Body Corporate 162791 v Gilbert

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IN THE COURT OF APPEAL OF NEW ZEALAND

CA213/2014
[2015] NZCA 185

BETWEEN

BODY CORPORATE 162791
Appellant

AND

JOHN GILBERT
First Respondent

AND

QSM TRUSTEE LTD (IN RECEIVERSHIP AND IN LIQUIDATION)
Second Respondent

Hearing:

29 April 2015

Court:

Harrison, Keane and Wylie JJ

Counsel:

J Anderson and T J G Allan for Appellant
D Chisholm QC for First Respondent
No apperance for Second Respondent

Judgment:

21 May 2015 at 10 am

JUDGMENT OF THE COURT

AThe appeal is allowed.

BJudgment is entered in favour of the appellant against the first respondent as receiver of the second respondent (in receivership and in liquidation).  The first respondent is personally ordered to pay the body corporate levies outstanding in respect of units 3A to 3E (inclusive) in the Mid City complex, from 9 August 2013 to the date of this judgment.

CThe first respondent is personally ordered to pay interest on the outstanding levies, at the rate of 10 per cent per annum, calculated from the last day of each month to the date of judgment.  Interest is not to be compounded.

DLeave is reserved to counsel to file memoranda in the High Court, in the event that they are unable to reach agreement as to the amount owing by the first respondent to the appellant.

EThe first respondent is ordered to pay to the appellant its reasonable solicitor/client costs, together with disbursements.

FLeave is reserved to counsel to file memoranda in the High Court in the event that there is any disagreement as to the costs or disbursements payable pursuant to this judgment.

____________________________________________________________________

REASONS OF THE COURT

(Given byWylie J)

Introduction  [1]
Factual background  [8]

The Mid City Complex  [8]
239 Queen Street Trustees Ltd  [13]
QSM Trustee Ltd  [18]
The receivership  [24]

The High Court decision  [26]
Submissions  [29]
Analysis  [31]

A receiver’s powers and liabilities  [31]
The Receiverships Act 1993 – Section 32  [35]
Issues  [41]
(a)      Do the body corporate levies fall due under an agreement?              [41]
(b)      Do the levies due under the agreement relate to the use, possession        
         or occupation by QSMTL of the units?  [50]
(c)      Is Mr Gilbert entitled to relief under s 32(7)?  [65]
Costs  [74]

Result  [80]

Introduction

  1. Body Corporate 162791 (the body corporate) appeals a decision given in the High Court by Associate Judge Abbott on 25 March 2014.[1]

  2. The Body Corporate initially filed a statement of claim seeking an interim injunction to restrain the first respondent, Mr Gilbert, as receiver of the second respondent, QSM Trustee Limited (QSMTL) from erecting a fence across an arcade comprising common property on level 1 of a strata title development known as the Mid City complex in central Auckland. 

  3. The application for an interim injunction was decided in the body corporate’s favour and an interim injunction was ordered on 15 April 2013.[2] The matter came back before the Court,[3] and ultimately…

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Details
Case
[2015] NZCA 185
Decision Date

CaseChat Overview and Summary

Body Corporate 162791, the body corporate for the Mid City complex, appeals against a decision of Associate Judge Abbott that Mr Gilbert, as receiver for QSM Trustee Limited (QSMTL), is not personally liable for body corporate levies owed by QSMTL for units 3A to 3E since 9 August 2013. The Court of Appeal found in favour of the body corporate. Mr Gilbert was appointed as receiver for QSMTL on 25 July 2013. The body corporate levies for units 3A to 3E were not paid by QSMTL, and Mr Gilbert has not paid them either. The Court found that the obligation to pay body corporate levies arises under an agreement, and that the obligation is captured by s 32(5) of the Receiverships Act 1993. It also found that the levies due under the agreement relate to the use, possession or occupation by QSMTL of the units. The Court held that Mr Gilbert was personally liable to pay the body corporate levies that have fallen due since his appointment as receiver, and that he is also personally liable to pay interest on the outstanding levies. The Court further found that Mr Gilbert is not entitled to relief under s 32(7) of the Act. Finally, the Court found that the body corporate is entitled to recover its reasonable solicitor/client costs from Mr Gilbert.

Orders

Orders of the court

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Background

Background to the litigation

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Evidence

Evidence Before The Court

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Decision

Reasons for decision

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Ratio Decidendi

Legal Principle Established

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