Wu v Body Corporate 366611 HC Auckland CIV 2009-404-5756
[2010] NZHC 1288
•30 July 2010
IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY
CIV 2009-404-5756
UNDER the Unit Titles Act 1972
BETWEEN CHUAN WU Plaintiff
AND BODY CORPORATE 366611
First Defendant
ANDTHETA MANAGEMENT LTD Second Defendant
Hearing: 9 June 2010
Counsel: B Rooney for Plaintiff
P D Sills for First Defendant
D M Lester and L Tran for Second Defendant
Judgment: 30 July 2010
JUDGMENT OF HEATH J
This judgment was delivered by me on 30 July 2010 at 4.00pm pursuant to Rule 11.5 of the High
Court Rules
Registrar/Deputy Registrar
Solicitors:
James Keat, PO Box 99-680, Newmarket, Auckland
Clendons, PO Box 1305, Auckland
Counsel:
B Rooney, PO Box 3320, Shortland Street, Auckland
P D Sills, PO Box 414, Kumeu 0841D M Lester, PO Box 825, Christchurch 8011
WU V BODY CORPORATE 366611 AND ANOR HC AK CIV 2009-404-5756 30 July 2010
The application
[1] Mr Wu seeks orders enforcing a judgment delivered by Lang J on 30
November 2009.[1] The judgment dealt with three preliminary questions, which were condensed into one by the Judge. The question, answered “yes” by Lang J,[2] was:
Did the Body Corporate act in excess of its powers under the [Unit Titles] Act [1972] in resolving on 8 February 2008 and 17 April 2009 to amend rule
3.10 [of the Body Corporate Rules]?[3]
[1] Wu v Body Corporate 366611 HC Auckland CIV 2009-404-5756, 30 November 2009.
[2] Ibid, at para [48].
[3] Ibid. Rule 3.10, in its finally amended form, is set out at para [11] of Lang J’s judgment and at para [12] below.
[2] Mr Wu claims that he is being denied entry to common areas of a unit title complex, from which his individual unit must be accessed. Mr Rooney, on his behalf, submits that denial of access is in contravention of Lang J’s judgment.
Background
[3] Empire Apartments is a high-rise unit title development containing 315 residential units, situated in Whitaker Place, Auckland. The building is used, primarily, as rental accommodation for students who are undertaking studies in Central Auckland. Most of the units are leased by owners to the building manager, Theta Management Ltd (Theta). Those leases include a term nominating Theta as the owner’s general proxy, for the purpose of voting at general meetings of Body Corporate 366611 (the Body Corporate). In turn, Theta sub-leases the units to students.
[4] Mr Wu is the proprietor of unit 810. He is one of a relatively few owners who rent their units directly to tenants.[4]
[4] The present application is purportedly brought on behalf of Mr Wu and the owners of units 722, 729,
912 and 1410. None of the other owners are joined as plaintiffs in this proceeding. See further paras
[29] and [31](c) below.
[5] The Body Corporate has contracted with Theta to manage the building. In terms of that contract, Theta has the operational responsibility for management of common areas in the apartment complex. Over the last few years, there have been tensions between Mr Wu (and those owners who support his position) and the Body Corporate. The tensions arise out of Theta’s dual interest as building manager and lessee of most of the units. As building manager, Theta acts on behalf of all
individual owners who make up the Body Corporate.[5] On the other hand, it has its
own economic interests to serve as a sub-lessor.
[5] Unit Titles Act 1972, s 12.
[6] The present litigation was commenced on 18 September 2009. The legitimacy of some of the Body Corporate rules (the Rules) is in issue. There are claims that the Body Corporate and Theta have acted unlawfully, contrary to Mr Wu’s interests. An application to appoint an administrator has been made.[6] Relief sought includes declarations as to the validity of certain rules and resolutions, as well as consequential orders.
[6] Unit Titles Act 1972, s 40.
[7] On 26 November 2009, Lang J heard argument on the preliminary question, relating to the validity of r 3.10 of the Body Corporate Rules (the Rules).[7] Rule 3.10 was inserted into those Rules as one that could be amended by majority (as opposed to unanimous) resolution of the individual proprietors.
[7] See para [1] above.
[8] The rule deals with security keys. Mr Wu’s concern lay in amendments to that rule, purportedly made on 8 February 2008 and 17 April 2009, which provided for sums of money to be paid as a refundable security deposit in respect of the acquisition of keys to the common area of the building.[8] The amendments were passed by a majority of owners,[9] with a number of the votes in favour being exercised by Theta, under a general proxy for the owners of the units that it leased.
[8] See paras [11] and [12] below.
[9] Mr Wu’s contention was that any amendment to r 3.10 had to be by way of unanimous resolution. This contention was accepted: see para [9] below.
[9] After the amendments were promulgated, the Body Corporate and Theta relied on them to support a decision not to supply access cards to Mr Wu and others,
even though they owned individual units. Lang J held that the amendments to r 3.10 were invalid and void as, in terms of the Unit Titles Act 1972 (the Act), r 3.10 could only be amended by unanimous resolution. The Judge said:
[47] The amendments to r 3.10 in 2008 and 2009 were wide ranging in scope. They purported to provide the body corporate and its agents with the power to require unit owners to pay substantial sums of money and to require them to enter into onerous contracts. Those are clearly the types of powers that the body corporate could only ever acquire by way of a rule under Schedule 2 rather than Schedule 3 [of the Unit Titles Act 1972]. Even putting aside the issue of the width of the powers, the absence of unanimity when the body corporate passed the resolutions means that they are ultra vires and invalid.
...
[53] There can be no justification for the body corporate and Theta denying proprietors access to their units in the future. Counsel for the body corporate responsibly accepted during the hearing that this was the case. I would therefore expect the body corporate and Theta to co-operate immediately in providing Mr Wu and others in his position with keys to their units.
How did the disputes arise?
[10] Rule 3.10 was incorporated into the original rules regulating the Body Corporate’s functions. When this rule was promulgated, on 30 March 2006, the only member of the Body Corporate was the developer of the complex. The original form of r 3.10 was:
3.10 Security Keys
(a) If for security purposes the Body Corporate or its agent the Secretary and/or the Building Manager restricts the access of any Proprietor or occupier to Common Property it may make available to that person a Security Key.
(b) A Proprietor or occupier in possession of a Security Key must not duplicate it, or permit it to be duplicated, and must take all reasonable steps to ensure that the Security Key is not lost or handed to any other person.
(c) A Proprietor or occupier must notify the Building Manager or the Body Corporate promptly if a Security Key is lost, or destroyed.
[11] At an Extraordinary General Meeting held on 8 February 2008, r 3.10 was repealed and replaced with the following:
3.10 Security keys
(a) That the Body Corporate or its agent the Secretary, or the Building Manager as necessary from time to time to ensure the ongoing security and efficient management of the Building may require any Proprietor or occupier of any Unit to:
i. Enter into a security and access protocol agreement detailing the regulations relating to the security of and access to services in the Building as the Body Corporate may from time to time prescribe; and
ii. Pay a refundable security deposit to the Body Corporate, or its agent the Secretary or the Building Manager of a total amount as set out below (which amount notwithstanding the provisions of rule 1.3 shall only be revised by a resolution of the Body Corporate) for the purposes of access security, fire protection, telecommunication services and utilities services for the Building.
Refundable security deposit $2,650
Key and swipe card [ ] Telephone and internet [ ] Fire security [ ] TOTAL $2,650
[12] On 17 April 2009, at the Annual General Meeting of the Body Corporate, a majority of those entitled to vote purported to repeal the amended version of r 3.10 and to substitute it with the following:
3.10 Access and security
(a) That the Body Corporate or its Agent the Secretary, or the Building Manager as necessary from time to time to ensure the ongoing security and efficient management of the Building may require any Proprietor, Proprietor’s Representative or the occupier of any Unit to:
1.Enter into a security and access protocol agreement detailing the regulations relating to the security of and access to services and utilities in the Building and each unit as the Body Corporate may from time to time prescribe; and
2.Pay a refundable security deposit to the Building Manager of a total amount as set out below (which amount shall only be revised by a resolution of the Body Corporate) for the purposes of access security, fire protection, insurance excess reserve, telecommunication services and utilities services and repair for the Building and each Unit:
Refundable security deposit $5,000
Key and swipe card [ ] Telephone and internet [ ] Fire security [ ] TOTAL ($5,000)
3.In the context of this Rule a Proprietor’s Representative includes individuals or companies appointed by the Proprietor to act as the Proprietor’s Representative to either rent, manage or sell a Unit (“Representative”). Where such Representative is appointed by a Proprietor, an individual person must be nominated to accept personal responsibility and liability under this Rule on the terms set out below.
4.Where a Proprietor’s Representative has been appointed by the Proprietor of a Unit, then the following additional security and access rules apply:
(a) The Representative must provide the Body Corporate or its agent the Secretary, or the Building Manager, with a signed undertaking and warranty letter from the proprietor appointing the Representative and authorising him or her to act on behalf of the proprietor.
(b)The Representative must agree to abide by all of the Body Corporate or its agent the Secretary, or the Building Manager’s rules and regulations imposed from time to time, copies of which will be provided to the Representatives upon request;
(c) A Representative Undertaking and Warranty Letter must be signed by the Representative for each Unit they represent. The form of the letter is to be as prescribed by the Body Corporate or its agent the Secretary, or the Building Manager from time to time.
(d)The Representative must procure the signature of each Proprietor certain undertakings required by the Body Corporate that relate to acceptance of liability for damages and excess on insurance premiums that have been taken out by the Body Corporate, or its agent the Secretary, or the Building Manager, for the benefit of the building as a whole;
(e) The Representative must agree to only let the Unit or Units he or she manages to students over 18 years old with a valid student ID;
(f) The Representative must ensure they advise the Proprietor of their IRD obligations when the Unit is rented residentially;
(g) The Representative acknowledges that open homes and the display of marketing signage or flags are strictly forbidden in the Empire Apartments and its proximities;
(h)The Representative must register every showing of a Unit or Units that he or she manages with the on duty manager appointed by the Building Manager;
(i) The Representative is to personally accompany every student, prospective purchaser or guest who is shown a unit;
(j) Any access cards provided by the Building Manager to the Representative must remain in the possession of the Representative at all times. Should an access card be found not to be in the possession of the Representative then all access cards currently held by the Representative will be cancelled;
(k) The Representative agrees to rent any units for not less than the minimum rents in the building plus utilities (electricity and telephone) set from time to time by the Body Corporate, or its agent the Secretary, or the Building Manager.
(l) All tenants procured by the Representative must be registered with the Building Manager and provide proof of student ID to the satisfaction of the Building Manager;
(m) All tenants must sign utilities agreements (electricity and telephone) directly with the Building Manager and pay those utility charges directly to the Building Manager.
5. The following additional refundable security deposits to be paid to the Building Manager shall be provided by the Proprietors and/or occupiers of any Units that are managed by a Proprietor’s Representative other than the Building Manager appointed by the Body Corporate:
Key and swipe card $150
Utilities deposit $500
[13] Having regard to Lang J’s findings, the present position is that r 3.10, in its original form,[10] governs the question of security keys.
The competing contentions
[10] See para [10] above.
[14] Mr Wu complains that the Body Corporate and Theta have not complied with the direction given by Lang J[11] or acted in a manner consistent with his findings that the amendments to r 3.10 were invalid.[12] Mr Rooney, on behalf of Mr Wu, seeks the following orders, to give effect to the question that Lang J answered:
[11] Wu v Body Corporate 366611 HC Auckland CIV 2009-404-5756, 30 November 2009 at [53]; see para [9] above.
[12] Ibid, at para [47]; see para [9] above. See also fn 5 above.
a) Directing the Body Corporate and Theta to deliver to each of the registered proprietors of Unit 722, 729, 912 and 1410[13] (or their nominees) electronic access cards providing unrestricted access to the floor where each of the apartments is located.
b)Directing the Body Corporate and Theta to pay Mr Wu’s costs on the application.
[13] The order sought extends to units other than Mr Wu’s.
[15] Mr Sills, for the Body Corporate, argued the application on behalf of both the Body Corporate and Theta.[14] The application is opposed on the merits; on the grounds that the orders made by Lang J have been complied with, so orders are unnecessary. An alternative ground of opposition is a lack of jurisdiction for this Court to enforce the answer given by Lang J to the question posed.
[14] Mr Lester, for Theta, took responsibility for arguing a contemporaneous application to strike out the seventh cause of action, an application that remains part-heard.
[16] On the merits, Mr Sills relies on an intervening event; namely an agreement which he contends was entered into after Lang J’s judgment, between a representative of the relevant unit owners (Mr Song) and the Body Corporate, concerning the way in which swipe cards would be issued for tenants to access those units.
[17] The “merits” defence arises in this way. After Lang J delivered his judgment on the preliminary question,[15] counsel for Mr Wu and the Body Corporate corresponded in an endeavour to resolve their differences over access to the units.
[15] See paras [1] and [9] above.
[18] On 17 December 2009, Mr Rooney, counsel for Mr Wu, wrote to counsel for the Body Corporate and Theta to record an arrangement they had reached:
Empire building
As I understand the arrangement we discussed this morning, the position is as follows:
1. The body corporate or Theta will open the doors to apartments 512,
624, 722, 728, 810, 912, 1210, 1410, 1516, 1517 and 1815 in the first instance. A time will have to be arranged for this because it will
have to be done in the presence of my clients’ locksmith. I expect it can be done tomorrow or on Monday.
2. My clients’ locksmith will replace or install locks once the doors have been opened. My clients reserve their rights to recover the costs of this, as discussed.
3.Common area access cards will be issued on request. The body corporate has indicated an intention to charge $150.00 per card. My clients reserve their rights to recover any such charge, as discussed.
4.George Song will act as the representative for my clients and the common area access cards will be issued to him in the first instance. Theta and the body corporate will have to ensure that the on-site building manager, with whom Mr Song will deal, knows the details of the arrangements.
5.The costs payable on the appeal and on the preliminary question hearing will be paid tomorrow by deposit to James Keat’s trust account . . ., and confirmation of payment will be sent to me and to Mr Hibbitt of James Keat, solicitors . . . The amount payable is as shown in the draft judgments which I have already provided. The costs are $5,160.00 on the appeal and $4,960.00 on the preliminary question hearing, being a total of $10,120.00. (my emphasis)
....
[19] Mr Sills, counsel for the Body Corporate, responded on 18 December 2009, stating:
My only issue is paragraph 1. I think the first sentence should read: “The body corporate or Theta will use their best endeavours to open the doors .....”
We have already had one locksmith there who could not open the doors. If we get a couple more that all reach the same position then I do not want the plaintiff to be saying that the Body Corporate must open the doors at all cost. It was clear yesterday that the Court considers that opening and controlling the doors is your clients’ issue to be met at their cost. We have been directed/encouraged to assist which we are endeavouring to do.
If another couple of locksmiths say they cannot do it as well then the other option is to take the doors off at the hinges and go from there. That should be for your clients to decide.
On the other issues:
1. The costs have been paid.
2.A new s 36 certificate for Mr Song has been sent. He will receive a swipe card on the same terms as the rest of your clients. (my emphasis)
[20] As is clear from that exchange of correspondence, Mr Wu and the Body Corporate were in agreement in relation to the points set out in paras 2-5 of Mr Rooney’s letter.[16] As a result, at a meeting held at about 2.30pm on 23 December
[16] See para [18] above..
2009 Mr Song, acting on behalf of a number of unit owners,[17] including Mr Wu,
[17] See para 4 of Mr Rooney’s letter of 17 December 2009; set out at para [19] above
signed a document designed to give effect to that agreement. The Body Corporate contends that Mr Song bound Mr Wu and other proprietors for whom he was acting to comply with the Rules, the “Empire Residents Handbook” and the “Empire Security and Access Policy”, in return for being given common area access cards, for the purpose of accessing individual units.
[21] Access cards to the relevant common areas were subsequently issued to Mr Song, at a price of $150.00 each. The sum of $150 was paid, on a without prejudice basis. The reasonableness of the fee remains in issue in the substantive proceeding.
[22] In addition, common area access cards were made available to Mr Song when he was appointed by six of the proprietors as an agent to let their units to tenants. In an affidavit Mr Song deposed that the “[common area access] cards for those units were issued without difficulty”.
Analysis
[23] The preliminary question determined by Lang J focussed on the need for keys to be supplied to Mr Wu and other owners who had not entered into leases to Theta. The central issue involved access to individual units, as opposed to common property.
[24] The Judge’s conclusion that the amended form of r 3.10 was invalid was based on a need for unanimous agreement to empower a Body Corporate to withhold access keys to individual proprietors or occupiers, in circumstances where the Body Corporate or the building manager had decided to restrict access to common areas.[18]
[18] Wu v Body Corporate 366611 HC Auckland CIV 2009-404-5756, 30 November 2009 at [35].
Because the “sole function” of the amended rule 3.10 “was to impose restrictions upon the unit owners”, the Judge held that it was a rule that could only be amended by unanimous resolution of the proprietors.[19]
[19] Ibid, at [41].
[25] The present application is directed specifically to access to the common areas. It is accepted that owners now have keys to enter their own units. What is in issue is the power of the Body Corporate (or its building manager) to withhold security keys for common areas, in order to ensure the building is managed in the best interests of all proprietors. Such interests, Mr Sills submits, include the need to make the building secure and to ensure only those persons actually entitled to be present in particular units have the ability to use common areas to reach them.
[26] For example, without any obligation to provide identification, it may be possible for a burglar (by using a tenant’s name) to obtain a key enabling him or her to access a particular floor within the complex, even though no card or key may be held to obtain access to any particular unit. I agree with Mr Sills that, in the absence of an appropriate identification regime, it would be impossible for a building manager to be able to identify the hundreds of students who occupy the units.
[27] That is the context in which the arrangements involving Mr Song need to be considered. On the face of it, the agreement reached by the exchange of
correspondence between Mr Rooney and Mr Sills[20] has been given effect through the actions of Mr Song. By way of example, in respect of unit 722,[21] Mr Song signed a document, on 23 December 2009, stating:
[20] See paras [18] and [19] above.
[21] Similar documents were signed for other apartments.
I (we) acknowledge that I (we) have received or been offered the opportunity to read the following:
– Empire Boyd Corporate Rules
– Empire Residents Handbook
– Empire Security & Access Policy
(together the Registration Documents)
I (we) further acknowledge that I (we) understood it is compulsory to read and understand the above documents as they are essential to the health and safety of all occupants in Empire Apartments and I shall contact Empire reception staff members shall I have query regarding these documents.
I (we) further agree in favour of the Body Corporate that in consideration of being permitted access to the Empire and its Common Property, I (we) will fully abide with the Registration Documents.
[28] The fact that Mr Song acted in accordance with that agreement was asserted by Mr Sills in a letter to Mr Wu’s solicitor of 2 March 2010. After referring to specific complaints made in that solicitors’ letter of 26 February 2010, Mr Sills stated:
In addition, on 23 December 2009, Mr George Song, as the agent for the plaintiff and various other owners, agreed to the procedures at a meeting between Mr Song and the Body Corporate Legal Committee (copy of memorandum attached).
Mr Song had conducted himself in accordance with the procedures now complained of. At all times Mr Song has introduced tenants to reception at the Empire Apartments for registration and he has completed all requisite documentation for the issuing of security cards etc. The Body Corporate has been pleased with the conduct of Mr Song to date and thanks him for that. Attached are documents evidencing the procedures followed by Mr Song as agent for the various owners. I have also attached copies of an invoice to Mr Song for the release of various security cards together with a summary showing the registered tenants introduced by Mr Song and the cards signed for by Mr Song.
A problem has now arisen whereby the owner of Unit 729 (and/or their agent) has given at least one of the common area security and access cards
for Unit 729 to a Mr Kim Anderson. Not only is Mr Anderson not registered as an occupant of the Empire Apartments, but he has in discussions with the staff at reception confirmed that he is not an occupant of Unit 729.
The card in question (registration no. 2404) was issued to Mr Song on 15
January 2010. Mr Song signed for the card and paid the deposit on the card of $150. The fact that the card had changed hands only came to the attention of the Body Corporate when Mr Anderson approached the front desk requesting assistance because his card did not work. Mr Anderson advised that he was a tenant of Unit 722. That fact was not known to the Body Corporate’s agent, Theta.
The situation involving Mr Anderson is in contravention of the procedures issued by the Body Corporate in December 2009. It is also in breach of the agreement reached between the Body Corporate and Mr Song on 23
December 2009. The situation is likewise in contradiction of the resolutions passed at the EGM on 18 January 2010.
.... (my emphasis)
[29] Mr Song has given evidence about the circumstances in which the 23
December 2009 meeting was held. It appears that he believed the way in which he signed the documents was sufficient to absolve his principals from the need to comply with his agreement. He disputes that he was clothed with authority to bind Mr Wu and others.[22] Mr Song deposed:
[22] Compare with the letter from Mr Rooney to Mr Sills of 17 December 2009, set out at para [18] above.
6.However, electronic access cards were still needed for access to the floors of the building by the lifts or stairs. The owners could not get access to their units by any other means. I was told that the lawyers involved had agreed that one common area access card was to be issued by Theta for each of the 10 units. This was done and those cards were given to me on about 18 December 2009. I was then able to arrange for the physical locks to each of the units to be installed.
7.However, a common area access card was needed for each of the tenants who were to be installed in the units (the units can accommodate 3 to 5 tenants) and the owners all needed their own common area access cards. These additional cards were to be issued as tenants were found, and there was to be a charge of $150 per card.
8.As part of the process of obtaining the lifts/stair access cards for tenants, I was called to a meeting at Empire on 23 December 2009 with [Mr Chen]of the body corporate and Theta’s manager Mr Xu. This was effectively the last working day before Christmas and the proprietors were anxious to get access to their units, which they had been denied for about 2½ years, so that their units could be let to tenants.
22
9.It was clear to me from the meeting that Theta and the body corporate would not issue any more common area access cards unless I agreed to [Mr Chen’s] and Mr Xu’s terms.
10.I agreed to sign documents given to me by [Mr Chen] and Mr Wu, but I was very careful to sign them for myself only. The printed documents which were given to me referred only to “occupants” of the units. I knew that none of the proprietors intended to occupy the units. I crossed out “occupant” on each form, and wrote in “representative” and signed the documents. Agreeing to this was the only way I could gain access to the floors in the building so that the physical locks could be installed by locksmiths.
11.I had no authority to bind the owners to [Mr Chen’s] and Mr Xu’s terms, so I was very careful to ensure that I signed the documents for myself only. (my emphasis)
[30] There are further conflicts in the evidence that I cannot resolve without hearing and seeing witnesses. An example of differences involving both substance and emphasis can be found in the conflicting evidence of Mr Lee and Mr Chen. They seek to cast blame for events that occurred when Mr Lee, acting on behalf of some owners, was taking steps to let units 722, 729, 912 and 1412 in February 2010. There is no need to go into detail. It is not the only area of conflict which might be relevant, ultimately, to any findings of credibility in respect of the primary protagonists.
[31] The need to make determinations on questions of fact after witnesses have been cross-examined mean that this is not an appropriate case in which to make any orders of the type sought by Mr Wu. Other factors militating against any enforcement orders are:
a) Lang J’s judgment dealt with a question of vires, in relation to r 3.10.
It simply answered a question “yes”. It did not go any further; in particular (and understandably because of the limited information before the Judge) no orders were made as to the consequences of the answer given to the vires question. The absence of any specific orders makes it difficult to direct particular steps to be taken in respect of the common area access issue, particularly as the Judge’s obiter observations about the lack of justification for denying proprietors access to their units and his expectation that Mr Wu and others in his
position would be supplied with keys “to their units” did not focus on the wider issues that have been debated before me.[23]
[23] Wu v Body Corporate 366611 HC Auckland CIV 2009-404-5756, 30 November 2009 at para [53], set out at para [9] above.
b)It is inappropriate for me to rule, in the context of an application to enforce Lang J’s judgment, on questions of vires not determined by him. That observation extends to the validity of conditions set out in all of the so-called “Registration Documents”.[24]
[24] See para [27] above.
c) If it were found that Mr Song did have authority to bind Mr Wu and the other owners whom he purported to represent, it is seriously arguable that the ground has changed significantly since Lang J’s judgment was delivered. Authority must be judged on the basis of all available relevant evidence.[25] The agent’s view is not determinative.
[25] See, generally, Savill v Chase Holdings (Wellington) Ltd [1989] 1 NZLR 257 (HC, CA and PC).
The correspondence between Mr Rooney and Mr Sills[26] suggests that
[26] Paras [18] and [19] above.
Mr Song did have authority. Mr Song’s explanation about his intention not to bind his principals could, on one view, be regarded as disingenuous. If new arrangements were made after judgment was delivered on 30 November 2009, those arrangements have not been the subject of judicial scrutiny to date. New arrangements are inapt for consideration on an enforcement application of the type with which I am now dealing.
d) Counsel were agreed that the issues before me are confined to units
722, 729, 914 and 1410. None of those units are owned by Mr Wu. The jurisdictional basis for making an order of the type sought by Mr Wu is dubious, when the owners of the units in issue are not co- plaintiffs in the proceeding.
e) The preferable option is to seek priority to resolve the substantive proceeding, as opposed to focussing on individual issues, none of which is likely to resolve the continuing disputes.
Result
[32] The application for enforcement orders is dismissed. [33] I make the following directions:
a) I direct the Registrar to set the proceeding down for a case management conference before the Civil List Judge (Lang J) on the first available date after 27 August 2010. That date is deliberately fixed at a time after the point at which Mr Lester, for Theta, is required to file and serve a memorandum, in response to an Amended Statement of Claim, indicating whether Theta wishes to pursue its application to strike out the seventh cause of action. Much will depend upon the way in which that cause of action is re-pleaded in the Amended Statement of Claim. That document was due to be filed and served earlier today.
b) Mr Rooney shall file and serve a memorandum on or before 18
August 2010 setting out:
i)The further directions required to ready the proceeding for hearing at the earliest possible time.
ii)The trial issues, on the assumption that the substantive claims in the Amended Statement of Claim are disputed.
iii)The number of witnesses who will give evidence; this will include the need to timetable filing and service of any further affidavits in support of or in opposition to the claims.
iv) An estimate of the time required to hear the proceeding.
c) Mr Sills and Mr Lester shall (after conferring) file and serve separate memoranda responding to Mr Rooney’s memorandum, on or before
25 August 2010. They should also express their own views on the topics to which I refer in (b) above.
[34] For Lang J’s benefit, I indicate my view that the need to determine the proceeding promptly outweighs the need for assignment to a particular Judge. The only possible exception would be if Theta elected to pursue its application to strike out the (present) seventh cause of action, which is currently part-heard.
[35] I did not hear from counsel on costs. If Mr Wu’s view of the facts and law is correct, then he has been put to much inconvenience and may have suffered financial loss due to the actions of the Body Corporate and Theta. In contrast, if the Body Corporate’s and Theta’s view of the facts and law is correct, Mr Wu’s stance might be regarded as unreasonable.
[36] In those circumstances, my strong preliminary view is that costs should be reserved on the enforcement application, to follow the outcome of the substantive proceeding itself.
[37] If, despite that indication, counsel wish to make any contrary submissions on costs, they may raise those with Lang J, at the case management conference. He can make directions as to the filing of memoranda, with which I can deal. I am
conscious that my preliminary view could be based on incomplete information.
P R Heath J
Delivered at 4.00pm on Friday 30 July 2010.
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