Published tribunal order
Tenancy Tribunal case 9053844 — Tenancy dispute in Papatoetoe, Auckland
Decided 15 Sept 2025 · Published 15 Sept 2025 · Application 9053844
Landlord favoured
- Unit Titles
Order
- Zeshen Zhou and Shunlian Huang must pay Body Corporate 95536 $47,656.92 immediately, calculated as follows: DescriptionsApplicantRespondent Levies$13,156.84 Costs: Legal Costs: Legal- appearance today $25,344.08 $345.00 Interest to date. Body Corporate debt collection charges $8,178.75 $132.25 Filing fee$500.00 Total payable by Respondent to Applicant $47,656.92
Reasons
- The Body Corporate was represented by Mr Baker. Ricky Huang, the brother of Ms Huang, appeared.
- This history of the matter has some complexity, due to the fact that one of the unit owners, Ms Shunlian Huang, has been deceased since around 2005 and the other unit owner, Mr Zeshen Zhou (her then partner), is incarcerated.
- The pair resided at the premises the subject of this application at the time of Ms Huang’s death.
- The application relates to the collection of levies from 2010 onwards. The Body Corporate today applies for: a. Levies of $13,156.84, incurred since 2010. 1 b. On-charges of $305.90 (process service fees). c. Body Corporate handover costs of $132.25 d. Legal costs of $27,344.08 e. Ongoing legal costs of $300 plus GST relating to the hearing today. f. The filing fee of $500. g. Interest of $8,178.75 to date.
- This matter first came before the Tribunal on 23 October 2024. 2
- At that hearing, I expressed concerns as to whether service had been properly effected. I made an order for the Body Corporate to provide evidence of service of 1 Updated since the application was filed. 2 There had been a High Court proceeding concerning earlier levies incurred prior to 2010. Judgment was entered on 29 September 2009 for $3,243.05. That judgment led to a sale order being made in 2014 concerning the premises. the application on Mr Zhou and the estate of Ms Huang. I made an order that if the parties had not been served, an application for substituted service could be filed.
- The next hearing was on 13 March 2024. Service had not been effected on the estate of Ms Huang, but information was available regarding her family members. I therefore made the following orders: The application to be served on the parties entitled to apply for letters of administration of the estate of Shunliaan Huang and for substituted service on her estate of the following parties and by the following means: (a) Posting the application and all supporting documentation including a copy of this order to the late Ms Huang’s father, Jian Cheng Huang, at 16A Kimberhall Ave, Mt Roskill (b) Posting the application and all supporting documentation including a copy of this order to the late Ms Huang’s mother, Ming Zhu Zhou, at 1/14 Aberfeldy Ave, Highland Park (c) Emailing a copy of the application and all supporting documentation including a copy of this order to the late Ms Huang’s brother, Ricky Huang, at rickyhetq12@gmail.com An order is made that Jian Cheng Huang, Ming Zhu Zhou and Ricky Huang, all being next of kin, are joined as respondents in this application, being parties who would be entitled to apply for letters of administration of the estate of the late Ms Huang and should be named.
- The application was then adjourned.
- The next hearing was on 29 May 2025. The brother of Ms Huang appeared and acknowledged service. I noted that Mr Zhou had been served also, by notification to the Department of corrections.
- Mr Huang confirmed that he and his family are not managing the property or receiving any rent from it; he said he believed Mr Zhou’s family was managing the property. He indicated he would try and make contact with them.
- The matter was then further adjourned because of the need to clarify if a payment of $22,300 was paid by a relative of Ms Huang. This has now been clarified; no such payment was made.
- The matter was then set down for hearing today.
- In the meantime, on 10 September 2025, a relative of Mr Zhou, Lucy Tam, emailed the Tribunal to seek an adjournment on the grounds that Mr Zhou had been granted parole after the 17th of September 2025
- To this point, Mr Zhou has taken no steps at all in this matter. He must be aware of the proceedings because he is in contact with family about them, as noted above. He has taken no steps to instruct Counsel or an agent or representative to appear. I declined the adjournment and proceeded to hear the application.
- I now turn to the orders sought by the Body Corporate.
Against whom is the Body Corporate seeking orders?
- A preliminary issue arose as to against whom the Body Corporate was asking for orders. Mr Baker confirmed that orders are only sought against Ms Huang and Mr Zhou, not against any of the family members who have previously been joined as respondents. I therefore strike those parties out and reinstate Ms Huang as a Co- respondent, along with Mr Zhou.
Do the Unit Owners 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 Mr Zhou and Ms Huang have not paid the levies by that date. See section 124(1) Unit Titles Act 2010. The Body Corporate has provided records to prove the amounts claimed and ordered above for levies.
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 proven the amount of interest owing from the due date to the hearing date, as ordered above.
Is the unit owner liable for costs?
- No party has challenged any of the costs that are sought but nevertheless the Tribunal must independently assess whether they are payable.
- Pursuant to section 124 UTA, 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 judgments (of the District Court and Court of Appeal respectively) in Body Corporate 162791 v Cheah 3 and Body Corporate 162791 v Gilbert, 4 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.
- The assessment of reasonableness of costs in connection with a contractual indemnity for reasonable solicitor and client costs was discussed in Exuberant Ltd 3 DC Auckland, CIV2014-004-0120, 24 June 2014. 4 [2015] NZCA 185. v Quinovic Management Limited 5 and, in the context, of s 124 of the UTA, in Body Corporate 45131 v 88 CHI Ltd, where the approach taken in Exuberant was adopted and applied. 6
- The District Court in Body Corporate 45131 v 88 CHI Ltd summarised the key elements of the relevant legal framework as follows: 7 a) the relevant test is as set out in section 124(2) of the Unit Titles Act – the body corporate is entitled to recover “any reasonable costs incurred in collecting the levy”; and b) solicitor and client costs are a category of costs that can be recovered under this provision; and c) the task is to assess the reasonableness of the solicitor and client costs that are claimed.
- Having set out that framework, the Court reviewed the relevant method to be applied in assessing the reasonableness of the solicitor and client costs, concluding: 8 ... the essential method is as follows: a) first, ask whether the work that was done was reasonably necessary; b) second, ask whether the amount charged for the reasonably necessary work was reasonable; c) in both instances the NZLS Rules and Rule 9 in particular are prime reference points when assessing reasonableness; d) third, test the analysis against other available reference points.
- At para [8], the District Court observed: 9 I make the following observations from the discussions on the cases and having regard to the way in which the methodology has been applied in the cases: (a) the exercise the adjudicator or the judge is engaged in is an objective one. The adjudicator or the judge must make a principled assessment of reasonableness against stated criteria; (b) the adjudicator or the judge must do the work required by the methodology, and in particular grapple with the available information on the specific tasks that were undertaken by the lawyers, and the amounts that were charged for them; (c) when doing that, the adjudicator or the judge must test the work and the invoicing against the realities of the legal market that we have, not an idealised or hypothetical standard; 5 [2021] NZ HC 3533. 6 CIV 2022 – 096 – 000494 [2023] NZDC 9036, at paragraph [5]. 7 Body Corporate 45131 v 88 CHI Ltd CIV 2022 – 096 – 000494 [2023] NZDC 9036, at paragraph [5]. 8 At [6], citing Exuberant Ltd v Quinovic Property Management Limited [2021] NZHC 3533 and other authorities. 9 Footnotes from the quote omitted. (d) the Rule 9 considerations are helpful in providing some structure to this assessment. Time expended is one of these factors but it is not the only factor; (e) if an adjustment to actual solicitor client costs is made, this should be explained with some specificity by identifying tasks that were seen to be unnecessary, or the necessary steps that were seen to have been overcharged in some way. Analysis and application of the law
- Applying the methodology endorsed by the District Court and set out above, I have viewed the time records associated with the costs that are claimed. The time records go back to April 2024, approximately one month before the application was lodged.
- There have been a significant number of legal attendances in this matter over the months. The amount of time spent in dealing with this matter well exceeds the amount of the levies being sought.
- This is a highly unusual case where the extent of the work has involved complexities arising out of the question of who to proceed against, and how to bring the proceedings to the attention of the relevant parties (as the timeline I set out above demonstrates). Mr Baker took me through the time records in summary and explained the work that was done to ascertain the identity of the appropriate party who should be contacted in regard to the outstanding levies.
- Whether or not there is a conditional fee agreement in place is a rule 9.1 consideration I am required to take into account. I consider that this entails assessing whether or not the Body Corporate will be required to pay the full amount of the invoices claimed, in the event the applicant is unsuccessful in claiming those costs today.
- Mr Baker advises me that the invoices relating to the legal costs have been rendered and remain unpaid, but assures me they are payable regardless of the outcome of the hearing today.
- I am required to take a “standing back assessment”. I am of the view that a reasonable lawyer considering the charging of this amount would make an assessment as to whether there was any element of double time being spent, or any element of a “learning curve” at play (given the unusual nature of the matter).
- I note there have been several authors working on this matter.
- Even though the attendances have all clearly been undertaken, I am not satisfied that the full amount of the legal invoice is reasonable. I consider that a reasonable approach would have been to write down at least a small amount of time to reflect any learning curve or double up attendances caused by a number of different authors working on the matter
- Taking a “standing back assessment”, I am of the view that the legal costs should be reduced by $2000 to reflect those concerns.
- I find that the Body Corporate is entitled to an order for payment of: a. The Body Corporate handover costs of $132.25 10 b. Legal costs of $25,344.08 11 c. Legal costs of $300 plus GST relating to the hearing today. d. The filing fee of $500.
- I am not prepared to allow the process server on-charges of $305.90 because when the information was sent to the Tribunal after the hearing I noted that they are dated from 2017, so I am unaware what they relate to in connection with this matter. Further, the actual invoices themselves are not supplied, only a statement.
- 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.