'Savoir Faire' Building Units Plan No 11752, Re [1995] QSC 218

IN THE SUPREME COURT OF QUEENSLAND No. 413 of 1995 Brisbane IN THE MATTER OF the Building Units and Group Titles Act - and - IN THE MATTER OF "Savoir Faire" Building Units Plan No. 11752 - and - IN THE MATTER OF an application by Savoir Faire La Dolce Vita Pty Ltd JUDGMENT - MOYNIHAN J Judgment delivered 01/09/1995 SUMMONS DISMISSED CATCHWORDS ORDER 64 RULES OF THE SUPREME COURT - summons sought interpretation of Building Management Agreement under Building Units Plan - whether issues raised by the summons could be appropriately determined under O.64 application Counsel: C. Brabazon Q.C. for the Applicant Mr G. Newton for the First Respondent J.C. Bell Q.C. for the Second Respondents Solicitors: Teys McMahon The Property Lawyers for the Applicant Thomson Redhead Boyd for the First Respondent James Conomos for the Second Respondents Hearing date: 10 July 1995 -- 1 of 8 -- IN THE SUPREME COURT OF QUEENSLAND No. 413 of 1995 IN THE MATTER OF the Building Units and Group Titles Act - and - IN THE MATTER OF "Savoir Faire" Building Units Plan No. 11752 - and - IN THE MATTER OF an application by Savoir Faire La Dolce Vita Pty Ltd JUDGMENT - MOYNIHAN J Delivered the First day of September, 1995 This is a summons brought under Order 64 seeking in effect a declaration that cl.14 of a Building Management Agreement (the Agreement) effecting property held under Savoir Faire Building Units Plan No. 11752 (the Plan). The issue is whether the building managers of the Savoir Faire complex in Park Road, Milton can lawfully charge and keep parking fees charged in respect of what is described as the public car park in the complex. The applicant (Savoir Faire La Dolce Vita Pty Ltd) is the registered proprietor of a lot under the Plan. The first respondent is the body corporate constituted pursuant to the Building Units and Group Titles Act 1980 (the Act) in respect of the Plan. The second respondents (Maureen Elaine and James Wharton) and the first respondent entered into the Management Agreement in respect of the complex on 28 October 1994. The provision of car parking on property coming under the Plan falls into two categories conveniently described as reserved and public. Reserved car parking spaces are part of lots held by registered proprietors under the Plan. Public car parking spaces are on what is held under the Plan as common property. -- 2 of 8 -- 2 The application seeks the resolution of a dispute concerning access to the latter spaces. The applicant contends there are no factual issues to be resolved for the present application to be disposed of. The applicant does not "raise any issue about severance". Not surprisingly the respondents do not necessarily share those perspectives. The Management Agreement was executed pursuant to a resolution of a general meeting of the first respondent held on 19 September 1994. At that time, by-law 27 of the Registered Building Unit By-laws relatively provided:- "27. Common Property Public Car Park 27.1 Part of the common property ("Public Car Park") is used for car park purposes by the employees, agents, clients, invitees and customers of the owners and occupiers of the lots so far as the limited capacity of the Public Car Park will permit. 27.2 (a) Subject to clause 27.1 the Body Corporate may refuse entry to the Public Car Park. (b) The Body Corporate shall not in any circumstances be liable for anyone for:- (i) any loss of and/or damage to any vehicle (including part of the vehicle or accessories or contents or articles left in the vehicle) occurring in the Public Car Park; (i) any loss and/or damage arising from doing or failing to do any act in relation to the activities in or keeping of the Public Car Park or the movement of any vehicle to or from the Public Car Park; and (iii) any personal injuries (fatal or non-fatal) sustained by any person in the Public Car Park. (c) The Body Corporate may grant to any person a licence to park a vehicle in such a car parking bay of the Public Car Park from time to time designated by the Body Corporate for such period of time and at such fee as the Body Corporate sees fit. 27.3 The owners and occupiers must at all times ensure their customers and invitees comply with the following:- -- 3 of 8 -- 3 (a) all signs placed in the Public Car Park by the Body Corporate and all reasonable directions and requests that may be made from time to time by the Body Corporate in respect of the Public Car Park or any vehicle in it; (b) that each motor vehicle using the facilities of the Public Car Park be parked wholly within a separate parking bay where parking bays are provided and not otherwise; (c) that no person in charge of a motor vehicle using the Public Car Park sounds the vehicle's horn unnecessarily or permits its engine to run for any longer time than is necessary; (d) that no vehicle be greased, oiled or repaired in the Public Car Park or any part of it; (e) that losses of or damage to the Public Car Park attributable to the spillage or discharge of grease, oil or other substances from any of the motor vehicles, be made good and that all such discharge is promptly removed." The first respondent was empowered to ensure that the public car park was not used in a manner which unreasonably interfered with the use and enjoyment of the car park by proprietors occupied and other authorised users (By-laws 21.1(d), 21.2, 27(3) and 51(d)). Clause 14 of the Management Agreement provides:- "14. The Buildings Manager may restrict access to the car park to those persons (other than the owners of Lots and their licensees who park vehicles in the car park space(s) owned by that owner) wanting to park vehicles who shall first have paid to the Buildings Manager a car parking fee. The car parking fee may be determined from time to time on casual (i.e. daily) car parking rates or on permanent (i.e. monthly) car parking rates. The car parking rates shall be such amount as is reasonable having regard to the then parking charges payable for car parking space in similarly situated areas in the City of Brisbane. The car parking fees paid or payable to the Buildings Manager shall be and remain the sole property of the Buildings Manager". By cl.7(b) of the Management Agreement everything done under the provisions of the agreement is then done as an agent of the body corporate (the first respondent). One of the second respondents (Maureen Elaine Wharton) deposes that prior to the -- 4 of 8 -- 4 regime put in place by the Management Agreement the public car park was used by customers and employees of local businesses outside the complex to the exclusion of customers and other invitees to the complex. Ms Wharton further deposes that there were complaints about interference and theft with and from vehicles in the car park. It is necessary to provide some description of the operation of the car parking arrangements under the Management Agreement as appears from the affidavit of Ms Wharton. An attendant is employed to control access to the public car parking spaces. This is done in accordance with notices which are displayed at the entry and in the vicinity of the car parking attendant's position. The system essentially involves the charging of specified rates to users of the public parking spaces. These are paid to the attendant on exit with specified remissions in the case of those with dockets validated by occupiers of premises in the complex. The system of charging applies between 10 a.m. and 9 p.m. Monday to Friday. Fees are not collected at other times. There are special arrangements involving free parking after 4 p.m. available to employees of businesses in the centre. Persons entering the centre desirous of using one of the public spaces have the system explained to them by the attendant and may leave if the arrangement is not acceptable. Otherwise the driver is directed to an available public parking space. Where the driver of a vehicle entering the car park is the owner of a reserved car parking space, or has the permission of such an owner, the driver is free to use the space without payment of a fee or any other interference by the parking attendant. The applicant's solicitor deposes that he is informed by one of its directors that neither he nor any employees, agents, clients, invitees or customers of the applicant may enter the car park located towards the rear of the premises (where the public car park is) without becoming liable for payment of a parking fee. To the extent to which that differs from the position set out earlier it is disputed. The applicant's argument in essence is that cl.14 gives the second respondents special -- 5 of 8 -- 5 privileges, the sole right to collect parking fees over the common property. Since s.30(7) of the Act has not been complied with, the arrangement is said to be void. That provides:- "30(7) Without limiting the generality of any other provision of this section, a body corporate may, with the consent in writing of the proprietor of a lot, pursuant to a resolution without dissent make a by-law in respect of that lot conferring on that proprietor the exclusive use and enjoyment of, or special privileges in respect of, the common property or any part thereof upon such terms and conditions (including the proper maintaining and keeping in a state of good and serviceable repair of the common property or that part of the common property, as the case may be, and the payment of money by that proprietor to the body corporate) as may be specified in the by-law and may, in like manner, make a by-law amending, adding to or repealing any by-law made under this subsection." The applicant submits that the statutory provisions cannot be avoided by saying that they do not apply to the second respondent in their capacities as managers under the Management Agreement. Furthermore it is submitted that clause 14 of the Management Agreement is ultra vires the provisions of by-law 27 which are to the effect that the first respondent is authorised to set and collect parking fees and not the second respondents. It is submitted by the first respondent that the present proceedings are not apposite to resolve the dispute between the applicant and the respondents. This is first because the issue of severance ought be determined in the same proceedings as those in which it is determined (assuming that be the outcome) that cl.14 is void. Secondly the first respondent submits these are factual issues which arise for determination making the dispute one which it is inappropriate to determine as a constructive summons. The second respondents contend for the validity of the agreement in terms which it is submitted on their behalf that cl.14 is severable and, apparently, that that can be dealt with on the summons if the applicant's arguments prevail. In my view, the summons gives rise to issues not appropriately determined on an application under O.64. To attempt to restrict the question to be determined on the application to whether the -- 6 of 8 -- 6 second respondents can lawfully charge and keep the parking fee for the public part of the car park seems to me too narrow approach. From this perspective the question more accurately is whether the agreement between the first and second respondent confers on the second respondent's special privileges in respect of the common property or any part of it and requires a by-law made by resolution without dissent under s.30(7). It may moreover be too narrow an approach to say that the special privilege is constituted by agreeing that the second respondents may lawfully charge and keep the parking fee for the public car park. These considerations to my mind give point to the first respondent's contentions that the appellant has not accepted the facts deposed to as founding a need to control parking and to provide for security of the car park. In this context the first respondent also puts in issue the assertion (made by the prayer for relief in the originating summons) that the Management Agreement purports to authorise the second respondent to conduct a car parking business "for its own profit on the common property of the first respondent" in circumstances where the agreement purports to empower the second respondents to refuse entry to the applicant, its employees, agents, clients, invitees or customers without payment of a fee. As I have said, there may be an issue as to the latter contention. The first respondent does not accept that it is or establish to be the fact that the second respondents conduct the car parking business "for their own profit" on the common property. It may be, for example, that the obligations in respect of the control of car parking make it unprofitable and it then may be a question of whether there is a special privilege. I think too that the point made by the first respondent about severability, and notwithstanding that the second respondent's submissions, is well made. The first respondent made reference to the decision in Humphreys v. The Proprietors "Surfers Palm North" Group Titles Plan 1955 (1994) 68 A.L.J.R. 479 to point to the flexibility and factual bases of the separability approach in that case. It is not, to my view, so simple as saying that the -- 7 of 8 -- 7 Agreement defines the second respondent's duties (in cl.3) and remuneration (in cl.23(k)) and the schedules. There is no evidence upon which any conclusion could be reached about the significance of the deletion of cl.14 on the remainder of the manager's rights, obligations and remuneration. Under the Management Agreement the second respondents have duties extending far beyond those in relation to the conduct of the car park. These relate to maintenance, seeing that the complex is kept in good order and repair, security, the removal of waste and so on, so as to "supervise the operation (of the complex) as a first class commercial and retail establishment". In my view the issues which seem to arise directly or by implication from the applicant's contentions should be properly defined (by pleadings) and the factual aspects of them (some of which are apparently contentious) determined. I would therefore dismiss the summons. Subject to submissions to the contrary, costs should follow the event. -- 8 of 8 --