Body Corporate 23599 v Hamrich

[2023] NZHC 3023

IN THE HIGH COURT OF NEW ZEALAND DUNEDIN REGISTRY

I TE KŌTI MATUA O AOTEAROA ŌTEPOTI ROHE

CIV-2023-412-103

[2023] NZHC 3023

BETWEEN

BODY CORPORATE 23599

Plaintiff

AND

MICHAEL HENRY HAMRICH and LAUREL SUSAN MITRO

Defendants

Hearing:	On the papers
Judgment:	30 October 2023

JUDGMENT OF HARLAND J

Introduction

[1]                 Body Corporate 23599 has applied by way of an interlocutory application for a charging order without notice over the property at Flat 19, 19 Tui Terrace, Waipori Falls, Outram (the property). I have decided to grant the application. This judgment sets out my reasons for doing so.

Background

[2]                 The respondents are the registered proprietors (owners) of the property. The Record of Title refers to the legal description being Unit F and Accessory Unit F1 and F2 contained in the title OT15D/268.

[3]                 The property was part of a Unit Titles development under the Unit Titles Act 1972. The Supplementary Record Sheet OT15D/269 sets out the unit titles issued to the various owners. A unit title was issued to the owners of OT15D/268 among others. The Body Corporate owns the common property subject to OT15D/269, with the unit

BODY CORPORATE 23599 v HAMRICH [2023] NZHC 3023 [30 October 2023]

title owners being beneficially entitled to the common property as tenants in common in shares proportional to their ownership interest.

[4]                 As is usual, fees are levied to owners in respect of the Body Corporates expenses.

[5]                 On 9 June 2023, the Christchurch Tenancy Tribunal granted Body Corporate’s application for judgment against Mr Hamrich and Ms Mitro for the sum of $11,642.11. The judgment was in respect of unpaid levies, interest, collection fees and a filing fee owed by them to the Body Corporate.

[6]                 The judgment was sealed, and a certificate of order made in the District Court on 11 September 2023. The judgment was then sealed as a final judgment in the High Court on 19 September 2023 in the sum of $12,220.11, being the amount of the Tenancy Tribunal judgment, together with the sum of $50 for the costs of the certificate of judgment, $50 for the cost of sealing that judgment and $478.00 2B scale costs under the High Court Rules 2016 for the costs of sealing the High Court judgment.

[7]                 The Body Corporate now applies for a charging order in relation to that judgment.

Discussion

[8]                 Rule 7.46(3) of the High Court Rules 2016 (the Rules) prescribes when an application may be dealt with without notice. Of relevance here is whether the application relates to a routine matter.1

[9]                 “Routine” is not defined in the Rules. Examples that have been determined to be a routine matter include:

(a)  an application for orders giving initial directions in respect of an arrangement under s 236 of the Companies Act 1993, where any final orders sanctioning the arrangement required prior approval by a

1      Rule 7.46(3)(c).

subsequent meeting of shareholders who had first received notice of what was proposed;2 and

(b)  an application to remove a trustee from a family trust because the trustee had become permanently incapacitated, and to subsequently make an order under s 52(2) of the Trustee Act 1956 vesting property of the trust in the new trustees.3 Ellis J considered the application related to a routine matter and that the disability of the trustee to be removed was such that service would be pointless.

[10]              In contrast, the Court in Re Baigent observed that it would be unusual to extinguish a property right (there, an easement), without giving notice to the beneficiary of that right.4 Hickmott v Tate involved an application to remove and replace two trustees that was not considered a routine matter because the applicants had contended one trustee lacked decision-making capacity and the other had failed to discharge their duties as a trustee. Jagose J held those allegations would have to be fully pleaded.

[11]              An order made without notice is draconian by nature because it is issued in the absence of the party who is to suffer its consequences,5 and the absent party is denied their right of natural justice to be heard in its own defence.6

[12]              It is not clear if the respondents were ever served with the judgment, however, the affidavit of Barbra Welffens, the manager of the Body Corporate accompanying this application, deposes that the Body Corporate has not received any payment towards the judgment entered in the Tenancy Tribunal.

[13]                It would have been helpful for Ms Welffens’ affidavit to have outlined whether the sealed judgment had been served on the respondents, but this does not impeach the judgment originally entered in the Tenancy Tribunal given the provisions of s 205 of the Unit Titles Act 2010. It would also have been helpful for the Tenancy Tribunal

2      Re Smiths City Group Ltd [2017] NZHC 2351

3      Re Barnes [2016] NZHC 327.

4      Re Baigent [2021] NZHC 2478.

5      Robert Osborne and others McGechan on Procedure (online ed, Thomson Reuters) at [HR7.46.01].

6      Green Way Ltd v Mutual Construction Ltd [2021] NZHC 1704 at [33].

decision to have been clearer about the service issue as well, namely outlining the evidence that satisfied the Tribunal that the email service complied with s 205.

[14]              Had the service requirements been clearer I would have had no difficulty in concluding this was a routine matter that justified the application being made without notice. The decision is however marginal in this case. By a narrow margin, I am persuaded to grant the application on this basis but, given my observations about the looseness of the paperwork, a similar outcome may not be assumed in the future.

Result

[15]              The application for a charging order is granted without notice. I make orders in terms of the draft order submitted to the Court with the application.

Harland J