; and
(ii) where any such cubic space forms part only of a proposed lot, the aggregate of the floor areas of every cubic space that forms part of the proposed lot;
(c) where proposed lots or parts thereof to which the plan relates are superimposed on other proposed lots or parts thereof to which the plan relates
(i) shows the base lines in respect of the proposed lots or parts thereof that are so superimposed separately from those in respect of the other proposed lots or parts thereof upon which they are superimposed; and
(ii) specifies, by reference to floors or levels, the order in which that superimposition occurs[.]
lot, in relation to a strata scheme, means one or more cubic spaces forming part of the parcel to which a strata scheme relates, the base of each such cubic space being designated as one lot or part of one lot on the floor plan forming part of the strata plan, plan of resubdivision or plan of consolidation to which that strata scheme relates, being in each case, but subject to section 3AB, cubic space the base of whose vertical boundaries is as delineated on a sheet of that floor plan and which has horizontal boundaries as ascertained under subsection (2), but does not include any structural cubic space except where
(a) the boundaries of the cubic space are fixed under section 3AB; or
(b) the boundaries are not so fixed and that structural cubic space
(i) has boundaries described in accordance with the regulations; and
(ii) is shown in that floor plan as part of a lot[.]
(a) the manner of division, from time to time, of a parcel into lots or into lots and common property under a strata plan and the manner of the allocation, from time to time, of unit entitlements among the lots; and
(b) the rights and obligations, between themselves, of proprietors, other persons having proprietary interests in or occupying the lots and the strata company, as conferred or imposed by this Act or by anything done under the authority of this Act and as in force from time to time[.]
unit entitlement in respect of a lot, means the unit entitlement of that lot shown on the schedule of unit entitlement registered with the Registrar of Titles[.]
(2) Except where section 3AB applies, the boundaries of any cubic space referred to in paragraph (a) of the definition of floor plan in subsection (1)
(i) are in the case of a vertical boundary, where the base of any wall corresponds substantially with any line referred to in paragraph (a) of that definition the inner surface of that wall; and
(ii) are, in the case of a horizontal boundary, where any floor or ceiling joins a vertical boundary of that cubic space the upper surface of that floor and the under surface of that ceiling;
(b) are such boundaries as are described on a sheet of the floor plan relating to that cubic space (those boundaries being described in the prescribed manner by reference to a wall, floor or ceiling in a building to which that plan relates or to structural cubic space within that building)[.]
(1) Land may be subdivided into lots, or lots and common property, by the registration of a strata plan or a surveystrata plan.
(a) is described as such in its title or heading; and
(b) shows the whole or any part of the land comprised in the plan as being divided into 2 or more lots; and
(a) consist of a location plan and a floor plan in respect of the parcel; and
(aa) where section 3(2)(a) or 3AB applies, contain a statement in the prescribed form describing all of the boundaries of a lot, or part of a lot, on the plan that are fixed by reference to a building or part of a building; and
(b) bear a statement containing such particulars as may be necessary to identify the title to the parcel; and
(c) be accompanied by a schedule specifying, in a whole number, the proposed unit entitlement in respect of each lot into which the parcel is to be subdivided and specifying also the proposed aggregate unit entitlement; and
(d) have endorsed on it the name of the scheme; and
(e) have endorsed on it the address of the parcel; and
(f) contain such other features as may be prescribed.
(b) the erection of, alteration to or extension of a structure on a lot in a strata scheme if
(i) each proprietor of a lot in the scheme has in writing given approval to the erection, alteration or extension; and
(ii) that approval, if subject to conditions, is given by each proprietor subject to the same conditions; and
(iii) a copy of each such approval is served on the strata company.
(2) The proprietor of a lot shall not cause or permit
(b) any alteration of a structural kind to, or extension of, a structure,
(c) with the prior approval of the proprietor of the other lot in the case of a strata scheme in which there are not more than 2 lots; and
(d) in any other case with the prior approval, expressed by resolution without dissent, of the strata company.
(5) The grounds on which approval may be refused are
(a) that the carrying out of the proposal will breach the plot ratio restrictions or open space requirements for the lot ascertained in accordance with section 7A(3); or
(b) in the case of a lot that is not a vacant lot, that the carrying out of the proposal
(i) will result in a structure that is visible from outside the lot and that is not in keeping with the rest of the development; or
(ii) may affect the structural soundness of a building; or
(iii) may interfere with any easement created by section 11 or 12;
structure includes any prescribed improvement;
vacant lot means a lot that is wholly unimproved apart from having merged improvements within the meaning of that expression in the Valuation of Land Act 1978.
(1) The unit entitlement of a lot, as stated in the schedule referred to in section 5, determines
(b) the quantum of the undivided share of each proprietor in the common property; and
(c) subject to subsection (1)(c)(ii) of section 36, the proportion payable by each proprietor of contributions levied under that section.
(2) The certificate of a licensed valuer which is required by sections 5B(1)(b), 8A(h), 21T(1)(d) and 31E(1)(d) to accompany a strata/survey-strata plan and a plan of re-subdivision lodged for registration shall be in the prescribed form and shall certify that, or to the effect that, the unit entitlement of each lot, as stated in the schedule referred to in those sections, bears in relation to the aggregate unit entitlement of all lots delineated on the strata/survey-strata plan a proportion not greater than 5% more or 5% less than the proportion that the value of that lot bears to the aggregate value of all the lots delineated on the plan.
(1) Common property shall be held by the proprietors as tenants in common in shares proportional to the unit entitlements of their respective lots.
(1) Where a building shown on a registered strata plan is damaged or destroyed, the District Court may, on an application by the strata company or by a proprietor or a registered mortgagee of a lot within the strata scheme, make an order for or with respect to the variation of the existing strata scheme or the substitution for the existing strata scheme of a new strata scheme.
(2) An insurer who has effected insurance on the building, or any part of the building, against damage to or destruction of the building has the right to appear, in person or by counsel, on an application to the District Court under this section.
(3) Without limiting the generality of subsection (1), an order made under that subsection may include such directions for or with respect to any one or more of the following matters as the District Court considers necessary or expedient
(a) the reinstatement in whole or in part of the building;
(b) the transfer or conveyance of the interests of the proprietors of lots that have been damaged or destroyed to the other proprietors in proportion to their unit entitlements;
(c) the substitution for the existing schedule of unit entitlement of a new schedule of unit entitlement;
(d) the application of insurance moneys received by the strata company in respect of damage to or destruction of the building;
(e) the payment of moneys to or by the strata company or any one or more of the proprietors;
(f) the amendment of the registered strata plan, in such manner as the District Court thinks fit, so as to include any addition to the common property;
(g) the payment to a mortgagee of a lot of money received by the strata company from an insurer of the building;
(h) any matter in respect of which it is, in the opinion of the District Court, just and equitable in the circumstances of the case to make provision in the order;
(i) the imposition of such terms and conditions as the District Court thinks fit.
(1) The District Court may, on an application by the strata company or by a proprietor or a registered mortgagee of a lot within a scheme, make an order terminating the scheme.
103F**. Order dispensing with approval under s. 7(2) or 7A(2)**
(1) A proprietor of a lot who has applied for but not obtained an approval under section 7B may apply to the State Administrative Tribunal for an order under this section.
(2) An order under this section is an order declaring that the approval required under section 7 or 7A, as the case may be, is to be deemed to have been given by the proprietor or the strata company.
(3) On the making of an application under subsection (1), the State Administrative Tribunal may make an order under this section if satisfied that the approval
(a) should have been given under section 7 or 7A, as the case may be; but
21 The parties set out their respective positions succinctly in written submissions, elaborating further in oral argument.
22 The respondents' primary contentions were set out at paragraphs 9 to 13 of their written submissions dated 16 April 2013, where they stated:
23 The applicants, in their written submissions in reply dated 6 June 2013, stated:
(a) the carrying out of the proposal will breach the plot ratio restrictions or open space requirements for the lot;
(b) in the case of a lot that is not a vacant lot, that the carrying out of the proposal:
(i) will result in a structure that is visible from outside the lot and that is not in keeping with the rest of the development;
(ii) may affect the structural soundness of a building; or
(iii) may interfere with any easement created by section 11 or 12 of the Act; or
'that by which something is extended; a prolongation, as an addition to a house.'
'Something built or constructed; a building, bridge, dam, or framework.'
'a substantial structure or edifice with a roof and walls'.
24 When the respondents' contention outlining the jurisdictional issue (set out above) is read in conjunction with the parties' submissions, the issue to be determined by the Tribunal can be stated simply as follows:
Can the Tribunal make an order under s 103F of the Strata Titles Act dispensing with approval under s 7(2) of that Act if the alteration proposed involves the demolition of the structure?
The proprietor of a lot shall not cause or permit
(a) any structure to be erected; or
(b) any alteration of a structural kind to, or extension of, a structure,
(c) ...
(d) in any other case with the prior approval, expressed by resolution without dissent, of the strata company.
26 Although 'structure' is not defined in the Strata Titles Act, it was common cause that the 'alteration of a structural kind to ... a structure' requested in the present case involved the demolition of four buildings followed by the construction of four new buildings.
27 As stated at paragraph 9 of the applicants' written submissions, s 18 and s 19 of the Interpretation Act 1984 (WA) (Interpretation Act) makes it clear that in interpreting a provision of a written law, the court, and in this case the Tribunal, is to give the written law its ordinary meaning and a construction which would promote the purpose or object underlying the written law.
28 In respect of the ordinary meaning of words, Ryan J, sitting with Gummow and French JJ, in AGFAGevaert Limited v Collector of Customs and Kodak (Australasia) Pty Ltd (1994) 124 ALR 645, stated at [3]:
As Gummow and French JJ have each noted, there is a convenient restatement in Collector of Customs v Basic Industries Ltd [1988] FCA 371; (1988) 20 FCR 146 at 155158 of the effect of the distinction between the question of fact involved in ascertaining the ordinary meaning of words not used in a technical or other specialised sense and the question of law which arises when meaning has to be attributed to an expression which the evidence shows has been used in a technical or other specialised sense. For present purposes, it is also instructive to refer to the first rule enunciated by Sir Frederick Jordan in The Australian Gas Light Company v The ValuerGeneral [1940] NSWStRp 9; (1940) 40 SR (NSW) 126 at 137:
(1) The question what is the meaning of an ordinary English word or phrase as used in the Statute is one of fact not of law: Girls' Public Day School Trust v Ereaut (1931) A.C. 12 at 25, 28; Life Insurance Co of Australia Ltd v Phillips [1925] HCA 18; 36 CLR 60 at 78; McQuaker v Goddard (1940) 1 All ER 471. This question is to be resolved by the relevant tribunal itself, by considering the word in its context with the assistance of dictionaries and other books, and not by expert evidence ... .
29 For the purposes of the present case, the words 'alter' and 'alteration' are defined in the New Shorter Oxford English Dictionary (6th ed, 2007) as:
alter ... Make otherwise or different in some respect; change in characteristics, position, etc; modify.
alteration ... A change in character or appearance; an altered condition.
30 The Macquarie Dictionary (5th ed, 2009) defines the words 'alter' and 'alteration' as:
alter ... to make different in some particular; modify.
alteration ... the act of altering the condition of being altered; a change, modification.
31 The words 'alter' and 'alteration' have also been considered in a number of courts and tribunals both here and abroad, in the context of a variety of legislation.
32 In Australia, in In the Matter of the Trustees of the Church of St. Jude, Brighton [1956] SASR 46, 53, (Trustees of the Church of St Jude) Hannan AJ, in discussing the meaning to be attributed to the words 'enlarge', 'alter', 'repair' and 'reinstate' used in a trust deed, stated:
Taking their meaning separately as applied to a building, 'enlarge' means to make bigger and more commodious by additions. Twice the church has been 'enlarged' in this sense. 'Alter' means to modify and change, and it presupposes an existing building of which the fabric will remain substantially unchanged after the alterations have been completed. 'Repair' means to renew what is decayed or has deteriorated, and again presupposes an existing building which has fallen into disrepair. According to Murray's New English Dictionary, 'reinstate' means 'to reinstall or reestablish a person or thing in a place, station, condition, etc.'; to restore to or in a proper state; to replace. An example given is 'reinstate the skirting, papering, etc., where the book-case formerly stood.' Murray also cites Chambers' definition 'the restoration of a person or thing to its former state or condition.' To reinstate the Church of Saint Jude therefore means to build it up again when it has collapsed or become ruinous or dilapidated past repair, so that it has to be demolished; to put it back as it was before, not necessarily of the same materials, but according to the same design, so as to be easily recognisable by those who knew the fallen or ruined church when it was stable and standing firmly upright.
What the trustees desire to do is none of these things. If they pulled down the existing building and proceeded to erect another larger building, of different design and different appearance, but of course for the same purpose, could they fairly be said, according to the ordinary meaning of the words of authority, to have enlarged, altered, repaired and reinstated the Church of Saint Jude? I do not think so. ...
33 In England, in Sainty v Minister of Housing and Local Government (1964) 15 P. & C.R. 432, Lord Parker CJ, in dealing with the planning Acts, stated:
... I entirely accept as correct in law what the minister says and it is for the reasons given by him. ...
34 What the relevant Minister had stated in that matter was:
... After a dwelling house is demolished that building is no longer capable of being enlarged, improved or altered and is therefore unable to benefit for the general provision contained in the order. In any event the minister takes the view that the complete replacement of one building by another does not constitute enlargement, improvement or alteration of the original building. ...
35 In New Zealand, Mollar J in Auckland Trotting Club v Commissioner of Inland Revenue [1968] NZLR 193, at 200 (quoting with approval the decision of the local Taxation Board of Review which had itself quoted with approval from the Australian case of the Trustees of the Church of St Jude Brighton), as set out above, also referred to:
In In re LevesonGower's Settled Estate [1905] 2 Ch. 95, 98, Swinfen Eady J. said:
The erection of a new building in place of an old building is not an addition to or alteration in that old building;
It is, I think, apparent ... that the word 'alteration' may well, in appropriate circumstances, refer to a repair or renewal incidental to the making of something 'otherwise or different in some respect, without changing the thing itself'. The circumstance that the dictionary meaning of 'alter' comprehends that the thing itself is not changed is strongly suggestive, however, that the question of alteration must itself in every case be one of degree and that the test to be applied is whether the act done is in substance an alteration in part only or a replacement of substantially the whole.
In deciding, therefore, for the purposes of s. 113 (1), whether the work carried out is a 'repair' or an 'alteration', or something going beyond both of those concepts, one must first find what constitutes the 'premises' upon which that work has been done. Then, when the submission is that the work done was 'repairs', one must decide whether it was of such a degree as to amount to a renewal or replacement of defective parts, or such as to amount to the reconstruction of substantially the whole subject-matter. And, when the submission is that the work done was an 'alteration', it is necessary to decide whether it amounted merely to a modification making the premises different in some way without changing the thing itself, or was of such a degree as to amount to a replacement of substantially the whole. ...
37 In Canada, Wilson JA, dealing with the word 'alter' in R v Parkway Chrysler Plymouth Limited (1976) 32 CCC (2d) 116 at 117118 Ont CA, stated:
On the basis of a number of a number of dictionary definitions of the word 'alter', he [the trial judge] found that 'alter' comprehended a change or variation in something, a modification, a change in some elements or ingredients of the thing, but not a change in the whole, a total replacement ... .
The dictionary definitions to which he resorted amply support his conclusion that to replace or substitute one thing for another is not to alter the original. The original is gone and a new thing has taken its place. ...
38 This Tribunal is of a similar view and believes that there is a clear distinction between alteration of a structure and demolition of a structure.
39 The Tribunal recognises that there may well be circumstances where to undertake an alteration, demolition of part of a structure such as a wall, may be necessary and, furthermore, during the act of demolishing a structure, one may be said for a time at least, to be altering a structure.
40 However, it would in every case be a question of fact and degree and the Tribunal is in no doubt that once the entire building is demolished, as is planned in the present case, one would be well past the point of what could be described as an alteration.
41 Furthermore, the Tribunal does not accept the argument that you are merely in the middle of alterations at the point where one structure is entirely demolished and nothing but a vacant lot is left while you are waiting to construct a new building.
42 It will in every case depend on the facts of the case, but the Tribunal is satisfied in the circumstances of the present case, that on a plain reading of the words, the question posed must be answered in the negative.
43 When one then looks at the purpose or object underlying the written law, in this case the Strata Titles Act, the matter is put beyond doubt.
44 The respondents referred to s 28 of the Strata Titles Act, which deals with circumstances where a building shown on a registered strata plan is damaged or destroyed, and pointed out that in such circumstances only the District Court has jurisdiction.
45 The applicants, on the other hand, submitted that s 28 of the Strata Titles Act is only intended to relate to 'damage or destruction' of buildings that are accidentally 'damaged or destroyed' by such things as fire, which make an application a practical necessity, which is not the case here.
46 The Strata Titles Act covers the field in respect of issues that relate to the horizontal and vertical subdivision of land and the disposition of titles in respect of such subdivisions in Western Australia.
47 Parties ownership of their 'lot', as defined in s 3 of the Strata Titles Act, is measured by way of cubic space which is calculated by applying the formula set out in s 3(2) of the Strata Titles Act to the relevant floor plan. To do that, it is of course necessary that a structure be in place, a fact counsel for the applicants recognised and conceded when it was put to him by the Tribunal. The Tribunal inquired:
... What am I supposed to do with section 3 subsection (2) of the Act? ...
(T:32; 31.07.13)
Yes, which says that the internal aspects of the lot are, if I've got I haven't got it in front of me, but I the internal, you do the boundaries because it's measured by the by the walls and it's a cubic space that you can touch and feel.
...
Well, then, it's clear that what's happened in relation to these lots, they've been converted into lots that are not bound by that space, that internal space, and for some time, for some time when there is a demolition, you won't be able to I accept that you won't be able to go there and calculate the internal space of built form lot, you won't be able to, I can't avoid that. (T:32; 31.07.13)
49 And later, counsel for the applicants confirmed:
... once those buildings have gone you couldn't measure the cubic space of lots 6, 7, 8 and 9. I can't avoid that. (T:40; 31.07.13)
50 The registered strata scheme recognises not only ownership of the various lots, as measured per s 3(2) of the Strata Titles Act, but it also records the ownership of the common property, although it is recognised that there is only a small amount remaining in the present scheme.
Ownership of common property
Common property shall be held by the proprietors as tenants in common in shares proportional to the unit entitlements of their respective lots.
(1) The unit entitlement of a lot, as stated in the schedule referred to in section 5, determines
(b) the quantum of the undivided share of each proprietor in the common property; and ...
53 Unit entitlement is also defined in s 3 of the Strata Titles Act, and once a strata plan has been registered, as it has been for the current development, the parties unit entitlements are calculated in compliance with s 5 of the Strata Titles Act.
(c) be accompanied by a schedule specifying, in a whole number, the proposed unit entitlement in respect of each lot into which the parcel is to be subdivided and specifying also the proposed aggregate unit entitlement[.]
55 A strata plan is in place for the current development which relies on the specific measurements of the current structures to calculate the parties' lot ownership, and together with the relevant valuation as per s 14(2) of the Strata Titles Act, their entitlement to an undivided share of the common property.
56 If a building which is part of a strata plan is destroyed, and the basis upon which the extent of a person's lot is measured or their entitlement to an undivided share in the common property is calculated, is no longer available, it is important that some body or authority have the necessary powers to deal with the issues that would arise. In Western Australia, Parliament has seen fit to vest that jurisdiction solely in the District Court as set out in s 28 to s 31 of the Strata Titles Act.
57 That statutory jurisdiction was recognised by Heenan J in The Owners of Habitat 74 Strata Plan 222 v Western Australian Planning Commission & Ors [2004] WASC 23 in a case dealing with the variation of a strata scheme due to compulsory acquisition where, at page 15, his Honour stated:
Where part of the land is resumed then s 29 of the Act confers upon the District Court of Western Australia a special jurisdiction to make an order for, or with respect to, the variation of the existing strata scheme or for the substitution for the existing strata scheme of a new strata scheme (subs 28(1)). Application to the District Court for this purpose may be made by the strata company, or by a proprietor or a registered mortgagee of any lot within the strata scheme, and the jurisdiction includes power for the District Court to make any directions for, or with respect to, the payment of monies to or by the strata company or any one or more of the proprietors (subs 28(3)(e)) or any matter in respect of which it is, in the opinion of the District Court, just and equitable in the circumstances of the case to make provision in the order (subs 28(3)(h)).
This is a distinct statutory jurisdiction conferred on the District Court in respect of special rights themselves derived from statute rather than from common law or equity. While it is unnecessary to decide the point in these proceedings it may well be the case that this is an exclusive jurisdiction of the District Court, one strangely, not shared by this Court ... .
58 It is noted that when a building is unexpectedly damaged or destroyed, the District Court is given specific powers to make directions to cover such things as the transfer or conveyance of a proprietor's interests, for example, s 28(3)(b) and (c) of the Strata Titles Act states:
Without limiting the generality of subsection (1), an order made under that subsection may include such directions for or with respect to any one or more of the following matters as the District Court considers necessary or expedient
...
(b) the transfer or conveyance of the interests of the proprietors of lots that have been damaged or destroyed to the other proprietors in proportion to their unit entitlements;
(c) the substitution for the existing schedule of unit entitlement of a new schedule of unit entitlement[.]
59 In Land Law (6th ed, 2010) Butt, in dealing with the issue in New South Wales under the heading 'Variation or termination of strata schemes', states:
... Section 51 empowers the Supreme Court to make an order terminating the strata scheme. Unlike s 50, this power does not depend on the existence of damage to or destruction of the building (although it is available in such circumstances); and so it will be useful, for example, where a building has reached the end of its life, or the site is to be redeveloped. ...
In considering the application under s 51, the court is obliged to ensure that noone is prejudiced by terminating the scheme. This includes rating and taxing authorities and other creditors whose interests in the lots will be destroyed by the termination. The termination will destroy all unregistered interests in the land, and so evidence about unregistered interests should normally be placed before the court.
60 In Western Australia, s 28 to s 31 of the Strata Titles Act provide similarly wide powers to the District Court to deal with matters that may arise.
61 An application for an order terminating a scheme under s 31 of the Strata Titles Act can be made by an individual proprietor or group of proprietors who may for any reason need to terminate the current scheme, including for example, to redevelop the property.
62 It is noted when an application is made under s 31 of the Strata Titles Act, the District Court may in particular circumstances order that the application be treated as an application under s 28 of the Act. Section s 31(6) of the Strata Titles Act states:
Where the District Court is of the opinion that an order should not be made under this section
(a) it may, upon application made by any person entitled to appear and be heard on the hearing of the application made under subsection (1) or of its own motion, direct that the application be treated as an application for an order under section 28; and
(b) where it makes such a direction
(i) the application the subject of the direction shall be deemed to be an application made under section 28 by a person entitled to make the application; and
(ii) the applicant under subsection (1), as well as any other person entitled to appear and be heard under section 28, is entitled to appear and be heard on the hearing of the application.
63 Furthermore, s 31(3) of the Strata Titles Act imposes a duty on the court when making an order to include directions in respect of a wide range of matters, including as set out at s 31(3)(g):
... any matter in respect of which it is, in the opinion of the District Court, just and equitable, in the circumstances of the case, to make provision in the order[.]
64 Finally, s 121 of the Strata Titles Act sets out the limitation on the Tribunal's jurisdiction where title to land is in question when exercising its dispute resolution powers contained in Pt VI of the Act when it states:
Notwithstanding any other provision of this Part, the State Administrative Tribunal shall not have jurisdiction under this Part in any case in which the title to land is in question otherwise than for the purpose of determining any matter before the State Administrative Tribunal and any determination made by the State Administrative Tribunal shall not have any force or effect except as provided by this Act.
65 The Tribunal is therefore satisfied that, by the insertion of s 28 to s 31 of the Strata Titles Act, Parliament recognised that damage or destruction to the whole or part of a building, or the variation or termination of a strata scheme, may affect the proprietary interests of owners in a strata scheme, both in respect of their lots and their share of the common property, and vested the power to deal with those matters exclusively in the District Court.
66 For the reasons outlined above, the Tribunal is satisfied that on the facts of this case, a plain reading of the word 'alteration' in s 7(2) of the Strata Titles Act does not include 'demolition' when the structure in question is an entire building which is part of the strata plan.
67 Furthermore, when looked at in the context of the provisions of the Strata Titles Act as a whole, where a building is to be demolished and the proprietary interests of owners in respect of their lots or their share of the common property may be affected, jurisdiction to deal with or interfere with those interests resides solely in the District Court.
68 In the circumstances, the Tribunal is satisfied that based on the facts of the current application, the Tribunal does not have jurisdiction to make an order under s 103F of the Strata Titles Act dispensing with approval under s 7(2) of the Act where the alteration proposed involves the demolition of a building which may affect owners' proprietary interests.
I certify that this and the preceding [68] paragraphs comprise the reasons for decision of the State Administrative Tribunal.
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(1988) 20 FCR 146
(1994) 124 ALR 645