BODY CORPORATE 207812 v SINGH [2018] NZHC 1402

BODY CORPORATE 207812 v SINGH [2018] NZHC 1402 [13 June 2018]IN THE HIGH COURT OF NEW ZEALANDAUCKLAND REGISTRYI TE KŌTI MATUA O AOTEAROATĀMAKI MAKAURAU ROHECIV-2018-404-734[2018] NZHC 1402BETWEEN BODY CORPORATE 207812ApplicantAND PRITHI PAL SINGH AND GENDO SINGHFirst RespondentsContinued on next pageHearing: On the papersCounsel: J Wood for ApplicantJudgment: 13 June 2018JUDGMENT OF WHATA JThis judgment was delivered by me on 13 June 2018 at 4.00 pm,pursuant to Rule 11.5 of the High Court Rules.Registrar/Deputy RegistrarDate: .Solicitors: Rainey Law, AucklandAGNES BEATRIX GEESecond RespondentVERA TURNERThird RespondentPAUL SPENCERFourth RespondentJACK MACNAY AND COLLEENROSEMARIE MACNAYFifth RespondentsROBERT STEPHEN PETTY ANDLINDA ELISABETH FINDLAYSixth DefendantsLYN KINGSNORTH AND ROYKINGSNORTHSeventh RespondentsMURIEL MAY TURNEREighth RespondentDOUGLAS GEOFFREYBAMFORTH, ELIEEN BAMFORTHAND SCO TRUSTEES NO 1LIMITEDNinth RespondentsJANET KWAI YING NICHOLLS,MARK STEVEN NICHOLLS, TINAMARIE NICHOLLS AND VIV TAMANICHOLLSTenth RespondentsDARIO EDUARDO MASUTTI,SHELLY ANNE GOODFELLOWAND VULCAN TRUSTEE CO (2012)LIMITEDEleventh RespondentsS.T.A.R.T. INVESTING INPROPERTIES LIMITEDTwelfth RespondentTRACEY ANN LIPPARDThirteenth RespondentJANET AMANDA FORBESFourteenth RespondentROSS WILLIAM NUNNFifteenth RespondentHAIQING WANGSixteenth RespondentASHINTULLY LIMITEDSeventeenth RespondentDOUGLAS THOMAS BICKLEYEighteenth RespondentPETER BARRY KIVELL AND GCTRUSTEE SERVICE LIMITEDNineteenth RespondentSTEPHEN JOHN WALLACETwentieth RespondentBRENDON LESLIE HAWORTH ANDALISON MAY HAWORTHTwenty First RespondentsMICHAEL JOHN McGOUGAN ANDMcGOUGAN TRUSTEE LIMITEDTwenty Second RespondentsTHOMAS IAN CURTIS DONALDAND ROBERT ALLAN DONALDTwenty Third RespondentsJOYCE MADELINE DAVIES ANDLEWIS CALLANAN TRUSTEESLIMITEDTwenty Fourth RespondentsAK INVESTMENT PROPERTIESLIMITEDTwenty Fifth RespondentSTEPHEN JOHN WHEELER,AMANDA JANE WHEELER ANDMICHAEL JAMES WHEELERTwenty Sixth RespondentsDOREEN MAY WALKERTwenty Seventh RespondentKEITH REGINALD INGER ANDBAVAGE CHAPMAN TRUSTEESLIMITEDTwenty Eighth RespondentsSANDRA KAY HILL AND SARAKATIE DEVENIETwenty Ninth RespondentsJAMES DEREK MARSHALL,PENELOPE JANE MARSHALL ANDJAMES DOMINIQUE MARSHALLThirtieth RespondentsBRONWEN McPHERSON ANDNICOLE ANN DOMETTThirty First RespondentsDAVID ROBERTSON BENTHAM,ROBYN MARIE BENTHAM ANDSUSAN MARY KINGSTONThirty Second RespondentsANN LOIS MILNER BUSSE ANDCHANTEL LOUISE WRIGHTThirty Third RespondentsROY SWANNACK AND MYRTLEDORA SWANNACK (DECEASED)Thirty Fourth RespondentsMAVIS LIMBRICKThirty Fifth RespondentCAROLE ANN O'LEARY ANDDANIEL MICHAEL O'LEARYThirty Sixth RespondentsHEATHER PATRICIA HOWARTH,CHARLES ANDREW HOWARTH,PATRICIA JILL HOWARTH ANDHOWARTH FAMILY TRUSTEECOMPANY LIMITEDThirty Seventh RespondentsGJCEE LIMITEDThirty Eighth RespondentJANET ELIZABETHSCRYMGEOUR, MARGARET ANNSCRYMGEOUR AND HORROCKSHAMPTON TRUSTEE COMPANYLIMITEDThirty Ninth RespondentsMAVIS PATRICIA KINGFortieth RespondentSTEPHEN JOHN CROSS ANDIRENE MARY CROSSForty First RespondentsJACQUELINE MICHELLE TOBINAND SHARON JOANNE BYRNEForty Second RespondentsNAM KYU CHOI AND JEONGSOON CHOIForty Third RespondentsROY TERENCE HARDING ANDREBECCA JANE CAREForty Fourth RespondentsSEOK HEON LEEForty Fifth RespondentALICE JANE YOUNG, LINDA-JEANYOUNG AND WEBB FARRYLIMITEDForty Sixth RespondentsEMERALD GREEN INVESTMENTSLIMITEDForth Seventh RespondentMICHAEL McHARDIE BERRY ANDSTEPHANIE ANNE BERRYForty Eighth RespondentsALLEN BRIAN McCLYMONT ANDEVANGELIA McCLYMONTForty Ninth RespondentsROBERT EDWARD HAMERFiftieth RespondentROSEMARIE WINIFRED WALTERSFifty First RespondentCORINNE FRANCES EDGAR ANDPHILIP REGINALD ANDERSONFifty Second RespondentsPATRICIA'S LEGACY LIMITEDFifty Third RespondentCOLIN JOHN TILLEY, PETRINALEE TILLEY AND JOHN MVINCENT TRUSTEE CO LIMITEDFifty Fourth RespondentsLUCILLE BRENDA BERLANDMELDRUMFifty Fifth RespondentCLARENCE ROBERT YOUNGFifty Sixth RespondentVANESSA ELIZABETH SKEENFifty Seventh RespondentDIVERS R US LIMITEDFifty Eighth RespondentDARIO MASUTTI AND COLLEENJUDITH MASUTTIFifth Ninth RespondentGWENOLYN PAYNESixtieth RespondentJOHN McGEOCH SWANSixty First RespondentBANK OF NEW ZEALANDSixty Second RespondentWESTPAC NEW ZEALANDLIMITEDSixty Third RespondentANZ NEW ZEALAND LIMITEDSixty Fourth RespondentGUY DENBY DOMETTSixty Fifth RespondentTHE HONGKONG AND SHANGHAIBANKING CORPORATIONSixty Sixth RespondentASB BANK LIMITEDSixty Seventh RespondentKIWIBANK LIMITEDSixty Eighth RespondentMICHAEL EDWARD WALTERS,SHIRLEY ELIZABETH WALTERS,LINDA LOUISE RYAN, MICHAELGRANT RYAN, CHRISTINE MAYCOOMBRIDGE, BRENT ALANCOOMBRIDGESixth Ninth RespondentVERO INSURANCE LIMITEDSeventieth Respondent[1] This is an originating application made by the Body Corporate of a complexknown as the Bay Palms Apartment. The Body Corporate seeks orders to settle ascheme for repairs. The application is supported by detailed affidavit evidence filedby Bronwen McPherson, Chair of the Body Corporate and Barry James Gill, buildingsurveyor. The application has been served on all respondents, being persons with aninterest in the application. The matter was called before me as Duty Judge. One ofthe owners had indicated opposition to the application if certain requests were not met.That owner did not, however, attend the call. I made timetabling orders in the owner'sabsence. It transpires that shortly after the call, the applicants were advised that theapplication is not opposed. I therefore proceed on the basis that the application is notopposed.Background[2] The Weathertight Homes Resolution Service has assessed the Bay Palmscomplex and found several systemic weathertightness deficiencies, as well as thelikelihood of further deterioration unless significant repairs are undertaken. Mr Gillconfirms that the defects identified by the Service are present in the building. He alsoconfirms that the scope of repairs detailed in Context's Architect plans for tender(attached as an exhibit to Ms McPherson's affidavit) are sufficient and required toaddress and remediate the problems in the building.[3] As a result, the Body Corporate now seek an order for a scheme of repairspursuant to s 74 of the Unit Titles Act 2010. There are 70 respondents to theapplication. The majority are owners of units in the building. The remainder ofrespondents are the mortgagees of units, and the insurer of the building. None of therespondents have filed opposition to the application for an order. One of themortgagees, Westpac, has responded advising it will abide by the decision of the Court.Ms McPherson confirms that a copy of the proposed scheme was circulated at an AGMon 13 March 2018, and all but two owners present voted in favour of it.Legislation[4] Section 74 of the Unit Titles Act provides:74 Scheme following destruction or damage(1) This section applies if any building or other improvement comprisedin any unit or on the base land is damaged or destroyed, but the unitplan is not cancelled.(2) The High Court may, by order, settle a scheme on the application of—(a) the body corporate; or(b) if the unit title development is in a layered unit titledevelopment, the body corporate of the head unit titledevelopment or any subsidiary unit title development in thatlayered unit title development; or(c) an administrator; or(d) the owner or one of the owners of a unit; or(e) a registered mortgagee of a unit.(3) A scheme under subsection (2) may include provisions—(a) for the reinstatement in whole or in part of the building orother improvement; or(b) for the transfer of units to the body corporate so as to formpart of the common property.(4) If an order is made under subsection (3)(b), sections 58(1)(c) and 59apply to the transfer, so far as applicable, but subject to any order ofthe High Court to the contrary.(5) A notice of any application made under subsection (2) must be lodgedwith the Registrar who must enter on the supplementary record sheeta notification that the application has been made.(6) On any application to the High Court under subsection (2), thefollowing persons have the right to appear and be heard:(a) any person having or claiming to have any estate or interestin any unit or in the whole or part of the base land; or(b) any insurer who has effected insurance on the buildings orother improvements comprised in any unit or in the whole orpart of the base land.(7) In the exercise of its powers under subsections (2) and (3), the HighCourt may make any orders that it considers expedient or necessaryfor giving effect to the scheme, including orders—(a) directing the application of any insurance money; or(b) directing payment of money by or to the body corporate or byor to any person; or(c) directing the deposit of an appropriate new unit plan; or(d) imposing any terms and conditions that it thinks fit.(8) The High Court may cancel, vary, modify, or discharge any ordermade by it under this section.(9) The High Court may make any order for payment of costs that it thinksfit.Orders sought[5] The Body Corporate has submitted a copy of their proposed scheme for repairs(attached as Schedule A). In short, it provides:(a) The Body Corporate is to reinstate the entirety of the building;(b) The Body Corporate has all powers necessary to carry out and obtain abuilding consent for the repairs, including the ability to raise a levy topay for the repairs, and borrow funds should a unit owner fail to paylevies;(c) The Body Corporate must make decisions in furtherance of the repairscheme in accordance with the Unit Titles Act;(d) The Body Corporate have accounting and reporting obligationsimposed upon them;(e) The Body Corporate members indemnify the Chair and Committeemembers for acts or omissions done in furtherance of the scheme,except for wilful misconduct or gross negligence.Assessment[6] The Court of Appeal in Tisch set out principles relevant to the granting oforders for a repair scheme:11 Tisch v Body Corporate No 318596 [2011] NZCA 420, [2011] 3 NZLR 679 at [45]-[49].(a) A scheme with broad support is to be preferred;(b) The scheme should be appropriately detailed;(c) A scheme may be retrospective;(d) Work should be done to the same standard and at the same time acrossthe complex; and(e) The terms of the scheme should depart from the Unit Titles Act and theBody Corporate rules no more than necessary.[7] I am satisfied that each of these matters are appropriately addressed by theproposed scheme. In addition to the matters already noted at [6]:(a) All but two of owners endorsed the scheme at a recent AGM.(b) The scheme is sufficiently detailed to enable the repairs to beundertaken in accordance with the Act.2[8] Subject to the applicants confirming that the scheme tabled at the March AGMis the same scheme submitted for approval, I order that the repair scheme sought bythe Body Corporate is approved.2 It is substantially similar to the schemes approved by this Court in Body Corporate 378351 v ANZBank New Zealand Ltd [2017] NZHC 2274; Body Corporate 85115 v Middlemiss [2017] NZHC1906.