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Chairperson took a risk, it did'nt work out, now we have an illegal fence - Can we sue?

By A John on Sun, 25 Nov 2018 at 13:47

Trustees obtained permission from members, through a majority vote, to erect a new fence.

What was not agreed was to erect this fence beyond the perimeter of the property. This decision by the chairman to do so, meant that the new fence would be erected on Council land ( Public Open Space in a Heritage Protection Overlay Zone) .

The chairman claimed the fence plans were approved, and yet the plans approved were plans for the erection of a fence on the scheme's property boundary.

While an application to lease Heritage land had been submitted, and the chairman had been advised by a council employee that it was a “low risk” that the lease would not be approved, the risk still existed and this opinion was clearly not the official and necessary approval required.

The lease application had been submitted, but not approved.

We repeatedly pointed out that proceeding without permission ie a lease, would be wrong and reckless. Trustees proceeded without the lease of land nor approved plans for same.

Permsion to lease the land has now been denied, and we have an illegally erected fence.

Despite the rule which protects trustees from personal liability in the decisions that are made, we feel that it is unfair that body corporate funds will be used for re-positioning the fence to the property boundary.

From reading the S.T.O forums, essentially, if trustees are not deliberately causing harm, then their liability is limited. While we have tried to reason with the Chairman from the onset to not proceeded until a lease was signed, we feel his deliberate action has involved the trustees into a reckless action and subsequently the unnecessary waste of body corporate money.

Furthermore, would trustees be permitted to use body corporate funds for legal fees to prevent their own liability in this regards if they are challenged?


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RE: reckless advantage

Murray Bennett replied on Sun, 25 Nov 2018 at 22:10

Every trustee, agent, other officer or servant of the BC is indemnified by the BC against all costs, losses, expenses and claims which he or she may incur or become liable to by reason of any act done by him or her in the discharge of his or her duties. However, trustees will not be entitled to such indemnification if the costs, expenses or claims were caused by his or her mala fide or grossly negligent act or omission. The question as to whether an act or omission is grossly negligent is open to interpretation by the courts. It is generally accepted that gross negligence is hard to prove and that a favourable decision by the court is more the exception than a rule.

RE: RE: reckless advantage

A John replied on Thu, 17 Jan 2019 at 09:49

Many thanks M Murray for your reply and wisdom.

RE: Chairperson took a risk, it did'nt work out, now we have an illegal fence - Can we sue?

Graham Paddock replied on Fri, 30 Nov 2018 at 11:51

The chairperson may be at fault, but was he the only person who knew of the risk? I am surprised that the professional consultants did not blow the whistle. And could owners have been expected to know any of the risks and do anything about them?

Once you are quite clear on who is to blame, you can propose a body corporate resolution to take action against the culprit(s). ...Show More

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RE: RE: Chairperson took a risk, it did'nt work out, now we have an illegal fence - Can we sue?

A John replied on Thu, 17 Jan 2019 at 09:50

Many thanks Professor Paddock, what a privilege to have you reply in person. Gratitude for all you do to the industry.

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