What was the outcome of Tenancy Tribunal case 9043124?

The tribunal order states: Cuixian Chen must pay Body Corporate 406198 $52,259.81 immediately,

How much money was awarded in case 9043124?

Individual award amounts are in the official MoJ PDF. Claim amounts appear on this page when claims and net totals reconcile.

What type of tenancy dispute was case 9043124?

The dispute type was not classified.

Where can I read the official tribunal order for case 9043124?

The official Ministry of Justice published order is available at https://forms.justice.govt.nz/search/Documents/TTV2/PDF/10128045-Tribunal_Order.pdf.

What was the outcome of Tenancy Tribunal case 9043124?

The tribunal order states: Cuixian Chen must pay Body Corporate 406198 $52,259.81 immediately,

How much money was awarded in case 9043124?

Individual award amounts are in the official MoJ PDF. Claim amounts appear on this page when claims and net totals reconcile.

What type of tenancy dispute was case 9043124?

The dispute type was not classified.

Where can I read the official tribunal order for case 9043124?

The official Ministry of Justice published order is available at https://forms.justice.govt.nz/search/Documents/TTV2/PDF/10128045-Tribunal_Order.pdf.

Auckland, Auckland Tenancy Tribunal Case 9043124 — Tenancy dispute

Order

Cuixian Chen must pay Body Corporate 406198 $52,259.81 immediately, calculated as follows: DescriptionsApplicant Levies$41,490.94 Interest$5,595.57 Debt collection costs$402.50 Filing Fee$500.00 Costs$4,270.80 Total payable by Respondent to Applicant $52,259.81

Reasons

The Tribunal must consider an application filed by the Body Corporate, seeking an order that the Unit Owner pay levies.

BACKGROUND

The premises are located in a unit titled complex, consisting of 157 residential units. The premises are known as ‘Bianco Off Queen’ (“Bianco”). Bianco was constructed between 2007 and 2009, and unfortunately has significant defects that now require remediation works, however I recognise that some unit owners may not consider the defects are significant.
In order to progress the remediation and any associated legal work to recover compensation, the Body Corporate applied to the High Court for approval of a ‘scheme’ under section 74 of the Unit Titles Act 2010 (UTA). The proposed Scheme was approved by Justice Campbell on 13 April 2021. 1
The Scheme includes express provisions for the Body Corporate to raise funds by way of levies to the unit owners, including the charging of interest of 10% for late payments. It is also relevant to note that the Scheme includes a specific Dispute Resolution process at section 9.
The Body Corporate also commenced proceedings in the High Court in order to recover compensation from various parties in relation to faulty work on the complex. The High Court decision on this has been issued, with the High Court making various orders in relation to the contractor (Argon Construction Limited) and the Auckland City Council. 2 The decision records that the plaintiffs sought $40,739.870 in damages.
At an AGM on 12 February 2022, the Body Corporate resolved to delegate authority to the body corporate’s committee: It was resolved by the Body Corporate by special resolution that the powers that have been delegated are all of the duties and powers of the Body Corporate (except those excluded by s.108(2)). The delegation endures until the end of the next AGM...This statement is evidence of the Body Corporate Committee’s authority to perform each duty or exercise each power that has been delegated.
On 15 October 2022 the Body Corporate committee passed the following resolution under its designated authority: RESOLUTION 1 – STRIKING OF LEVIES TO COVER LITIGATION

COSTS

It was resolved by the Body Corporate Committee to strike a levy of $3,800,000 inc GST to cover the costs for the litigation which would be payable in four instalments which will be due on 30 th November 1 Body Corporate 406198 v Housing New Zealand Limited and Others [2021] NZHC 769. 2 Body Corporate 406198 v Argon Construction Ltd and Ors [2023] NZHC 3034.

2022, 31 December 2022, 31 January 2023 and on 28 th February 2023.

A hearing was convened in Auckland on 25 March 2024. This application was scheduled and heard concurrently with 11 other applications, where the Body Corporate was similarly seeking an order for the payment of levies.

BODY CORPORATES CASE

The Body Corporate’s position is that the levies were correctly raised in order to fund litigation costs in relation to the proceeding against the council and other contractors, and in some cases there are operating levies claimed. The Body Corporate states in its written submissions: The Body Corporate’s claim is simple: by combination of a section 74 Scheme ordered by the High Court, and via delegated powers given to its committee, the Body Corporate has raised levies to fund investigatory work relating to defects within the Body Corporate complex, and fund a claim against liable parties in the High Court to seek recompense for the cost of prospective remediation for the building (as opined by the Body Corporate’s retained consultants as well as for other losses). It has issued levies to the respondent owners following on from those resolutions, and the substance of the resolutions are uncontroversial.

UNIT OWNERS CASE

Only two unit owners appeared at the hearing, that was Ms Wu and Ms Wang.
Ms Wu disputes that she should have to pay the levies raised. Ms Wu advised that she considers the amounts raised are inflated, and based on conflicting amounts quoted by various providers. Ms Wu considers the amounts claimed for the legal representatives are excessive. Ms Wu is strongly of the view that the charges are a fraud and a scam.
Ms Wu gave an example of $84,000.00 being charged for administration of the Body Corporate in one month (for retrospective work over a six month period). Ms Wu considers that funds have gone missing or been misappropriated.
Ms Wang states that they understood it was a straight forward litigation, not consistent with a requirement to raise $3,800,000 to fund that proceeding, rather this came out of the blue when the invoice was received. Ms Wang states that it should have been discussed at a meeting in order to decide if the unit owners even wanted to proceed with the court case.
Ms Wang also considers the sum raised was excessive for legal fees.
Ms Wang considers that there is a fraud occurring in relation to the money that is being raised and used, and that the unit owners are not being provided with the necessary evidence to show how this was properly determined as necessary.
As I understand matters, Ms Wu and Ms Wang consider that the building remediation is not needed, and they consider there has been a ‘miscarriage of justice’.

ANALYSIS

The question I must determine, is whether I can make the requested order that the Unit Owner pay the levies claimed by the Body Corporate.
I begin by noting section 84 of the UTA, which relates to the powers and duties of body corporates. That includes the obligation to raise funds for the management of the complex, and to levy owners to obtain those funds.
Section 80 confirms the responsibilities of unit owners and that includes that the owner: 3 must pay all rates, taxes, charges, body corporate levies, and other out‐goings that are from time to time payable in respect of the unit:
In this a High Court Scheme has been approved, which allows the Body Corporate to proceed with work necessary around the building defects. Within the scope of that Scheme, the Body Corporate Committee has resolved to raise $3,800,000 from the unit owners to cover possible costs associated with that litigation.
It is very clear that at least some unit owners disagree with a number of decisions that the Body Corporate has made, which include the decisions around proceeding with an action against Argon Construction and the Auckland City Council, ranging to decisions around what if any work is needed to remediate the complex, and if it needs remediation at all. 3 Section 80(1)(f).
However despite the strong submissions Ms Wu and Ms Wang have made to me, I cannot consider those matters. The application before me is an application from the Body Corporate to order that the levies raised be paid, I do not have any application from the unit owners challenging any decision making from the Body Corporate. That means the ground upon which the Respondents could challenge the Body Corporate’s claims are limited.
Broadly the Unit Owners could challenge the claim if they could show that there were procedural defects with the process in which the levies were struck, but they have not identified any. In my assessment the levies were raised by way of delegated authority from the Body Corporate in the usual way, so I accept the levies were correctly raised.
I recognise that the Unit Owners (Ms Wu and Ms Wang at least) are deeply unhappy with the decisions made by the Body Corporate, and that the charges and levies are a ‘fraud and scam’. As I advised the Unit Owners, I cannot go behind the decision making of the Body Corporate in this case. If the Unit Owners are unhappy with what the Body Corporate or the Committee is doing, there are processes they can apply within the Body Corporate to challenge those things, or there may be other legal remedies available to those unit owners. There is also a dispute resolution process set out in the Scheme which the unit owners could have applied. However those matters fall outside of the scope of this levy recovery claim.

Does the Unit Owner owe the levies claimed?

A unit owner must pay all body corporate levies and outgoings payable for the unit. See sections 80(1)(f) and 121(1) Unit Titles Act 2010.
The Body Corporate has determined the levies payable and Unit Owner's share has been calculated according to their utility interest.
The Body Corporate has fixed the due date for the levies to be paid, and the Unit Owner has not paid the levies by that date. See section 124(1) Unit Titles Act 2010. The Body Corporate has provided records to prove the amount claimed.

Is the Unit owner liable for interest?

If a unit owner fails to pay levies by the due date, interest accrues on the unpaid balance. A body corporate may charge interest up to 10% per annum. See section 128 Unit Titles Act 2010.
The Body Corporate has resolved to charge interest at 10% per annum on unpaid levies. The Body Corporate has proved the amount of interest owing from the due date to the hearing date.

Is the Unit Owner liable for costs?

Pursuant to section 124 UTA, and as resolved at meetings of the Body Corporate, the Body Corporate is entitled to recover any reasonable costs incurred by it in collecting unpaid levies as a debt due by the owner to the Body Corporate. In accordance with the judgments (of the District Court and Court of Appeal respectively) in Body Corporate 162791 v Cheah DC Auckland, CIV2014-004-0120, 24 June 2014 and Body Corporate 162791 v Gilbert [2015] NZCA 185, the Tribunal must order that the reasonable costs incurred by the Body Corporate in recovering the levies, objectively assessed, be paid by a defaulting unit owner. I am satisfied that the costs ordered above are reasonable.
Because the Body Corporate has succeeded with the claim I have reimbursed the filing fee. Section 176(1) Unit Titles Act 2010 and section 102(4) Residential Tenancies Act 1986. 2.

Tenancy Tribunal case 9043124 — Tenancy dispute in Auckland, Auckland

Tenancy Tribunal case 9043124 — Tenancy dispute in Auckland, Auckland

Order

Reasons

BACKGROUND

COSTS

BODY CORPORATES CASE

UNIT OWNERS CASE

ANALYSIS

Does the Unit Owner owe the levies claimed?

Is the Unit owner liable for interest?

Is the Unit Owner liable for costs?

Order

Reasons

BACKGROUND

COSTS

BODY CORPORATES CASE

UNIT OWNERS CASE

ANALYSIS

Does the Unit Owner owe the levies claimed?

Is the Unit owner liable for interest?

Is the Unit Owner liable for costs?