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…

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: [2023] NZHC 3023
Decision Date: 30 October 2023

CaseChat Overview and Summary

In this case, Body Corporate 23599 sought an interlocutory charging order over the property owned by Michael Henry Hamrich and Laurel Susan Mitro, located at Flat 19, 19 Tui Terrace, Waipori Falls, Outram. The dispute arose from unpaid levies, interest, collection fees, and a filing fee owed by the defendants to the Body Corporate, amounting to $12,220.11. The High Court of New Zealand, Dunedin Registry, was tasked with deciding whether the application for a charging order without notice was appropriate.

The central legal issue was whether the application for a charging order qualified as a "routine matter" under Rule 7.46(3)(c) of the High Court Rules 2016, thereby justifying the absence of notice to the respondents. While the Tenancy Tribunal had granted the Body Corporate's application for judgment, the Body Corporate had not received any payment towards this judgment. The affidavit of Barbra Welffens, the manager of the Body Corporate, stated that the Body Corporate had not received any payment towards the judgment, though it was not clear whether the respondents had been served with the judgment. The Court considered the nature of a charging order, which is inherently draconian as it is issued without the respondent being heard, and weighed this against the marginal nature of the paperwork provided.

The Court concluded that, by a narrow margin, the application was justified as a routine matter, given the lack of payment despite the judgment being sealed and the difficulties in serving the respondents. However, the Court noted that future applications might not be granted without notice if the paperwork was not more precise. Therefore, the application for a charging order was granted without notice.

The Court made orders in accordance with the draft order submitted with the application, effectively charging the property with the outstanding amount owed to the Body Corporate.

Orders