SP61285 v Taylor: collateral challenges
The Owners – Strata Plan No. 61285 v Taylor [2022] NSWCATCD 48
In short
A strata committee can authorise the commencement of legal proceedings.
A decision of the Tribunal binds the parties and can only be challenged by appeal or application to a superior court to quash the decision; such a decision is not subject to a “collateral challenge” within the Tribunal in different proceedings.
A collateral challenge is available in respect of an administrative decision but not a judicial act.
Background
In prior proceedings, the owners corporation obtained orders for the respondent lot owner to remove and reinstate alterations to the common property. The owners corporation sought the imposition of a civil penalty under section 247A for noncompliance with that order. The respondent argued that the reinstatement works would be in contravention of the Building Code of Australia.
The law
Section 247Aof the Strata Schemes Management Act 2015 provides that the Tribunal may require a person to pay a penalty of up to $5,500 for the contravention of an order under the Act.
Issues
Three issues arose for determination:
Did the owners corporation properly authorise the commencement of the penalty proceedings?
Are the original orders susceptible to challenge as contrary to the BCA?
Was there a section 247A contravention?
Decision
Authorisation of proceedings
The respondent argued that the owners corporation should have approved the commencement of proceedings in general meeting, or otherwise have resolved in general meeting to delegate those functions to the strata committee.
The Tribunal held that the strata committee is able to exercise all of the functions of the owners corporation, save for those express exclusions in section 36(3). Secondly, section 36(2) states that in disagreement, the decision of the owners corporation in general meeting prevails, indicating that they may each determine the same subject matter.
A strata committee resolution was deemed sufficient to commence the penalty application.
Orders subject to challenge for BCA noncompliance
The assertion that compliance with the Tribunal’s orders to reinstate the common property would give rise to a breach of the BCA was considered to be a “collateral challenge” to the decision—being an attack on the decision outside the course of an appeal.
The Tribunal directed parties to High Court authority (Ousley v The Queen (1997) 192 CRL 69) that a collateral challenge was only available in respect of an administrative decision but not a judicial act. A judicial decision binds the parties and can only be challenged by appeal or application to a superior court to quash the decision.
Contravention of section 247A
The respondent conceded that the works remained outstanding so the contravention was established.
Next steps
The proceedings are listed for further hearing to determine whether a penalty should be imposed, and if so, how much.