Current issues with Unit Titles November 2014 Presented

Current issues with Unit Titles November 2014 Presented by: Kay Keam

Introduction 1972 2010 • Flats, not apartments • Largely residential • Low rise • 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 Additional Pre Settlement 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% d l o S

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 rules 1. 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 Keam ktk@martellimckegg. co. nz