QUEENSLAND CIVIL AND 
ADMINISTRATIVE TRIBUNAL

CITATION:	Midep Pty Ltd ATF Mipadel Investment Trust v Body Corporate for SWELL Coolangatta CTS 54750 [2024] QCAT 241	
PARTIES:	midep pty ltd AS trustee FOR mipadel investment trust	

(applicant)	

	v	
	body corporate for swell coolangatta cts 54750	

(respondent)	

APPLICATION NO/S:	OCL046-22	
MATTER TYPE:	Other civil dispute matters	
DELIVERED ON:	7 June 2024	
HEARING DATE:	26 April 2024	
HEARD AT:	Brisbane	
DECISION OF:	Member King-Scott	
ORDERS:	1.	There be an adjustment of the contribution schedule lot entitlements and interest schedule lot entitlements for the scheme in accordance with the Schedule attached to this order;
2.	The body corporate, within 45 days of this order, lodge a new community management statement incorporating changes to the contribution schedule lot entitlements and interest schedule lot entitlements for the lots included in the scheme in accordance with these orders.
3.	The Respondent pay the Applicant’s costs fixed at $6,600.00.	
CATCHWORDS:	REAL PROPERTY – STRATA AND RELATED
TITLES – MANAGEMENT AND CONTROL – BODY
CORPORATE: POWERS, DUTIES AND LIABILITIES – 
adjustment of community title scheme – principles for
deciding schedule lot entitlements – principles for setting
and adjusting contributions schedule lot entitlements –
principles for deciding interest schedule lot entitlements adjustment by tribunal of contribution schedule – first community title scheme – lots included in the scheme not consistent with the deciding principle for the lot entitlements –an adjustment of the contribution and interest schedule – criteria for deciding just and equitable circumstances – lodgement and recording of changes to contribution and interest schedule lot entitlements
Body Corporate and Community Management Act 1997
(Qld), s 46A(1), s 46B, s 47B, s 47B(1), s 47B(1)(a),
s 47B(7), s 47B(8), s 48(5), s 48(6), s 49, Schedule 6
Body Corporate and Community Management (Standard Module) Regulation 2020 (Qld)
Queensland Civil and Administrative Tribunal Act 2009
(Qld), s 100, s 102(1)

Fischer & Ors v Body Corporate for Centrepoint CTS 7779 [2004] QCA 214
Locke & Ors v Stanton Crest Stage 2 Body Corporate [2014] QCAT 433
Robertson and Robertson v Airstrike Industrial Pty Ltd [2011] QCAT 120	
APPEARANCES & REPRESENTATION:	

Applicant:	
Self-represented	

Respondent:	
M de Waard instructed by OMB solicitors	

REASONS FOR DECISION
[1]	The respondent, SWELL Coolangatta CTS 54750 (‘Swell’), is a residential apartment complex located at 15 Dutton Street Coolangatta. It was constructed between February 2020 and July 2021 by the developer Kirra Beach Developments Pty Ltd (‘Kirra’). Swell comprises 24 residential apartments over 4 levels, a yoga/BBQ/spa recreation area on the level 5 roof and a basement car park. 
[2]	The ground floor has 2 x three bedroom apartments and 4 x two bedroom apartments while other levels have 1 x three bedroom apartments and 5 x two bedroom. All apartments have 2 bathrooms and either 1, 2 or more car parks. There is a common lift servicing each level and the roof and a common garbage chute on each apartment level taking occupant rubbish to the basement bins.
[3]	Kirra has retained 11 of the 24 Lots in Swell, being Lots 1 to 6 (all level 1), Lot 11 on level 2, and Lots 19, 21, 22 and 23 on level 4.
[4]	The applicant, Midep Pty Ltd as Trustee for Mipadel Investment Trust (‘Midep’) entered into a contract to purchase Lot 18 on 13 August 2018 and the Contract settled on 21 October 2021. 
[5]	Midep has applied for an adjustment of the contribution schedule lot entitlements (‘CSLE’) and the interest schedule lot entitlements (‘ISLE’) in relation to the body corporate.
Requirements of the Scheme
[6]	The Scheme is governed by the Body Corporate and Community Management Act 1997 (Qld) (‘the Act’) and the Body Corporate and Community Management (Standard Module) Regulation 2020 (‘Standard Module’). 
[7]	The Act requires a body corporate scheme to have a contribution schedule and interest schedule which are contained in the community management statement (‘CMS’) for the scheme.
[8]	The CMS contains a schedule that sets out each lot in the scheme in two columns, the contribution schedule lot entitlement (CSLE) and the interest schedule lot entitlement (ISLE). The entitlements are expressed as a number for each lot adding up to a combined total sum for the entire scheme.
[9]	The contribution schedule is, generally, the basis for calculating the lot owner's share of amounts levied by the body corporate and for voting on an ordinary resolution. The interest schedule is the basis for calculating the lot owner's share of common property and the lot owner's interest on termination of the scheme, including the lot owner's share in body corporate assets on termination of the scheme and the value of the lot, for the purpose of a charge, levy, rate or tax that is payable directly to a local government, the Commissioner of State Revenue appointed under the Taxation Administration Act 2001 (Qld) or other authority and that is calculated and imposed on the basis of value.
[10]	A body corporate is established on the registration of a CMS with Titles Queensland along with a survey plan identifying the scheme land. Kirra was registered as the original owner. 
[11]	Section 66 sets out in detail the requirements of the scheme including the details of how the schedule lot entitlements have been decided. The scheme was registered on 3 August 2021. 
[12]	Schedule A to Swell Coolangatta First CMS sets out the lot entitlements as follows:
Lot on Plan	Contribution	Interest	
Lot 1 	46	46	
Lot 2 	39	39	
Lot 3 	39	39	
Lot 4 	35	35	
Lot 5 	41	41	
Lot 6 	39	39	
Lot 7 	41	41	
Lot 8 	39	39	
Lot 9 	39	39	
Lot 10 	36	36	
Lot 11 	40	40	
Lot 12 	58	58	
Lot 13 	40	40	
Lot 14 	39	39	
Lot 15 	36	39	
Lot 16 	36	36	
Lot 17 	40	40	
Lot 18 	57	57	
Lot 19 	40	40	
Lot 20 	39	39	
Lot 21 	39	39	
Lot 22 	39	39	
Lot 23 	44	44	
Lot 24 	56	56	
TOTALS	1000	1000	
[13]	The following notation is recorded under Schedule A.
In accordance with section 66(1)(db) of the Body Corporate and Community Management Act 1997 (’Act’), the contribution schedule principle under section 46(7) of the Act on which the contribution schedule lot entitlements have been decided is the relativity principle (as defined in section 46A of the Act) in that the contribution schedule lot entitlements are not equal due to the nature, features and characteristics of the lots, the impact the lots may have on the costs of maintaining the Common Property, and the market values of the lots.
In accordance with section 66(1)(dc) of the Act, the interest schedule principle under section 46(8) of the Act on which the interest schedule lot entitlements have been decided is the market value principle (as defined in section 46B of the Act) in that the interest schedule lot entitlements must reflect the respective market values of the lots, except to the extent to which it is just and equitable in the circumstances for the individual lot entitlements not to reflect the respective market values of the lots. It is not considered that any circumstances exist for which it is just and equitable for the interest schedule lot entitlements not to reflect the respective market values of the lots.
[14]	Section 47 of the Act sets out the general principles for the application of lot entitlements. 
47	Application of lot entitlements
(1)	…
(2)	The contribution schedule lot entitlement for a lot is the basis for calculating—
(a)	the lot owner's share of amounts levied by the body corporate, unless the extent of the lot owner's obligation to contribute to a levy for a particular purpose is specifically otherwise provided for in this Act; and
Note–
The regulation module applying to a community titles scheme might provide that a lot owner's contribution to some or all of the insurance required to be put in place by the body corporate is to be calculated on the basis of the lot's interest schedule lot entitlement.
(b)	other than for the owner of a lot included in a specified two-lot scheme, the value of the lot owner's vote for voting on an ordinary resolution if a poll is conducted for voting on the resolution.
(3)	The interest schedule lot entitlement for a lot is the basis for calculating—
(a)	the lot owner's share of common property; and
(b)	the lot owner's interest on termination of the scheme, including the lot owner's share in body corporate assets on termination of the scheme; and
(c)	the value of the lot, for the purpose of a charge, levy, rate or tax that is payable directly to a local government, the Commissioner of State Revenue appointed under the Taxation Administration Act 2001 or other authority and that is calculated and imposed on the basis of value.
(4)	Neither the contribution schedule lot entitlement nor the interest schedule lot entitlement for a lot is used for the calculation of the liability of the owner or occupier of the lot for the supply of a utility service to the lot if the amount of the utility service supplied to each lot is capable of separate measurement, and the owner or occupier is billed directly.
[15]	Section 47A sets out the rules for adjustment of a contribution schedule by resolution of the body corporate without dissent. Section 47AA applies if a motion under s 47A is passed without dissent but a lot owner believes the contribution schedule as changed by the resolution is not consistent with whichever of the principles (the relevant principle) in s 47B(3)(a) or (b) was used as the basis for the change. The application may be made to an adjudicator or QCAT but is limited to whether it is consistent with the relevant principle. In this case there has been no motion to change the lot entitlements.
Tribunal’s jurisdiction to adjust the contribution schedule under Section 47B
[16]	The Tribunal can adjust the contribution schedule under s 47B(3)(b) of the Act. However, if it does so, the adjusted CSLE for the lots included in the community titles scheme must-
(a)	be consistent with the deciding principle for the existing contribution schedule lot entitlements, and be just and equitable to the extent the deciding principle allows; or
(b)	if there is no apparent deciding principle for the existing contribution schedule lot entitlements, be just and equitable.
[17]	The Act makes it abundantly clear that if there is a deciding principle, the Tribunal cannot change the deciding principle.
Tribunal’s jurisdiction to adjust the interest schedule
[18]	A lot owner of a community titles scheme may as of right apply under s 48 of the Act exercising the Tribunal’s original jurisdiction.
[19]	The order of the Tribunal must be consistent with the market value principle, as applied in relation to the respective market values of the lots included in the scheme when the order is made.
[20]	If the Tribunal orders an adjustment of the interest schedule, the body corporate must, as quickly as practicable, lodge a request to record a new community management statement incorporating the adjustment ordered.
Midep’s application
[21]	Midep’s application seeks adjustment of the CSLE and ISLE and is made under s 47B(3)(b) and s 48 respectively of the Act. I note that Swell assumes that Midep’s application was made under s 47AA(3)(b) of the Act. However, there has been no further CMS other than the first CMS and no motion under s 47A of the Act to enliven an application under s 47AA(3)(b). The submission by Swell on this issue appears to be misconceived.
[22]	Section 47B relevantly provides:
47B	Adjustment of contribution schedule for particular schemes by order of specialist adjudicator or QCAT
(1)	This section applies if—
(a)	…
(2)	This section also applies if—
(a)	a community titles scheme is established after the commencement of this section; and
(b)	there has been no change to the contribution schedule lot entitlements for the lots included in the scheme arising from—
(i)	a resolution passed under section 47A; or
(ii)	an order of a specialist adjudicator or QCAT mentioned in section 47AC; or
(iii)	a decision in relation to an appeal from an order of a specialist adjudicator or QCAT mentioned in section 47AC; and
(b)	the owner of a lot included in the scheme believes the contribution schedule lot entitlements for the lots included in the scheme are not consistent with the deciding principle for the lot entitlements.
(2A)	In addition, this section applies if—
(a)	…
(3)	The owner of the lot may apply—
(a)	under chapter 6, for an order of a specialist adjudicator for an adjustment of the contribution schedule for the community titles scheme; or
(b)	as provided under the QCAT Act, for an order of QCAT, exercising the tribunal’s original jurisdiction, for an adjustment of the contribution schedule for the scheme.
(7)	If the specialist adjudicator or QCAT orders an adjustment of the contribution schedule, the adjusted contribution schedule lot entitlements for the lots included in the community titles scheme must—
(a)	be consistent with the deciding principle for the existing contribution schedule lot entitlements, and be just and equitable to the extent the deciding principle allows; or
(b)	if there is no apparent deciding principle for the existing contribution schedule lot entitlements, be just and equitable.
(8)	If the specialist adjudicator or QCAT orders an adjustment of the contribution schedule, the body corporate must, as quickly as practicable, lodge a request to record a new community management statement incorporating the adjustment ordered.
Maximum penalty—100 penalty units.
Note—
Under section 46(10), a change to a lot entitlement takes effect on the recording of the new community management statement incorporating the change.
(9)	To remove any doubt, it is declared that, if there is a deciding principle for the existing contribution schedule lot entitlements, the specialist adjudicator or QCAT can not change the deciding principle for the lot entitlements.
[23]	The pre-conditions to application under s 47B(2) of the Act have been satisfied for Midep to make an application under s 47B(3)(b). The issue that Midep’s application raises is its belief that the CSLE for the lots included in the scheme are not consistent with the deciding principle for the lot entitlements.  
[24]	The deciding principle in relation to the contribution schedule is stated in the First CMS to be the relativity principle. 
[25]	Midep requests that the Tribunal make the following orders:
(a)	the CSLE be amended to reflect the equality principle, pursuant to section 46A(1) of the Act;
(b)	in the event that the CSLE is not amended to reflect the equality principle, that the CSLE be amended to reflect the relativity principle, pursuant to section 46A(2) of the Act;
(c)	the ISLE be amended to reflect the market value principle, pursuant to section 46B(1) of the Act and
(d)	the Applicant be reimbursed its costs, in the amount of $9,703.80, for obtaining various advices in preparing and filing the Application.
[26]	Midep’s detailed submissions in support of those orders are set out below.
[27]	I note that as there is a deciding principle  for the existing contribution schedule being the relativity principle the Tribunal cannot change the deciding principle. That being so, the issue to be determined is whether the current contribution schedule is consistent with the relativity principle and is just and equitable to the extent that the relativity principle allows. 
[28]	The relativity principle is defined in section 46A of the Act.
46A	Principles for deciding contribution schedule lot entitlements
(1)	... 
(2)	The relativity principle for deciding contribution schedule lot entitlements for the lots included in a community titles scheme is the principle that the lot entitlements must clearly demonstrate the relationship between the lots by reference to 1 or more particular relevant factors.
(3)	A relevant factor for subsection (2) may, and may only, be any of the following—
(a)	how the community titles scheme is structured;
(b)	the nature, features and characteristics of the lots;
(c)	the purposes for which the lots are used;
(d)	the impact the lots may have on the costs of maintaining the common property;
(e)	the market value of the lots.
History leading up to the First CMP
[29]	Midep signed the contract with Kirra on 13 August 2018. At that time the Disclosure Document revealed that the Lot 6 apartment was 127 m2 and had one car park. The CMS attached to the document notes under the Schedule of Lot Entitlement contained the notation that CSLE would be based on the Equality Principle. The ISLE would be based on the Market Value Principle. In respect of the equality principle reference, there is a note that … It is not considered that any circumstances exist for which it is just and equitable for the contribution schedule lot entitlements not to be equal.
[30]	On 28 August 2020 Midep received a further Disclosure Document. The Survey Plan attached showed changes to the car park layout and to Lot 6, which increased Lot 6 to 196 m2, comprising an additional car park and 35 m2 of storage in the basement level. The size of Lot 4 also was increased by 26 m2 by the addition of a tandem car park.
[31]	The proposed Community Management Plan included with the Disclosure Document showed the CSLE was still based on the Equality Principle even though the Lot Entitlements were not equal. Lot 6 was showing as having 39 units for both CSLE and ISLE despite increasing in size by over 50%.
[32]	On 4 September 2020, Mr Payne, a director of Midep, through its solicitors, requested from Kirra a copy of the quantity surveyors report used to determine the Lot entitlements under the original Disclosure Statement and the updated Disclosure Statement. The surveyor’s report was not provided.
[33]	On 11 December 2020 a further Disclosure Statement was received from Kirra which updated the CMS and stated that … the contribution schedule principle under section 46(7) of the Act is the equality principle. However, the Schedule of Lot Entitlements was updated so that the CSLE was now based on the Relativity Principle with the notation … are not equal due to the nature, features and characteristics of the lots, the impact of the lots may have on the costs of maintaining the Common Property, and the market value of the lots. It was submitted that this was so despite there being no changes to the nature and characteristics of any lots or the building other than Lot 6 and Lot 4. The lot entitlement for Lot 6 remained at 39 despite the material changes to that Lot, and Lot 4 remained at 41 despite the addition of a tandem car park. Indeed, there was no change in any of the lot entitlements. No explanation was provided for the change in principle. The principle and allocation of units for the ISLE had not changed for any lots, despite the material changes to Lot 6 and Lot 4 which, it was submitted, must have affected their market values.
[34]	On 22 December 2020 the solicitor for Kirra provided a response to the request for information regarding the basis for determining the Lot Entitlements. The solicitor confirmed that the advice from their client was that the method used to calculate the contribution and interest schedules of entitlements were based on ‘the total square meters per unit, including patios and car spaces. Included was a spreadsheet showing the detailed calculation per Lot. It was submitted by Midep, that not only did the basis not appear to be a proper factor to take into account for the CSLE principles (and irrelevant for the ISLE), the areas for Lot 6 and Lot 4, and indeed other lots, had been increased over a year earlier, such that the areas calculated were wrong.
[35]	Midep settled its purchase of Lot 18 on 21 October 2021. At Settlement, the final First CMS was received from Kirra. The CMS disclosed that the CSLE was determined by the Relativity Principle and the ISLE was determined by the Market Value Principle.
[36]	In respect of the CSLE, the lot entitlements for Lot 6 had not changed from the original 39 units despite the lot’s characteristics materially changing which required adjustment even under the Relativity Principle. In addition, Lot 6 had been allocated an Exclusive Use area of 173 m2 on the rooftop that Midep says was never disclosed to it by Kirra at any stage of the development.
[37]	In respect of the ISLE the lot entitlements for Lot 6 have not changed from the original 39 units despite the change in characteristics of the Lot 6 by the additions that were made including the rooftop Exclusive Use area. It is submitted by Midep that these changes must have affected the market value of Lot 6 and therefore the unit allocations were wrong.
[38]	At Settlement the applicant received the final Survey Plan. This showed Lot 6 had another storage space of 12 m2 added, giving a total of 205 m2 (excluding the rooftop 173m2 exclusive use area). The Plan also showed that the tandem car park previously allocated to Lot 4 had been switched to Lot 5 and its area increased to 165 m2.
[39]	The above history sets out the development of the scheme but is largely irrelevant to the issues I am asked to determine as the First Community Title Scheme did not come into existence until 3 August 2021. 
[40]	Midep may have had a basis to rescind the Contract on the basis of the inaccuracy of the statements or inconsistency in the deciding principle. However, it decided to proceed to settlement of the Contract.
[41]	I also note that, under section 48A of the Act which sets out the criteria for deciding whether the CSLE is consistent with the deciding principle, the Tribunal cannot have regard to the knowledge and understanding that Midep had at the time it entered into a contract to buy the lot. It entered into the Contract on 13 August 2019 which settled on 21 October 2021.
[42]	Although the history of the development of the scheme is largely irrelevant to the application for adjustment of the CSLE and ISLE, the history does cast doubt on the methodology by which Kirra arrived at the lot entitlements. The lot allocations have never changed over the period from 13 August 2018 to the first CMS on 3 August 2021, yet the areas of some lots and allocation of car parks and exclusive use areas have significantly changed during the period.
Herron Todd White Valuation Report
[43]	Midep engaged Mr Scott Walker of Herron Todd White (‘HTW’) to provide a valuation report of the Swell apartments. Mr Walker is a Certified Practising Valuer. The report values the property as of 17 January 2022 at $19,465,000. Mr Walker provided individual valuations for each apartment which are set out later in these reasons. He was only able to inspect apartment 13 and 18. His report assumes that the fit out and appliances are the same or of similar quality for all of the apartments. There is no evidence to suggest that this assumption is incorrect.
[44]	Swell criticises the report as being too old and not reflective of current values. Mr Walker stated in cross examination that the report is a snapshot in time which is the case with any valuation report. It was put to Mr Walker that there had been sales since his report that were much higher than his valuations. Mr Walker reiterated that the valuations in the report were as of 17 January 2022 and that subsequent sales did not invalidate his report.
[45]	Mr Walker opined that although floor area was relevant to the value of the property, nine times out of ten it was the level the apartment was on that determined its value. The higher up the greater value. Higher levels had better views and less traffic noise. 
[46]	Cross examined about recent sales and that Lot 15 sold at a higher price than Lot 22, Mr Walker commented that it was within the acceptable error range of 5% to 10%. He conceded that the values of the lots may be significantly different if he was to value them today, but I did not understand him to mean that there would be any significant change in the comparative difference in value between individual lots. The percentage difference between individual lots would remain essentially the same.
[47]	I should interpolate here that although a number of new sales were put to Mr Walker by Counsel for Swell, no evidence was led by Swell to substantiate the sales.
Swell’s response
[48]	Swell opposes the orders sought by Midep and seeks orders that  the application be dismissed on the basis that it is frivolous, vexatious or misconceived or lacking in substance. It relies on the following grounds:
(a)	the Tribunal does not have the jurisdiction to change the deciding principle for the lot entitlements. It relies upon s 47B(9) of the Act which provides that if there is a deciding principle for the existing CSLE it cannot be changed.
(b)	Midep relies only on an outdated valuation report, which does not, in any way, consider a number of relevant factors which are used when deciding the CSLE under the relativity principle.
(c)	Midep’s reliance on the HTW Report is substantially lacking in substance as the report fails to give genuine consideration, or consider a number of factors, which reasonably impact the market values of lots in the Scheme.
(d)	Midep has provided no supporting evidence confirming why it is "appropriate in the interests of justice" for the Respondent to reimburse the Applicant’s costs.
[49]	Although the claim that the application is frivolous, vexatious or misconceived or lacking in substance in itself lacks substance, I do agree with the first proposition that the Tribunal cannot change the deciding principle for the CSLE once it has been established. The deciding principle has been established as the “relativity principle” and that cannot be changed by the Tribunal.
[50]	Swell submits that Midep has made its application under s 47AA(3)(b) of the Act. That is clearly incorrect as its application has been made under s 47B(3) as it has satisfied s 47B(2) of the Act.
[51]	Swell also refers to the decision of the Court of Appeal in Fischer & Ors v Body Corporate for Centrepoint CTS 7779 for the proposition that the starting point should be that the lot entitlements should be equal. That may be true in part in relation to ISLE but I note the decision predates the substantial amendments made in 2010.
[52]	Swell refers to and relies on section 46A(2) of the Act in seeking the dismissal of Order 2, which provides that lot entitlements must clearly demonstrate the relationship between the lots by reference to 1 or more particular relevant factors. It says that the market value of the lots is only one (1) factor which may be used to decide the CSLE and that Midep has really only relied upon the market value for deciding the CSLE. It does not refer to any of the other factors.
[53]	I note that Kirra’s solicitors advised on 22 December 2020 by email that the method used to calculate both schedules was the “total square meters per unit, including patios and car spaces.”
[54]	It further submits that if the CSLE was decided only by reference to the market value, then Swell submits that the CSLE ought to be adjusted each time the market value for the lots increases (or decreases).
[55]	In relation to the application to adjust the ISLE Swell criticises the HTW Report which it says Midep relies upon to adjust the lot entitlements. It notes that the HTW Report, which proposes an "assessed value" for each of the 24 lots in the Scheme, was completed on or about January 2022 approximately 12 months after the Scheme was developed and is no longer current.
[56]	Swell relies upon s 48(5) of the Act which provides that if the Tribunal were to make an order to amend the interest schedule, it would need to be an order that applies the market values at the time the order is made. The relevant section is not as unambiguous as stated by Swell. What the section 48(5) says is that:
The order of the specialist adjudicator or QCAT must be consistent with the market value principle, as applied in relation to the respective market values of the lots included in the scheme when the order is made.
Midep says what the section requires is that the lots be present when the order was made not a requirement to have a market value at the time. 
[57]	Swell relies upon a decision of a Specialist Adjudicator in Style on Louis. In that decision the Specialist Adjudicator was critical of the valuation for a number of reasons being the purpose for which the valuation was made (for a mortgagee), that it was made before the scheme was developed and although it considered a range of values for each unit it did not take account of the actual sale values of each unit. The valuation was in May 2018 and the decision of the Adjudicator was made in March 2021.
[58]	Swell criticises the HTW Report as it does not provide any advice as to the reasonableness of the current unit entitlement schedule, nor does it provide any advice as to any changes that should be made to the unit entitlement schedule.
Decision
Contribution Schedule
[59]	The issue in a nutshell is whether the CSLE for the lots are consistent with the relativity principle and just and equitable within that principle for the lot entitlements.
[60]	Floor areas (including car parks and exclusive use areas) based on the registered survey plan are reproduced below in Table 1. In addition, I have incorporated the Contribution Schedule entitlements.
Table 1
Unit No	Configuration	Contribution
Schedule lot
entitlements	Level	Inside
Area
(m2)	Outside
Area
(m2)	Car
(m2)	Gross Floor Area
(m2)	
1	2 bed 2 bath 1 car	46	G	94	35	13	142	
2	2 bed 2 bath 1 car	39	G	90	22	14	126	
3	2 bed 2 bath 1 car	39	G	85	22	14	121	
4	2 bed 2 bath 1 car	35	G	83	63	14	160	
5	3 bed 2 bath 3 car	41	G	106	14	30	150	
6	3 bed 2 bath 2 car	39	G	105	213	72	390	
7	2 bed 2 bath 1 car	41	1	98	19	15	117	
8	2 bed 2 bath 1 car	39	1	90	22	15	112	
9	2 bed 2 bath 1 car	39	1	89	22	15	111	
10	2 bed 2 bath 1 car	36	1	83	22	15	105	
11	2 bed 2 bath 1 car	40	1	102	14	15	116	
12	3 bed 2 bath 2 car	58	1	138	21	36	159	
13	2 bed 2 bath 1 car	40	2	98	19	15	117	
14	2 bed 2 bath 1 car	39	2	90	22	15	112	
15	2 bed 2 bath 1 car	39	2	89	22	15	111	
16	2 bed 2 bath 1 car	36	2	83	22	14	105	
17	2 bed 2 bath 1 car	40	2	102	14	18	116	
18	3 bed 2 bath 2 car	57	2	138	21	29	159	
19	2 bed 2 bath 1 car	40	3	98	19	14	117	
20	2 bed 2 bath 1 car	39	3	90	22	14	112	
21	2 bed 2 bath 1 car	39	3	89	22	14	111	
22	2 bed 2 bath 1 car	39	3	83	22	13	105	
23	2 bed 2 bath 1 car	44	3	102	14	14	116	
24	3 bed 2 bath 2 car	56	3	138	21	28	159	
[61]	The above floor areas include the rights of exclusive use that some of the apartments enjoy, particularly Lot 6 and Lot 4. Lot 4 enjoys 63 m2 exclusive use of a courtyard adjacent to its patio. Lot 6 enjoys 40 m2 adjacent to its patio, 12 m2 storage area in the basement and 173 m2 on the roof top.
[62]	It can be immediately seen that Lots 2 and 3 have the same lot entitlement of 39 as lot 6. Lot 6 is a 3-bedroom apartment and the other two are 2-bedroom apartments. Lot 6 has a far greater floor area than the other two lots. The 173 m2 exclusive use of roof top area may not be as valuable as other useful area though Lot 6 benefits solely from the solar panels erected in that area.
[63]	Lots 5 and 7 could not be considered to be similar although both had the same lot entitlement of 41. Lot 5 is a 3-bedroom apartment with 3 car spaces and Lot 7 a 2-bedroom apartment with one car space. Floor area is significantly different at 150 m2 and 117 m2 respectively. They have a different aspect and are on different floors but that would not justify the same lot entitlement of 41.
[64]	These are clear examples that the relativity principle has not been applied properly nor just and equitably within that principle.
[65]	The explanatory notes to the 2010 amendments to the Act contained the following comments in relation to the new s 46A and s 46B. In relation to s 46B it relevantly states:
The intention of the relativity principle is to provide a transparent rationale for calculation of contribution schedule lot entitlements that can be tailored to relevant characteristics of the scheme and its lots. This will give developers a structured, customisable framework within which to set contribution schedule lot entitlements.
The relativity principle requires that the contribution schedule lot entitlements must reflect the relationship between the lots, based on one or more of the factors set out in section 46A(3). The developer may choose, at their discretion, which factor or factors in section 46A(3) of the Bill will be used to calculate the contribution schedule lot entitlements.
The explanation of how contribution schedule lot entitlements are calculated forms part of the community management statement. If the relativity principle is used, the explanation should sufficiently demonstrate how it has been applied to determine individual contribution schedule lot entitlements for lots included in the scheme.
The relationship can be demonstrated using a formula if applicable, or by an explanation, including the chosen relevant factors and how they relate to the setting of individual contribution schedule lot entitlements based on the relevant characteristics of the scheme or lots.
Under the relativity principle, it is acceptable to have an unequal contribution schedule (or a purposefully weighted schedule) provided that the inequality demonstrates a relationship between lots, and that the relationship is based on relevant factors provided for in the Bill
[66]	Kirra, as developer, has not provided any specific explanation of how the CSLE has been determined. It has not explained the calculation of the lot entitlements and how they have been tailored to relevant characteristics of the scheme and its lots. It has not identified which factors it has used to calculate the lot entitlements or their relationship to the setting of the individual relationship of the lots other than to restate in the Schedule A to its CMS some of the factors in s 46B(3) of the Act.
[67]	The HTW valuation report noted that whilst the Survey Plan for the subject building included the car parking and basement storage areas in the total Surveyed Floor Area the author, Scott Walker, excluded these areas from the gross floor area calculations. Gross floor area for the subject apartments was recorded as living plus outdoor areas consistent with their analysis of the sales evidence.
[68]	The report recorded that the registered Survey Plan indicated 3 basement car spaces for Unit 5 comprising 2 tandem car spaces and 1 single car space. It was noted by the author that upon inspection that the single car space had been allocated to Unit 6. Nevertheless, the valuation was subject to the registered Survey Plan indicating 2 car spaces allocated to Unit 6 in a tandem configuration and 3 car spaces allocated to Unit 5 in a tandem and one single car space.
[69]	Furthermore, Unit 6 had exclusive use of 173 m2 of open space located on the rooftop. As at the date of valuation the area was being used to house a significant solar panel system that reportedly benefited only Unit 6. This open space area was not fenced nor covered and could not be legally used as additional outdoor living area, according to the author, the assessed value for Unit 6 reflected this.
[70]	Mr Walker inspected only two of the apartments which he found to be presented in a “as new” condition with no major repair or defect items. His valuation assumed that the remaining apartments that were not available for inspection presented to a similar standard and condition as the two apartments that were inspected. No evidence was led to suggest that his assumption was misplaced. I accept that all apartments were of a similar standard and condition as the two apartments that were inspected.
[71]	The assessed values for Lots 1 to 6 were inclusive of exclusive use courtyard areas and a rooftop open space area (Lot 6). The assessed value for Lot 5 was inclusive of 3 basement car spaces, and for Lot 6 was inclusive of 44 m2 of basement storage space included on title.
[72]	The report noted that Kirra still owned 11 of the 24 lots particularly Lots 1-6, 11, 19, 21-23. I note that some have been sold since the report.
[73]	The relativity principle is not unique to body corporate legislation, it has been a principle applied to land valuation. Simply, the principle involves a comparison of one property to another and in this case the application of the principle is assisted by taking account of factors set out in s 46A(3) of the Act which are the only factors to be considered. They are:
How the community titles scheme is structured
[74]	This community scheme has 24 lots comprising of 2 and 3-bedroom apartments constructed over 4 floors. The ground floor apartments have patios and the higher level apartments each have balconies. Each has one or more car parks, and some have additional storage area and exclusive use of some common areas. 
The nature, features and characteristics of the lots
[75]	Apartments have local and city skyline views from either a northerly or easterly aspect. Some have better views than others. The higher apartments experience less traffic noise. On the other hand, the ground floor apartments have direct access to the street and do not require lift access other than perhaps to access the basement car park. All apartments differ in floor area, and all have a car park: some have two, others have three. Some have additional storage area, and one has exclusive use of a 175 m2 open space on the roof, albeit limited in use, in this case for solar panels from which Lot 6 benefits solely. The ground floor units have outdoor patios with apartment Lot 1 having 40 m2 compared to the other apartments that have about half that area either as a balcony or patio. 
[76]	The valuer has assumed that each has generally modern PC items of good quality in good condition. Although Scott Walker’s valuation was criticised in cross examination on this matter, I have assumed, in the absence of evidence to the contrary, that there is a uniformity in respect of fit out and appliances.
The purposes for which the lots are used
[77]	The apartments are solely for residential and not commercial accommodation use. 
The impact the lots may have on the costs of maintaining the common property
[78]	Those lots that enjoy exclusive use of certain areas designated in the CMS have the responsibility at their expense, for the performance of the duties of the Body Corporate to clean, maintain and repair such parts of the Common Property. They must also give access to the Body Corporate’s servants and agents at all reasonable times. 
[79]	I have little evidence of any difference between apartments as to the impact of costs of maintaining the common property.    
The market value of the lots.
[80]	Table 2 sets out the assessed values as well as the 2023 levies. Also incorporated are the lot entitlements and the gross floor area of each lot. The HTW valuation was as at 17 January 2022 and Midep filed its claim on 6 September 2022. Sales since the valuation report have also been included but evidence of when these sales took place has not been provided.
Table 2
Unit No	Configuration		Lot Entitlements	Gross floor area
(m2)	Assessed value	Rate
($/m2)	2023
Levy
$	
			Con	Int					
1	2 bed 2 bath 1 car	G	46	46	134	$820,000	6,119	4775	
2	2 bed 2 bath 1 car	G	39	39	112	$750,000	6,606	4048	
3	2 bed 2 bath 1 car	G	39	39	107	$750,000
$880,000*	7,009	4048	
4	2 bed 2 bath 1 car	G	35	35	103	$765,000
$915,000*	7,427	3633	
5	3 bed 2 bath 3 car	G	41	41	121	$935,000	7,727	4256	
6	3 bed 2 bath 2 car	G	39	39	133	$970,000	7,293	4048	
7	2 bed 2 bath 1 car	1	41	41	117	$765,000	6,538	4256	
8	2 bed 2 bath 1 car	1	39	39	112	$745,000	6,652	4048	
9	2 bed 2 bath 1 car	1	39	39	111	$745,000	6,712	4048	
10	2 bed 2 bath 1 car	1	36	36	105	$745,000	7,095	3737	
11	2 bed 2 bath 1 car	1	40	40	116	$765,000	6,595	4152	
12	3 bed 2 bath 2 car	1	58	58	159	$985,000	6,195	6020	
13	2 bed 2 bath 1 car	2	40	40	117	$775,000	6,624	4152	
14	2 bed 2 bath 1 car	2	39	39	112	$755,000	6,741	4048	
15	2 bed 2 bath 1 car	2	39	39	111	$755,000
$910,000*	6,802	4048	
16	2 bed 2 bath 1 car	2	36	36	105	$755,000	7,190	3737	
17	2 bed 2 bath 1 car	2	40	40	116	$775,000	6,681	4152	
18	3 bed 2 bath 2 car	2	57	57	159	$1,000,000	6,289	5917	
19	2 bed 2 bath 1 car	3	40	40	117	$790,000	6,752	4152	
20	2 bed 2 bath 1 car	3	39	39	112	$770,000	6,875	4048	
21	2 bed 2 bath 1 car	3	39	39	111	$770,000	6,937	4048	
22	2 bed 2 bath 1 car	3	39	39	105	$770,000
$880,000*	7,333	4048	
23	2 bed 2 bath 1 car	3	44	44	116	$790,000	6,810	4567	
24	3 bed 2 bath 2 car	3	56	56	159	$1,020,000	6415	5813	
			1000	1000					
  *Sales since HTP valuation report.
[81]	The 2023 levies show an inconsistency when account is taken of lot size and benefits.
[82]	In Table 3 the lots are separated into the aspect that they occupy in the building. Those on Lanham Street face north, those on Dutton Street face south. Included are the lot entitlement for the Contribution Schedule and the Interest Schedule. Lots 2 and 3, 8 and 9, 14 and 15 and 20 and 21 are not included which occupy northern aspect but not a corner aspect of the building. They have all been allocated the same entitlement of 39. The market values for each of Lots 2 and 3 is $750,000, for each of Lots 8 and 9 is $745,000, for each Lots 14 and 15 is $755,000 and for each of Lots 20 and 21 is $770,000. The reason why Lots 2 and 3 are valued $5,000 more than Lots 8 and 9 a floor higher I presume is because the former has roughly 10m2 more floor space. Lots 14 and 15 are each valued $10,000 more than each of Lots 8 and 9. Lots 20 and 21 are each valued $15,000 more than each of Lots 14 and 15. The difference can be explained on the which level the apartment is situated. They have all been allocated a 39 entitlement.
Table 3
Unit No	Configuration		Lot Entitlements	Gross floor area
(m2)	Assessed value	Rate
($/m2)	
			Con	Int				
	Lanham Street							
1	2 bed 2 bath 1 car	G	46	46	134	$820,000	6,119	
7	2 bed 2 bath 1 car	1	41	41	117	$765,000	6,538	
13	2 bed 2 bath 1 car	2	40	40	117	$775,000	6,624	
19	2 bed 2 bath 1 car	3	40	40	117	$790,000	6,752	
	Lanham Street							
4	2 bed 2 bath 1 car	G	35	35	103	$765,000	7,427	
10	2 bed 2 bath 1 car	1	36	36	105	$745,000	7,095	
16	2 bed 2 bath 1 car	2	36	36	105	$755,000	7,190	
22	2 bed 2 bath 1 car	3	39	39	105	$770,000	7,333	
	Dutton Street							
5	3 bed 2 bath 3 car	G	41	41	121	$935,000	7,727	
11	2 bed 2 bath 1 car	1	40	40	116	$765,000	6,595	
17	2 bed 2 bath 1 car	2	40	40	116	$775,000	6,681	
23	2 bed 2 bath 1 car	3	44	44	116	$790,000	6,810	
	Dutton Street							
6	3 bed 2 bath 2 car	G	39	39	133	$970,000	7,293	
12	3 bed 2 bath 2 car	1	58	58	159	$985,000	6,195	
18	3 bed 2 bath 2 car	2	57	57	159	$1,000,000	6,289	
24	3 bed 2 bath 2 car	3	56	56	159	$1,020,000	6415	
[83]	Lots 1, 7, 13 and 19 are all 2 bedroom, 2 bathroom and 1 car park apartments and occupy the same position and have the same aspect in the building but on different levels. Other than Lot 1 they all have the same floor area. Lot 1 has 17 m2 more floor space made up of an extra patio. It also has exclusive use areas adjacent to both patios. It is valued at $820,000: the higher floors are valued respectively at $765,000, $775,000 and $790,000 increasing for each level. The difference in values seem to be reasonable and consistent with the relativity principle. However, the Lot entitlements are not consistent being respectively 46, 41, 40 and 40.
[84]	Lots 4, 10, 16 and 22 are all 2 bedroom, 2 bathroom and 1 car park apartments and also occupy the same position and have the same aspect in the building but on different levels. Other than the ground floor level the values increase according to the level. The floor areas of the apartments are essentially the same, but Lot 4 has an additional exclusive use area of 63 m2 which extend the area of its patio. The ground floor apartment is valued more, presumably for this reason, than the higher level apartments. Lot entitlements for these apartments also, are not consistent being respectively 35, 36, 36 and 39.
[85]	Lots 5, 11, 17 and 23 with the exception of Lot 5 are all 2 bedroom, 2 bathroom and 1 car park apartments and occupy the same position and have the same aspect in the building but on different levels. Lot 5 has 3 bedrooms, 2 bathrooms and 3 car parks. Their valuations other than for Lot 5 seem to be reasonable and consistent with the relativity principle, the difference in values being the different floors. Lot 5 is valued at a similar level equivalent but less than the other 3 bedroom apartments, despite its superiority in floor space. Again, the Lot entitlements are not consistent being respectively 41, 40, 40 and 44.
[86]	Lots 6, 12, 18 and 24 are all 3 bedroom, 2 bathroom and 2 car park apartments and occupy the same position and have the same aspect in the building but on different levels. The valuations seem reasonable and consistent with the relativity principle. Again, the lot entitlements are not consistent being respectively 39, 58, 57 and 56. The upper 3 levels have been allocated decreasing entitlements the higher the level which is inconsistent with the valuations.
Reassessed Lot Entitlements
[87]	Midep has performed an exercise of calculating lot entitlements on the basis of the market valuation. The exercise involves the calculation of each lot market value by a lot value of $19,465.00 being one thousandth of the gross market value of Swell of $19,465,000. 
[88]	Swell criticises Midep for using the market value of the lots as the only factor for deciding the CSLE. Swell does not refer to what other factors Midep should have taken into account, nor did it provide any evidence in support of its submission. The market values of the respective lots, as advised by Mr Walker, necessarily incorporate various other factors such as aspect, level in the building, floor area and number of car parks to name a few in reaching a market valuation. 
[89]	Table 4 sets out the new lot entitlements. In my opinion, although not perfect, it provides a reasonable and equitable result using the relativity principle.
Table 4
Unit No	Configuration		Lot Entitlements	Gross floor area
(m2)*	Assessed value	
			New	Old			
1	2 bed 2 bath 1 car	G	42	46	142	$820,000	
2	2 bed 2 bath 1 car	G	38	39	126	$750,000	
3	2 bed 2 bath 1 car	G	38	39	121	$750,000	
4	2 bed 2 bath 1 car	G	39	35	160	$765,000	
5	3 bed 2 bath 3 car	G	48	41	150	$935,000	
6	3 bed 2 bath 2 car	G	50	39	390	$970,000	
7	2 bed 2 bath 1 car	1	39	41	117	$765,000	
8	2 bed 2 bath 1 car	1	38	39	112	$745,000	
9	2 bed 2 bath 1 car	1	38	39	111	$745,000	
10	2 bed 2 bath 1 car	1	38	36	105	$745,000	
11	2 bed 2 bath 1 car	1	39	40	116	$765,000	
12	3 bed 2 bath 2 car	1	51	58	159	$985,000	
13	2 bed 2 bath 1 car	2	39	40	117	$775,000	
14	2 bed 2 bath 1 car	2	39	39	112	$755,000	
15	2 bed 2 bath 1 car	2	39	39	111	$755,000	
16	2 bed 2 bath 1 car	2	39	36	105	$755,000	
17	2 bed 2 bath 1 car	2	40	40	116	$775,000	
18	3 bed 2 bath 2 car	2	52	57	159	$1,000,000	
19	2 bed 2 bath 1 car	3	41	40	117	$790,000	
20	2 bed 2 bath 1 car	3	40	39	112	$770,000	
21	2 bed 2 bath 1 car	3	40	39	111	$770,000	
22	2 bed 2 bath 1 car	3	40	39	105	$770,000	
23	2 bed 2 bath 1 car	3	41	44	116	$790,000	
24	3 bed 2 bath 2 car	3	52	56	159	$1,020,000	
			1000	1000			
*Inclusive of storage areas and car parks
Interest Schedule
[90]	The principles to be applied in deciding lot entitlements under the interest schedule are contained in section 46B of the Act.
46B	Principle for deciding interest schedule lot entitlements
(1)	The market value principle for deciding interest schedule lot entitlements for the lots included in a community titles scheme is the principle that the lot entitlements must reflect the respective market values of the lots, except to the extent to which it is just and equitable in the circumstances for the individual lot entitlements not to reflect the respective market values of the lots.
(2)	The following apply for working out the market values of lots included in a community titles scheme—
(a)	if a lot included in the scheme is a subsidiary scheme, the market value of the lot is the market value of the scheme land for the subsidiary scheme;
(b)	for establishing the market value of a lot created under a standard format plan of subdivision or volumetric format plan of subdivision, buildings and improvements on the lot are to be disregarded.
[91]	The notation in Swell’s first and only CMS is that, in accordance with section 66(1)(dc) of the Act, the interest schedule principle is the market value principle (as defined in section 46B of the Act) and that the ISLE must reflect the respective market values of the lots, except to the extent to which it is just and equitable, in the circumstances, for the individual lot entitlements not to reflect the respective market values of the lots. It was not considered that any circumstances exist for which it is just and equitable for the ISLE not to reflect the respective market values of the lots.
[92]	The calculation of the lot entitlements under the ISLE must reflect the respective market values of the lots in accordance with s 46B of the Act. When making an order to adjust the ISLE the order of the Tribunal must be consistent with the market value principle, as applied in relation to the respective market values of the lots included in the scheme when the order is made. The Tribunal may have regard to whether it is just and equitable in the circumstances for the individual lot entitlements not to reflect the respective market values and may have regard to the same matters contained in section 46A(3) of the Act. 
[93]	Like the lot entitlements in the CSLE, the lot entitlements in the ISLE of the CMS are not just and equitable and are not consistent with the market value principle. I see no reason why the ISLE should not be the same as the lot entitlements I have found for the CSLE which have been predominantly decided on market value.
[94]	Considering how the community title scheme is structured, the nature, features and characteristics of the lots, the purpose for which the lots are and have been used, the impact the lots may have on the costs of maintaining the common property and the market value of the lots I find that:
(a)	the CSLE ought to be adjusted to reflect the relativity principle so far as it is just and equitable to do so in accordance with s 47B of the Act in accordance with the attached schedule; and
(b)	the ISLE ought to be adjusted to reflect the market value principle in accordance with s 48 of the Act in accordance with the attached schedule.
Costs
[95]	Midep seeks payment of its costs of $9,703.80 which includes the HTW report cost of $6,600.00. Other costs include legal fees incurred by Midep of $2,836.80.
[96]	Swell submits that there should be no order as to costs.
[97]	The Queensland Civil and Administrative Tribunal Act 2009 (Qld) (‘QCAT Act’) provides ‘Other than as provided under this Act or an enabling Act, each party to a proceeding must bear the party’s own costs for the proceedings.’
[98]	Section 102(3) sets out some factors which may be considered in the exercise of the Tribunal’s discretion to award costs.  They are:
(a)	whether a party to a proceeding is acting in a way that unnecessarily disadvantages another party to the proceeding, including as mentioned in section 48(1)(a) to (g);
(b)	the nature and complexity of the dispute the subject of the proceeding;
(c)	the relative strengths of the claims made by each of the parties to the proceeding;
(d)	for a proceeding for the review of a reviewable decision—
(i)	whether the applicant was afforded natural justice by the decision-maker for the decision; and
(ii)	whether the applicant genuinely attempted to enable and help the decision-maker to make the decision on the merits;
(e)	the financial circumstances of the parties to the proceeding;
(f)	anything else the tribunal considers relevant.
[99]	Member Deane in Locke & Ors v Stanton Crest Stage 2 Body Corporate was unable to locate any decided cases which support the proposition that the disadvantage referred to in s 48 of the QCAT Act which may found an award of costs relates to conduct prior to the proceedings having been commenced. See also Robertson and Robertson v Airstrike Industrial Pty Ltd.
[100]	I do consider that the dispute was relatively complex since the introduction of the 2013 amendments to the Act. I also believe that Midep had strong grounds for bringing he application, which necessitated the commissioning of the HTW valuation report.
[101]	I do not consider the financial circumstances of the parties to be a disentitling factor in this case. 
[102]	In all the circumstances, I am prepared to exercise my discretion to award some costs. I allow the costs of the HTW valuation report which was essential to the success of Midep’s application. Midep was not legally represented at the hearing. I have not allowed the costs of legal advice.
[103]	The orders will be:
1.	There be an adjustment of the contribution schedule lot entitlements and interest schedule lot entitlements for the scheme in accordance with the Schedule attached to this order;
2.	Body Corporate for Swell Coolangatta CTS 54750, within 45 days of this order, lodge a new community management statement incorporating changes to the contribution schedule lot entitlements and interest schedule lot entitlements for the lots included in the scheme in accordance with these orders.
3.	Body Corporate for Swell Coolangatta CTS 54750 pay the Midep Pty Ltd as Trustee for Mipadel Investment Trust costs fixed at $6,600.00.

Lot on Plan	Lot Entitlements	
	Contribution Schedule	Interest Schedule	
Lot1 	42	42	
Lot 2 	38	38	
Lot 3 	38	38	
Lot 4 	39	39	
Lot 5 	48	48	
Lot 6 	50	50	
Lot 7 	39	39	
Lot 8 	38	38	
Lot 9 	38	38	
Lot 10 	38	38	
Lot 11 	39	39	
Lot 12 	51	51	
Lot 13 	39	39	
Lot 14 	39	39	
Lot 15 	39	39	
Lot 16 	39	39	
Lot 17 	40	40	
Lot 18 	52	52	
Lot 19 	41	41	
Lot 20 	40	40	
Lot 21 	40	40	
Lot 22 	40	40	
Lot 23 	41	41	
Lot 24 	52	52	
	1000	1000