november 2014 presented by: kay keam current issues with unit titles

November 2014

Presented by:

Kay Keam

Current issues with

Unit Titles

Introduction

1972• Flats, not apartments• Largely residential• Low rise

2010• 4,000 people living in

Hobson Street• Leaky buildings• Mixed uses

Topics for today

• Disclosure

• Body corporate rules

• Selling off plans

• Issues for vendors and purchasers

• Other issues under the Unit Titles Act

Disclosure

Pre Contract Pre Settlement

Additional Turnover

Pre Contract Disclosure• Prescribed form• Content

– Levies– Maintenance in next 12 months– Funds– Weathertightness– Unit titles and conveyancing 101– Cost of additional disclosure

• No statutory consequences

Pre Settlement Disclosure• Details prescribed but not form• DBH template• Content

– Unit and body corporate number– Levies and charges for unit and debts by other units– Repairs of building elements and infrastructure– Interest rate– Litigation against body corporate– Changes from default operational rules since disclosure

• Body corporate certificate• Consequences for non disclosure but no approval rights• Deposit and disclosure tension if long term settlement

Additional Disclosure

• Under used• Prescribed form and

DBH template

Content of additional disclosure

Contact details for body corporate and committee

Funds

Creditors

Expenses

Debtors

Insurance

Content of additional disclosure (cont.)

Contracts

Ground leases

Motions at last meeting

Rules

Long term maintenance plan

Additional disclosure

• Can ask for part• Timing for request• Right of cancellation if no disclosure• Need right to approve• Deposit• Paying for it

Turnover disclosure

• Developer• When sells 25%

Sold

Content of Turnover disclosure– Date– As built plans and specs– Assets and liabilities of body corporate– Leases/licences of common property– CCC– Maintenance schedules– Resource consent and heritage obligations– Warranties and guarantees– Fire evacuation plans and fire protection systems– Building WOF– Compliance schedule– Maintenance and service contracts

Body Corporate Rules

Default rules1. Owner or occupier must not:

a) Damage or deface common property;b) Leave rubbish or recycling material on the common property;c) Create noise likely to interfere with the use or enjoyment of the

unit title development by other owners or occupiers;d) Park on the common property except in designated areas or as

the body corporate consents;e) Interfere with the reasonable use or enjoyment of the common

property by other owners or occupiers.

2. Owner or occupier must dispose of rubbish hygenically and tidily.

Body Corporate rules

• Different from old Act

• Very basic

Body Corporate Rules

• DBH guidelines• ADLSi model operational rules• Careful review• Ultra vires

Selling Off Plans

• Conditions• Variations• Substitutions• Encumbrances• Body corporate rules• Sunset dates• Accruals clause• Maintenance period

Issues for vendors and purchasers

• Right of cancellation• Consent to alterations• Encroachment into common property• Remediated properties• Disclosure of weathertightness issues• Mortgagee sale

Other issues under the Unit Titles Act

Appointment of a chairperson

Long term maintenance plans

Governance and advice

Kay Keamktk@martellimckegg.co.nz