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Wheeldon v Body Corporate 342525

Wheeldon v Body Corporate 342525

Case [2016] NZCA 247 7 June 2016

Contract Formation

Specific Performance

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Breach of Contract

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IN THE COURT OF APPEAL OF NEW ZEALAND

CA290/2015
[2016] NZCA 247

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:	12 November 2015
Court:	Winkelmann, Courtney and Clifford JJ
Counsel:	C Baker and B E Brill for Appellants T J G Allan and T J P Gavigan for Respondent
Judgment:	7 June 2016 at 11 am

JUDGMENT OF THE COURT

A The application to adduce fresh evidence is declined.

B The appeal is dismissed.

CThe appellants must pay the respondent costs for a standard appeal on a band A basis and usual disbursements.

____________________________________________________________________

REASONS OF THE COURT

(Given by Courtney J)

Introduction

The Bridgewater Bay apartment complex in Paihia has weather-tightness issues. Its Body Corporate considers that they are significant and proposes substantial remedial work at an estimated cost of about $3,000,000. The owners[1] of five of the units do not accept that the water-tightness issues require this response. They say that targeted repairs at less cost would be sufficient. These unit owners applied unsuccessfully for declarations and injunctive relief to prevent the proposed work proceeding. They appeal against Muir J’s decision.[2]
[1]The first and second named appellants, Mr and Mrs Wheeldon, have sold their unit to Ms Stent, who has taken their rights of action by assignment.
[2]Wheeldon v Body Corporate 342525 [2015] NZHC 884 [HC decision].
The appeal raises questions about the nature of the scheme provided under the Unit Titles Act 2010 (UTA 2010) for repairs and maintenance. Central to these issues is the interpretation of s 138(1)(d), which confers on bodies corporate the obligation to repair and maintain building elements that relate to more than one unit. The unit owners do not accept that s 138(1)(d) authorises the Body Corporate to undertake the work proposed to wall panel frames that form part of the northern façade of the building, or to the decks at levels two and three.[3] Their central proposition is that they have the primary obligation (and right) to repair and maintain their units, including building elements, such as decks, located within the units. On the appellants’ case, the Body Corporate’s obligation to repair and maintain building elements is limited to:
(a)cases where the unit holder defaults in his or her primary obligation; and
(b)cases where repairs and maintenance are required to infrastructure or common property that can only be accessed through another unit holder’s unit.
[3]Although the case in the High Court involved all of the proposed work, the appeal focused on the proposed repairs to the panels forming part of the façade and the decks at levels two and three.
The appellants say that if the Body Corporate is to act, it bears the onus of showing that the proposed work is necessary and that it falls within s 138(1)(d). This Body Corporate has failed to discharge that onus. They also say…

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 [2016] NZCA 247
Case: [2016] NZCA 247
Decision Date: 7 June 2016 at 11 am

CaseChat Overview and Summary

This appeal concerns the scope of the Body Corporate's obligations to repair and maintain building elements under s 138(1)(d) of the Unit Titles Act 2010 (UTA 2010). The Body Corporate has proposed to undertake work to repair weather-tightness issues at a cost of about $3,000,000. The appellants, owners of five of the units, sought to prevent the work from proceeding. They lost their challenge to the Body Corporate's decision at first instance and appeal to the Court of Appeal. The appeal was dismissed. The appellants' arguments can be summarised as follows. They submit that they have the primary obligation to repair and maintain building elements that relate to more than one unit. The Body Corporate can only act if they fail to fulfil their obligations under s 80(1)(g) of the UTA 2010. The appellants say that s 138(1)(d) does not apply to building elements that relate to more than one unit because the proposed work is not necessary. The appellants also argue that the Body Corporate was not properly authorised to undertake the work. The Court of Appeal rejected the appellants' arguments. The Court held that the Body Corporate's obligations under s 138(1)(d) prevail over those of the unit owners under s 80(1)(g) because of the purposes of the UTA 2010. The Court held that s 138(1)(d) engaged in relation to the panels and decks because they related to or served more than one unit. The Court also held that the Body Corporate was properly authorised to undertake the proposed work. The Court of Appeal dismissed the appeal and ordered the appellants to pay the respondent's costs.

Orders