Westerweller v The Owners - Strata Plan No. 18484

Background

1. In the Original Proceedings the applicant sought various orders under the Strata Schemes Management Act 2015 (NSW) (the Strata Act). The majority of the orders sought in those proceedings related to: 1. air-conditioning condenser units which had been installed by the owner of lot 3 on the common property roof of the building, without the consent of the OC: and 2. associated roofing damage.
2. The applicant also sought "further, or in the alternative, an order appointing a compulsory agent pursuant to section 162 and/or 237 of Strata Act to undertake the functions of the Owners Corporation".
3. On 10 November 2021 the Original Proceedings came before the Tribunal for directions and the following orders and notations (the Consent Orders) were made by the Tribunal: 1. By consent, the Owners - SP 18482 is to cause the undertaking of the following work, on or before 8 December 2021, in a proper and workmanlike manner: a remove the airconditioning units, condensers, conduit and other associated works ("the airconditioning works') from the roof, and b carry out such work as is necessary to reinstate the roof to the condition it was in prior to the placement of the air conditioning works on the roof 2. NOTE: The owner of Lot 3 has advised the Owners Corporation that it agrees to be responsible for the cost of the removal of the air conditioning works. 3. These orders are made in full and final settlement of this dispute. 4. If these orders are not complied with by the date referred to, the applicant may renew these proceedings at any time up until 8 December 2022.
4. In the Renewal Proceedings the applicant initially sought a variety of orders. However, at the hearing on 1 November 2022 the applicant's counsel confirmed that the only orders pressed were: 1. an order under s 237 of the Strata Act for appointment of a compulsory managing agent to exercise all the functions of the OC; and 2. costs.
5. It is not disputed that the works specified in the Consent Order were not completed by the due date - 8 December 2021 - and therefore that the applicant's right to renew the proceedings was enlivened under Cl 8 Sch 4 of the Civil and Administrative Tribunal Act 2013 (NSW) (the NCAT Act).

Evidence

1. The applicant relied on two affidavits sworn by him on 21 June 2022 and 24 August 2022 respectively. At the hearing the applicant also sought leave to rely on a letter of consent from Bright & Duggan Pty Ltd (the compulsory managing agent proposed by the applicant), together with copies of its licence certificate and form of strata management agency agreement. Those documents were not lodged with the Tribunal in accordance with the procedural directions made on 19 April 2022. The applicant was given leave to rely on those documents on the basis that if the Tribunal decided to appoint a compulsory manager, the respondent would be given an opportunity to lodge further evidence, and make submissions, in relation to the proposed agent. In light of my decision to dismiss the application for a compulsory strata managing agent, it will not be necessary for this issue to be further ventilated.
2. The respondent relied on: 1. two affidavits of Mr David Peter Loewy sworn 12 October 2022 and 21 October 2022 respectively; 2. an affidavit of Tanya Gilerman sworn 7 October 2022; 3. an affidavit of Martine Harvey sworn 7 October 2022; and 4. a transcript of the Tribunal hearing on 10 November 2021.
3. Mr Loewy is the chairperson of the strata committee and is a director of Meltdee Pty Ltd which is the registered proprietor of lot 3. Ms Gilerman is a member of the strata committee and is the daughter of the registered proprietors and occupiers of lot 2. Ms Harvey is the owner of lot 1.
4. At the hearing Mr Loewy also gave limited additional oral evidence under affirmation.
5. Each party elected not to cross-examine the witnesses of the other party except that Mr O'Dowd cross-examined Mr Loewy on the additional oral evidence given by him at the hearing.
6. The parties also each submitted a chronology of significant events to assist the Tribunal.

Legislative framework

1. The renewal provisions in respect of the Consumer and Commercial Division of the Tribunal are contained in Cl 8 Sch 4 of the Civil and Administrative Tribunal Act 2013 (the NCAT Act) which provides as follows: 8 Renewal of proceedings in respect of certain Division decisions (1) If the Tribunal makes an order in exercise of a Division function in proceedings, the Tribunal may, when the order is made or later, give leave to the person in whose favour the order is made to renew the proceedings if the order is not complied with within the period specified by the Tribunal. (2) If an order has not been complied with within the period specified by the Tribunal, the person in whose favour the order was made may renew the proceedings to which the order relates by lodging a notice with the Tribunal, within 12 months after the end of the period, stating that the order has not been complied with. (3) The provisions of this Act apply to a notice lodged in accordance with subclause (2) as if the notice were a new application made in accordance with this Act. (4) When proceedings have been renewed in accordance with this clause, the Tribunal: (a) may make any other appropriate order under this Act or enabling legislation as it could have made when the matter was originally determined, or (b) may refuse to make such an order. (5) This clause does not apply if: (a) the operation of an order has been suspended, or (b) the order is or has been the subject of an internal appeal.
2. The Tribunal has power under s 237 of the Act to appoint a compulsory manager to exercise the functions of an owners corporation. The text of s 237 is as follows: ORDERS FOR APPOINTMENT OF STRATA MANAGING AGENT (1) Order appointing or requiring the appointment of strata managing agent to exercise functions of owners corporation The Tribunal may, on its own motion or on application, make an order appointing a person as a strata managing agent or requiring an owners corporation to appoint a person as a strata managing agent-- (a) to exercise all the functions of an owners corporation, or (b) to exercise specified functions of an owners corporation, or (c) to exercise all the functions other than specified functions of an owners corporation. (2) Order may confer other functions on strata managing agent The Tribunal may also, when making an order under this section, order that the strata managing agent is to have and may exercise-- (a) all the functions of the chairperson, secretary, treasurer or strata committee of the owners corporation, or (b) specified functions of the chairperson, secretary, treasurer or strata committee of the owners corporation, or (c) all the functions of the chairperson, secretary, treasurer or strata committee of the owners corporation other than specified functions. (3) Circumstances in which order may be made The Tribunal may make an order only if satisfied that-- (a) the management of a strata scheme the subject of an application for an order under this Act or an appeal to the Tribunal is not functioning or is not functioning satisfactorily, or (b) an owners corporation has failed to comply with a requirement imposed on the owners corporation by an order made under this Act, or (c) an owners corporation has failed to perform one or more of its duties, or (d) an owners corporation owes a judgment debt. (4) Qualifications of person appointed A person appointed as a strata managing agent as a consequence of an order made by the Tribunal must-- (a) hold a strata managing agent's licence issued under the Property and Stock Agents Act 2002, and (b) have consented in writing to the appointment, which consent, in the case of a strata managing agent that is a corporation, may be given by the Secretary or other officer of the corporation or another person authorised by the corporation to do so. (5) Terms and conditions of appointment A strata managing agent may be appointed as a consequence of an order under this section on the terms and conditions (including terms and conditions relating to remuneration by the owners corporation and the duration of appointment) specified in the order making or directing the appointment. (6) Return of documents and other records A strata managing agent appointed as a consequence of an order under this section must cause a general meeting of the owners corporation to be held not later than 14 days before the end of the agent's appointment and must on or before that meeting make arrangements to return to the owners corporation all documents and other records of the owners corporation held by the agent. (7) Revocation of certain appointments An order may be revoked or varied on application and, unless sooner revoked, ceases to have effect at the expiration of the period after its making (not exceeding 2 years) that is specified in the order. (8) Persons who may make an application The following persons may make an application under this section-- (a) a person who obtained an order under this Act that imposed a duty on the owners corporation or on the strata committee or an officer of the owners corporation and that has not been complied with, (b) a person having an estate or interest in a lot in the strata scheme concerned or, in the case of a leasehold strata scheme, in a lease of a lot in the scheme, (c) the authority having the benefit of a positive covenant that imposes a duty on the owners corporation, (d) a judgment creditor to whom the owners corporation owes a judgment debt.

Facts leading up to the Renewal Proceedings

1. The matter has a lengthy and convoluted history and it is helpful to make some factual findings in relation to key background matters before turning to the issues which I must decide. The following factual findings are based on the parties' respective evidence and, unless indicated, are not disputed.
2. On 28 August 2013 on application of the applicant, a strata adjudicator appointed Coyle & Everett Pty Ltd as compulsory managing agent for a period of 12 months.
3. On 2 February 2016 the OC approved a quote from The Roofing Professionals to replace the entire roof, and raise a special levy of $50,000 to cover the costs of that work.
4. In March 2016 the OC engaged The Roofing Professionals to replace the roof. At about that time the roof was replaced with a new colorbond roof.
5. In late 2017 or early 2018 the owner of lot 3 carried out renovations which included the installation of a split system air conditioner and two air conditioning condenser units on the common property roof. No approval had been sought or obtained from the OC prior to the carrying out of these works.
6. On 7 May 2021 the applicant's solicitors wrote to the owner of lot 3 requesting the removal of the air conditioning condensers from the roof.
7. At an extraordinary general meeting of the OC held on 11 May 2021 a resolution was passed by the OC to authorise the then strata manager to "affix the common seal to plans for the relocation of … air conditioning condensers". The applicant voted against the resolution.
8. On 15 June 2021 the OC passed a resolution accepting a quotation from Affordable Roofing "for required repairs" in respect of the roof. The minutes of the meeting noted: "It was agreed Lot 3 must make good any roof penetrations or damages caused by the installation of the air conditioning unit on the roof".
9. On 16 June 2021 the then strata managing agent (Mr Evan Efstratiadis of O'Neill Strata) issued a work order to Affordable Roofing to proceed with its quote for the roof repairs.
10. On 29 July 2021 Mr Loewy contacted his air conditioning contractor, Mr Ozkose of Ozkozee Air-Conditioning, to inquire as to when the air-conditioning units could be removed from the roof. Mr Ozkose responded that due to living in a COVID "hot spot" area subject to lockdown restrictions, his work was on hold.
11. On 29 July 2021 Mr Efstratiadis wrote to the owners to advise that Affordable Roofing was scheduled to attend the property and carry out a check measure on 3 August 2021.
12. On 31 August 2021 the OC resolved at an extraordinary general meeting to appoint a new strata manager, Strata Partners. Strata Partners' appointment commenced on 15 October 2021. The appointment of O'Neill Strata ended on 1 October 2021.
13. The applicant has regrettably been diagnosed with motor neurone disease and is close to being wheelchair bound. His daughter Kobe Westeweller and his former wife Lynne Westweller have frequently intervened on the applicant's behalf in matters relating to this dispute, and until recently Mrs Westeweller was lot 4's representative on the strata committee.
14. The applicant and his family have strongly disagreed with the approach taken by the OC to bring about the repairs. As a result, they have taken steps which have resulted in the OC's efforts to repair the roof being thwarted or delayed. Some of these actions are detailed below.
15. On 13 September 2021 Kobe Westeweller sent an email to Affordable Roofing stating, among other things "Affordable Roofing is not to attend [the premises], if you do the police will be called and Affordable Roofing will be forced into a lawsuit". On the same day the applicant sent an email to Affordable Roofing stating "no one is to set foot on the roof or work on the roof until the legal action and engineer's report has been finalised with the strata agents and committee".
16. The following day Affordable Roofing emailed the strata manager stating "in light of recent emails and phone calls made to Affordable Roofing … with pending threats of legal action and calls to police I can advise that we are currently not in a position to carry out any works to [the premises]".
17. On 5 October 2021 Bannermans Lawyers, on behalf of lots 1, 2 and 3, wrote to the applicant requesting that he refrain from making any threats to "stop, obstruct or hinder" Affordable Roofing undertaking the roofing work.
18. On 28 October 2021 the applicant commenced the Original Proceedings.
19. On 3 November 2021 Mr Loewy emailed Mr Ozkose asking when he can remove the air-conditioning units and saying it is "imperative" that they be removed "post-haste".
20. On 5 November 2021 Mr Loewy emailed the new managing agent (Bronwyn Dutton of Strata Partners), to inform her that the owner of lot 3 would be relocating the air-conditioning condensers from the roof to the lot 3 balconies at its own cost.
21. On 10 November 2021 the Original Application came before the Tribunal for directions and the Consent Orders were made.
22. There followed a string of correspondence between the strata manager, the owners and Affordable Roofing regarding the relocation of the air-conditioning condensers and the commencement of the roofing works.
23. On 25 November 2021 the strata manager wrote to the owners stating: We have unfortunately had a rather serious phone call this morning from Affordable Roofing advising that due to threats and harassment from unit 4 owner that they are withdrawing from the contract and will not be attending the site again or taking any further phone calls from the owner of unit 4… Affordable Roofing will refund the deposit that has been made minus materials they have already purchased. Affordable Roofing have also advised that they will be formally contacting the police in regards to their concerns.
24. On 5 December 2021, (ie three days before the due date for compliance with the Consent Orders) Mosedale Airconditioning & Electrical, at the request of the applicant and without the knowledge or consent of the OC, decommissioned and removed the air-conditioning units from the roof.
25. On 6 December 2021 Ozkozee Airconditioning provided a quote to Mr Loewy to decommission and relocate the air-conditioning units from the roof.
26. On 21 November 2021 another roofing contractor, ANZ Roofing, provided a quote to the OC to carry out roof repairs and other works for $12529. The quote was accepted by the OC and a work order was issued.
27. On 17 February 2022 ANZ Roofing advised that it had missed a number of issues when it prepared its previous quote, and issued a revised quote for a significantly higher amount than its original quote.
28. There followed some further correspondence between the owners and the strata manager regarding the ANZ Roofing quote.
29. On 10 March 2022 the applicant commenced the Renewal Proceedings.
30. Another roofing contractor, Strata Roofing, was subsequently engaged to quote for the roofing work. Strata Roofing provided three quotes in all, the third of which was provided at the request of the applicant. On 1 April 2022 the OC issued a work order to Strata Roofing accepting its second quote. That quote, for $19,970 in total, relevantly included "supply and fit back trays to cover the holes left by the removal of the air con units".
31. On 12 April 2022 Strata Roofing emailed Mr Loewy stating, inter alia, "Our quote … is the work that needs to be done it will keep this roof watertight".
32. Strata Roofing did not send its proposed contract to the OC until 16 June 2022. The signed contract was returned by the strata manager to Strata Roofing on 28 June 2022.
33. On 29 June 2022 Strata Roofing informed a representative of one of the owners (by email) that there would be delays in commencement of the roofing works due to the COVID-19 pandemic and lockdowns, "huge rain storms" causing a backlog of work, and a critical shortage of skilled roofing tradesmen.
34. On 21 September 2022 Strata Roofing commenced work on the roof. On 31 October 2022 a representative of Strata Roofing informed Mr Loewy that he expected to complete the roofing work on the following day - ie 1 November 2022 (which was the day of the final hearing of the Renewal Proceedings).

What is the proper construction of the Consent Orders?

1. The applicant says that the works which have been done by Strata Roofing (and which I am satisfied are now complete or virtually complete) do not comply with the Consent Orders. He says that the requirement in the Consent Orders for the OC to "reinstate the roof to the condition it was in prior to the placement of the air conditioning works on the roof" can only mean that the OC was required to replace or partially replace the roof, and that this has not been done. The OC says that the Consent Orders merely required it to repair the damage to the roof caused by the installation of the air-conditioning units, including to repair or cover over the penetrations made to the roof by the chasing of conduit and pipes from the air-conditioning condensers into lot 3.
2. I agree with the respondent that the Consent Orders are vague and unclear. The Macquarie English Dictionary (Macmillan Publishers Australia 2022) defines "reinstate" as "to put back or establish again, as in a former position or state". The term does not mean "replace". Indeed the definition is broad and, in the context of roofing work, could be taken to mean any number of steps besides replacement, including for example repairs sufficient to restore the roof to its previous undamaged condition.
3. Also, the Consent Orders contain no concrete proposal for reinstatement of the roof in the sense of a defined scope of works, with the result that the OC is left to guess what it is required to do: Glenquarry Park Investments Pty Ltd v Hegyesi [2019] NSWSC 425 (Glenquarry) at [104]-[105]. This problem is exacerbated by the inclusion of the words "carry out such work as is necessary to reinstate the roof" meaning that the task of determining what is "necessary" is left to the OC. Similarly, the requirement for the roof to be reinstated to its condition "prior to placement of the air conditioning works" is problematic because the Orders contain no explanation as to what that prior condition was.
4. The applicant's counsel ostensibly acknowledged the ambiguity of the Consent Orders when he said in closing submissions that it will be a matter for the compulsory strata manager to determine how many of the roof panels will require replacement in order to comply with the Consent Orders. In other words, even the applicant's submissions appreciate that the Consent Orders do not make clear on their face what works are required to "reinstate" the roof.
5. A consent order must be construed in the light of any admissible evidence of surrounding circumstances but without direct evidence of the parties' intention: Kirkpatrick v Kotis [2004] NSWSC 1265 at [39]-[45] (Kirkpatrick). The type of surrounding circumstances which can be used are those which can be used to construe a contract: Kirkpatrick at [45]. In this case the relevant surrounding circumstances are as follows: 1. In the Original Proceedings the application filed in the Tribunal stated that the orders sought by the applicant included an order to require the OC to "repair any damage resulting from the illegal erection of the Air-Conditioning Units to the common property rooftop". In the section of the application entitled "Reasons for Orders sought" the applicant stated "urgent roofing repair works are required to be undertaken in order to repair damage caused by the presence of the air conditioning units". There was no reference in the original application to replacement of the roof. The application clearly sought repairs to the roof only. 2. The transcript of the directions hearing at which the Consent Orders were made reveals that no mention was made by any person present at the hearing of the need to replace the roof. Indeed, the applicant's own legal representative who attended the hearing said to the presiding Senior Member: "the parties could consent to orders that the owners corporation remove the existing units and the conduits … and undertake the repairs to the roof". 3. The roof was relatively new, having been entirely replaced only five years earlier. The applicant has not provided persuasive evidence (including for example from an independent expert) which establishes that the damage to the roof could not be replaced other than by replacement. The respondent's evidence, including the email from Strata Roofing to Mr Loewy dated 12 April 2022, suggests that it was possible to repair the damage to the roof and render it watertight without the need to replace the roof. An order requiring replacement of the roof, rather than merely repair of the damage to the roof, would therefore have gone beyond the minimum necessary to ensure that the OC complied with its statutory duty under s 106 of the Strata Act to repair common property: Glenquarry at [111].
6. In the light of these surrounding circumstances, the respondent's construction of the consent orders is to be preferred. That is, that the works required by the consent orders were repairs to the damage caused by the installation of the air-conditioning system, rather than replacement of the roof.

Should the Tribunal, in the exercise of its discretion, appoint a compulsory strata managing agent?

1. The applicant says that a compulsory strata manager should be appointed under s 237(3) because the OC has failed to comply with the Consent Orders.
2. The applicant also says that a compulsory strata manager should be appointed because the management of the scheme is not functioning, or is not functioning satisfactorily and because the owners corporation has failed to perform one or more of its duties.
3. The principles regarding whether or not a compulsory strata manager should be appointed are well established. In Hoare and Ors v The Owners-Strata Plan No 73905 [2018] NSWCATCD 45 the Tribunal stated at [199]-[200]: Appointment of a compulsory strata manager is a serious measure not to be taken lightly, because it removes the democratic process that has been established under the Strata Act 2015 for the owners corporation to govern itself. In essence, it places the owners corporation into the hands of an administrator for a period of time.
4. As the Tribunal said in Maple v The Owners - Strata Plan No. 8950 [2021] NSWCATCD 108 at [19] - [22]: 19. The Tribunal must be satisfied, based on sufficient evidence, that one or more of the matters set out in s 237 (3) (a)-(d) has occurred, and, if so, there are appropriate discretionary reasons for the appointment of a compulsory strata manager. The exercise of that discretion must take into account the fact that appointment of a compulsory strata manager is a serious matter. 20. An applicant may, for example, provide sufficient objective evidence to satisfy the Tribunal that one of the matters set out in s 237 (3) (a)-(d) has occurred, but fail to satisfy the Tribunal that the nature or duration of the actions or inactions of the owners corporation (or the level of dysfunctionality) does not justify the appointment of a compulsory strata manager. 21. Further, a relevant matter is whether, despite past inadequacies of the management of the owners corporation that involve failure to comply with obligations under the Strata Act and/or the Strata Schemes Regulation 2015 (NSW) there has been a recent change in behaviour involving compliance, such as the recent election of a new strata committee that has adopted an approach that accords with ensuring the owners corporation complies with its obligations; and whether any previous "dysfunctionality" has improved. 22. The applicant bears the onus of establishing that a compulsory strata manager should be appointed. The Tribunal focusses upon the objective evidence. It is axiomatic that a Lot owner who is making an application for compulsory appointment of a strata manager is subjectively dissatisfied with the current management of the owners corporation. However the matters set out in s 237 (3) of the Strata Act and the discretionary considerations as to whether a compulsory strata manager should be appointed are not established merely because of the subjective belief of a Lot owner that management of the owners corporation is, or has been, inadequate.
5. I will now deal with each of the allegations which the applicant says justify the appointment of a compulsory strata manager.

Has the OC failed to do the works required by the Consent Orders?

1. The applicant says that the OC has failed to comply with the Consent Orders because the repair works it has undertaken do not include full or partial replacement of the roof panels.
2. For the reasons explained above, I agree with the respondent's interpretation of the Consent Orders. That is, that the Consent Orders required the damage to the roof caused by the installation of the air-conditioning system to be repaired. They did not mandate replacement of all or part of the roof.
3. The applicant did not provide independent expert evidence or indeed any evidence which establishes that the works done by Strata Roofing have been insufficient to repair the air-conditioning damage. Therefore I am not satisfied that there has been a substantive breach of the Consent Orders.
4. I would add that even if I am wrong in this regard, and the Consent Orders properly construed required full or partial replacement of the roof, I do not consider the OC's failure to replace the roof would give rise to serious concerns about the management of the scheme. My reasons for this include: 1. There is nothing before me which establishes that the OC's interpretation of the orders was not in good faith. 2. It is to be expected that a strata committee will have difficulties interpreting vague and imprecise orders (the meaning of which could not even be agreed by the parties' legally qualified representatives). 3. The OC has carried out the repairs which it considers, in good faith, are necessary to comply with the Consent Orders. The evidence does not establish that those repairs are insufficient to address the roof damage which precipitated the Original Proceedings nor does it establish that the repairs are insufficient to comply with the OC's obligations under s 106 of the Strata Act.
5. In these circumstances, even if I had been satisfied that the roof repairs technically did not comply with the Consent Orders because the roof was not replaced, the failure to comply would not have justified the draconian step of appointing a compulsory strata manager.

The OC's failure to comply with the Consent Orders in time

1. It is not disputed that the respondent is in breach of the Consent Orders because the roofing works carried out by Strata Roofing were completed almost nine months after the due date of 8 December 2021. The applicant says this is also a reason for appointing a compulsory strata manager.
2. Failure to comply with a Tribunal order within the time stipulated in the order is of course not a matter to be taken lightly. However, the breach needs to be considered in its full context. In this case that includes: 1. Although works did not commence until September 2021, steps were taken by the OC almost immediately after the applicant's solicitor brought the issue to the OC's attention (on 11 May 2021) to have the roof repaired including: holding an extraordinary general meeting on 11 May 2021 at which a resolution was passed regarding removal of the air-conditioning system; procuring quotes from roofing contractors and issuing a work order to Affordable Roofing on 16 June 2021. 2. Further steps were taken by the OC promptly after the Consent Orders were issued including issuing further work orders to Affordable Roofing on 18 November 2021 and to ANZ Roofing on 21 December 2021. 3. The delay in progressing the works is attributable at least in part to the conduct of the applicant and his family outlined above. In particular, Affordable Roofing twice refused to carry out the work citing harassment and abuse from the applicant and his family as the reason for its refusal. Also, the applicant inappropriately arranged for his own contractor to remove the air-conditioning units from the common property roof without the consent of the OC and prior to the due date for the OC to do this work. The applicant then proceeded to demand that the OC pay the contractor's invoice. The correspondence establishes that this issue caused at least some distraction to the OC at a time when it was attempting to organise roof repairs. 4. The delay has also been attributable to other events outside the OC's control, including the delay by Strata Roofing in issuing its contract to the OC and challenges in the building industry caused by COVID-19 lockdowns, unusual rain events, and a shortage of skilled workers.
3. Having considered all the circumstances I am not satisfied that the failure to carry out the roofing works in time reflects mismanagement or dysfunction on the part of the respondent. Conversely, the circumstances reflect that the OC has, despite difficult circumstances, made diligent and persistent efforts to comply with the Consent Orders.
4. For these reasons I am no satisfied that the delay in complying with the Consent Orders warrants the appointment of a compulsory strata manager.

Dysfunction and failure to perform one or more duties

1. The applicant says that in addition to his concerns regarding the Consent Orders, he has other concerns about the way the OC is functioning which justify the appointment of a compulsory strata manager. The applicant refers to a variety of issues, many of which are historical and predate the Original Proceedings.
2. The respondent says that the allegations made in relation to such matters are inadmissible because they are irrelevant to the renewal proceedings. It says the renewal proceedings are predicated on the alleged breach of the Consent Orders, and that evidence of any other failures by the OC are irrelevant and should have been the subject of a separate application.
3. I do not agree that the additional matters raised by the applicant are inadmissible. The Tribunal could have made an order for a compulsory strata manager when the Original Proceedings were determined (per cl 8(4)(a) of Sch 4 of the NCAT Act) and if it had, evidence regarding dysfunction other than in relation to the roof repairs would have been relevant.
4. However, I do think evidence of such additional matters is of little, if any, relevance in these proceedings.
5. As the Appeal Panel said in Bondarek v NSW Land and Housing Corporation [2018] NSWCATAP 299 at [45] the purpose of a renewal under cl 8: … is to consider what to do next given a non-compliance, but not to rehear the substantive merits already determined, and to do that on the basis of material put forward by the parties relevant to the issue of what to do next. As was said in Akratos v Papadopoulos [2016] NSWCATAP 139 at 36: the purpose of the renewal proceedings was to consider, in light of the fact that the original order was not complied with, what other appropriate orders it could have made when the matter was originally determined and not to reconsider the substantive merits of the respondent's building claim.
6. In this instance the Consent Orders made in the original application have now been complied with and although compliance was out of time, for reasons I have explained, that of itself does not justify the appointment of a compulsory manager.
7. In such circumstances the renewal application is otiose because there is nothing further to do to address the non-compliance with the Consent Orders. The additional information provided by the applicant regarding the functioning of the scheme is therefore of little if any relevance to the issues I must decide.
8. In any case, even if I am wrong about this, the additional matters raised by the applicant do not persuade me that appointment of a compulsory strata manager is warranted. My reasons for this are set out below.

Previous compulsory manager

1. The applicant refers to events which occurred during and just after the tenure of the previous compulsory manager in 2013 and 2014. The allegations in this regard are vague and not persuasive. In any case, events which occurred almost ten years ago are not, in the absence of evidence of any continuing pattern of concerning behaviour, relevant to determining whether a strata scheme is currently dysfunctional.

Unit entitlements

1. The applicant says that the scheme is dysfunctional because the applicant has "just over" 25% of the unit entitlements for the scheme and therefore no special resolution, for example to approve a change in the by-laws, can ever be passed by the scheme without the consent of the applicant.
2. No evidence was put forward by the applicant to substantiate the assertion that his unit entitlement is "just over" 25%. In any case, it is not unusual for a single lot owner to hold more than 25% of the unit entitlements in a strata scheme. That of itself does not render a strata scheme dysfunctional. No persuasive explanation or supporting evidence have been provided by the applicant as to how the distribution of unit entitlements makes this scheme dysfunctional. Moreover, if this is a matter that concerns the applicant in respect of any proposed change to the by-laws, he need do no more than vote in favour of the proposed change. To suggest that the draconian step of appointing a compulsory strata manager is the only solution to this problem is perplexing.

Assertions by previous strata manager

1. The applicant refers to numerous emails from the previous strata manager, Mr Efstratiadis of O'Neill Strata, which refer to dysfunctionality in the scheme and the need to appoint a compulsory strata manager.
2. The most recent of those emails is dated 13 April 2021, ie six months before the Original Proceedings were commenced and almost one year before the Renewal Proceedings were commenced. Mr Efstratiadis' firm's appointment as strata manager ceased shortly thereafter on 1 October 2021.
3. The evidence is historical and has been superseded by more recent events, including the appointment of a new strata manager (Strata Partners) with effect from 15 October 2021. Also, at the annual general meeting of the owners which occurred on 5 May 2022 the scheme resolved, among other things, to adopt a statement of accounts, obtain a new 10-year capital works fund plan, amend and adopt a budget, raise a special levy of $240,000 for the purpose of remedial building works, appoint solicitors to represent the scheme in these proceedings, appoint an auditor and accept roofing quotes. These actions reflect a strata scheme which is functioning satisfactorily, contrary to the assertions in Mr Efstratiadis' emails.

Lot 3 air-conditioning

1. The applicant asserts that the owner of lot 3 has installed air-conditioning condensers on the balcony of lot 3, without obtaining the necessary council and other approvals.
2. The applicant also asserts that Mr Loewy intentionally delayed the moving of the air-conditioning units from the roof whilst his lot was tenanted.
3. It is not clear how these allegations are relevant to whether the scheme is dysfunctional. In any event, the applicant submitted no evidence to substantiate either of these assertions and I am not satisfied in regard to either of them. Indeed conversely to the applicant's assertions, the email exchange between Mr Loewy and Mr Ozkose establishes that Mr Loewy took steps to have the air-conditioning units removed as quickly as possible once the applicant had formally complained about them.

Strata committee

1. The applicant's representative on the strata committee, Ms Lynette Westerweller, was removed from the strata committee by a resolution passed at the annual general meeting on 22 May 2022. The applicant says this reflects dysfunction because his lot is now the only lot not represented on the committee.
2. There is no requirement under the Strata Act or indeed under any other law that all lot holders in a four-lot scheme be represented on the strata committee. Whilst this action by the OC may reflect discord between the applicant and the owners of the other lots, it does not of itself reflect dysfunctionality. Indeed, given the hostile and at times aggressive and threatening behaviour exhibited by the applicant and his family I expect that the committee will be able to function more productively without a representative of lot 4 on the committee.
3. The applicant also suggests that the other three lot owners have formed an alliance against him with the result that the OC is not acting in the best interest of all the lot owners.
4. The operation of the OC must be viewed with some degree of common sense. It may be anticipated that there will be various disagreements and clashes of personalities between interested parties and that factions will form. This is particularly to be expected in a case such as the present where there is a history of animosity and legal proceedings between the parties.
5. Whilst it is clear that there is significant discord between the applicant and the other three lot owners, the evidence does not establish that the relationship between the applicant and the owners of the other lots has, as a practical matter, resulted in the OC making decisions which are not in the best interests of the scheme. Indeed, despite the hostility between the parties, the committee has been actively engaged in attending to the roofing works the subject of these proceedings as well as other important matters.

Building reports and leak into lot 4

1. The applicant refers to three major building reports obtained by the OC since 2016 which identify major defects in the building. The most recent of those is a report by Core Consulting dated 2021. The applicant asserts that to date none of the works identified in those reports have been done and that no levies have been raised for this purpose.
2. The applicant also refers to water damage which has been sustained to his lot as a result of water ingress through the roof in March and April 2022. He says that the respondent's insurer has agreed to undertake repairs but that the repairs have not yet been authorised by the respondent.
3. With regard to the remedial works, the evidence establishes that steps have been taken by the OC to attend to those works and that in May 2022 the OC held an annual general meeting at which the OC resolved to prioritise the remedial works recommended by Core, to obtain quotes and appoint a builder. The OC also raised a special levy of $240,000 plus GST to fund the works.
4. I am satisfied that notwithstanding previous delays, the OC now has this matter in hand and is taking appropriate steps to progress the remedial works.
5. With regard to the water leaks into the applicant's lot, the applicant has provided no evidence to establish that the leaks complained of are due to the common property being in a state of disrepair. Indeed in Mr Loewy's affidavit he states that he has observed that the applicant frequently leaves the skylights in his roof open for extended periods, including during periods of heavy rain, allowing water penetration into lot 4. Mr Loewy was not challenged about this evidence.
6. In the circumstances I am not satisfied that the leaks into lot 4 which occurred in March and April 2022 are the responsibility of the OC.

Conclusion regarding compulsory strata manager

1. As the Consent Orders have now been complied with, and the delay in compliance is well explained, the appointment of a compulsory manager is not justified and the Renewal Proceedings serve no further practical purpose.
2. The other grounds raised by the applicant are not relevant to the Renewal Proceedings. Even if they were, I am not satisfied that any of those grounds, considered either individually or as a whole, would warrant the Tribunal taking the serious and draconian measure of appointing a compulsory manager under s 237 of the Act.

Orders

1. For these reasons I make the following orders: 1. The application is dismissed. 2. If there is a costs application, the costs applicant is to file and serve submissions and documents on the costs application by 14 days from the date of these orders. 3. The costs respondent is to file and serve submissions and documents on the costs application by 28 days from the date of these orders. 4. The costs applicant is to file and serve costs submissions in reply by 35 days from the date of these orders. 5. The costs submissions of the parties are to state whether the parties seek an oral hearing on the issue of costs, or consent to the costs application being determined on the papers in accordance with s 50 (2) of the Civil and Administrative Tribunal Act 2013 (NSW). 6. The Tribunal may determine it appropriate to deal with any costs application on the papers and without a further oral hearing.

I hereby certify that this is a true and accurate record of the reasons for decision of the Civil and Administrative Tribunal of New South Wales. Registrar

Amendments 10 February 2023 - Amendment of party name. 04 September 2023 - Formatting amendments. DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated. Decision last updated: 04 September 2023