Body Corporate 4426 v Phoenix Resort
[2015] NZHC 1966
•18 August 2015
IN THE HIGH COURT OF NEW ZEALAND NAPIER REGISTRY
CIV-2015-441-62 [2015] NZHC 1966
UNDER The Unit Titles Act 2010 IN THE MATTER OF
an application by Body Corporate 4426
BETWEEN
BODY CORPORATE 4426
ApplicantAND
PHOENIX RESORT Respondent
On thePapers: 10 July 2015 Counsel:
M MacFarlane for the Applicant
Judgment:
18 August 2015
JUDGMENT OF ASSOCIATE JUDGE SMITH
[1] The applicant Body Corporate has filed an originating application under s 187 of the Unit Titles Act 2010 (the Act) for cancellation of a unit plan in respect of the Phoenix Resort near Taupo.
[2] Under s 187(2) of the Act, the applicant is required to serve “a notice of any application” made under the section on “every unit owner” and on a number of other parties listed in the subsection.
[3] There are a total of 612 unit owners (the Phoenix Resort is a timeshare development), and the applicant has encountered difficulty in locating 24 of them. None of the 24 unit owners the Body Corporate has been unable to locate have appointed agents in New Zealand to act on their behalf under s 81 of the Act (applicable to owners who are absent from New Zealand), and none have complied
with their obligations under s 85(2) of the Act, which requires owners of principal
BODY CORPORATE 4426 v PHOENIX RESORT [2015] NZHC 1966 [18 August 2015]
units to notify the body corporate in writing of any changes to the information held
in the body corporate’s register that relates to their units.
[4] The Body Corporate has filed an ex parte application in this Court for directions that service may be effected on these people by advertisements published in the New Zealand Herald and Dominion Post newspapers. The ex parte application also seeks a direction that service on two unit owners who were companies which have seen been struck of the register of companies, be effected by service on the Secretary of the Treasury.
[5] There is an issue as to whether s 205 of the Act requires that such applications for directions be made to the District Court, and not to this Court.
[6] Section 205 of the Act provides:
205 Service of documents
(1) Any notice or other document required or authorised by this Act to be served on or given to any person must be in writing and is sufficiently served or given if—
(a) it is delivered to that person; or
(b) it is left at that person’s usual or last known place of residence or business or at an address specified for that purpose; or
(c) it is posted in a letter addressed to that person by name at that place of abode or business or address; or
(d) it is transmitted to the email address or facsimile number given by that person as an address for service.
(2) If the person is absent from New Zealand, the notice or other document may be served on or given to the person’s agent in New Zealand.
(3) If the person is deceased, it may be served on or given to the
person’s personal representatives.
(4) If the person is not known, or is absent from New Zealand and has no known agent in New Zealand, or is deceased and has no personal representatives, the notice or other document must be served or given in a manner as may be directed by an order of the District Court.
(5) If any notice or other document is sent to any person by post, it is to be treated as having been delivered to the person on the fourth day after the day on which it was posted, and in proving the delivery it is sufficient to prove that the notice or other document was properly addressed and posted.
(6) A notice or other document sent by electronic means or by facsimile is to be treated as having been received on the working day immediately following the date on which it was transmitted; and in proving service it is sufficient to prove that the notice or other document was properly transmitted.
(7) Despite anything in the previous provisions of this section, the District Court may, in any case, make an order directing the manner in which any notice or other document is to be served or given or dispensing with the service or the giving of the service.
(8) This section does not apply to any other notices or other documents served or given in any proceedings in any court.
[7] The Unit Titles Regulations 2011 prescribe a number of forms which are to be used for the general matters to which the forms relate.1 One such form, Form 21, covers notices of application under s 187(2) of the Act to cancel a unit plan. Form
21 reads:
Form 21 Notice of application to High Court to cancel unit plan
Sections 165(2)(b) and 187(2), Unit Titles Act 2010
To [full name(s) and address(es) of persons in section 187(2) of Unit Titles
Act 2010]
Applicant(s): [full name, address, and capacity (ie, unit owner, body corporate, lessor, or administrator) of each applicant]
High Court application number: [number] Unit plan: [reference number]
Body Corporate Number: [number] Supplementary record sheet: [number]
Schedule of land: [computer register number(s) of land, or computer register number of principal unit, or computer register numbers of all principal and accessory units or future development units]
Notice
The applicant gives/The applicants give notice under section 187(2) of the
Unit Titles Act 2010 that an application has been made to the High Court to cancel the unit plan.
1 Unit Titles Regulations 2011, r 37.
[8] In a memorandum filed with the ex parte application for directions as to service, Mr Macfarlane points out that s 205 does not contain any provision directly covering the situation where a body corporate no longer has a physical or email address by which it can satisfy the Court that service has been effected on a unit owner. It appears that in such cases the party wishing to serve a notice of other document in accordance with the section is required to apply to the District Court under s 205(7) for an order directing the manner in which the notice or other document is to be served or given (or for an order dispensing with the service or the giving of the notice as the case may be).
[9] Section 205(8) provides that the section “does not apply to any other notices or documents served or given in any proceedings in any court”. Mr Macfarlane submits that while it is not clear whether a notice referable to High Court proceedings is intended to be covered by subs 8 of s 205, it is unlikely that Parliament intended that the District Court should give directions concerned with the service of proceedings in the High Court. On that basis, the Body Corporate has applied for directions as to service in this Court.
[10] In a supplementary memorandum, Mr MacFarlane submitted that a s 187(2) application requires the giving of a notice “in any proceedings in any Court” (in this case the High Court), and thus s 205(8) takes questions relating to the service of the notice outside the ambit of s 205. If that submission is right, the District Court would have no jurisdiction under s 205(7) to give directions for service of s 187(2) notices in cases of difficulty. But it would also follow that the provisions in s 205(1) permitting service of notices by email or post would be unavailable to the Body Corporate – the effect of ss (8) of s 205 is that the entire section has no application where the subsection applies. And in this case, Mr Clarry’s affidavit makes it clear that the Body Corporate does intend to serve the 600 or so owners it has been able to locate, by post or email.
[11] At first sight it does seem strange that an issue relating to service of a document which is concerned with proceedings issued in this Court should not be dealt with in this Court. But s 187 of the Act does not state that the originating application itself is to be served on the parties listed in s 187(2): the applicant is
required only to serve “a notice of” the application. Form 21 makes it clear that the “notice of” the application is intended to be something less than the originating application and the accompanying affidavits. The Form provides only sufficient details of the application for a recipient to obtain from the applicant or the Court copies of the formal application and supporting documents, so that he or she can exercise the right to appear and be heard on the application which is conferred by the
Act.2
[12] In my view, the notice required by s 187(2) is a notice which s 205(1) refers to as “required or authorised by this Act”. It must be served on the listed parties, and a specific form has been prescribed for the notice under the regulations. I do not consider that s 205(8) applies – that subsection is concerned with “any other notices or other documents…”, and I think the word “other” can only refer back to the documents described in s 205(1) i.e. notices or other documents which are “required or authorised by this Act…”. The notice required by s 187(2) is a notice required to be served “by this Act”, and is accordingly not affected by s 205(8).
[13] Nor in my view is a s 187(2) notice given in the relevant High Court proceedings in which the cancellation order is sought. The notice draws the attention of interested persons to the existence of the proceeding (just as a public advertisement of a company liquidation application does), but it is not itself a step taken in the proceeding. Once the s 187(2) notices have been given in accordance with the Act, it will be for the High Court to give such further directions as may be necessary for the conduct of the proceeding.
[14] I think the notice regime provided by s 187(2), Form 21 and s 205 is understandable. As this case illustrates, there could be many hundreds of unit title owners to be served under s 187(2), and it would be unduly onerous if the applicant were required to effect personal service on every one of them in accordance with the High Court Rules.
[15] I understand the distinction Mr MacFarlane endeavoured to draw between notices given for purely administrative purposes and notices relating to Court
2 Unit Titles Act 2010, s188(1).
proceedings, where a party’s substantive rights might be significantly affected. But in my view the wording of the statute and the regulations (in particular s 187(2) and Form 21), make it clear that no such distinction was intended to apply in the case of s 187(2) notices.
[16] Section 205 establishes a code setting out the steps which must be taken to give or serve “any notice or other document required or authorised [by the Act] to be served on or given to any person…”, and part of that code requires that further directions are to be obtained where necessary from the District Court, not the High Court.
[17] I accordingly conclude that the proper course is for the applicant to apply to the District Court for directions as to the service of Form 21 on the parties listed in the ex parte application for directions as to service. Once those directions have been obtained, the conduct of the proceeding in the High Court will be governed by part 19 of the High Court Rules, and directions will be given as to the conduct of the proceeding in this Court on receipt of a further memorandum from counsel.
[18] Leave is given to seek those further directions from this Court by memorandum; it will not be necessary to file a further or amended interlocutory application. Matters to be addressed in that memorandum will include the time by which any notices of opposition are to be filed and served, whether it may be possible and appropriate for directions to be made appointing a person or persons to represent any particular group of owners, and how the directions made are to be communicated to the owners.
Associate Judge Smith
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