Form time to time a body corporate in strata title developments is required to make decisions, some of which can be contentious. As a result of a recent decision of the High Court in the case of Ainsworth & Others v Albrecht and Another (also known as the Viridian case), clarity has been given in relation to what constitutes a body corporate acting reasonably in body corporate decisions.

The Viridian case involved a unit owner in the Viridian Noosa Residences (Mr Albrecht) wanting to combine the balconies of two adjoining units to create one large balcony. This required the consent of the body corporate in a general meeting by way of a resolution without dissent (i.e. no objections to the motion). The body corporate put forward a motion to approve the new balcony but a number of unit owners voted against the motion. As a result, the motion failed.

Mr Albrecht took the matter to the adjudicator for the Commissioner for Body Corporate and Community Management who found that the body corporate had acted unreasonably. Several unit owners appealed the decision of the adjudicator in the Queensland Civil and Administrative Appeals Tribunal which found in favour of the body corporate. Mr Albrecht then appealed to the Court of Appeal which found in favour of Mr Albrecht.

The matter was finally determined in the High Court on appeal by the unit owners which affirmed the original decision of the body corporate to reject approval for the new balcony. The High Court concluded that courts will be likely to identify unreasonable opposition to a motion if (without being an exhaustive list):-

• the opposition could not, from any rational perspective,
• have any adverse effect on an opponent’s material rights, or
• the opposition is borne out of spite, ill will or desire for attention.

The case will not stop disputes arising regarding body corporate decisions but does give some clarity as to what may be regarded as acting unreasonably.

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This update is for your information and interest only. It is not intended to be comprehensive, and it does not constitute and must not be relied on as legal advice. You must seek specific advice tailored to your circumstances.