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Douglas v Body Corporate 10209

Douglas v Body Corporate 10209

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Case Copied 5 September 2025 20 min read

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IN THE COURT OF APPEAL OF NEW ZEALAND

I TE KŌTI PĪRA O AOTEAROA

CA44/2025
[2025] NZCA 358

BETWEEN	ANDREW ALEXANDER DOUGLAS, IAN STUART PETRY, LEONARD ELLSWORTH KURPUIS AND JOHN FRANCIS MATHER Appellants
AND	BODY CORPORATE 102029 First Respondent
AND	MAUD JOHNS LIMITED Second Respondent
AND	JOANNE LEE UNDERDOWN Third Respondent
AND	VEER CHARAN Fourth Respondent
AND	LE MANS PROPERTY LIMITED Fifth Respondent

Hearing:	15 May 2025
Court:	Woolford, Jagose and Powell JJ
Counsel:	P J K Spring and A Wang for Appellants J Heatlie and J M Wood (appearance excused) for First Respondent S E Wroe for Second to Fifth Respondents
Judgment:	5 September 2025 at 12 pm

JUDGMENT OF THE COURT

AThe appeal is dismissed.
BThe appellants must pay costs to the second to fifth respondents for a standard appeal on a band A basis, together with usual disbursements.

REASONS OF THE COURT

(Given by Jagose J)

The appellants—being three of the seven unit owners in, together comprising the members of the body corporate of, a unit title development subdividing base land in Auckland’s Freemans Bay—appeal the 6 December 2024 judgment of Anderson J in the High Court at Auckland.[1]
[1]Douglas v Body Corporate 102029 [2024] NZHC 3695, [2025] 2 NZLR 438 [judgment under appeal].
On the unit owners’ disagreement if to demolish and rebuild (as the appellants wish) or sell (as the second to fifth respondents wish) the economically irreparable development, the Judge authorised cancellation of the unit plan under s 188 of the Unit Titles Act 2010 (the UTA), with effect to dissolve the body corporate under s 185(1), and ordered sale of the resultant co‑owned property under s 339 of the Property Law Act 2007 (the PLA) for division of the proceeds among the co‑owners.[2]
[2]At [84].
The judgment since has been made final.[3] Execution of the judgment and implementation of the final orders are stayed pending appeal.[4]

Statutory context

[3]Douglas v Body Corporate 102029 [2025] NZHC 983 [final judgment].

[4]Douglas v Body Corporate HC Auckland CIV-2023-404-2182, 7 March 2025 (Minute of Anderson J) at [4(a)]); and final judgment, above n 3, at [16].

The UTA’s purpose is:[5]
… to provide a legal framework for the ownership and management of land and associated buildings and facilities on a socially and economically sustainable basis by communities of individual owners and, in particular,—
(a)to allow for the subdivision of land and buildings into unit title developments comprising units that are owned in stratum estate in freehold or stratum estate in leasehold or licence by unit owners, and common property that is owned by the body corporate on behalf of the unit owners; and
(b)to create bodies corporate, which comprise all unit owners in a development, to operate and manage unit title developments; and
(c)to establish a flexible and responsive regime for the governance of unit title developments; and
(d)to protect the integrity of the development as a whole.
[5]Unit Titles Act 2010 [UTA], s 3.
Unit owners have “all the rights derived from…

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: [2025] NZCA 358
Decision Date: 5 September 2025 at 12 pm

CaseChat Overview and Summary

The appeal was brought by Andrew Alexander Douglas, Ian Stuart Petry, Leonard Ellsworth Kurpuis, and John Francis Mather (the appellants) against Body Corporate 102029 (the first respondent), Maud Johns Limited (the second respondent), Joanne Lee Underdown (the third respondent), Veer Charan (the fourth respondent), and Le Mans Property Limited (the fifth respondent). The appellants sought to overturn a decision by the High Court that had ordered the cancellation of the unit plan for a unit title development in Freemans Bay, Auckland, and the subsequent sale of the property. The appeal was dismissed by the Court of Appeal, with the appellants ordered to pay costs to the second to fifth respondents.

The Court of Appeal considered whether the High Court had erred in authorising the cancellation of the unit plan, given the appellants' contention that the body corporate had a statutory obligation to repair and maintain common property, including by renewal where necessary. The Court of Appeal found that the Unit Titles Act 2010 did not impose such an obligation on the body corporate. Instead, the Act recognises that damage or destruction of any building or other improvement may be of such an extent to terminate a development's legislatively desired utility, leading to the dissolution of its body corporate and cancellation of its unit plan. The Court of Appeal found that the Judge's decision to cancel the unit plan was just and equitable, given the serious compromise to the development's integrity, the lack of economic viability to repair, and the hostility between the unit owners.

The Court of Appeal also considered the Judge's decision to order the sale of the property under the Property Law Act 2007. The Court of Appeal found that the sale was the most just and practical way to resolve the impasse between the unit owners, given the uncertainties associated with the cost and benefit of a rebuild and the marginal benefit of a rebuild over a sale. The Court of Appeal dismissed the appeal and ordered the appellants to pay costs to the second to fifth respondents for a standard appeal on a band A basis, together with usual disbursements.

Orders