ACT CIVIL & ADMINISTRATIVE TRIBUNAL

UREN & ANOR v THE OWNERS – UNITS PLAN NO 396 (Unit Titles) [2017] ACAT 51

UT 2/2017

Catchwords: UNIT TITLES - works for which approval was refused by owners corporation: proposed construction of an extension to dwelling – unsuccessful motion at the meeting of owners corporation – two stage process in making a tribunal order under section 129 of the Unit Titles (Management) Act 2011: merits review of proposal and deciding whether opposition to the motion was unreasonable – requirement for merits review – characteristics of ‘unreasonableness’ – consideration of opposition to motion

Legislation cited: Unit Titles (Management) Act 2011 s 129

Cases cited: Ainsworth v Albrecht [2016] HCA 40Meaney v The Owners Corporation Units Plan 40 [2013] ACAT 72Owners Units Plan 768 v Lokusooriya [2013] ACAT 80Floro v Owners – Unit Plan No 630 [2017] ACAT 4

Tribunal: Senior Member P Sutherland

Date of Orders: 6 July 2017Date of Reasons for Decision: 6 July 2017

AUSTRALIAN CAPITAL TERRITORY )CIVIL & ADMINISTRATIVE TRIBUNAL ) UT 2/2017

BETWEEN:

CHRISTOPHER DAVID URENFirst Applicant

REBECCA VIVIENNE BLUNDELL Second Applicant

AND:

THE OWNERS – UNITS PLAN NO 396Respondent

TRIBUNAL: Senior Member P Sutherland

DATE: 6 July 2017

ORDER

The Tribunal orders that:

1. Pursuant to section 129(1)(g) of the Unit Titles (Management) Act 2011, the

Tribunal makes an order giving effect to the unsuccessful motion at the Special

General Meeting of Units Plan 396 held on 26 June 2016. The terms of the

motion, as amended by the Tribunal, are:

“We, the members of Units Plan 396, approve the proposed extension to Unit

3 as approved by ACTPLA in response to DA 201528514, on condition that:

(a) The design of the new window in Bedroom 3 must be provided to the

body corporate for approval by the owners of Unit 4. This approval

must be given within two weeks after provision of the design.

(b) The applicants must ensure that, during the period of construction of

the extension, all of their vehicles and vehicles of their invitees must be

parked on the applicants’ property, in the designated visitor parking

spaces, or outside the common areas of Units Plan No 396. These

vehicles must not be parked in the common areas of the access road

and the turning circle, or so as to impede vehicle access to Unit 4.

2. The parties and the owners of Unit 4 have liberty to apply in respect of

conditions (a) and (b) in Order 1.

3. There is no order as to costs.

………………………………..Senior Member P Sutherland

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REASONS FOR DECISION

1. This is an application made on 31 January 2017 by the joint owners of Unit 3 in

Units Plan No 396 for an order under section 129(1)(g) of the Unit Titles

(Management) Act 2011 (the UTM Act) giving effect to an unsuccessful motion

for a resolution of a Special General Meeting of Units Plan 396 held on 26 June

2016. The motion stated that “the proposed extension to Unit 3 as previously

shown to the body corporate and since approved by ACTPLA in response to

DA201528514 be approved”.

2. The respondent to the application is the owners corporation for Units Plan No

396, represented by its Secretary, Mr Leon Smith, who is a joint owner of

Unit 1. The applicant was represented by Ms Peta Rogers, Solicitor, Howes

Kaye Halpin.

3. The ACT Civil and Administrative Tribunal conducted a directions hearing on

15 February 2016 and listed the application for mediation on 10 March 2017,

commencing with the parties on site and resuming at the ACAT. The mediation

did not result in a settlement and Senior Member Robinson issued directions for

the filing of documents and witness statements by both parties in preparation for

a hearing at the ACAT on 6 June 2017.

4. The applicants, the Secretary of the owners corporation, and the various owners

of units in Units Plan 396 all prepared witness statements and attended the

hearing on 6 June 2017. Mr Darren Jenkins of Counsel appeared for the

applicants at the hearing, having been engaged only days earlier. The applicants

called one expert witness, Ms Giselle Ravarian, an urban designer and town

planner.

5. The hearing commenced with a view onsite at the property in Belconnen and

resumed at 11.30am in ACAT Hearing Room 5. The hearing concluded at

6.10pm and the decision was reserved.

6. In these reasons for decision, the tribunal is referred to as ‘the ACAT’ and

Senior Member Sutherland as ‘the Tribunal’.

Background to the Complaint

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7. Units Plan No 396 is located in Belconnen and comprises six well separated

units, each with substantial access to dense native vegetation on public land on

the slope of a major hill. Unit 1 is to the left of the site near the entrance and

above the common area access road through the site. Unit 2 is north of Unit 1

and is above and to the left of the access road. Unit 3 is north of Unit 2 and is

above and to the left of the access road and a turning circle at the end of the

access road. Unit 4 is at the end of the access road below and to the east of Unit

3. Unit 5 is opposite and below Unit 2 and Unit 6 is near the entrance of the site

and below the access road.

8. Units Plan No 396 was established more than 27 years ago and has a mix of

original residents and residents who have lived there for five years or more. A

document setting out the “Ethos” of the Units Plan was tendered in evidence.

This was dated 1996 with revisions in 2003, 2004 and 2011, and sets out some

rules for owners about parking, waste management, etc along with aspirational

statements about the ethos of the owners corporation and its emphasis on native

vegetation and community spirit. At the hearing, Mr Jenkins pointed out that the

document was not registered and therefore had no validity as rules of Units Plan

396.

9. In 2015, the applicants sought approval from the owners corporation for

construction of an extension to their premises. This motion was not passed at a

Special General Meeting on 19 November 2014, with the vote being two in

favour, three against and one abstaining.

10. The applicants proceeded to obtain approval of the extension by the ACT

Planning and Land Authority (ACTPLA) of DA 201528514. ACTPLA

approved the DA subject to the consent of the owners corporation.

11. At a Special General Meeting on 26 June 2016, the owners corporation again

failed to pass the motion with a similar vote: two in favour (Units 3 and 6);

three opposed (Units 2, 4 and 5) and one abstaining (Unit 1, on the basis that he

was Secretary of the owners corporation).

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12. The applicant did not accept this outcome and made an application to the ACAT

to have the unsuccessful motion given effect under section 129(1)(g) of the

UTM Act.

13. The development proposed by the applicants and approved by ACTPLA was an

extension to the southern corner of their house, adding 3.6 metres to the eastern

wall of the house to create a fourth bedroom and a new entry porch. The

proposed bedroom extension is symmetrical with a garage on the western corner

of the house.

Legislation and legal issues

14. Section 129(1) of the UTM Act lists a number of orders which the ACAT may

make in relation to a unit titles dispute.; It states:

(1)The ACAT may make the following orders:…(g)an order giving effect to an unsuccessful motion for a resolution of a general meeting (either as originally proposed or as amended by the ACAT) if the ACAT is satisfied after merits review of the motion that opposition to the motion was unreasonable;

15. The provision is unusual in that it marries two legal concepts, that of merits

review and that of unreasonableness. The issue of ‘unreasonableness’ in a

similar context in the Queensland unit titles legislation has been recently

considered by the High Court in Ainsworth v Albrecht [2016] HCA 40 at [54]-

[62].

16. The ACT provision has been considered in depth by the ACAT in several

decisions:

(a) Meaney v The Owners Corporation Units Plan 40 [2013] ACAT 72 where

(now) Presidential Member, Ms M-T Daniel, held that opposition to a

motion for the installation of four air conditioning units was unreasonable

and that an opposed motion for alteration of carport gates be given effect,

with amendments.

(b) Owners Units Plan 768 v Lokusooriya [2013] ACAT 80 where (now)

Presidential Member, Ms M-T Daniels, expanded on her observations in

Meaney; and

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(c) Floro v Owners – Unit Plan No 630 [2017] ACAT 4 where Senior

Member H Robinson followed the observations in Lokusooria and gave

effect to a motion for erection of a carport partially on common property,

where no contradictor appeared at the hearing of the matter.

17. From these decisions, I draw the following conclusions about how section

129(1)(g) is to be applied:

(a) The provision involves a two-step process, firstly to undertake a merits

review to determine which is the correct and/or preferable decision, and

then to determine whether opposition to the motion was ‘unreasonable’.

(b) The review is de novo and the Tribunal is able to consider issues of both

fact and law.

(c) The ACAT considers and determines issues as at the date of the hearing

and is able to consider evidence not available to, or not considered by, the

owners corporation at the time of their decision.

(d) When conducting the merits review, there is no threshold question of

reasonableness or unreasonableness of the original decision to be

determined before the ACAT may proceed to make an order. However,

before an order giving effect to an unsuccessful motion is made, the

ACAT must be satisfied that opposition to the motion was unreasonable.

(e) The test to determine if the opposition to the motion was unreasonable is

not a subjective test of the intentions of the unit owners who opposed the

motion. Rather, it is an objective test taking into account all relevant

circumstances.

(f) An opponent to the motion is not required to act with altruism or

sympathy for the interests of the proponent, at the expense of the

opponent’s reasonably held view of their own interests.

(g) Whether or not there is evidence of other pending applications, it may be

reasonable to consider the cumulative effect of multiple identical

improvements generating an adverse impact in deciding whether to

oppose a motion.

18. To the matters above concerning unreasonableness, the Tribunal would add that

opposition to a motion may be unreasonable where the opposition is based on

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discriminatory grounds that are unlawful in other contexts or where the grounds

for opposition are essentially de minimis, that is they are so minimal as to be

immaterial or subjective in their essential character.

19. In this case, a merits review of the proposal had been conducted by ACTPLA

and the parties were agreeable to the Tribunal accepting the ACTPLA approval

as its merit review process. Where the proposal has not previously been tested

in a merits review process conducted by a relevant government agency, the

merits review to be undertaken by the ACAT under section 129(1)(g) may need

to be more thorough, and canvass comparative issues in a detailed manner.

20. Mr Jenkins for the applicants submitted that the discussion of the High Court in

Ainsworth v Albrecht concerning the meaning of ‘reasonableness’ should be

read down as applying only to legitimate property rights established under

common law, contract or statute. The relevant property rights are the well-

recognised ‘bundle of rights’ that accrue to a holder of an interest in land, in this

case the owner of a unit title property.

21. The applicant submitted that:

...absent an easement or other contractual right, the general law does not recognise the right of any landholder to:

(a) An aspect or a view: Shepperd v Municipality of Ryde (1952) 85 CLR 1;

(b) Privacy, or freedom from overlooking or observation: Victoria Park Racing and Recreation Grounds Co Ltd v Taylor (1937) 58 CLR 479; and

(c) Light or solar access: Dalton v Angus (1881) 6 App Case 740 at 794-795; Ray v Hazeldine [1904] 2 Ch 1, Conveyancing Act 1919 (NSW), s179 applicable in the ACT by reason of the Ancient Lights Declaratory Act 1904.

It was submitted that the grounds for objections in this case were based on such

impermissible considerations. In the alternative, the applicants submitted that

the opposition to the resolution was unreasonable.

22. The Tribunal agrees that the High Court in Ainsworth v Albrecht was discussing

property rights, however this does not restrict the applicability of its discussion

of ‘unreasonable’ opposition in the specific context of the UTM Act. In context,

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and considering the primary role of the ACAT in unit title dispute resolution, in

my opinion the ACAT can have regard to the real issues in dispute between unit

title holders in an owners corporation, including privacy, visual amenity, noise

and other disturbances.

The hearing process

23. The hearing process for this matter presented some difficulties, including:

(a) the applicants were represented by counsel while the respondent owners

corporation was not legally represented;

(b) the applicants did not file relevant documents on time, leading to the

Tribunal and the respondent not having adequate time to prepare

responses and for the hearing;

(c) counsel for the applicants constantly drew the Tribunal’s attention to

procedural problems in the conduct of the respondent’s case, raising

points of law in relation to procedural fairness;

(d) the respondent owners corporation was represented by its Secretary with

the written authority of five of the six owners of units in the corporation.

This included the owner of Unit 6 who voted in support of the opposed

resolution and the Secretary who was a joint owner of Unit 1 and

abstained from the owners corporation vote, but was clearly opposed to

the motion on a personal basis;

(e) the representative of the owners corporation had difficulties in conducting

cross-examination in the face of frequent objections by counsel for the

applicants about what was permissible and relevant in cross-examination,

including in relation to the presentation of expert evidence; and

(f) the owners of Unit 5 initially were not available for cross-examination and

the arrangements for their evidence to be given by telephone were less

than satisfactory.

24. In drawing attention to these difficulties, the Tribunal is not criticising the

conduct of counsel for the applicants. Mr Jenkins explained to the Tribunal that

he was bound to represent the interests of his clients, however, within this

constraint, he assisted the Tribunal to make the hearing workable, particularly

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by making constructive suggestions about how procedural difficulties raised by

him could be resolved on a practical basis.

25. In a situation such as this where the various owners are in significant conflict

about the appropriate outcome of the litigation, the Tribunal suggests that it

would be preferable for the owners corporation to make a submitting

appearance and to make the opponents to the motion parties to the matter, either

individually or in concert.

26. However, where the members of the owners corporation are in general

agreement and the opposition to the motion is from a single individual owner or

a small minority of owners, it may be appropriate for the owners corporation to

be the respondent, with the arrangements for, and the costs of representation,

authorised by the owners corporation by resolution of the committee.

27. In this case, the view undertaken by the Tribunal at the commencement of the

hearing was extremely useful and the desirability of a view should be

considered at the directions hearing for matters of this type.

28. While the respondent’s representative, Mr Smith, had difficulty in prosecuting

his case in cross-examination, any potential disadvantage was compensated by

the excellent quality of the written documentation prepared by the respondent.

The case for the respondent was made very clear by the respondent’s

documentation (including the witness statements, statements of facts and

contentions, and responses) and by the final oral submissions, which were based

on a pre-prepared written document. The Tribunal expresses its appreciation for

the work undertaken by Mr Smith in presentation of the corporation’s case.

Consideration and findings

29. In relation to the issue of reasonable or unreasonable opposition to the motion,

the Tribunal identified the following grounds of opposition from the material

before it:

(a) An adverse effect on property values of units in the body corporate.

(b) Potential increase in traffic flows, parking pressures and noise in the body

corporate.

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(c) An effect on the privacy of Unit 2.

(d) Overlooking and an effect on the privacy of Unit 4.

(e) Loss of a sunlight amenity for Unit 4.

(f) Obstruction of access to Unit 4 by vehicles associated with the building

work.

(g) Overlooking and an adverse effect on the privacy of Unit 5.

30. In the consideration that follows, the residents of the various units who gave

witness statements, and who were cross-examined, are described collectively by

their Unit number.

(a) Property values

31. In written material prepared for the hearing, several witnesses for the

respondent raised the possibility that the value of units in the body corporate

may be reduced because of the increased number of bedrooms in Unit 3 and its

possible rental to a group seeking four bedroom accommodation. The applicants

had prepared counter evidence by an expert witness that unit values may be

enhanced by the approval of the extension.

32. At the hearing, the parties agreed that property values were not a matter of

pressing concern and that the Tribunal need not consider this issue. The witness

statement of an expert witness for the applicants was not admitted into evidence.

(b) Traffic, parking and noise

33. In written material prepared for the hearing, several respondents raised their

concern that the additional bedroom in Unit 3 may, at some time in the future,

lead to rental of the premises to a large group share with a consequent potential

for traffic and parking problems, noise, etc. Unit 1 (a four bedroom property)

had been rented to a group some years earlier and these problems had arisen on

that occasion.

34. All of the witnesses understood that the applicants were seeking to build a

fourth bedroom to provide a separate bedroom for each of their three children

and all were generally understanding of the desirability of this outcome for the

applicants. However, they submitted that this concern was outweighed by their

other, reasonable concerns about the extension.

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35. The Tribunal considers that this concern is highly speculative and, on an

objective basis, is not a reasonable ground for objection to the resolution.

(c) Unit 2 - Privacy

36. Unit 2, supported by other Units, submitted that the extension would bring the

large window of the new bedroom closer to Unit 2 and would adversely impact

on Unit 2’s privacy because of the angle of view and the placement of the rooms

in Unit 2.

37. Ms Ravarian’s response to this submission was unhelpful as she merely

reiterated that the extension complied with the DA. She did not respond to the

particular points made by Unit 2 and other witnesses.

38. In the Tribunal’s opinion, Unit 2 and Unit 3 are a substantial distance apart and,

objectively, there is no reasonable basis for this objection to the resolution.

(d) Unit 4 – Overlooking and privacy

39. Unit 4, supported by other witnesses, submitted that the extension would

significantly affect the amenity of Unit 4 through overlooking and reduced

privacy in their external living area. This concern appeared to the Tribunal to be

main concern of the other residents – probably more significant than the impacts

on their own properties.

40. In the evidence, there was considerable discussion about screening vegetation,

including what shrubbery would be removed or damaged during the

construction phase. There were also varying opinions about the visual impact of

the new eastern wall of the extension and the line of sight to the new works

from Unit 4.

41. The Tribunal was greatly assisted by the view and formed the opinion that the

actual visual and privacy impacts on Unit 4 of the extension itself will be

minimal. In the Tribunal’s opinion, objectively there is no reasonable basis for

this objection to the resolution.

42. In the ‘Documents as evidence to support the statements of the respondent’ (at

page 120), a design diagram shows installation of a new window in Bedroom 3

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and notes “Demolish external wall as reqd to install new timber bed 3 window

as noted. Make good”. There does not appear to be any further information on

the size and design of this new window which overlooks the external living area

of Unit 4 and will be cut into the existing blank, painted external wall at the

southern end of the house on Unit 3.

43. At the view, Mr Smith pointed out the location of the proposed new window

and drew the Tribunal’s attention to some floor to ceiling windows in the same

wall at the northern end of the house. In her report dated 2 May 2017,

Ms Ravarian stated: “The proposed extension entails a blank wall facing Unit 4

and therefore no overlooking or breach of privacy may be caused as the result of

this extension.” The Tribunal asked Ms Ravarian about the new window and

received the rather disingenuous reply that the extension does not have a

window facing Unit 4. When pressed, she agreed that a new window for

Bedroom 3 was part of the DA.

44. The Tribunal agrees that the new window will have an effect on the privacy of

Unit 4, but also notes that it is reasonable for Bedroom 3 to have a modest

window for amenity. On an objective basis, it would not be reasonable for Unit

4 to object to a modest window of appropriate design in Bedroom 3, given the

distance between their external living area and the bedroom wall, and the

substantial vegetation in place, mostly on the property of Unit 4. Accordingly,

the Tribunal finds that this is not a reasonable basis for objection to the Motion,

providing the new window is modest in size. The Tribunal will impose a

condition on approval, requiring the applicants to provide a copy of the

proposed design of the new window for consideration and approval by Unit 4.

The Tribunal notes that the window design must be compatible with the look of

the eastern wall of the property, must not be floor to ceiling, and must be

modest in size compared with the size of the external wall of Bedroom 3. If the

applicants wish to have more light in Bedroom 3, they could consider

installation of a skylight (with ACTPLA and owners corporation approval).

45. The process for obtaining approval by Unit 4 should involve:

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(a) provision of the proposed design to the owners corporation for on

forwarding to Unit 4;

(b) consideration of the design by Unit 4 for a period of up to two weeks; and

(c) advice of approval or recommendations for modifications by Unit 4 in

writing to the owners corporation and Unit 3 at or before the end of the

two week period.

46. The parties and Unit 4 have liberty to apply to the Tribunal if agreement is not

reached.

(e) Unit 4 – Loss of a sunlight amenity

47. Unit 4 submits that the extension will reduce the filtered warm orange light

from the setting sun which they enjoy during the afternoon at times of the year

around the two equinoxes. Mr Smith sought to give technical evidence about

this effect, but this was opposed by Mr Jenkins on the basis that Mr Smith was

not a technical expert. The Tribunal did not permit Mr Smith to give technical

evidence about the angles of the sun at the equinoxes and how the extension

would affect Unit 4. The Tribunal did, however, accept evidence about the

nature of the sunlight amenity and the possible effect of the extension on Unit

4’s access to the amenity.

48. Ms Ravarian’s report was originally prepared for the consideration of the DA by

ACTPLA and discussed shadowing effects only at the Winter solstice. The

report had no bearing on Unit 4’s actual submission about an effect on amenity

at the two equinoxes. In cross-examination, Ms Ravarian agreed that her study

was of the Winter solstice and that she was unable to give a technical opinion

about shadowing or sunlight during the equinoxes.

49. While the Tribunal accepts that the owners of Unit 4 enjoy a particular amenity

of afternoon sunlight during the equinoxes, it considers that this is a very

subjective consideration. After considering the line of sight from Unit 4 to the

proposed new extension, and the location of the existing garage on the property,

the Tribunal is not satisfied about the likelihood or extent of any loss of

amenity. In the Tribunal’s opinion, objectively there is no reasonable basis for

this objection to the resolution.

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(f) Unit 4 – Obstruction of access

50. Unit 4 gave cogent evidence of the disruption caused by previous renovations to

Unit 3, particularly through parking in the common areas of the access road and

turning circle between Units 3 and 4. Unit 4 pointed to serious obstruction to

access to their property, particularly when reversing out from Unit 4. The

Tribunal considers that this is a substantive objection, however it should not be

seen as a permanent blockage to the development when its impact will be felt

only during the construction phase (primarily because of parking in the common

area by construction workers who are invitees of Unit 4).

51. On an objective basis, it would not be reasonable for Unit 4 to object to the

development if on-street parking is strictly controlled by the applicants. The

driveway to Unit 3 is fairly large and could house several vehicles with no

adverse impact on Unit 4. If Unit 3 fails to comply with the Tribunal’s order and

condition, Unit 4 has liberty to apply to the Tribunal for enforcement action

under the ACAT Act.

(g) Unit 5 – Overlooking and privacy

52. Unit 5 and other units submitted that the extension would adversely affect the

amenity of Unit 5 through overlooking and reduced privacy. There is a

considerable distance between Unit 5 and Unit 3, and the view from Unit 5 to

Unit 3 is densely screened by vegetation and a wall. Ms Ravarian noted that the

extension would only have minimal impact on Unit 5. The Tribunal considers

that the extension will have no material impact on the privacy of Unit 5 and that

there would be impact only if Unit 5 were to remove the screening which is on

their land.

53. In the Tribunal’s opinion, objectively there is no reasonable basis for this

objection to the resolution.

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Conclusion

54. For the reasons set out above, the Tribunal concludes that the unsuccessful

motion at the Special General Meeting of Units Plan 396 held on 26 June 2016

should be given effect as amended by the order set out above.

………………………………..Senior Member P Sutherland

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HEARING DETAILS

FILE NUMBER: UT 2/2017

PARTIES, FIRST APPLICANT: Christopher David Uren

PARTIES, SECOND APPLICANT: Rebecca Vivienne Blundell

PARTIES, RESPONDENT: The Owners – Units Plan No 396

COUNSEL APPEARING, APPLICANT Darren Jenkins

COUNSEL APPEARING, RESPONDENT N/A

SOLICITORS FOR APPLICANT Peta Rogers, Howes Kaye Halpin

ADVOCATE FOR RESPONDENT Leon Smith, Secretary

TRIBUNAL MEMBERS: Senior Member Peter Sutherland

DATE OF HEARING: 6 June 2017

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