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Wheeldon v Body Corporate 342525

Wheeldon v Body Corporate 342525

Case [2015] NZHC 884 30 April 2015

Unjust Enrichment

Causation

Specific Performance

Statutory Construction

Property Law

Administrative Law

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IN THE HIGH COURT OF NEW ZEALAND WHANGAREI REGISTRY

CIV-2014-488-0122 [2015] NZHC 884

BETWEEN
DEREK PETER WHEELDON AND

CAROL ANN WHEELDON, ANTHONY JOHN BUTCHER AND RUTH BARBARA ROGERS, LARRY LAWRENCE SMALL AND

KM TRUSTEES SERVICES LTD, IVOR ANTHONY MILLINGTON AND NEVILLE EADE

Plaintiffs

AND

BODY CORPORATE 342525
Defendant

AND

ROBYN KATHLEEN STENT Counterclaim Defendant

Hearing: 2-6, and 10-11 March 2015

Counsel:

B E Brill for the Plaintiffs and Counterclaim Defendant
TJG Allan and TJP Gavigan for the Defendant

Judgment:

30 April 2015

INTERIM JUDGMENT OF MUIR J

This judgment was delivered by me on 30 April 2015 at 4.30 pm pursuant to Rule 11.5 of the High Court Rules.

Registrar/Deputy Registrar

Date:………………………….

Solicitors: B E Brill Ltd, Kerikeri
Grove Darlow & Partners, Auckland

WHEELDON v BODY CORPORATE 342525 [2015] NZHC 884 [30 April 2015]

Introduction

[1] Yet again the Courts are faced with a Body Corporate whose members have strongly divergent views as to how it should respond to alleged weathertightness issues. Together, they own the 22 apartments comprising the Bridgewater Bay Development adjacent to an estuary on the outskirts of Paihia. The development was constructed between 2003 and 2004.

[2] In response to a detailed report by a specialist investigator 17 of the unit owners wish to proceed with a comprehensive repair which would, among other things, require regrading each of the apartment decks and remodelling (or replacing) existing joinery suites on the northern façade of the development. The cost is substantial. Although originally budgeted at approximately $1.7 million, recent escalation in building costs and the absence of a competitive local market has seen that budget increase to in excess of $3 million. During the course of the trial this option came to be identified by the defendant as the “holistic repair”. It would involve delivery of a development fully compliant with current Building Code requirements and, says the Body Corporate, would mitigate, as fully as possible, the current stigma attaching to the building.

[3] The five plaintiffs, or at least those who owned apartments at the time, were initially supportive of (or passively accepted) the holistic repair option. However, with what they say is better information and in the face of escalating costs, they now submit that the Body Corporate’s proposed works are ultra vires and/or have not been properly authorised. They allege “capture” of the Body Corporate by the Auckland based “leaky building industry” and cupidity on the part of individual consultants. They contend for a limited or “targeted” repair, deny that there are any systemic problems with the development and say that all that is currently required is remedial work to the two timber-framed “penthouses” which sit on the fourth floor of the building. They say that such work should be paid for by the owners of those units and that although other elements of the building, and, in particular, deck membranes for the remaining 18 apartments, may be nearing the end of their service life, all that is, in due course, required is to lift…

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 [2015] NZHC 884
Case: [2015] NZHC 884
Decision Date: 30 April 2015

CaseChat Overview and Summary

The case of Wheeldon v Body Corporate 342525 involved a dispute among unit owners in the Bridgewater Bay Development, a multi-unit property in Paihia, New Zealand. The dispute centred on the scope and legality of proposed repairs by the Body Corporate to address weathertightness issues. Seventeen of the unit owners supported a comprehensive repair plan, while five owners opposed it, advocating for a limited repair approach. The court was tasked with determining the legal issues surrounding the Body Corporate's duties under the Unit Titles Act 2010, particularly in relation to repair and maintenance of building elements and infrastructure that serve more than one unit or the common property.

The key legal issues included whether the Body Corporate's duties under s 138(1)(d) of the Unit Titles Act 2010 were subordinate to the duties of unit owners under s 80(1)(g), and whether the Body Corporate had the authority to undertake repairs within unit boundaries without first giving individual unit owners the opportunity to effect their own repairs. The court also considered the proper interpretation of s 138(1)(d) and whether it included building elements that serve the common property.

The court rejected the plaintiffs' argument that the Body Corporate's duties under s 138(1)(d) were secondary to the unit owners' obligations under s 80(1)(g). It held that the Act intended to provide a flexible and responsive regime for the governance of unit title developments, and that the Body Corporate had a duty to ensure the integrity of the development as a whole. The court found that the Body Corporate was entitled to undertake a comprehensive repair of the entire building without first requiring individual unit owners to effect their own repairs. It also amended s 138(1)(d) to include building elements that serve the common property, harmonising it with s 80(1)(a)(ii).

The court dismissed the plaintiffs' claims for declarations and injunctions, finding that the Body Corporate's proposed repair plan was within its legal authority. It adjourned the determination of the plaintiffs' second cause of action and the counterclaims for a later date, allowing the parties an opportunity to resolve the issues between themselves. The court reserved costs for its final judgment.

Orders