Body Corporate and Community Management (Accommodation Module) Regulation 2020 (Accommodation Module)

APPLICATION FOR INTERIM ORDER - where the applicant is seeking to challenge a motion authorising works to refurbish the scheme's rooftop facilities - whether the interim order sought by the applicant is warranted in the circumstances.

Act, ss 94, 100, 270, 279; Accommodation Module, ss 150, 152, 157, 159, 176

1. The application for an interim order is dismissed.

• [1] West Village One CTS 51970 is a 325-lot scheme situated in West End, Queensland. It is governed by the Accommodation Module. The applicant, Sarah Duggan, is the owner of Lot 20213 in the scheme.
• [2] I understand the body corporate is looking to refurbish the scheme's rooftop facilities. The applicant says that at a general meeting held in January 2025, the committee put forward a motion to authorise refurbishment works the cost of which required a special resolution. However, that motion failed to pass.
• [3] The applicant says the committee subsequently proposed revised refurbishment works with reduced costing. This motion only required an ordinary motion to pass and it was passed by the body corporate with 73 votes in favour and 43 against.
• [4] The applicant is challenging the body corporate's decision to pass this motion. She seeks the following final orders:
  • That the rooftop refurbishment resolution be declared void on the grounds of procedural irregularity, misleading conduct, and misuse of sinking funds.
  • The vote be considered a special resolution given the procedural manipulation and deception to owners. On this basis a 2/3 majority was not achieved and the motion doesn't pass. A correction issued to all owners on the previous advice that stated the works were at no cost to owners, as sinking funds are owner's contributions. An adjusted sinking fund forecast be provided to include the additional funds required to go to the West Village precinct sinking fund, and based on the rooftop refurbishment being the originally budgeted $300,000. Body Corporate to issue details of increased levies for owners to cover the additional precinct fund.
  • Body Corporate to attend to the required rooftop works only, i.e. works that are required to maintain the rooftop for repairs and maintenance purposes, and not including cosmetic upgrades, e.g. a new roof, and in line with the acceptable uses of sinking funds and the existing sinking fund forecast. If the Body Corporate wishes to proceed with a rooftop refurbishment above the forecasted $300,000 and/or including aesthetic improvements, it should follow the proper methods and channels, with a special resolution and a special levy raised 100% by owners. Given the vote has already failed on a special resolution basis twice, costs associated with proceeding to a third vote should be considered to determine whether a third vote is appropriate.
• [5] The applicant also seeks an interim order to suspend all aspects of the refurbishment project including signing the contract, payment of any funds or commencement of the works. She says without an immediate stop being put on the project contracts will be signed and funds spent from the sinking fund.
• [6] This is my consideration of the applicant's request for an interim order. The applicant bears the onus to establish that the interim order she seeks is warranted in the circumstances.

• [7] The applicant lodged this application for adjudication on 19 September 2025. The commissioner sought clarification on some aspects of the application and, the application was amended.
• [8] The commissioner referred the interim order request to department adjudication under section 247(2)(b) of the Act.
• [9] There is no statutory requirement to obtain comments from a respondent or affected parties before an interim order is decided. However, in the circumstances of this case, interim submissions were invited from the body corporate committee and it made interim submissions on the dispute.
• [10] I have reviewed and considered all the submissions and materials submitted on this dispute before coming to my decision on the applicant's application for an interim order.

• [11] An adjudicator may make an interim order if satisfied, on reasonable grounds, that the order sought is necessary because of the nature or urgency of the circumstances to which the application relates.[1]
• [12] In deciding whether an interim order is warranted in the circumstances, adjudicators often adopt the approach taken by courts to considering interim injunction applications.[2] Accordingly, to determine if it is just and equitable to make the interim order sought by the applicant, I must consider the substantive issues in dispute, the nature and urgency of the matter, as well as the balance of convenience between the parties. I will explain each consideration in more detail below.
• [13] Firstly, I must consider the substantive issues in dispute and be satisfied there is a serious legal question to be answered. At this stage, the applicant does not need to satisfy me that, on the balance of probabilities, her legal position is the correct one to take in the case. However, I must be satisfied the applicant's case has a sufficient likelihood of success to justify the making of the interim order sought prior to a full investigation into the matter being concluded.
• [14] Secondly, an adjudicator may make an interim order only if satisfied, on reasonable grounds, that it is necessary because of the nature or urgency of the circumstances.[3] The applicant must therefore establish that the circumstances warrant the interim order she has sought. This may be where, for example, the order is necessary to prevent serious or irreparable harm from taking place or to stop something that cannot be undone. I must also balance the inconvenience of granting relief now if final orders are ultimately refused, against the inconvenience of refusing relief now if final orders are ultimately granted.

• [15] The applicant has raised several grounds for why the body corporate's resolution authorising the refurbishment of the rooftop facilities should be voided. I will address each of the grounds she has raised in turn.

• [16] The applicant says the sinking fund is legally intended for capital expenses such as essential maintenance and replacement of common property. She says it is not meant to be used to pay for optional, aesthetic upgrades and enhancements. The applicant says the proposed works are costing more than double the amount this work was allocated in the sinking fund forecast. She says the reason for the cost blowout is that the proposed refurbishment includes cosmetic upgrades. She says this is not a proper use of the sinking fund.
• [17] In response, the body corporate says there is no prohibition in the Accommodation Module against the sinking fund being used to fund optional, aesthetic upgrades or enhancements. In addition, it says a sinking fund forecast does not operate to prevent more funds being spent than have been forecast or accumulated. It says it is up to owners to decide whether they wish to spend more than has been accumulated in the sinking fund.
• [18] Chapter 5, Part 6 of the Accommodation Module provides for administrative and sinking funds:
  • Section 157(3)(a) sets out a body corporate must pay into its sinking fund the amount raised by way of contribution to cover anticipated spending of a capital or non-recurrent nature, including the periodic renewal or replacement of major items of a capital nature and other spending that should be reasonably met from capital.
  • Section 159 sets out that the sinking fund may be applied towards: (a) spending of a capital or non-recurrent nature; (b) the periodic replacement of major items of a capital nature; and (c) other spending that should reasonable be met from capital. This section provides the example that the cost of repainting common property or replacing air-conditioning plant would be paid for out of the sinking fund.
• [19] Neither the Act nor the Accommodation Module provides a definition for 'capital nature'. However, the Australian Taxation Office provides the following information about capital expenses:[4]

Capital expenses are expenses that provide long-term benefits to your property. These costs typically improve the property's value or extend its useful life. For example, installing a new roof, upgrading appliances, or adding a deck are capital expenses...

• [20] In light of the above, I will consider the works which are being proposed under the disputed motion. The motion carried by the body corporate for the refurbishment of the rooftop facilities was the acceptance of the quote from the contractor 'Unita' to undertake the following items:
  • breakfast bar joinery;
  • demolition;
  • stone - breakfast bar;
  • pre-finished box - over firepit;
  • stone fireplace;
  • tiling;
  • metal screens;
  • PVC blinds;
  • painting of breakfast bar bench; and
  • cleaning.
• [21] The works authorised by the motion also include engaging the contractor 'Turner & Townsend' to provide architectural consultancy services, building certification services and project management services.
• [22] From the materials currently before me, it appears the proposed refurbishment works are improvements which will provide long-term benefits to the property and are therefore of a capital nature. While the applicant argues the works are optional, aesthetic upgrades and enhancements, my preliminary view is that the legislation does not restrict improvements on this basis. There is nothing in the materials before me which indicate the refurbishment works cannot be funded out of the sinking fund.
• [23] It seems the applicant is unhappy that the body corporate is going beyond its maintenance obligations and has elected to upgrade and enhance the scheme's rooftop facilities. While the applicant may be unhappy with the upgrades the body corporate has resolved to make, it is open to a body corporate to make improvements to the common property (provided the improvements have been properly authorised and the body corporate has acted reasonably in making the decision about the improvements).[5]
• [24] The applicant has not yet persuaded me that the motion authorising the refurbishment of the rooftop facilities should be invalidated on the basis that it is an improper use of the sinking fund.

• [25] The applicant says flyers circulated to owners about the refurbishment works stated that the works would be "at no cost to owners". The applicant says this is misleading as the works will be funded from the sinking fund which consists of levies already paid by owners. She further notes that an additional $350,000 is being spent on these works beyond what was budgeted for in the sinking fund forecast and this means the sinking fund will require additional funds from owners to meet other costs in the future.
• [26] In response, the body corporate says the alleged misleading statement appeared in a notice posted in a lift at the scheme and did not form part of the agenda paper for the general meeting in question. It says the explanatory materials circulated with the agenda papers made it very clear that the cost of the works would be paid for from the sinking fund. It says there is no evidence that any owners were misled by the statement in the flyer.
• [27] The applicant has provided a copy of the flyer she has referred to. Although I acknowledge it contains the statement that the project will be "at no cost to owners", I am not yet persuaded a reasonable owner would be under the impression that the rooftop refurbishment works would have no cost at all to owners.
• [28] As set out at paragraph [18] above, the Accommodation Module provides for funds to be established out of which the body corporate can meet its expenses and other financial obligations. Section 152(2) of the Accommodation Module provides that if a liability arises for which no provision, or inadequate provision, has been made in the budget, a body corporate must fix a special contribution to be levied on owners towards the liability.
• [29] In light of the relevant legislation, my preliminary view is that a reasonable owner would have understood that where a project is said to be "at no cost to owners", this would simply mean that the cost of the project could be met by the funds already available to the body corporate and no special levy would be needed. At this stage, I am not yet persuaded that the wording of the flyer has misled owners in this regard. Furthermore, it appears the explanatory materials circulated with the agenda papers made it clear the cost of the works would be met from the sinking fund.
• [30] In addition, I am not yet persuaded by the applicant's argument that using the sinking fund for this project and owners possibly needing to make additional contributions in the future means that the wording of the flyer has misled owners. The sinking fund forecast is only ever an estimate of costs which may apply and the precise cost of any works will not be known until such a time that those specific works are quoted for. This issue is further addressed at paragraphs [39] to [45] below.
• [31] The applicant has not yet persuaded me that the motion authorising the refurbishment of the rooftop facilities should be invalidated on the basis that the flyer issued before the motion misled owners into believing the project would be at no cost.

• [32] The applicant says that under the legislation, an improvement costing more than $2,000 per unit requires a special resolution. She explains the committee's first motion proposing the rooftop refurbishment was correctly put up as a special resolution however, that motion failed to pass. The applicant says the committee then moved forward with an alternative option for the refurbishment which cost just under $2,000 per unit to deliberately avoid the special resolution requirement. She says this undermines the requirement and is not in the spirit of the law.
• [33] In response, the body corporate says the applicant has mischaracterised the committee's approach. It acknowledges that a more expensive option was first put to owners however, that motion was defeated. The body corporate says the committee understood that owners wanted the option of considering a cheaper alternative. Subsequently, the committee put forward two motions which gave owners a choice between a more expensive, larger project for the refurbishment which required a special resolution, or a less expensive more modest project for the refurbishment which required only an ordinary resolution. It says owners overwhelmingly voted to select the less expensive option.
• [34] Section 176 of the Accommodation Module sets out the requirements for authorising improvements to the common property by the body corporate. Section 176(1)(b) provides that the body corporate may make improvements to the common property if the improvements are authorised by ordinary resolution and the cost of the improvements are within the ordinary resolution improvement range. If the improvements are above this cost, then a special resolution would be required.[6]
• [35] Section 176(5) sets out that the ordinary resolution improvement range for a scheme (as is applicable in this case) means an amount that is (a) more than the basic improvements limit for the scheme; and (b) not more than the amount worked out by multiplying $2,000 by the number of lots included in the scheme. The number of lots in West Village One is 325 and accordingly, the ordinary resolution improvement range for the scheme is between $97,500 and $650,000.
• [36] I have reviewed the motion passed by ordinary resolution and it authorises works for refurbishment of the rooftop facilities up to a total cost of not more than $649,999.00. At this stage, it appears to me that the body corporate has complied with the requirements to obtain the appropriate authorisation for the works.
• [37] The applicant appears to be arguing that as the committee's previous motion which required a special resolution to pass was not carried, this means the committee was unable to move forward with an alternative option that only required an ordinary resolution. However, I am not yet persuaded by this position. The body corporate's obligation to administer the common property and body corporate assets for the benefit of all owners remained. The committee appears to believe the rooftop facilities at the scheme need to be refurbished. Accordingly, after the committee's first motion for proposed works failed to pass, it investigated an alternative proposal which required only an ordinary resolution. My preliminary view is that this was a legitimate way to meet the requirements under the legislation.
• [38] The applicant has not yet persuaded me that the motion authorising the refurbishment of the rooftop facilities should be invalidated on the basis that the process to approve the works was deliberately manipulated.

• [39] The applicant says the scheme's sinking fund budget included $300,000 for refurbishment of the rooftop facilities. However, the quote being moved forward is $650,000, which is more than double what was planned. She says this creates an unbudgeted drain on the sinking fund. The applicant says the sinking fund will now go into a negative balance in 2034 and each owner will need to come up with an additional $4,000 to cover the shortfall.
• [40] In response, the body corporate says this ground is essentially a reformulation of the arguments made under the 'improper use of the sinking fund' ground. It says that as it noted under that ground, a sinking fund budget is not a fixed budget or a cap on expenditure. It says a sinking fund budget does not operate to prevent a body corporate from spending more than what has been forecast in the budget. It reiterates that it is up to owners to decide whether they wish to spend more than has been accumulated in the sinking fund.
• [41] Section 150(1) of the Accommodation Module provides that a body corporate must adopt two budgets for each financial year: the administrative fund budget and the sinking fund budget. This section goes on to set out that a sinking fund budget must allow for raising a reasonable capital amount both to provide for necessary and reasonable spending from the sinking fund for the financial year, and also to reserve an appropriate proportional share of amounts necessary to be accumulated to meet anticipated major expenditure over at least the next 9 years after the financial year, having regard to (i) anticipated expenditure of a capital or non-recurrent nature; and (ii) the periodic replacement of items of a major capital nature; and (iii) other expenditure that should reasonably be met from capital.[7]
• [42] Essentially, the purpose of a sinking fund is to facilitate making provision for all the works of a capital or non-recurrent nature that are anticipated over the next ten years. Forecasting is, in reality, a body corporate's best estimate of expenses it may incur in the future. However, some expenses may end up being more or less than were forecast, or they may crop up sooner or later than initially anticipated. There is nothing in the applicable legislation which suggests that a budget sets the limit for expenditure or that they limit the body corporate to spending only the amount which has been budgeted for a particular item. This accords with the view adjudicators have reached in previous decisions.[8]
• [43] I note section 150(7) of the Accommodation Module makes it clear that the inclusion of an item of expenditure in a budget adopted by the body corporate is not, of itself, authority for the expenditure. Accordingly, at this stage, I agree that it is up to the body corporate to decide if it wants to move forward with a particular project irrespective of the amount set aside in the budget for that particular project.
• [44] My preliminary view is there is no restriction on a body corporate spending more on an item or project than has been forecast in its budget. It follows that the applicant has not yet persuaded me that the motion authorising the refurbishment of the rooftop facilities should be invalidated on the basis that inadequate provision has been allocated to that item in the body corporate's sinking fund budget.

• [45] The applicant says the earlier motion about the rooftop refurbishment failed to pass by special resolution. She says the motion which ultimately authorised the works was only passed by ordinary resolution with 73 owners in favour and 43 against. She says this demonstrates that the committee has ignored the will of owners under the proper threshold by manipulating the process. She argues this is unreasonable.
• [46] In response, the body corporate says the motion being challenged by the applicant passed with a clear and overwhelming majority of owners voting to authorise the works (73 to 43). It says the 'will of the owners' referred to by the applicant is plainly the will of the minority. The body corporate says it is unclear why the will of the minority of owners should be given priority.
• [47] A body corporate is obligated to act reasonably in carrying out its general functions, including making or not making a decision. A decision of the committee is a decision of the body corporate and a committee must act reasonably in making a decision.[9] The question here is whether the committee acted unreasonably in putting forward a further motion which required only an ordinary resolution to authorise the works after a motion requiring a special resolution for similar, (but more expansive and costly), works failed to pass.
• [48] At this stage, it appears that when the initial motion to authorise the works failed to pass, the committee investigated a less expensive alternative proposal which required only an ordinary resolution. As I indicated at paragraph [37] above, just because the committee's previous motion which required a special resolution to authorise the works did not pass, this does not mean the committee was unable to move forward with an alternative option that required only an ordinary resolution. I am not yet persuaded the committee acted unreasonably by putting forward a less expensive option to owners. I am also not yet persuaded that it has 'ignored the will of owners' by doing so.

• [49] In its response, the body corporate submits that the applicant's application is misconceived and without substance. It requests that the application be dismissed in its entirety and an order for costs of $2,000 be made in favour of the body corporate to partially compensate it for the costs it has incurred in responding to the application. It says the applicant's arguments were tenuous and exaggerated and were simply destined to fail.
• [50] Section 270(1)(c) of the Act provides that the adjudicator may make an order dismissing the application if it appears to the adjudicator that the application is frivolous, vexatious, misconceived or without substance. And, if an adjudicator makes an order under section 270(1)(c), they may award costs against the applicant to compensate the respondent to a maximum of $2,000.
• [51] For the reasons provided above, the applicant has failed to persuade me that there is a serious legal question to be answered in relation to any of the ground she has raised. I have therefore given careful consideration to whether I should dismiss this application on the basis that it is misconceived and without substance. I note an adjudicator has discretion as to whether or not to dismiss an application pursuant to section 270(1)(c) of the Act. At this stage, I decline to exercise my discretion to dismiss it. However, the applicant may wish to review her final application as this issue may be reconsidered in the context of final orders.

• [52] I have dismissed the applicant's request for an interim order.
• [53] At this stage, I have declined to exercise my discretion to dismiss the applicant's application on the basis it is misconceived and without substance.
• [54] The dispute will now be referred back to the commissioner to progress under the Act.[10]

[2] For general principles see: Australian Broadcasting Corporation v O'Neill [2006] HCA 46 and SDW2 Pty Ltd v JLF Corporation Pty Ltd & Ors [2017] QSC 1

[4] https://www.ato.gov.au/individuals-and-families/investments-and-assets/property-and-land/residential-rental-properties/rental-expenses/capital-expenses

[5] See section 94 of the Act and 176 of the Accommodation Module

[6] Section 176(1)(c) of the Accommodation Module

[7] Section 150(3)(a) of the Accommodation Module

[8] See Evolution Apartments [2019] QBCCMCmr 647 and Parkwood Villas [2010] QBCCMCmr 521