Lots in arrears for significant amounts of time

There has been a lot of chatter about the recent District Court of Queensland decision (BC for Mount Saint John Industrial Park CTS v Superior Stairs & Joinery Pty Ltd [2017] QDC 245).  There is a clause (S145) in the Body Corporate standard module regulations that states – If the amount of a contribution or contribution instalment has been outstanding for 2 years, the body corporate must, within 2 months from the end of the 2-year period, start proceedings to recover the amount.  In this judgement, the court is saying that because the Body Corporate did not take any action during those two years, it no longer has that right of redress.  The Limitations of Actions Act permits six years and most Bodies Corporate would be working on that understanding.

We are not lawyers, but we do think that the court has got it wrong.  In the Body Corporate Act and the associated regulations there are many clauses where the Body Corporate, Committee, lot owner, or other individual “must” do some action.  Where the action is not taken within the timeframe, there is usually a penalty associated with the inaction which has the potential to be enforced through the courts.  However, in all cases, the expectation remains that the action will still have to be completed.  Body Corporate Commissioner Adjudications make this very clear through their orders.

In this clause 145, no penalty for the inaction has been stated.  To say that the Body Corporate is no longer permitted to pursue the debt seems contrary to the entire regulation when read in the context that the Body Corporate must do many things and there are some ‘penalty sticks’ that can be used when the fail to do their duty but despite any imposed penalty, they will still need to complete their tasks.  We really hope that this case is overturned.