More and more people nowadays are living in apartment complexes known as unit titles.
The common areas of such unit title complexes are owned and managed by the Body Corporate, which represents all owners in the complex. It is important therefore to understand how the Body Corporate should function.
Who pays? Unit owner or Body Corporate
There is often a grey area between what the unit owner is responsible for individually, and what the Body Corporate has jurisdiction over.
Here is a recent case in point. It is a High Court decision and it relates to a Queenstown development.
This particular development suffered from building defects and leaks in the roof. The roof was in fact mainly the private property of the top unit owners, as were the top floor decks.
The Body Corporate however sought a court order authorising a scheme to remediate the entire complex and to have the costs paid by all unit owners on the basis that the roof was essential to the overall integrity of the entire complex and it wouldn’t be fair to burden the top floor unit owners with the whole cost.
Some unit owners objected to having to contribute to the costs because there was no damage to their units.
The Court however departed from the law set out in the Unit Titles Act and approved the scheme to apportion the entire roof costs and some of the deck costs across all unit owners.
Be careful
If you were to own or consider buying a unit in this particular complex, you would need to know this information in advance.
Some information should be available to buyers on a pre contract disclosure document but we are aware that these are in some cases looked at as simply a standard form that someone needs to sign so the transaction can move forward. We have seen some pre contract disclosure statements that actually contain no information at all about the unit being sold, yet someone has signed them.
We are also aware that some Body Corporates are better organised than others. For example, does your unit title complex have a ten year maintenance plan in place and a means of funding the work that is planned? If there is nothing in kitty when you buy, you need to know that because chances are you will be required to contribute to some unplanned maintenance at some stage.
So our take home message is this:
Please contact us on russell@queenstownlaw.co.nz or on 03-4500000 before you commit to a unit title purchase.
And if you already own a unit title property and things are happening in the Body Corporate that don’t seem quite right, please contact us then too.