What was Tenancy Tribunal case 9063524 about?

The tribunal order states: The application is dismissed.

How much money was awarded in case 9063524?

Verified claim lines are listed on this page.

What type of tenancy dispute was case 9063524?

The primary dispute was Leaks. Related themes: Cleanliness, Property damage, Unit Titles.

Where can I read the official tribunal order for case 9063524?

The official Ministry of Justice published order is available at https://forms.justice.govt.nz/search/Documents/TTV2/PDF/12398977-Tribunal_Order.pdf.

What was Tenancy Tribunal case 9063524 about?

The tribunal order states: The application is dismissed.

How much money was awarded in case 9063524?

Verified claim lines are listed on this page.

What type of tenancy dispute was case 9063524?

The primary dispute was Leaks. Related themes: Cleanliness, Property damage, Unit Titles.

Where can I read the official tribunal order for case 9063524?

The official Ministry of Justice published order is available at https://forms.justice.govt.nz/search/Documents/TTV2/PDF/12398977-Tribunal_Order.pdf.

Auckland Central, Auckland Tenancy Tribunal Case 9063524 — Leaks

Tenantcheck Insights

Order

The application is dismissed.

If the parties cannot agree on the question of costs, the respondent has leave to apply further to the Tribunal for costs to be fixed. In that event, they must provide submissions to the Tribunal, supported by corroborating evidence, no later than five working days of the date of this order. If an application for costs is made, the Tribunal will consider whether a further hearing is necessary or whether it can deal with the application on the papers.

Reasons

For the applicants I heard from Ms [The party] and for the Body Corporate, I heard from Mr McFadyen, its counsel. 1 There was no basis made to advance for any claim against the Body Corporate manager personally and so I strike him out of the application because he had been wrongly named as a second respondent.

The applicants are the owners of unit 1205 on deposited plan 540618. The first respondent is the relevant Body Corporate. The second respondent is the professional manager for the Body Corporate, Strata Title Administration Limited.

In late December 2023, the Body Corporate noticed signs of water ingress outside the apartment located immediately below the applicant’s unit, unit 1105. The Body Corporate manager contacted the applicants and had a conversation with Ms Donougher, who does not reside at the unit, which is tenanted.

She claims that he indicated the likely source of the water could be a failed intake valve in the applicant’s toilet. He had reached this conclusion because he said there had been a previous problem with an intake valve in another toilet located in the building.

Ms Donougher did not object to the Body Corporate undertaking investigations to locate the source of the leak and perform the required repairs, although she personally disagreed that the first place to look would be the toilets.

Things were then left to the Body Corporate to contact a plumber to locate and repair the source of the water. Presumably, based on the views of the Body Corporate manager, initial investigations were directed at the toilets in both units. Ms Donougher claims this was a misguided investigation.

Eventually, the source of the water leak was traced to a perforated air- conditioning drainage pipe located within the applicant’s unit. This was only after the toilets had been pulled out from units 1205 and 1105, causing damage to the walls and tiles.

The Body Corporate then undertook repairs to the pipe and repairs of the consequential damage which included the work done to investigate the damage by pulling out the toilets in the two units, remediation of those areas and drying out of carpet on both levels. There was also remediation to a ceiling in level 10.

The Body Corporate next required the applicants to pay for the full cost of all of this work, a total of $8,225.84. This sum is comprised of: a. Plumbing invoice $2374.64. This invoice comprised callouts and work undertaken to remove the toilet and cut the tiles in apartment 1205, remove the toilet and cut the tiles in apartment 1105, and then finally work to cut out sections of Gib to finally expose the leak in the air- conditioning drain. The applicants say that the work undertaken to actually fix the perforated pipe would have only taken two hours. b. Carpet cleaning invoice of $1,200.60. This related to remediation work for apartment 1105. c. Second carpet cleaning invoice of $1,028.10. This related to remediation work for apartment 1205. 2 d. Plaster and repairer invoice of $3,507.50. This related to the remediation work for jib patching, plastering and painting. The work covered off work to levels 10, 11, and 12. e. Body Corporate on-charges.

The Body Corporate attempted to on-charge and recover all of these costs from the applicants, who refused to pay.

Subsequently, and presumably foreshadowing the fact that Tribunal proceedings may be required, the Body Corporate passed a resolution at a meeting. It resolved that the recovery of all expenses incurred by the Body Corporate in: ....doing statutorily authorised work at unit 1205, and the surrounding common property, for the repair of the air-conditioning pipe leak and all associated work is required is to be recovered from the owner as a debt due by them to the Body Corporate under s 126(1)(a) and 2(a) of the Unit Titles Act 2010.

There was little information provided to the Tribunal about the discussion that took place concerning that resolution, other than a note in the minutes that stated: Mr O’Reilly had been liaising with the Body Corporate’s lawyers, Price Baker Berridge in relation to the Tenancy Tribunal hearing scheduled for 11 June 2025. This hearing was brought by the owner of unit 1205 in response to the on-charging of invoices related to a leak from the air-conditioning unit servicing unit 1205. To ensure that the invoices have been on-charged using proper processes, Mr O’Reilly tabled the following resolution, which was resolved unanimously.

In written submissions dated 10 June 2025, the Body Corporate submitted that: a. It was obliged to repair the damage under s138 of the UTA. b. The applicants were in breach of s 80(1)(g) of the UTA by failing “to repair and maintain the unit and keep it in good working order to ensure that no damage or harm, whether physical, economical otherwise, is, or has the potential to be, caused to the common property, any building element, any infrastructure, or any other unit in the building.” c. Pursuant to s 126(2) of the UTA, the Body Corporate was empowered to recover any expense incurred in doing any repair works from the applicants because the repair work benefited the applicants by a distinct and ascertainable amount. Its rationale for that argument is that the pipe only served the applicant’s unit. The Body Corporate’s position is 2 Initially the applicants had submitted that this was a duplicated invoice due to the content of the narrations on both invoices. Following an amended invoice containing a corrected narration, that point was not advanced further by the applicants. therefore that the repairs are appropriately levied on the applicants because the root cause of the fault necessitating those repairs related to a pipe that serviced only their unit. d. Consequently the Body Corporate was empowered to on-charge the associated cost of repairs to the applicants.

The applicants accept the Body Corporate is entitled to recover the costs of repairing the pipe itself. They claim that cost to be two hours of a plumber’s time at the charge out rate that was charged of $109 per hour plus GST (a total of $250.70). But they say they are not liable for all of the rest of the repairs and work that was done. They claim the Body Corporate is acting ultra vires. They say: a. The recovery sought by the Body Corporate does not meet the requirements of s 126 of the Unit Titles Act 2010 (UTA). As the applicants are not at fault, they say s 127 cannot be applied either because the alleged damage was caused by a latent construction defect and not by any wilful or negligent act or omission on their part, b. The Body Corporate has no authorisation under s 138 to recover “common property costs” as it is its duty to maintain common property and no fault can be attributed to the applicants for the repairs that were required. c. There is no breach by the applicants of 80(1)(g) of the UTA. d. The costs incurred were primarily related to common property, not solely for the benefit of the applicant’s unit. e. The costs incurred included misdirected/misguided investigative actions that conferred no benefit to the applicants and were not reasonable. f. The Body Corporate has ignored its own meeting resolution making it liable for insurance excess as documented at the November 2022 AGM.

The applicants have therefore brought this claim as a response to the Body Corporate requiring them to pay for the full cost of all of this work.

I treat the application as an application for a declaration that of the sum of $8,225.84, the applicants are only liable to pay the Body Corporate the sum of $250.70. 3 The balance of proof

As with any other civil claim, the balance of proof lies on the applicants to prove their claim on the balance of probabilities. This is a slightly unusual case in that 3 Section 78(1)(a) o f t h e Residential Tenancies Act 1986 (applicable by virtue of s 176 UTA) enables the Tribunal to make an order in the nature of a declaration as to the rights of any party. ordinarily, the Tribunal would see such claims being brought by the Body Corporate against the unit owner. Because in those sorts of claims the Body Corporate is the applicant, the burden of proof would fall on the Body Corporate to prove that the unit owners were liable to pay the amount claimed.

Here, the unit owner was the applicant. I allowed the applicants to go first in the order of presenting submissions since it was their application. Relevant law

Section 80(1) (g) of the UTA provides that an owner of a principal unit “must repair and maintain the unit and keep it in good order to ensure that no damage or harm, whether physical, economic or otherwise, is, or has the potential to be, caused to the common property, any building elements, any infrastructure, or any other unit in the building”.

Section 126 of the UTA applies where the Body Corporate does any repair that it is authorised to do under the UTA but the repair is either substantially for the benefit of one unit only, substantially for the benefit of some of the units only, or benefits one or more of the unit substantially more than it benefits the others or other of them. It provides that any expense incurred by the Body Corporate in doing the repair, work or act, is recoverable as a debt in accordance with the following: “(a) so far as the repair, work, or act benefits any unit by a distinct and ascertainable amount, the owner at the time when the expense was incurred and the owner at the time when the action is instituted are jointly and severally liable for the debt; or (b) so far as the amount of the debt is not met in accordance with the provisions of paragraph (a), it must be apportioned among the units that derive a substantial benefit from the repair, work, or act rateably according to the utility interest of those units, and in the case of each of those units, the owner at the time when the expense was incurred and the owner at the time when the action is instituted are jointly and severally liable for the amount apportioned to that unit.”

Section 138(1) of the UTA provides that a Body Corporate must repair and maintain: a. the common property; and b. any assets designed for use in connection with the common property; and c. any other assets owned by the body corporate; and d. any building elements and infrastructure that relate to or serve more than one unit.

Section 138(4) of the UTA provides that any costs incurred by the Body Corporate that relate to repairs of infrastructure contained in a principal unit are recoverable by the Body Corporate from the owner of that unit as a debt due to the Body Corporate by the person who is the unit owner at the time the expense was incurred.

Section 5 of the UTA includes the following definition: Infrastructure includes pipes, wires, ducts, conduits, gutters, watercourses, cables, channels, flues, conducting, or transmission equipment necessary for the provision of water, sewerage, drainage, stormwater removal, gas, electricity, oil, shelter, protection from fire, security, rubbish collection, air, telephone connection, Internet access, radio reception, television reception, or any other services or utilities to or from a unit or to or from the common property

Wheeldon v Body Corporate 342525 [2016] NZCA 247 concerned the relationship between a unit owner’s duty to repair the unit under s 80(1)(g) of the UTA and the Body Corporate’s duty to repair and maintain any building elements and infrastructure that relate to or serve more than one unit under s 138(1)(d).

It was argued that the primary obligation of repair of individual units fell on a unit owner, including those building elements falling within the confines of an individual unit.

In the High Court, Muir J had rejected that argument, holding that s 138(1)(d) prevailed, having regard to the purposes of the UTA expressed in s 3 as follows: Recognition of flexibility and responsiveness, the requirement to manage buildings on an economically sustainable basis and the requirement to protect the integrity of the development as a whole all, in my view, point strongly to a more expansive interpretation of s 138 than the “default provision” for which the plaintiffs contend.

The Court of Appeal declined the appeal, finding that the scheme of the UTA was that the Body Corporate had the responsibility not only to repair and maintain common property – being property not within any unit – but also to repair and maintain: 4 a. building elements, whether they formed part of the common property or are found within a unit and b. infrastructure, again whether found on common property or and an individual unit servicing that unit.

In Body Corporate 73368 v Otway, 5 water had leaked from decks located on level I of an apartment building to the commercial units below. The Body Corporate 4 At para [35] 5 [2017] NZHC 3265 sought to recover from two level I apartment owners the cost of repairs to damage sustained by level I and ground floor units located directly beneath.

Initially, the Body Corporate had sought to argue that the damage that had been caused by a defective membrane on the decks of the level I units had occurred as a result of a failure on the part of the relevant apartment owners to keep the units in sufficiently good order repair and condition.

Woodford J concluded that the damage was caused by a failure during the construction process.

He then went on to consider whether the repair costs could be recovered from the unit owners.

In relation to the claim under s 126, he conducted an assessment as to the extent to which the repair work benefited the level I units “by a distinct and ascertainable amount”. He observed that: Otherwise it must be apportioned among the units that derive a substantial benefit from the repair work according to their utility interest in those units. However, the court retains a discretion under s 126(3) to apportion the cost of the repair work as it thinks fit, having regard to the relevant benefits to those units. 6

In a recent Tenancy Tribunal decision, a very similar dispute to that currently before the Tribunal arose for consideration.

The case was Baubles Ltd v Body Corporate 49818 [2025] NZTT 9043804. The Body Corporate discovered a leak in the unit owner’s premises that had affected an area beneath their unit. The source of the leak was from a leaking pressure reducing valve contained within a service cupboard which supplied services only to the unit owner’s unit.

This case therefore raised the identical issue before the Tribunal in this matter.

The issue was who was liable for remediation of the flooding.

Adjudicator Woodhouse found that the leak arose from “infrastructure” (as that term is defined in s 5 of the UTA). He found that the leak did not arise from infrastructure that related to or served more than one unit meaning that the repair cost would not be the responsibility of the Body Corporate but would fall to the Unit Owner.

He therefore dismissed the Unit Holder’s claim that it was not liable to pay for these costs. Analysis and findings 6 At para [26]

It is accepted by the parties and established by the evidence that the fault requiring repair in this case was the perforated air-conditioning drainage pipe. Without question, this pipe falls within the definition of infrastructure.

It was not challenged by any of the parties that this pipe was located within the applicant’s unit, that it serviced only their unit, that it perforated during the construction process and that up until the point signs of water ingress were discovered in late December 2023, there had been no prior indication of any water ingress or cause for concern.

The failure of the perforated pipe was not caused by any wilful or negligent act or omission on the part of the applicants or their tenant; it was caused by oversight, omission or negligence in the course of construction.

The Body Corporate says that the obligation to pay arises under ss 80(1)(g) and 126 of the UTA.

I consider that the Body Corporate was authorised to perform repairs of this fault. This authorisation arises by virtue of s 138 and the law I have referred to above. It would make no sense for a Body Corporate not to be authorised to perform such repairs, particularly given the purposes of the UTA expressly referred to by Muir J and set out above.

The applicants say that other than the actual repair to the perforated pipe, none of the work was of benefit to their unit and on this basis, they are not liable for the cost of repair.

This argument misinterprets the nature of the clear obligation in s 80(1)(g). The obligation to repair and maintain is an obligation which arises regardless of how the item requiring repair has come to be defective or, in this case, perforated. It arises regardless of whether an owner is aware of the damaged item or not. Once the pipe required repair it was the applicant’s responsibility to repair it. The failure to do that has then led to the need for repairs to other parts of the building lying outside their unit. The repairs were all of benefit to the applicants, from that perspective.

I do not agree that the evidence supports a finding that the repairs were misguided. I consider that it was a prudent step for the Body Corporate to investigate other potential sources of water ingress such as leaking toilets. Identifying the cause of water leaks is notoriously difficult. I note that although the applicants criticised the Body Corporate manager taking that approach and incurring additional remediation costs, they advanced no expert evidence that suggested that that course of action was negligent or irresponsible in any way. To put this another way, the evidence is that the assessments undertaken to the toilets was simply one of the reasonable steps taken in an effort to locate the source of the leak, later found to be the air conditioning pipe.

Regarding the insurance related point, the applicants claimed: “the Body Corporate has ignored its own meeting resolution making it liable for insurance excess as documented at the November 2022 AGM.” The excess is $10,000. Submitting an insurance claim for this matter – a decision of the Body Corporate - would therefore be pointless. I note that I did not have a copy of the insurance policy before me.

The Body Corporate may well have insurance and be required to pay the excess where there is a claim for damage to common property but it is for the Body Corporate to decide whether an insurance claim should be made following a determination as to whether the damage is to common property.

It follows that the applicant’s claim is dismissed.

I have made the directions above regarding costs because a submission was made by the Body Corporate for costs in the event they were successful. I note however that this has been a reasonably complex matter. The matter involves only a small amount of money and I would be minded to consider that costs should lie where they fall. However I give the respondent the opportunity to make an application for costs should it choose to do so.

Order