Body Corporate 207650 v Speck - [2018] NZHC 1952

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

I TE KŌTI MATUA O AOTEAROA TĀMAKI MAKAURAU ROHE

CIV-2018-404-000326

[2018] NZHC 1952

UNDER the Unit Titles Act 2010, s 74

IN THE MATTER

varying a scheme for payment of remedial works

BETWEEN

BODY CORPORATE 207650
Applicant

AND

KATY SPECK and RYAN SPECK & ORS

Respondents

Hearing: 20 July 2018

Appearances:

SF Powrie for Applicant

Sixteenth Respondent in person (C Singh) Thirtieth Respondent in person (E Simpson)

Judgment:

1 August 2018

JUDGMENT OF DOWNS J

This judgment was delivered by me on Wednesday, 1 August 2018 at 4 pm pursuant to r 11.5 of the High Court Rules.

Registrar/Deputy Registrar

Solicitors:
Grove Darlow & Partners, Auckland.

Copy to:
Sixteenth Respondent.
Thirtieth Respondent.

BODY CORPORATE 207650 v SPECK & ORS [2018] NZHC 1952 [1 August 2018]

The case

[1] Richmond Terraces is a residential complex in East Tamaki. It leaked. In 2016, the High Court approved a repair scheme under s 74 of the Unit Titles Act 2010.1 The scheme acknowledged the extent of the damage could not be known until work commenced. Sadly, the damage was much worse than anticipated. There have been four “top-up” levies to date. A final levy is to come.

[2] Code compliance certificates have been issued in respect of all units—the work is largely complete. The scheme requires the body corporate to apply to discharge it within 25 working days of obtaining a code compliance certificate for the complex. But, because of a dispute with a consultant, the body corporate says it cannot yet issue the final levy and so cannot discharge the scheme: levies are made under the scheme. The body corporate applies to vary the scheme so it is instead required to apply for its discharge within 25 working days of issuing the final levy. The owners of three units oppose the application: Ms Stark-Heath (unit 12); Ms Singh (unit 16); and Mr and Mrs Simpson (unit 30).2 The owners of the remaining 27 units either do not oppose the application or have taken no steps in relation to it.

Related cases

[3]Three related cases warrant mention.

[4] First, Ms Singh and the Simpsons challenged the validity of the body corporate’s second levy. On 12 May 2017, Lang J upheld the levy. His Honour concluded work to obtain code compliance fell within the scheme.3 The Judge considered the work the body corporate had carried out was necessary.4 Top up levies could, therefore, be issued.

[5] Second, the body corporate sought summary judgment against Ms Singh and the Simpsons in respect of the second and third levies. The third levy was issued after Lang J’s judgment. Ms Singh and the Simpsons refused to pay either. On

1      Body Corporate 207650 v Speck [2016] NZHC 1826.
2      Ms Amy Cole also opposed the application but has withdrawn her opposition.
3      Body Corporate 207650 v Speck [2017] NZHC 966, (2017) 18 NZCPR 742 at [48].
4 At [56].

20 December 2017, Judge GM Harrison granted…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

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Details

Case: [2018] NZHC 1952
Decision Date: 1 August 2018

CaseChat Overview and Summary

Body Corporate 207650, the body corporate for Richmond Terraces in East Tamaki, applied to the High Court under section 74 of the Unit Titles Act 2010 to vary a scheme for the payment of remedial works. The scheme was approved in 2016 when it was acknowledged the extent of the damage could not be known until work commenced. The damage was much worse than anticipated and four top-up levies have been issued to date. A final levy is to come. Code compliance certificates have been issued in respect of all units. The body corporate applied to vary the scheme so it is instead required to apply for its discharge within 25 working days of issuing the final levy. The owners of three units opposed the application. The primary legal issue for the court to decide was whether the logic of the existing scheme would be compromised by the proposed variation. The Court concluded that the variation did not change any significant aspect of the scheme, the original clause envisaged the body corporate would be able to issue any levies it needed to within that timeframe, the variation was not unfair to the respondents and was fair as between all unit owners, and the variation complemented the existing scheme and was necessary to bring it to fruition. The Court granted the variation. The scheme is varied.
……………………………..Downs J

Orders