Symes v The Proprietors Strata Plan No 31731 [2003] NSWCA 7
The New South Wales Court of Appeal allowed a lot owner's appeal, in a dispute under the Strata Titles Act 1973 (NSW), from a Supreme Court judge's decision on a case stated by the Strata Titles Board, holding that the body corporate could not first argue before the judge that a wall it had conceded was common property was not, as evidence could have been called before the Board to meet the point, and remitted the matter with orders protecting the owner from its costs.
What the court decided
Douglas Symes, the appellant, called Mr Symes here, bought Unit 32 in August 1994 and found water entering its level 11 area [4]. The respondent, The Proprietors Strata Plan No 31731, is called here the body corporate; the two have since disputed who must fix the problem [4].
Heydon JA gave the only reasons; Sheller JA and McClellan J agreed [1], [85].
The strata plan, for a Wollongong building, was registered in January 1987 [3]. In 1996 the Strata Titles Commissioner ordered the body corporate, under its duty in the Strata Titles Act 1973 (NSW) to maintain and repair the common property, to rectify water penetration through the floor or at floor level into Unit 32 [7].
The eastern wall of the lot, dividing it from lot 34, was known as the No 3 wall; the wall between its sunroom and deck was the No 2 wall [5]. On the body corporate's appeal, the Strata Titles Board held it not liable to rectify water entering the sunroom at floor level or through the No 3 wall, the sunroom not being legally built for habitable use [10]–[11]. On the case the Board stated, Barrett J dismissed Mr Symes' appeal [14]. He declared that the No 2 wall, the No 3 wall and the surface tiles were not common property [18]. Mr Symes appealed from those orders by leave [2], [15].
Heydon JA held that the declaration about the No 2 wall should not have been made, accepting Mr Symes' argument that nothing in the stated case raised its status [20], [22].
Before the Board, both sides had treated the No 3 wall as common property, and the stated case recorded that as a finding of fact [25]. Heydon JA did not decide whether its status was a question of fact or of law [26]. Only in its address before Barrett J did the body corporate contend that the wall had not existed when the plan was registered [36]. Barrett J allowed the point as a decisive question of law [38].
Mr Symes relied on the principle in Coulton v Holcombe (1986) 162 CLR 1 that a point cannot be taken later if, had it been raised below, evidence could by any possibility have been given to prevent it succeeding [29]. An affidavit from the surveyor who prepared the plan, annexed to an affidavit Mr Symes had leave to file in the Court of Appeal, showed that such evidence existed, though Heydon JA said it did not necessarily defeat the evidence Barrett J relied on [33]–[34]. His Honour held that the principle should have stopped Barrett J entertaining the point [34]. The principle applies whether the new question is central or marginal [40]. Although its application can have discretionary aspects, Heydon JA saw no reason not to apply it here [51].
Heydon JA held that the court rule allowing a stated case to be added to, sent back or supplemented by evidence did not displace the principle [49]. If Barrett J thought the point open, which Heydon JA called controversial, he should have sent the matter back or taken the evidence himself, procedural fairness outweighing delay and cost [50]. The tiles findings were likewise outside the stated case [59]–[61].
The first two grounds of the notice of contention were that the body corporate had no duty to repair or had not breached it [68]. They turned mainly on whether the sunrooms were unlawfully built; Heydon JA left them undecided for want of reasoned analysis below, which the body corporate's course had caused [70]–[71].
The Court allowed the appeal and set aside Barrett J's declaration, his dismissal of the appeal and his costs order [84]. It declined to answer the stated case questions itself or to declare, as Mr Symes asked, that the No 3 wall was common property [75]–[76]. Mr Symes' grounds 15 and 16, about the slab, were not upheld [66]. The Court remitted the matter to the Equity Division for a single judge to consider afresh [76], [84]. Heydon JA said the remitter should be understood as not permitting the body corporate to reopen whether the No 3 wall is common property, given its agreement before the Board [77]. Otherwise either party may argue what was fairly open on the case stated [71].
The body corporate was ordered to pay Mr Symes' costs of the appeal and of the hearing before Barrett J, the latter levied on lots other than lot 32 in proportion to unit entitlements [84]. Heydon JA founded that levy order on section 229(2) of the Strata Schemes Management Act 1996 (NSW) [82]. The Court also ordered that none of the body corporate's own costs be payable by Mr Symes, identifying section 76(1)(b) of the Supreme Court Act 1970 (NSW) as a source of power, given doubt whether the proceedings were under Chapter 5 of the Strata Schemes Management Act 1996 (NSW) [83]–[84]. It made both orders without any amendment of the notice of appeal [83].
Why it matters
The decision did not resolve who must rectify the water penetration; that question went back to the Equity Division [76], [84].
Where the solicitor for the body corporate had himself treated the wall as common property before the Board, and evidence could have been called to meet a contrary point, the body corporate could not withdraw that position on the appeal or on the remitter [24]–[25], [34], [77]. Its attempt to withdraw the concession caused the hearing below to miscarry, so it bore Mr Symes' costs there [78]. Solicitors conducting such hearings should consider early what they treat as common ground about the building.
In New South Wales a lot owner could seek a levy order of this kind under section 229(2) [79], [82]. Mr Symes first sought it late, saying it had been omitted by oversight; the Court made it, limited to the costs below and with unit entitlement proportions, without any amendment [79]–[80], [82]–[83]. Asking for such an order at the outset avoids the point.
The repair duty arose under the Strata Titles Act 1973 (NSW) [7]. The levy order rested on the Strata Schemes Management Act 1996 (NSW) as the Court applied it [82]. The order about the body corporate's own costs drew also on the Supreme Court Act 1970 (NSW) [83]. Readers should check the legislation now in force in New South Wales, and the Victorian position, which this decision does not address.
Numbers in square brackets are paragraph numbers of the judgment. This note summarises a decided case for education and is not legal advice. See how the notes are written.