What was the outcome of Tenancy Tribunal case 9042924?

The tribunal order states: The term “carpark” in the original Body Corporate Operational Rules includes the

How much money was awarded in case 9042924?

____________________________________…: $2,100.00 awarded to landlord; Costs Payable By Second Respondent: $2,100.00 awarded to landlord; Costs Payable By Third Respondent: $2,100.00 awarded to landlord; Filing Fee: $166.66 awarded to landlord; Filing Fee: $166.67 awarded to landlord; Filing Fee: $166.67 awarded to landlord

What type of tenancy dispute was case 9042924?

The dispute type was not classified.

Where can I read the official tribunal order for case 9042924?

The official Ministry of Justice published order is available at https://forms.justice.govt.nz/search/Documents/TTV2/PDF/10437721-Tribunal_Order.pdf.

What was the outcome of Tenancy Tribunal case 9042924?

The tribunal order states: The term “carpark” in the original Body Corporate Operational Rules includes the

How much money was awarded in case 9042924?

____________________________________…: $2,100.00 awarded to landlord; Costs Payable By Second Respondent: $2,100.00 awarded to landlord; Costs Payable By Third Respondent: $2,100.00 awarded to landlord; Filing Fee: $166.66 awarded to landlord; Filing Fee: $166.67 awarded to landlord; Filing Fee: $166.67 awarded to landlord

What type of tenancy dispute was case 9042924?

The dispute type was not classified.

Where can I read the official tribunal order for case 9042924?

The official Ministry of Justice published order is available at https://forms.justice.govt.nz/search/Documents/TTV2/PDF/10437721-Tribunal_Order.pdf.

Queenstown, Queenstown Tenancy Tribunal Case 9042924 — Tenancy dispute

Claims and awards in Tenancy Tribunal application 9042924 — net $6,800.00 NZD. Amounts reconciled from the published order (claims sum and net total). Verify on MoJ.
Claim	Landlord	Reason
___________________________________________________________________________ 90429242 DescriptionsApplicant Costs payable	$2,100.00	___________________________________________________________________________ 90429242 DescriptionsApplicant Costs payable
Costs payable by second respondent	$2,100.00	Costs payable by second respondent
Costs payable by third respondent	$2,100.00	Costs payable by third respondent
Filing Fee payable by first respondent	$166.66	Filing Fee payable by first respondent
Filing Fee payable by second respondent	$166.67	Filing Fee payable by second respondent
Filing Fee payable by third respondent	$166.67	Filing Fee payable by third respondent
Net award	$6,800.00
Total payable by Tenant to Landlord	$6,800.00

Claims and awards in Tenancy Tribunal application 9042924 — net $6,800.00 NZD. Amounts reconciled from the published order (claims sum and net total). Verify on MoJ.
Claim	Landlord	Reason
___________________________________________________________________________ 90429242 DescriptionsApplicant Costs payable	$2,100.00	___________________________________________________________________________ 90429242 DescriptionsApplicant Costs payable
Costs payable by second respondent	$2,100.00	Costs payable by second respondent
Costs payable by third respondent	$2,100.00	Costs payable by third respondent
Filing Fee payable by first respondent	$166.66	Filing Fee payable by first respondent
Filing Fee payable by second respondent	$166.67	Filing Fee payable by second respondent
Filing Fee payable by third respondent	$166.67	Filing Fee payable by third respondent
Net award	$6,800.00
Total payable by Tenant to Landlord	$6,800.00

Order

The term “carpark” in the original Body Corporate Operational Rules includes the garages.
The second and third respondents were in breach of the original Body Corporate Operational Rules.
The amendment to the Body Corporate Operational Rules is upheld with the exception that, by consent, the words “approved by the body corporate” shall be inserted at the end of rule 4(2)(iii).
The application for compensation for breach of the Body Corporate Operational Rules is dismissed.
Body Corporate 20188’s application for costs is dismissed.
Body Corporate 20188, M & A Limited Mayank, and VR Group Limited Mangal must pay Julie Anne Jolley $6,800.00 immediately, as follows: DescriptionsApplicant Costs payable by first respondent$2,100.00 Costs payable by second respondent$2,100.00 Costs payable by third respondent$2,100.00 Filing Fee payable by first respondent$166.66 Filing Fee payable by second respondent $166.67 Filing Fee payable by third respondent $166.67 Total payable by Respondent to Applicant $6,800.00

Reasons

Both parties attended the hearing.
Applicant sought a declaration that the actions of the second and third respondent were in breach of the Body Corporate Operational Rules, that the Body Corporate (“BC”) had a duty to enforce the rules, and compensation for breaches of the rules together with costs.
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 (in this case, the unit owner) to establish their claims “on the balance of probabilities”. That means that they must establish that what they are 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.
I do not need to be completely certain, but I need to be more certain than uncertain. In deciding any particular claim, I must consider all the evidence presented (including oral evidence during the hearing). I must weigh this evidence to decide what is more likely.
For the sake of brevity, I may not have referred to all the evidence and submissions presented; however, the parties can be assured that it has all been carefully considered. Background
The premises is a unit title development in central Queenstown. The majority of the units are rented as holiday accommodation. Each unit has either an allocated garage or a space in the carparking portion of the development. There is no differentiation between carparks and garages in the development plans. Both are simply referred to as accessory units.
There is a relationship between the development and the neighbouring hotel, in terms of management agreements. This has also resulted in the use of some of the garages in the development for storage by the third respondent. The second and third respondents are related entities.
This use of the garages is the cause of the Applicant’s complaint. It says that the use of the garages for storage creates an eye-sore and this leads to complaints from guests renting its unit.
The applicant argues that the use of the garages for this purpose is a breach of the Body Corporate Operational Rules.
The respondents argue that the Body Corporate Operational Rules only apply to carparks and not the garages. Further, the BC argues there is no obligation on a BC to enforce the Body Corporate Operational Rules.
The relevant rules are: a. Rule 1 which states: Rule 1: Interference and obstruction of common property An Owner of a unit must not interfere with the reasonable use or enjoyment of the common property by other Owners or obstruct any lawful use of the common property by other owners. b. Rule 4 which states: Rule 4: Vehicle Parking ... b.) An Owner of a unit that has part of that unit designated as a carport or carpark must: i. only use the vehicle park for the purpose of parking vehicles; ii. ensure that the vehicle park is kept tidy, clean and free of litter; iii. not use the vehicle park or permit it to be used for storage; ... c. Rule 8 which states: Rule 8: Rubbish, recycling and pest control An Owner of a unit: a. Must not leave rubbish or recycling material on the common property except in those areas designated for rubbish or recycling collection by the Body Corporate.
The main point of contention was the meaning of “carpark” in rule 4. The applicant contends that “carpark” includes the garages. The Respondents say that garages are not carparks, and the reference to “carpark” in rule 4 excludes the garages from that rule.
Neither carpark nor garage is defined in the Body Corporate Operational Rules or the UTA. Garages are not mentioned in the Body Corporate Operational Rules at all. That is a term used by the parties, but not referred to in the documentation.
“Carpark” is defined in the Oxford English Dictionary as “an open space or building for the parking of motor vehicles.” “Garage” is defined as “A building, either private or public, intended for the storage and shelter of motor vehicles while not in use.” The only difference being that a garage is a building, whereas a carpark can be either an open space or a building.
Given the absence of any reference to garages in the Body Corporate Operational Rules and the plan reading of the word carpark, I find that rule 4 applies to all the accessory units, whether they are called carparks or garages by the parties. In fact, the ordinary meaning of “carpark” encompasses both the open spaces and the enclosed garages (buildings) in this development.
Following my indication, at the first hearing, on this point, there was an amendment to the Body Corporate Operational Rules to allow use of the garages for commercial purposes.
Rule 4 now states:
While the applicant considers that this amendment is a correcting of the previous wrong, she accepts that the rules were changed in accordance with correct procedures. That said, the applicant sought assurances that there would a consistent standard of screen used to ensure that the agreed standards would be maintained.
The parties agreed that the words “approved by the Body Corporate” should be inserted at the end of rule 4.2(iii).
Annexure A to this decision is a photograph of the exemplary screen provided to me as an example of what the parties agree is appropriate. This is currently in use. Issues
Prior to the second hearing, the parties agreed the following issues required determination: a.Did, prior and/or subsequently to the amendments to the operational rules, the second and/or third respondent breach the operational rules? b.If so, does the Body Corporate have a duty to enforce the operational rules? c.If yes: i.did the first respondent breach that duty? and ii.what is the loss (if any) flowing from that breach? d.costs. Did, prior and/or subsequently to the amendments to the operational rules, the second and/or third respondent breach the operational rules?
In relation to the original Body Corporate Operational Rules this question largely turns on the interpretation of “carpark”. As set out above, I find that “carpark” in the Body Corporate Operational Rules includes the garages.
That being the case, the use of the garages for storage by the second and third respondents is in clear breach of the Body Corporate Operational Rules.
Given the amendment to the Body Corporate Operational Rules has yet to be notified, the breaches are ongoing.

If so, does the Body Corporate have a duty to enforce the operational rules?

The BC is bound by the Body Corporate Operational Rules and can enforce them against all other parties bound by those rules.
That said, there is no specific duty on the BC to enforce the rules on behalf of unit owners or any other relevant parties. I consider that a BC cannot be compelled to act. This is reflected in the ability of all persons covered by section 171(2) of the UTA to bring proceedings in the Tribunal, which has the jurisdiction to determine disputes between those persons.
That said, the BC took a clear and strong position on this dispute right from the outset. The BC maintained the position right up to, and including the second hearing, that there was no breach of the Body Corporate Operational Rules.
That stance effectively created the need for this hearing, as it emboldened the second and third respondent in their refusal to reach an agreement around the breach and the interpretation of the rules. This is confirmed by the submission made on behalf of the second and third respondents that: Despite the comprehensive response provided to both the Body Corporate and the committee members, the applicant remained steadfast in their pursuit of legal recourse, thereby disregarding the efforts made by the respondents to address the issue internally.
Further, the BC chairperson, Mr Paget created a significantly hostile tone to efforts to resolve this issue, which, in my view further entrenched the positions taken by the applicant and the second and third respondent. This is reflected in the Chairman’s report to the Body Corporate in 2023, in correspondence with the Applicant, in comments annotated across documents the applicant wished to table at the AGM when the change to the Body Corporate Operational Rules was being considered, and in his approach at the first hearing.
Mr Paget’s final comments in the final line of the report for the AGM sum up his position, which is in effect the position of the BC – “I will call the shots as I see them!” . Mr Paget and the BC clearly considered their position was the answer to the interpretation of the rules, and no amount of dressing up now can undo the reality of the way that approach unfolded in reality.
The BC actively involved itself in this dispute throughout, siding with the second and third respondents. I consider the BC cannot now remove itself by arguing that it had no obligation to enforce the Body Corporate Operational Rules.
What the BC did, effectively, was enforce its interpretation of the Body Corporate Operational Rules against the applicant.
The applicant is entitled to challenge that interpretation and has brought this application to do so.
In short, the BC does not have a duty to enforce the Body Corporate Operational Rules. However, it is entitled to do so. In the present case, I find that the BC did enforce the rules, albeit not in the way the applicant sought.

Was there a loss?

I intend to answer this question, slightly more broadly than framed by the parties, given my finding that the BC did enforce the rules by determining that there was no breach of the rules.
So, I ask myself – was there a loss that flowed from the BC’s actions? Secondly, did the breach of the rules by the second and third respondents cause loss to the Applicant.
The applicant gave evidence of numerous complaints from guests at her unit about the eye sore created by the use of the garages for laundry and storage. However, these complaints were by email or in person, rather than in the form of written reviews on sites such as “yelp” or “TripAdvisor” and other review sites frequented by tourists.
The applicant is concerned that she has missed out on repeat bookings as a result, but she is unable to prove or quantify this.
Further the applicant gave evidence that the occupancy rates for her unit are the same, or slightly higher than average for accommodation in central Queenstown.
The rate charged by the applicant is in line with other similar properties, and there has been no reduction for loss of amenity caused by the breaches of the rules.
Accordingly, I am not satisfied that the applicant has proved a loss arising from the breaches by the respondents. Costs
The applicant seeks costs from all the respondents.
The first respondent seeks costs from the applicant, but not the second and third respondent.
The second and third respondents oppose an order for costs, but do not seek costs.
The BC is critical of the Tribunal for seeking submissions on costs prior to the release of the substantive decision. I have some sympathy with that, however the reasons for prompt and simultaneous exchange of memoranda were given in the hearing, namely the timeframes for release of this decision created by my appointment in an alternative jurisdiction.
With respect, the BC submissions overstate the claims actually pursued by the applicant. At hearing, the applicant pursued the declaration that the use of the garages in the manner demonstrated by the respondents was a breach of the rules. This was expanded to include the proper interpretation of the rules. The applicant sought compensation for losses she alleged arose from that, and legal costs associated with the proceeding.
For the reasons outlined above, by virtue of the BC’s own actions, I consider that this application appropriately involves the BC as much as the second and third respondents.
For completeness, the BC submission that the applicant’s own use of the garage for storage is also a breach is largely irrelevant. There is no claim against the applicant for a breach, and the change to the rules will benefit the applicant in the same way it does the other unit owners. Further, the applicant accepted that if her interpretation of the rules was correct, then her use of storage lockers in her garage would also be a breach, albeit less egregious.
The second and third respondent’s submissions to not assist much in the determination of the issue of costs. They submit that the rules were ambiguous, and that is why they should not be liable for the costs of determining this dispute. That could be said of any dispute. If everything was clear cut, there wouldn’t have been an application to determine.
In my view, the applicant has been largely successful against all three respondents. With the exception of compensation for actual loss, the claims have been upheld.
In making this finding, I do not overlook the fact that interim steps were made to install screens over the garages. This is acknowledged by the applicant to have improved the visual amenity of the development. However, in the absence of any agreements about the interpretation of the rules, and in light of the joint position of all three respondents that there was no breach, the applicant’s apprehension that this solution would not last is justified.
This is confirmed by the fact that following the first hearing, the rules were changed to regularise the use of screens to hide use of garages for storage purposes. This was not undertaken until my indication of the interpretation of the rules. Further, it was not pursued in good faith by the BC, with the Mr Paget’s unprofessional and inflammatory comments in the report to the AGM, and annotations on the Applicant’s proposal further undermining the Applicant’s confidence in fair and appropriate treatment by the BC. A ruling from the Tribunal was required, and the applicant’s pursuit of that is justified. Quantum of costs
Section 102 of the Residential Tenancies Act 1986 (RTA) relates to costs. Section 102(2) confirms that the Tribunal “may make an order” where “any of the parties was presented by counsel”. Subsection 3 confirms that an order may be made to a party for “the reasonable costs of that other party in connection with the proceedings.”
It is unusual for a Tribunal or Court in New Zealand to award full indemnity costs against the losing party.
What is considered to be ‘reasonable costs’ will depend on a range of factors. In Holden v Architectural Finishes Ltd [1997] 3 NZLR 143 Justice McGechan, in his reserved costs decision, held that: ...the sum in issue is a ‘reasonable’ ‘contribution’. It is not some mere gesture. It is not some virtual payment in full. It is merely a contribution, and a reasonable one. At the outer limits, proportions of reasonable actual fees can afford some guidance. A 10% or even 20% contribution – very little indeed – may seldom qualify. A 90% or 80% contribution, virtually the total, may be regarded as likewise...if the ‘reasonable contribution’ earlier determined falls within a middle range, say 40% to 70%,there is a feeling of some comfort...
The High Court confirmed that when a party is represented by counsel, that the following factors are relevant to be considered when assessing costs: a. The length of the hearing. b. The sum of money involved. c. The legal and factual complexity. d. Whether the argument lacking substance was advanced, and e. The degree of success achieved by the parties.
Similarly in the judgment of David Blair Ltd v Hawkins Arms and Engineering Ltd (No 2) [1988] 1 PRNZ 162, Tompkins J considered a costs issue where the party was represented, and held: In addition to the length of the hearing, matters such as the amount of money involved, the importance either to the parties or generally of the issues, monetary or non-monetary, the legal and factual complexities, the amount of time required for effective preparation, the number and complexity of interlocutory applications and the likely or actual solicitor and client costs incurred, may, in appropriate cases, be relevant to the exercise of the discretion.
While this dispute did not involve considerable sums of money, there was a degree of complexity involved and the outcome was important to all parties.
I do not consider that indemnity costs are appropriate, however. The costs ordered reflect around 60% of the applicant’s actual costs, and in all the circumstances, I consider that appropriate.

Tenancy Tribunal case 9042924 — Tenancy dispute in Queenstown, Queenstown

At a glance

Tenancy Tribunal case 9042924 — Tenancy dispute in Queenstown, Queenstown

At a glance

Award balance

Claims & awards

Order

Reasons

If so, does the Body Corporate have a duty to enforce the operational rules?

Was there a loss?

Topics & place

Residential Tenancies Act sections

Key findings

Property management

Frequently asked questions

Award balance

Claims & awards

Order

Reasons

If so, does the Body Corporate have a duty to enforce the operational rules?

Was there a loss?

Topics & place

Residential Tenancies Act sections

Key findings

Property management

Frequently asked questions