Closing facilities in a body corporate

14 April 2020

It has been well publicised that bodies corporate must close their swimming pools. However, how that is to take place has been a practical issue begging more questions than answers.

Why must pools close?

The Public Health Act 2005 (Qld) specifically gives Queensland’s Chief Health Officer (CHO) the power to give any direction the CHO considers necessary to protect public health to assist in containing or responding the spread of COVID-19 within the community.

On 31 March 2020, the CHO make the fourth “Non-essential business, activity and undertaking Closure Direction” that a person who owns, controls or operates a swimming pool must not operate the swimming pool (Directive). This includes a pool in shared facilities such as hotels and apartments but does not include a private backyard swimming pool.

Accordingly, any common property swimming pools which are owned, controlled and operated by the body corporate, must be closed by the body corporate.

The maximum penalty for non-compliance is $13,345.

How can the pool be closed by the body corporate?

Not surprisingly, the Body Corporate and Community Management Act 1997 (Qld) (BCCMA) does not deal with the ability of the committee to close facilities of the scheme during the COVID-19. What it does deal with is the decision making power of the committee and that a decision changing the rights, privileges or obligations of owners of lots requires general meeting authorisation. There is no exception allowing the committee to make this decision in special circumstances.

Closing the facilities of the scheme would amount to a restricted issue. This was confirmed in Villanella [2017] QBCCMCmr 248 where the adjudicator relevantly provided:

If there is a safety issue or some other problem with the pool that rendered it unusable, the Body Corporate could potentially resolve to close the pool but that would be a restricted issue for the Committee.

We understand that there would be many committees nervous about exceeding their powers and hesitant to close the pool in contravention of the BCCMA.

What should the committee do?

Calling and holding a general meeting to make the decision to close the pool (which would take at least a month now) would put the body corporate in the position where it would contravene the Directive.

Contravening the Directive is by far a more serious and detrimental option than the committee exceeding its decision making powers in the BCCMA in circumstances where:

  1. The committee can later ratify its decision to close the pool at the next general meeting – remedying any BCCMA contravention;
  2. If for whatever reason the general meeting ratification was unsuccessful, we cannot see how such a decision would be reasonable, such that an adjudicator could overturn the decision not to ratify the committee’s conduct; and
  3. If an occupier or owner took issue with the committee’s decision to close the pool and did make an application in the Commissioner’s Office, the committee should take comfort in the position that:

(a) an adjudicator can make an order that is just and equitable in the circumstances.

(a) non-compliance is not always fatal, particularly when the body corporate is acting in good faith. The District Court decision of Wei-Xin Chen v Body Corporate for Wishart Village CTS 19482 provided:

“The very detailed provisions of the standard module regulation … make it almost inevitable that from time to time there will be non-compliance. Equally though the provisions of the Act make it clear that non-compliance of an insubstantial nature will not be allowed to imperil the actions of bodies corporate or their committees, particularly in the instance of committees where actions are taken bona fide.”

(c) the Commissioner’s Office has indicated in relation to COVID-19 that it would take a more flexible approach to non-compliance. For example, in relation to meeting procedure the Commissioner’s Office stated:

“Provided that bodies corporate make reasonable endeavours to comply with the legislative requirements for holding general meetings, instances of non-compliance that do not affect the voting outcomes will be unlikely to affect the validity of meetings.”

How is the pool closed?

The committee should authorise the pool closure by passing a resolution. The following template can be used:

“That the committee:

  1. pursuant to the “Non-essential business, activity and undertaking Closure Direction (No. 4)” (Direction) closes the swimming pool until the Direction is revoked and not replaced with a similar direction requiring the closure of the swimming pool; and
  2. authorises the placement of notices around the scheme, and sending of communication to owners and occupiers in relation to the closure of pools; and
  3. submits a motion for the next general meeting to ratify the committee’s decision to close the swimming pool”

Notices should then be put up around the scheme and communication should be sent to all owners and occupiers in relation to the swimming pool being closed and the reasons why.