Wheeldon v Body Corporate 342525 - [2018] NZCA 20

IN THE COURT OF APPEAL OF NEW ZEALAND

CA112/2017
[2018] NZCA 20

BETWEEN	DEREK PETER WHEELDON AND CAROL ANN WHEELDON, ANTHONY JOHN BUTCHER AND RUTH BARBARA ROGERS, LARRY LAWRENCE SMALL AND KM TRUSTEE SERVICES LIMITED, IVOR ANTHONY MILLINGTON AND NEVILLE EADE Appellants
AND	BODY CORPORATE 342525 Respondent

Hearing:	20 September 2017
Court:	Kós P, Cooper and Gilbert JJ
Counsel:	B E Brill for Appellants T J G Allan and S F Powrie for Respondent
Judgment:	20 September 2017 at 3.00 pm
Reasons:	21 February 2018 at 2.30 pm

JUDGMENT OF THE COURT

AThe appeal is dismissed.
BThe appellants must pay the respondent costs for a standard appeal on a band A basis with a 50 per cent uplift and usual disbursements. We certify for second counsel.

____________________________________________________________________

REASONS OF THE COURT

(Given by Gilbert J)

Introduction

This appeal (Wheeldon) was heard together with the related appeal in Butcher v Body Corporate 342525 (CA42/2017) (Butcher). Both appeals arise out of the same long‑running dispute between the owners of apartments in the Bridgewater Bay Apartments situated on the outskirts of Paihia in Northland as to the remedial works required to overcome weathertightness issues.
The appellants in both proceedings own five of the 22 apartments in the building. Derek and Carol Wheeldon sold their apartment to Robyn Stent (who is the wife of counsel for the appellants, Mr Brill) in March 2014 with the transfer being registered on 31 July 2014. This appears to be why Mr and Mrs Wheeldon were named as plaintiffs in the Wheeldon proceedings issued on 30 July 2014 but were replaced by Ms Stent in the Butcher proceedings issued on 7 July 2015.
The appellants consider that targeted repairs by individual owners would have been sufficient whereas the Body Corporate, supported by the majority, has consistently maintained, on the recommendation of Origin Building Consultants Ltd (Origin), that more comprehensive remedial works were required. The Body Corporate considered that it was responsible for carrying out these works in terms of its repair and maintenance obligations under s 138 of the Unit Titles Act 2010 (the Act). The works have been completed by the Body Corporate and the contest now centres on who should pay for them.
At the conclusion of the hearing, we dismissed both appeals with reasons to follow.[1] These are our reasons for dismissing the Wheeldon appeal. Our reasons for dismissing the appeal in Butcher are delivered contemporaneously.[2] We have set out the relevant background in the Butcher reasons judgment. Rather than repeating that background here, this judgment should be read together with our reasons judgment in Butcher.

Claim in the High Court

[1]Wheeldon v Body Corporate 342525 [2017] NZCA 424; Butcher v Body Corporate 342525 [2017] NZCA 423.

[2]Butcher v Body Corporate 342525 [2018] NZCA 19 [Butcher Reasons (CA)].

In their statement of claim filed in July 2014, the Wheeldon plaintiffs advanced two causes of action. In the first, they claimed that the remedial works recommended…

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.

Continue reading Wheeldon v Body Corporate 342525

Details

AGLC: Wheeldon v Body Corporate 342525 [2018] NZCA 20
Case: [2018] NZCA 20
Decision Date: 20 September 2017 at 3.00 pm

CaseChat Overview and Summary

In Wheeldon v Body Corporate 342525, the appellants, who own apartments in the Bridgewater Bay Apartments in Paihia, appealed against a decision of the High Court that dismissed their claims against the Body Corporate responsible for the maintenance of the building. The appellants argued that the Body Corporate had breached the Unit Titles Act 2010 by misusing a long-term maintenance fund and unlawfully raising a special levy to pay for weathertightness issues in the building. The Court of Appeal dismissed the appeal and found that the Body Corporate had not breached the Act. The court found that the fund in question was an optional contingency fund, not a long-term maintenance fund, and that the special levy was properly raised by the Body Corporate.

The legal issues before the Court of Appeal were whether the High Court was correct in finding that the Body Corporate did not breach the Act by using the long-term maintenance fund for unbudgeted expenditure and whether the Body Corporate lawfully raised the special levy. The appellants argued that the Body Corporate had misappropriated funds and acted without lawful authority. However, the Court of Appeal found that the Body Corporate had the authority to use the contingency fund for unbudgeted expenditure and that the special levy was properly raised and ratified by the Body Corporate. The court also found that the appellants' appeal lacked merit and that an uplift of 50% on standard costs was appropriate.

The final orders of the Court of Appeal were that the appeal be dismissed and that the appellants pay the respondent's costs for a standard appeal on a band A basis with a 50% uplift and usual disbursements. The court also certified for second counsel.

Orders