Warren v Body Corporate for Buon Vista CTS 14325
[2006] QDC 397
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- Unreported Judgment
- Warren v Body Corporate for Buon Vista CTS 14325[2006] QDC 397
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Warren v Body Corporate for Buon Vista CTS 14325[2006] QDC 397
Warren v Body Corporate for Buon Vista CTS 14325[2006] QDC 397
DISTRICT COURT OF QUEENSLAND
CITATION: | Warren v Body Corporate for Buon Vista CTS 14325 [2006] QDC 397 |
PARTIES: | IAN CAMPBELL WARREN First Applicant AND FLORENCE BURNETT WARREN Second Applicant AND ALEXIA MARGARET WARREN Third Applicant V BODY CORPORATE FOR BUON VISTA CTS 14325 Respondent |
FILE NO/S: | D2929/05 |
DIVISION: |
|
PROCEEDING: | Application |
ORIGINATING COURT: | District Court, Brisbane |
DELIVERED ON: | 30 November 2006 |
DELIVERED AT: | District Court, Brisbane |
HEARING DATE: | 9 October 2006 |
JUDGE: | McGill DCJ |
ORDER: | Application dismissed with costs. |
CATCHWORDS: | APPEAL AND NEW TRIAL – Extension of time – initial attempt to pursue different course – no satisfactory explanation for delay – proposed appeal unmeritorious – extension refused Body Corporate and Community Management Act 1997 s 290(2) |
COUNSEL: | Third applicant for the applicants V. Brennan for the respondent |
SOLICITORS: | Third applicant for the applicants Herdlaw Solicitors for the respondent |
- [1]This is an application for an extension of time within which to appeal against the decision of an adjudicator under the Body Corporate and Community Management Act 1997 (“the Act”). The decision sought to be appealed against was given on 23 December 2004. By s 289(2) of the Act an aggrieved person may appeal to the District Court against a decision of an adjudicator but only on a question of law. By s 290(2) the appeal “must be started within six weeks after the date of the adjudicator’s order, but the court may allow the appeal to be started at a later time on application by a prospective appellant.” In the present case, the notice of appeal was not filed until 8 August 2005. What has been argued today is simply the question of whether there should be an extension of time within which to appeal, although to some extent the merits of the proposed appeal have been touched on.
- [2]Section 290(2) confers an unfettered discretion on the court in relation to an extension of time. Nevertheless, in my opinion it is necessary for an applicant seeking an extension of time for appeal to demonstrate that there is some good reason why this particular appeal should be allowed to proceed notwithstanding a failure to exercise the right of appeal within the time specified by the Act.[1] I accept that it is relevant to consider, to some extent at least, the merits of the proposed appeal in relation to that question, and also any explanation for the delay in filing the notice of appeal, and whether the respondent has suffered any prejudice as a result of that delay.[2]
Background
- [3]In order to understand the significance of the application to the adjudicator, and the significance of what was to be decided, and to some extent in order to understand the reasons of the adjudicator for the decision from which the appeal is sought to be brought, it is necessary to set out some background information. The applicants as owners of a lot in the respondent body corporate were sued in the magistrates court by the respondent some time ago for unpaid body corporate levies. By the time the matter came to a determination by the magistrate, the unpaid levies had been paid, but there was an order made ultimately in the magistrates court that the appellants pay the respondent certain costs in connection with that proceeding.[3] Those costs were to be assessed by a registrar, and were ultimately assessed, at an amount of less than $1000.
- [4]An application for leave to appeal to the District Court against that order was filed, but was dismissed by another judge on 20 February 2002. An application for leave to appeal to the Court of Appeal against that dismissal was filed, and was ultimately dismissed by the Court of Appeal. In the meantime, an application for assessment of costs and costs statement were filed in the District Court pursuant to the order for costs made on 20 February, and came on for assessment before a deputy registrar. At that point, the applicants sought to challenge the entitlement of the respondent to recover the costs claimed in the costs statement, on the basis that no liability for costs had ever been validly incurred by the respondent, so that no amount was recoverable from the appellants, under the indemnity principle. It is now established that this is a matter which the deputy registrar could determine[4] but it does not appear that the deputy registrar has ever in fact determined this.
This application to the adjudicator
- [5]The committee of the body corporate proposed to call an extraordinary general meeting of the body corporate, to be held on 6 August 2004, in order to pass various resolutions dealing with the question of legal costs. The applicants are still owners of a lot in the building, and therefore notice of the extraordinary general meeting was given to them. Prior to the meeting being held, an application was made for an order of an adjudicator, by way of interim relief, essentially restraining the body corporate from holding the meeting, and, by way of final relief, seeking 19 orders dealing with various aspects of legal costs associated with the proceedings against the applicants, and subsequent applications for leave to appeal, essentially seeking to frustrate any attempt by the body corporate to do anything which might overcome any technical deficiencies in the process by which legal costs had been incurred by the body corporate in connection with legal proceedings involving the applicants. It appears, however, that no such interim order was made, or at least no interim order was made prior to the time when the extraordinary general meeting was held. Various resolutions were carried at that meeting.
- [6]An adjudicator under the Act does not hold a hearing as such; rather there are submissions in writing obtained from relevant persons, and ultimately a decision in writing is provided, together with reasons. A history of this matter is set out in some detail in the reasons of the adjudicator. The matter was complicated by the fact that, just after this application was filed, an adjudicator gave a decision on an application which had been filed on a previous occasion by one of the applicants which was primarily challenging four resolutions of the body corporate at a general meeting of 30 October 2003, that purported to ratify various steps taken in the proceedings against the applicants, and purporting to authorise the solicitors retained by the respondent to take all necessary steps to pursue costs orders against the applicants. The body corporate was given the opportunity to respond to the application, and solicitors for the body corporate sought an extension of time to respond, which was granted. The adjudicator by an interim order granted the extension of time, and ordered the body corporate not to take any further steps to implement resolutions passed at the extraordinary general meeting on 6 August 2004. The submissions on behalf of the body corporate were forthcoming on 12 October 2004. On 2 November 2004 the adjudicator requested further information from the body corporate, which was provided on 10 December 2004, and on 20 December 2004 the applicants provided their response in relation to these further submissions.
The decision of the adjudicator
- [7]The body corporate had submitted that the application was frivolous, vexatious, misconceived and without substance. The adjudicator rejected the proposition that the application was frivolous, but found that it was vexatious, misconceived and without substance, and therefore dismissed the application. In arriving at that conclusion, the adjudicator went through the various relief sought and decided in respect of each either that it was without substance, or that it was not appropriate to decide the matter that the appellants ought to raise.
- [8]As to the latter point, one of the matters particularly sought to be raised by the appellants was that, when something had not been done in accordance with the mechanism prescribed under the legislation, the body corporate in general meeting could not subsequently validly ratify what had been done. Accordingly, the appellant’s position was that, insofar as there had been any failure to comply with the legislation, that was incurable by a general meeting. That was a point that the adjudicator declined to determine, essentially on the basis that that point did not need then to be determined, but could be left to some appropriate proceeding when it was necessary to determine whether or not the purported validation was effective. He gave as an example a situation where someone was being sued by the body corporate to recover money paid under a process which had been ratified, and pleaded the ratification by way of defence. It may well be that an alternative way in which it could be decided is on the assessment of costs by the deputy registrar.
- [9]The adjudicator also took into account that there was some duplication between the issues raised in this application and the issues raised in the 2003 application, which issues were not abandoned after the 2003 application had been decided. He also commented on the significant volume of the application, and the attempt to dispute the validity of matters that had been previously litigated or determined. The application was supported by 42 pages of written submissions, and had annexed to it a further 11 documents or bundles of documents. The adjudicator also took into account that much litigation had already taken place and that the applicants had done little to reduce their application to clearness and definiteness. Authority was cited justifying taking into account each of these matters.
- [10]Further, the adjudicator noted that:
“The applicants showed a tendency to object to every possible irregularity irrespective of the triviality of that irregularity. I am not satisfied that the application as a whole is frivolous. However, I note that one dissatisfied owner could severely disrupt the decision-making process of a body corporate by making an application in respect of every smallest irregularity in committee procedure. I caution the applicants that meetings of body corporate committees, and general meetings of body corporate members, will not be declared void on the basis of minor irregularities that do not significantly impact on the ability of members to participate in the decision-making processes of their body corporate. If further applications are made on purely technical matters without evidence of any real detriment claimed from the irregularity then those further applications would be at risk of being dismissed on the basis that they are frivolous.”
- [11]That tendency was also manifest in the course of the submissions before me on the hearing of this application, and the following day on the argument of an appeal against a different decision of the adjudicator. There is no reason to think the rest of the comments of the adjudicator in that paragraph were properly the subject of any criticism.
Explanation for the delay
- [12]The third applicant, who is acting as solicitor for the applicants, agreed that she was aware of the decision on 25 January 2005; apparently she was not aware of it earlier than that, notwithstanding it was delivered about a month earlier, because she was away on holidays. She also conceded that she was aware at the time that there was a limit of six weeks for an appeal. The third applicant is a solicitor, and therefore ought to have appreciated the significance of time limitations in relation to appeals. She discussed the possibility of an appeal with counsel, but then decided, perhaps with the benefit of some advice from counsel, to attempt to challenge the decision in another way.
- [13]She wrote to the Commissioner’s office on 23 March 2006 a lengthy letter complaining to the commissioner about the behaviour of the adjudicator, and the following day a letter to the same effect was sent to the office of the relevant minister. This in my opinion amounted to a deliberate choice to pursue a method other than appeal as a means of attempting to overcome the decision. As a general proposition, where there is a decision not to appeal, either because of a determination to do something else, or simply an acceptance of the decision at first instance, it is more difficult to obtain an extension of time within which to appeal because the prospective appellant has subsequently changed her mind.[5]
- [14]In any case, there was a response in May 2006 indicating that the alternative methods sought to be pursued were not going to be successful and pointing out that there was a right of appeal under the statute. Even then, there was no prompt filing of a notice of appeal, or an application for an extension of time within which to appeal. The notice of appeal was not filed until 8 August 2005. There was no proper explanation in the material for the further delay between May and August. Reference was simply made to some delay in obtaining necessary information or documents from counsel. That is not a proper ground to justify a delay of this length, particularly coming as it does on top of a delay which is not justified anyway from January until May. The explanation for the failure to file a notice of appeal earlier does not in my opinion encourage a sympathetic response to the application for an extension.
Prejudice to the respondent
- [15]The next question is whether there is prejudice to the respondent. No particular prejudice to the respondent as a result of the delay in instituting the appeal was identified. There is inevitably some prejudice to a respondent from the fact of the appeal, and from the fact that additional legal costs may be incurred in connection with the application for an extension of time. Ordinarily the latter could be met by giving an extension of time on terms that the applicant pay the respondent’s costs in connection with the extension of time. In the present case, however, there is the further difficulty that the applicant challenges still the validity of the retainer by the body corporate of the solicitor and counsel to appear before me. It is not necessary or appropriate that I decide anything about the validity of that challenge, but given the matters that have been referred to by the adjudicator and the history of this matter generally, the fact that any order that I might make for costs is likely to generate a further dispute on the part of the applicants suggests that the prejudice associated with the extra costs involved in an application for an extension of time will be more significant than would ordinarily be the case. That is not in itself a matter of great moment, but I do not think it is irrelevant.
Merits of the appeal
- [16]In relation to the merits of the matter, the principal reason which the appellant advanced as the matter sought to be ventilated in the course of the appeal is the question of whether there can be a retrospective authorisation or validation of matters not undertaken in accordance with the statute and regulation governing the conduct of a body corporate. The argument was advanced not so much in terms of the general question of whether something which had not been properly done can be validly ratified later, but more particularly on the basis that any purported validation in this case was not valid. I have decided the general question of law concerning the validation of acts not done in accordance with the act and regulation at the time in a separate appeal, the appeal involving the third applicant which was argued the following day in relation to another decision of the adjudicator, so there is no need for this appeal to proceed in order for that question to be decided, particularly in circumstances where the decision is not the one sought by the applicants. Insofar as there were characteristics of these ratifications which are sought to be challenged by the applicants, that was not something decided by the adjudicator, so the substantial question becomes whether this was something the adjudicator ought to have decided.
- [17]Essentially, the adjudicator proceeded on the basis that these issues did not arise in the determination at this stage, and that therefore it was not appropriate to decide them. That on the face of it was a reasonable approach for an adjudicator to adopt, and nothing said by the applicant has suggested that that necessarily involves any error of law on the part of the adjudicator. Arguing that, if the matter had been decided, it ought to have been decided in a particular way, does not address the question of whether the matter ought to have been decided. In my opinion, no substantial ground has been shown by the applicant to dispute the conclusion that it was not appropriate to decide those issues, which the adjudicator declined to decide.
- [18]The adjudicator’s position was that he was not deciding whether the resolution was defective, simply declining to declare it void. If the resolution was not effective, for some reason, then that will remain the position. If that is the situation, the dismissal of the application did not give the resolution any greater effectiveness than it would have otherwise had. On the other hand, by declaring the resolution void, he would have deprived the respondent of the opportunity of arguing, perhaps successfully, in any proceeding where the issue arose for determination, that the resolution was effective. That seems to me to be a very good reason for him not to decide the point, and indeed for me not to decide the point on appeal.[6] In those circumstances, any appeal looks somewhat unpromising. It also shows that in this respect the applicants do not suffer any prejudice by being unable now to appeal.
- [19]There was then a resolution directed towards authorising further expenditure. The adjudicator indicated that it should be treated as authorising expenditure only up to $15,000, but did not think that there was any satisfactory basis upon which he could declare the resolution void and of no effect. On this point, I do not say that there is no arguable case to the contrary, but that in itself is not a sufficient reason to give an extension of time within which to appeal. It must be remembered that this application, and the proposed appeal, is an attempt to frustrate attempts by the body corporate to enforce costs orders which have been made, and which may be made in the future, against the applicants, or the third applicant, in relation to the earlier court proceedings, or other proceedings. It does not seem to me that there is any great injustice if the applicants, having failed to protect their technical legal position in a timely way, are now unable to pursue what I regard as essentially unmeritorious arguments.
- [20]Whether or not the applicants’ position has any technical legal merit, in my opinion it clearly has no other merit. To the extent that the applicants’ intransigence in relation to the matter of the legal costs which were incurred in attempts to recover body corporate levies which ought to have been paid in a more timely fashion has led the body corporate, or someone, to incur legal expenses, there is no particular reason why the court should be astute to assist the applicants to escape any obligation to pay or contribute towards those expenses. Similar arguments apply in relation to the other resolution in respect of which the adjudicator determined that the applicants’ submissions did not satisfy him that any satisfactory basis had been shown to declare the resolution void and of no effect.
Merits as to the costs order
- [21]With regard to the order for costs, there is a statutory power to order costs of up to $2,000 in circumstances where an application is dismissed on this ground: s 270(3) of the Act. On the face of it, the adjudicator has approached the exercise of discretion under that section on a proper basis. Again, the principal basis upon which this order was challenged by the applicants was that costs had not been properly incurred in resisting the application, and therefore the respondent had no real liability to costs, and therefore it was not appropriate to make an order for costs.
- [22]It is unnecessary to determine whether there is any substance in this argument, and the submissions advanced on the part of the applicants. I am not specifically deciding that there was no substance in any of those submissions. They do, however, appear to me not to be substantial. Insofar as there was any deficiency in relation to the operation of the Act and regulation governing bodies corporate, the adjudicator was in a good position to decide that, and his decision in that respect is not obviously wrong.
- [23]The applicants also relied on the Queensland Law Society Act 1952, and submitted that there had been failure to enter into a proper costs agreement under the Act. That may well be the case, but that Act does not prohibit solicitors from recovering costs if there is no costs agreement. Section 48I(1) of that Act provides that in the absence of a costs agreement the solicitor is only entitled to recover scale costs, or if there is no applicable scale, reasonable costs.[7] There is, as far as I know, no applicable scale for costs associated with resisting an application to an adjudicator under the Act. The adjudicator determined in this case that the amount claimed by the body corporate was reasonable in the circumstances. In these circumstances, the finding that the costs were reasonable on the face of it means that they are recoverable as far as the Queensland Law Society Act is concerned. The submission of the applicants to the contrary in relation to that Act is therefore unpersuasive.
- [24]There is also the consideration that the order was for an amount of only $2,000, so there will be no great injustice to the applicants if they have by their dilatory pursuit of their rights lost the opportunity to challenge successfully an order that that sum be paid, particularly in circumstances where there seems to be no reason to doubt that the respondent has been put to expense,[8] and no doubt trouble, by the application to the adjudicator.
- [25]In all the circumstances, in my opinion this is clearly not a case where it is appropriate to exercise the discretion to allow an extension of time within which to appeal. The applicants initially chose to protect their position by a process other than appeal, which is not a good reason to delay appealing. They were well aware of their rights to appeal and the time within which to appeal as soon as they were aware of the decision. Even once other avenues were unsuccessful, there was no prompt attempt to pursue any appeal. The position of the applicants is unmeritorious, and there appears to be no compelling reason to think that any real injustice has been done by the adjudicator’s orders in this matter. Without deciding that there is no merit in anything in a technical sense in any of the submissions made on the part of the applicants, the prospects on appeal are unpromising.
- [26]Overall, in my opinion there is no good reason to allow the applicants now to pursue rights of appeal which could have been but were not pursued in a timely way. Accordingly, the application for an extension of time within which to appeal is dismissed. The appeal is struck out. I order the applicants to pay the respondent’s costs of and incidental to the application, and the appeal, to be assessed. That does not involve any finding or determination as to whether any and what costs have been validly incurred, but it seems highly likely that there will have been at least some costs validly incurred, and there is no good reason why the applicants should not pay them.
Footnotes
[1] Cf. Tyler v Custom Credit Corporation Ltd [2000] QCA 178 at [5].
[2] Civil Procedure Queensland para [r 748.5] and cases there cited; R v Nguyen [2001] QCA 144.
[3] These costs were claimed not as costs in the proceedings but as a debt payable under the by-laws then in force, and hence on a solicitor and client basis.
[4] Casey v Quabba & Anor [2006] QCA 187.
[5] See for example R v Fatnowna [1999] QCA 456 at [7], [16].
[6] I am not at all sure that the Court is not being asked to give what is in substance an advisory opinion on these matters.
[7] Subsection (1)(c) speaks of reasonable costs assessed by a tribunal costs assessor, no doubt because of the mechanism for resolving disputes as to quantum of costs established by the Act. But it is clear from the scheme of the Act as a whole that assessment by such an assessor is not a prerequisite to the determination of reasonable costs; for example, costs which are reasonable can be sued for in the absence of such an assessment if the assessment process is not activated by the client.
[8] Or at least someone has been put to expense in defending the position of the respondent.