Body Corporate 104278 v Whinerary

[2020] NZHC 212

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

I TE KŌTI MATUA O AOTEAROA TĀMAKI MAKAURAU ROHE

CIV-2019-404-2759

[2020] NZHC 212

UNDER

the Unit Titles Act 2010

IN THE MATTER

of an Originating Application for Orders establishing a Scheme under section 74 of the Unit Titles Act 2010

BETWEEN

BODY CORPORATE 104278

First Applicant

MARTIN JEROME McGAHAN, ROBYN KRISTINA McGAHAN AND MAUREEN BERYL JOHN

Second Applicants

AND

HEATHER MARY WHINERARY AND MATTHEW LUDLOW WHINERARY

First Respondents

ROBYN JEAN MARSHALL
Second Respondent

…/cont

Hearing:	19 February 2020
Appearances:	K Wendt for the Applicants
Judgment:	19 February 2020

ORAL JUDGMENT OF GORDON J

Solicitors:           Pidgeon Law, Auckland Counsel:     K Wendt, Auckland

BODY CORPORATE 104278 v WHINERARY [2020] NZHC 212 [19 February 2020]

VERENA MARY MOXON HAY, JONATHAN JAMES CARLTON HAY, NICHOLA MARY HAY, TERENCE SHANE McDELL AND ALAN MARK POSTLES

Third Respondents

VALERIE HEY
Fourth Respondent

EDWIN CHARLES GRAY AND UNA ANTOINETTE GRAY

Fifth Respondents

APARNA PRASAD, SUBBARAO SESHA PRASAD AND KEVIN OGLES TRUST SERVICES LIMITED
Sixth Respondents

TERRY LEE WARD AND WENDY ANN WARD
Seventh Respondents

TONY CHRISTENSEN AND ROSALIND MARY CHRISTENSEN
Eighth Respondents

ANZ BANK NEW ZEALAND LIMITED
Ninth Respondent

ASB BANK LIMITED
Tenth Respondent

BANK OF NEW ZEALAND

Eleventh Respondent

CHUBB INSURANCE NEW ZEALAND LIMITED

Twelfth Respondent

[1]                 This is an originating application by Body Corporate 104278 (the Body Corporate) for an order settling a scheme under s 74 of the Unit Titles Act 2010 (the Act) in respect of a unit title development at 43-47 Bay Road, St Heliers, Auckland.

[2]                 The proposed scheme is annexed as Schedule 2 to the Body Corporate’s application of 17 December 2019. There is a corrected application of 3 February 2020. The corrections are simply to the numbering in the list of respondents in Schedule 1 to the application.

[3]                 Ms Wendt appears today in support of the application. There are no other appearances. That is explained by the fact that there is unanimous support for the scheme by the owners of the units.

[4]                 In those circumstances and having regard to the full and careful documentation filed in support and the helpful memorandum of submissions of counsel, this judgment will be succinct.

[5]                 In brief, the Body Corporate development comprises two separate buildings, a six unit building known by the owners as “Bay Terraces” and a three unit building known as “Bay Villas”. The application concerns only damage and repairs to the  Bay Terraces building.

[6]                 Weathertightness issues were identified in about 2016. The Bay Terraces owners investigated and reports have identified wide-spread construction defects and damage. Remediation work commenced in September 2019.

[7]                 In his affidavit the Body Corporate Chairman, Martin McGahan, explains that although it is one body corporate legally, the owners in the two buildings have, for the most part, operated independently. In relation to the Bay Terraces remediation project, Bay Terraces’ owners have progressed the remediation of their building but have kept the owners of the Bay Villas building informed and have included them in key decision-making. One of those key decisions was voting on the s 74 scheme now before the Court and also cost apportionment.

[8]                 Mr McGahan says that the Bay Terraces owners alone have to date funded the investigation and remediation of the Bay Terraces building and also this scheme application. The owners in the Bay Villas building have not been called on to fund any aspect of the Bay Terraces remediation project.

[9]                 The power of the Court under s 74 is discretionary and each application to settle a scheme is determined on its factual circumstances.1 The overarching consideration in a s 74 scheme is fairness.

[10]            I have carefully considered the documents filed and, in particular, I note that at the 27 September 2019 AGM, owners of all nine units were represented either in person, by proxy or postal vote. The owners unanimously passed various resolutions relating to the scheme and, in particular, approval of the scheme and proposed cost apportionment.

[11]            I am satisfied that the proposed scheme satisfies the criteria in Tisch v Body Corporate No 318596,2 and I make the order as sought in paragraph 1.1 of the corrected originating application dated 3 February 2020.

[12]            I further order that the Body Corporate is not required to effect formal service of the corrected application on the parties. As noted, the correction is simply to the numbering in the list of respondents in Schedule 1.

[13]There is no issue as to costs.

Gordon J

1      Body Corporate 177519 v Li [2014] NZHC 3381 at [18]; Body Corporate 194769 v Wheatley

[2016] NZHC 856 at [10].

2      Tisch v Body Corporate No 318596 [2011] 3NZLR 679.