Published tribunal order
Tenancy Tribunal case 9045904 — Unit Titles in Paihia, Paihia
Decided 11 Dec 2023 · Published 11 Dec 2023 · Application 9045904
- Unit Titles
Order
- Firgie King Limited must immediately pay [The party] the sum of $3,626.29, comprised of the insurance monies of $3,126.29 and the filing fee of $500.
Reasons
- Both parties attended the hearing.
- The background is that the applicant and the respondent are, respectively, the sole owners of principal units located at Unit 1 and Unit 2, 14 Marsden Road Paihia. The applicant is claiming reimbursement of the respondent’s share of building insurance for the last two years. She has paid the invoices for the building insurance for the last two years herself. She claims that $3,126.29 is owing to her by the respondent.
- The applicant claims that such expenses are required to be shared between herself and the respondent in accordance with the relevant unit plan entitlement. She says that the relevant split under that entitlement is 56% to be paid by the respondent and 44% to be paid by the applicant.
- The respondent does not deny that the relevant split under the unit plan entitlement is 56%/44% but alleges it has only ever paid only 36% of the insurance and that therefore this is the applicant percentage it should pay.
- This matter was adjourned to today on the application of the respondent. The respondent wanted time to obtain and produce evidence of this alleged understanding or agreement, which it says goes back to the prior owner of the applicant’s unit.
- At issue is whether or not the respective shares of the parties for meeting the building insurance are 56% for the respondent and 44% for the applicant or whether the unit plan entitlement was displaced by a historic agreement or understanding between the prior owner of the applicant’s unit and the respondent, now binding on the applicant. The applicant’s submissions
- The applicant submits that the way in which costs must be met is set out in the deposited plan, to be read in conjunction with the Unit Titles Act 1972 and the UTA. She says that the deposited plan 184064, which forms part of their record for the two units, refers to the unit entitlement allocation which was determined by a registered valuer. That unit entitlement allocation was: 556 for unit A and 3 for accessory unit 1 (559 in total). For unit B, the unit entitlement allocation was 382 and the accessory unit 2 (totalling 441).
- The applicant submits that when the property was built and the plan for the subdivision deposited, the relevant legislation was the Unit Titles Act 1972. Section 6 of that Act provided that the unit entitlement is utilised for the purposes of determining an owner’s obligations in respect of body corporate levies.
- The Unit Titles Act 1972 was replaced by the UTA, which redefined unit entitlement into ownership interest and utility interest. Sections 38 and 39 of the UTA describe how those assigned interests are to be used to calculate an owner’s costs and obligations. A special resolution must be held in the event there is to be any change. The applicant says that there has never been any change to the designated entitlement interest.
- The applicant was unaware of any actual agreement to vary the allocation of expenses, although she was aware that previously the insurance had been paid in the proportions alleged by the respondent. The respondent’s position.
- Mr Chohan, the director of the respondent, gave evidence on its behalf. He claimed at the first hearing that he had an agreement with the previous owners of the applicant’s unit to pay only 36% of the insurance, although stepped back from that position somewhat at the second hearing, submitting that that was simply always the way the insurance had been paid. His position is that because that is the way things had always been done, and because the applicant was aware of this before she bought, she should now be bound by this arrangement, going forwards.
- Mr Chohan says the respondent bought the unit in 2017. At that time, the applicant’s unit was owned by a Mr Berry. Mr Berry would send him invoices, which he paid. Those invoices always referred to the percentage the respondent had to pay of only 36%.
- According to Mr Chohan, there was no verbal or other agreement as such, it was simply a case of receiving the invoices with that percentage noted on them and then paying the invoices accordingly.
- At the first hearing of this matter, Mr Chohan said that “I have the legal things” to back up his position. He did not however file anything corroborating the position of the respondent. Burden of proof
- I begin by noting that as with any claim before the Tenancy Tribunal, the Tribunal applies the usual civil law standards and expectations. That means that it is for the party bringing the application to establish their claims “on the balance of probabilities”. That means that they must establish that what they are factually claiming is more likely than not.
- This is referred to as the “burden of proof”. Independent witnesses, corroborating documents and photographs may be an important part of discharging this burden. Ultimately however, it is for the party making the application to decide what evidence to put before the Tribunal.
- As noted in Kaipo v Clarke & McCarthy (DC) TT233/02, in practical terms this means that: ... [L]ike anyone who brings an application before a Tribunal or Court, it is incumbent upon the applicant to provide the evidence necessary to prove the case. If the applicant fails to do that, then their application will be dismissed whether it has merit or not because it is up to the applicant to provide the necessary evidence. It is not up to the other parties, and it is certainly not up to the Tribunal to extract evidence.
- Where a party claims there to be an agreement or understanding that applies, then it is for that party to prove the facts giving rise to that alleged agreement or understanding. Analysis
- I accept that the relevant law is as set out above. The way in which costs must be allocated is set out in the deposited plan, to be read in conjunction with the Unit Titles Act 1972 and the UTA. The relevant deposited plan 184064, which forms part of the record for the two units, refers to the unit entitlement allocation which was determined by a registered valuer. That unit entitlement allocation was: 556 for unit A and 3 for accessory unit 1 (559 in total). For unit B, the unit entitlement allocation was 382 and the accessory unit 2 (totalling 441).
- Sections 38 and 39 of the UTA describe how the assigned interests are to be used to calculate an owner’s costs and obligations. A special resolution must be held in the event there is to be any change.
- There has been no special resolution and I find that there was not even any agreement in place to vary the allocation of the insurance expense. For all the Tribunal knows, the practice of sending invoices with a different allocation on it could simply have been in error.
- Regardless, whether there was an agreement to vary the allocation is irrelevant; in order to have succeeded, the respondent needed to point to a special resolution, as noted above, and no evidence of such resolution has been provided to me. A simple agreement between a prior owner of one unit and a prior owner of another unit would not suffice to bind future owners.
- I therefore make the orders as above.
- Because the applicant has succeeded, she is entitled to recovery of the filing fee of $500.