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Worthington v Body Corporate for Williams Retreat QCATA 103
Worthington v Body Corporate for Williams Retreat CTS 23581 & Ors  QCATA 103
Body Corporate for Williams Retreat CTS 23581
On the papers
Senior Member Stilgoe OAM
13 June 2016
APPEAL – REAL PROPERTY – STRATA AND RELATED TITLES – MANAGEMENT AND CONTROL – BY–LAWS – EXCLUSIVE USE – bodies corporate – whether grounds for leave to appeal – whether former by–law relating to the placement of signs was an exclusive use by–law.
Body Corporate and Community Management Act 1997 (Qld), ss 170, 171, 180, 226, 289, 294, Schedule 5, Schedule 6
Accident Towing & Advisory Committee v Combined Motor Industries Pty Ltd  VR 529.
Australian Broadcasting Commission v Bond (1990) 170 CLR 321
Chambers v Jobling (1986) 7 NSWLR 1
Dearman v Dearman (1908) 7 CLR 549
Fox v Percy (2003) 214 CLR 118
Independent Finance Group Pty Ltd v Mytan Pty Ltd  1 Qd R 374.
Lion Nathan Australia Pty Ltd v Coopers Brewery Ltd (2006) 156 FCR 1
McColl v Body Corporate for Lakeview Park Community Titles Scheme  2 Qd R 401
Owners of Stata Plan No 3397 v Tate (2007) 70 NSWLR 344
Pacific Carriers Ltd v BNP Paribas (2004) 218 CLR 451
Ryledar Pty Ltd v Euphoric Pty Ltd (2007) 69 NSWLR 603
Toll (FGCT) Pty Ltd v Alphapharm Pty Ltd (2004) 219 CLR 165
Waterford v The Commonwealth (1987) 163 CLR 54
Whelpton v Kur-Ring-Gai Council  85 LGERA 120
APPEARANCES and REPRESENTATION:
This matter was heard and determined on the papers pursuant to s 32 of the Queensland Civil and Administrative Tribunal Act 2009 (Qld) (QCAT Act).
REASONS FOR DECISION
- Nigel Worthington owns lot 8 in the Body Corporate for Williams Retreat CTS 23581. Worthington Pty Ltd, as trustee for the Worthington Family Trust, is the caretaker for the scheme.
- Prior to 10 March 2015, by-laws 13.31 to 13.34 read as follows:
13.31 Signs, advertisements, placards, banners, pamphlets or bill boards may only be displayed to the public view on any portion of any Lot or Common Property in accordance with the following rules:-
- For the purposes or (sic) letting of any Lot – this may only be conducted by the Proprietor or occupier of lot 8 for the purposes of conducting the letting business being carried out upon that Lot; and
- For any other purposes – only with the prior written approval of the Committee or the Body Corporate or as elsewhere provided in the By-laws.
13.32 A person who wishes to place a sign or notice on a Lot or Common Property shall make a written application to the Committee for approval of the erecting or placement of such a sign or notice.
13.33 The Committee shall permit the placement of at least one (1) “For Sale” sign on a Lot to promote the sale of that Lot, such sign to be of a design and standard approved by the Committee.
13.34 The Proprietor or occupier of lot 8 shall be entitled to place such signs on or about that Lot as shall be reasonably required for the purposes of conducting the businesses which are from time to time carried out upon that Lot.
- On 10 March 2015, at an annual general meeting, by special resolution, the body corporate repealed by-laws 13.31 to 13.34 and replaced them with the following by-laws:
13.31 Signs, advertisements, placards, banners, pamphlets or bill boards may only be displayed to the public view on any portion of any Lot or Common Property in accordance with the following rules:-
- For the purpose of letting any Lot by the Owner of Lot 8 in conducting the letting business being carried out on that Lot;
- The Owner of any Lot who does not use the letting service provided by the Owner of Lot 8 and wishes to place a letting sign shall make a written application to the Committee for approval to display any letting signs or notices upon the Lot. Such Committee approval may be granted in the following manner:-
- a written application for approval shall be submitted to the Committee.
- such application must contain reasonable details to enable proper consideration of the application and must comply with any relevant statutory requirements.
- such details must include (but are not limited to) a draft of the proposed signage indicating position, size, colours, font style and wording of signage.
- committee approval may be effected by an authorising endorsement of a majority of committee members on the written application within 14 days of receipt of the application.
- all signage must be to a professional standard and applied or installed in a competent manner.
- all costs relating to the Owner’s signage shall be borne by the Owner. The Body Corporate shall not be responsible for any costs whatsoever in relation to such signage.
13.32 An Owner who wishes to place a sign other than a letting sign or notice on a Lot or Common Property shall make a written applications to the Committee for approval of the erection or placement of such a sign or notice.
13.33 The Committee shall permit the placement of at least one (1) “For Sale” sign on a Lot to promote the sale of that Lot, such sign to be of a design and standard to be approved by the Committee.
13.34 The Owner or occupier of Lot 8 shall be entitled to place such signs on or about that Lot as shall be reasonably required for the purpose of conducting the businesses which are from time to time carried on upon that Lot.
13.35 At all times the Owner of the sign must keep the signage in clean condition and good state of repair.
- Mr Worthington applied to the Commissioner for Body Corporate and Community Management, for an order that the new by-laws were invalid under s 171 of the Body Corporate and Community Management Act 1997 (Qld) (BCCM Act). The Commissioner referred the application to an adjudicator who dismissed the application.
- Mr Worthington wants to appeal that decision. An appeal from a decision of an adjudicator can only be brought on a question of law. Mr Worthington relies on the following grounds of appeal:
- The adjudicator erred in finding that by-law 13.31 was not an exclusive use by-law.
- The adjudicator failed to apply the correct test in s 180(7) of the BCCM Act. Mr Worthington says the adjudicator improperly considered the body corporate’s motives for changing the by-law; and
- The adjudicator made improper findings of fact.
Standing to bring the appeal
- The body corporate submits that the appeal is incompetent because the appeal is brought in the name of Worthington Pty Ltd ATF the Worthington Family Trust. The application filed on 10 April 2015 names Mr Worthington as the applicant. However, the Commission received an amended application on 13 April 2015, substituting Worthington Pty Ltd as the applicant. Mr Worthington was subsequently substituted as the correct applicant.
- Section 289(2) of the BCCM Act gives an “aggrieved person” the right to appeal to the appeal tribunal, but only on a question of law. An aggrieved person includes, relevantly, an applicant.
- There appears to have been some confusion as to which entity was the proper applicant in relation to this dispute. That depends upon the issues in dispute. Here, the central issue was whether the by-law in its previous or amended form was an exclusive use by-law. If it was, certain requirements needed to be satisfied before the by-law could be repealed or amended. Those requirements, set out in s 171(2) of the BCCM Act, apply to the owner of the lot affected by the by-law.
- The relevant by-law is by-law 13.31. That by-law, whether in its previous or amended form attaches to the owner or occupier for the time being of lot 8.
- The owner of lot 8 is therefore the proper applicant and accordingly, the proper appellant in this litigation. The owner of a lot is the person who is, or is entitled to be, the registered owner of the lot. Further, for Chapter 6, owner means a person in the person’s capacity as the owner of a lot, and not, for example, in the person’s capacity as a service contractor or letting agent for the scheme. Lot 8, at the time the application was made, was owned by Nigel Worthington. There is no evidence to indicate that ownership of lot 8 was transferred to another entity.
- The proper party to bring the appeal is therefore Mr Worthington.
- We note that Worthington Pty Ltd ATF the Worthington Family Trust is the Caretaking Service Contractor (the Manager) at the Williams Retreat Scheme. This dispute however does not concern rights under that agreement and, as noted above, ‘owner’ means the person in the capacity of owner of a lot rather than in their capacity as service contractor or letting agent.
Construction of by-laws
- The proper approach to the construction of scheme by-laws was considered in Owners of Stata Plan No 3397 v Tate. There it was held that, whether by-laws were characterised as delegated legislation or a statutory contract, their interpretation had to be approached on a basis which was consistent with the statutory scheme. Further, it was held that exclusive use by-laws should be interpreted objectively by what they would convey to a reasonable person.
- In construing the relevant by-law it is necessary to take into account the chosen language and the surrounding circumstances in which the by-law was made, in order to determine, objectively, the mutual intention of the parties.
- Here, that would include the terms of the Resort Management and Letting Agreement which did not grant to the Resort Manager an exclusive right to let lots within the scheme.
Is by-law 13.31, in its previous form an exclusive use by-law?
- This issue is central to this dispute because s 171 provides that an exclusive use by-law may only stop applying to a lot if the lot owner agrees in writing prior to a resolution without dissent consenting to the recording of a new community management statement reflecting the change.
- Whether the proper procedure was followed in passing the resolution depends upon the proper characterisation of by-law 13.31. This involves construction of the definition of “exclusive use by-law” in s 170(1) of the BCCM Act and its application to the by-law in its previous form.
- “Exclusive use by-law” is defined to mean:
An exclusive use by-law, for a community titles scheme, is a by-law that attaches to a lot included in the scheme, and gives the occupier of the lot for the time being exclusive use to the rights and enjoyment of, or other special rights about –
- (a)the common property; or
- (b)a body corporate asset.
- The former by-law attached to a specific lot, that is, lot 8 and, in that respect, satisfies the statutory definition of an exclusive use by-law.
- The issue is whether it gave the occupier for the time being exclusive use or special rights about the common property.
- The body corporate says that by-law 13.31 was intended to permit the owner of lot 8 to place signs on the common property or an owner’s lot for the purpose of conducting the letting business.
- The body corporate also says that the by-law therefore recognised that lot 8 was conducting a letting business but also permitted a lot owner to advertise letting on their own lot.
- The body corporate further argues that there is no change to lot 8’s rights because it does not change its rights to advertise on the common property but merely permits other owners to display signage on their lots. That argument ignores the first question; whether by-law 13.31 was an exclusive use by-law.
- Worthington says that the by-law granted rights in respect of the common property unavailable to any other owner. Only the owner of lot 8 had the right to erect signage in respect of letting. By contrast, by-law 13.31(b) permitted the committee to authorise signage for any “other purposes” which might include for example the sale of a lot. Any lot owner could exercise these signage rights, subject to Committee approval. For this reason, only by-law 13.31(a) conferred exclusive rights. The relevant and decisive consideration is that no other persons are able to erect signage in respect of letting, whether or not a lot owner gives consent, or the committee gives approval.
- The meaning of the by-law is obtuse.
- In our view, neither interpretation is correct. We note, in that respect, that the Tribunal is not, on a matter of interpretation of the by-law, bound to accept the interpretations contended for by the parties and is obliged to do its best to arrive at the proper construction of the by-law.
- The first three lines of by-law 13.31 (which we will refer to as the Preamble to by-law 13.31), in our view, identifies the subject matter of the by-laws to follow. That is, the “rules” in respect of the display of signs, advertisements, placards, banners, pamphlets and bill boards (“signs”) to the public view on any portion of any Lot or Common Property.
- By-law 13.31(a) and (b) identify the purposes for which signs may be displayed. By-law 13.31(a) provides, in effect, that the owner of lot 8 for the time being may display signs for the purpose of letting any lot in the course of carrying out the business of letting from lot 8. By-law 13.31(b) provides that for any lot owner to display signs for any other purpose, that is, a purpose beyond the purpose of the letting business conducted from lot 8, the written approval of the Committee is required.
- So construed, by-laws 13.31(a) and (b) do not address the location of the signs. As noted above, the Preamble to the by-law defines the subject matter of the by-laws to follow, and it is incorrect to construe it as informing, in the context of by-law 13.31(a), where the signs may be placed.
- By-law 13.32 concerns the process of seeking approval from the Committee for the erection or placement of a sign contemplated by by-law 13.31(b).
- By-law 13.33 grants to the owner of a lot the right to erect at least one sign on the lot to promote the sale of that lot.
- By-law 13.34 describes what signs the owner of lot 8 may erect for the purpose of conducting the businesses which are from time to time carried out upon lot 8, including the business referred to in by-law 13.31(a). For those purposes, the owner of lot 8 shall be entitled to place such signs on or about lot 8 as shall be reasonably required.
- So understood, the by-law does not grant to the owner of lot 8 any right, without the prior written approval of the Committee, to place signs upon the common property. The owner may, however, place signs on lot 8 but that is not a right in respect of common property.
- The interpretation contended for by Worthington reads by-law 13.31(a) as being informed by the Preamble, such that the signs for the purpose identified in sub-paragraph (a) may be placed on “any portion of any Lot or Common Property”. Further, it would necessarily follow on this interpretation, that there would be no constraint on the extent of such signage on the common property or any lot, because the constraint in by-law 13.34 is confined to lot 8. This is, in our view, an unlikely construction, since it grants untrammelled rights to the owner of lot 8 to place signs without constraint on the lot of any other owner, and on the common property whereas, in respect of its own lot, only such signs as are reasonably required could be erected.
- The arguments of the body corporate proceed from the proposition, which we regard as erroneous, that by-law 13.3(a) deals with where the signs may be placed, rather than the purpose for which signs may be erected.
- The issue remains as to whether, if such right as existed to display signs on the Common Property was not an exclusive right, whether it was nonetheless a “special right about common property”.
- “Special right” is not defined. “Special” is a word of protean meaning. It should in our view be read in the context of and coloured by the word “exclusive”. The word “special” connotes something which pertains only to a particular lot, that is, that it is not a right universally enjoyed by lot owners and which is, in its context, in the nature of, or close to, “exclusive”. It would be wrong, in our view, in the context of “exclusive”, to read “special” simply as particular to the owner of a lot.
- In our opinion, such right as the owner of lot 8 had to place signs on the Common Property is not “special” within the meaning of the Act. Here the fact that the right of other lot owners to display signs was subject to the consent of the body corporate is not, in our view, enough to convert the right attaching to lot 8, to “special”. “Special” means more than different.
- In conclusion, the right in the previous by-law 13.31(a) to display signs for the purpose of lot 8’s business is not properly characterised as an exclusive use by-law. It was not exclusive to lot 8 and was not in the nature of a special right. Although the by-law is ambiguous, it is a reasonable construction to interpret it to mean that lot owners had a right to display signs, and we would say that included letting signs, with the consent of the body corporate. The fact the lot owners needed consent and lot 8 did not is not enough, in our view, to make the right attaching to lot 8, a “special right”.
- We note that a narrower construction of the by-law, that lot owners did not have a right to display letting signs in any circumstances, is unduly restrictive, unfair and oppressive to lot owners and inconsistent with the terms of the Resort Management and Letting Agreement.
- It follows therefore, on our view, that the fact the right in by-law 13.31(a) ceased to apply to lot 8 upon its repeal was immaterial because it was not properly characterised as an “exclusive use by-law” within the meaning of the Act. It could be repealed by special resolution without the need to obtain the prior written agreement of the owner of lot 8.
- The only ground upon which the amendments to the by-laws were challenged was that the former by-law was an exclusive use by-law.
- For the above reasons we are of the opinion that the former by-law is not an exclusive use by-law. Accordingly, we do not, on that ground, find that the amended by-laws are invalid.
Did the Commission fail to correctly apply the test in s 180(7) of the BCCM Act?
- Section 180(7) of the BCCM Act states that a by-law must not be oppressive or unreasonable, having regard to the interests of all owners and occupiers of lots included in the scheme and the use of the common property for the scheme.
- The Commission found that a by-law that restricted a lot owner’s ability to advertise a lot for rent and that prohibited the lot owner erecting a sign could be seen as unreasonable or oppressive.
- Worthington submits that the Commission failed to consider the interest of all owners, instead referring only to those owners who were unhappy with Worthington’s letting service.
- The Commission’s decision referred to a number of factors in deciding that by-law 13.31 was unreasonable. Firstly, the Commission referred to the remote location of the scheme. Secondly, the Commission referred to a dispute between some lot owners and Worthington. Thirdly, the Commission referred to the lack of options for lot owners, given that the other real estate agent in the area did not want to take over letting duties. Lastly, the Commission referred to the fact that the Resort Management and Letting Agreement acknowledged that lot owners were free to engage another letting service.
- Although we find that these considerations do not affect whether or not the by-law is an exclusive use by-law, we are not satisfied that the Commission’s decision depended upon a finding that by-law 13.31 was unreasonable.
- This is not therefore a basis for overturning the decision.
Did the Commission improperly consider the body corporate’s motives for changing the by-law?
- After finding that by-law 13.31 was not an exclusive use by-law, the Commission said this:
From the evidence I find it understandable and reasonable that the action taken by the body corporate to amend the by-laws was to clarify the issue of signage at the scheme for all lot owners. I am of the view that the amended by-laws were validly amended; do not change any purported exclusive rights for [Worthington] and that there was no evidence that there was any exclusive use by-law attached to [Worthington’s] lot.
- The passage in the Commission’s decision is not central to the decision. The Commission had already found that by-law 13.31 was not an exclusive use by-law. These words were simply obiter dictum.
Error of fact
- The body corporate has correctly pointed out the test to be applied in considering an appeal on an error of fact.
- Findings of fact by a Tribunal will not usually be disturbed on appeal if the facts inferred by the Tribunal, upon which the finding is based, are capable of supporting its conclusions, and there is evidence capable of supporting any inferences underlining it.
- An appellate tribunal may interfere, however, if the conclusion at first instance is ‘contrary to compelling inferences’ in the case. As the High Court said in Fox v Percy:
In such circumstances, the appellate court is not relieved of its statutory function by the fact the trial judge has, expressly or implicitly, reached a conclusion influenced by an opinion concerning the credibility of witnesses. In such a case, making all due allowances for the advantages available to the trial judge, the appellate court must “not shrink from giving effect to” its own conclusion.
- There is no error of law simply in making a wrong finding of fact unless there is no evidence to support that finding. That test is not made out in this case.
- The amendments to the by-laws were challenged on the basis the former by-law was an exclusive use by-law.
- The former by-law 13.31 was not, in our opinion, an exclusive use by-law.
- Accordingly, the appeal is dismissed.
 Williams Retreat CTS 23581.
 BCCM Act s 289(2).
 Appeal Tribunal Directions dated 10 February 2016.
 BCCM Act, s 289(1)(d)(ii)(A).
 BCCM Act, Schedule 6; Independent Finance Group Pty Ltd v Mytan Pty Ltd  1 Qd R 374 at 377.
 BCCM Act, s 226.
 Qld Dept of Natural Resources and Mines Title Search Records dated 10 April 2015.
 The relevant terms of that agreement are those assigned from Australia Pacific Holdings Pty Ltd to Worthington Pty Ltd on 5 February 2004.
 BCCM Act, s 226.
 (2007) 70 NSWLR 344.
 Ibid at .
Lion Nathan Australia Pty Ltd v Coopers Brewery Ltd (2006) 156 FCR 1 cited in Tate at .
 Tate at  citing Pacific Carriers Ltd v BNP Paribas (2004) 218 CLR 451 at 461; Toll (FGCT) Pty Ltd v Alphapharm Pty Ltd (2004) 219 CLR 165 at 179; Ryledar Pty Ltd v Euphoric Pty Ltd (2007) 69 NSWLR 603.
 BCCM Act, s 171(2)(b).
 BCCM Act, s 170(1).
 McColl v Body Corporate for Lakeview Park Community Titles Scheme  2 Qd R 401 at -.
 Cf. Accident Towing & Advisory Committee v Combined Motor Industries Pty Ltd  VR 529 at 547; Whelpton v Kur-Ring-Gai Council  85 LGERA 120 at 126.
 In particular, [5.2.12] and [5.2.13].
Williams’ Retreat  QBCCMCmr 466.
Dearman v Dearman (1908) 7 CLR 549 at 561; Fox v Percy (2003) 214 CLR 118 at 125-126.
 Chambers v Jobling (1986) 7 NSWLR 1 at 10.
 Fox v Percy (2003) 214 CLR 118 at 128 per Gleeson CJ, Gummow and Kirby JJ.
 Waterford v The Commonwealth (1987) 163 CLR 54 at 77; Australian Broadcasting Commission v Bond (1990) 170 CLR 321 at 341.
- Published Case Name:
Nigel Worthington v Body Corporate for Williams Retreat CTS 23581, John Brennan, Tania Nifosi, Peter Whitely and John Hodges
- Shortened Case Name:
Worthington v Body Corporate for Williams Retreat
 QCATA 103
Senior Member Stilgoe, Member Traves
13 Jun 2016