What was the outcome of Tenancy Tribunal case 9050924?

The tribunal order states: The Tribunal declares that the applicant did not require the consent of the Body

How much money was awarded in case 9050924?

Individual award amounts are in the official MoJ PDF. Claim amounts appear on this page when claims and net totals reconcile.

What type of tenancy dispute was case 9050924?

The primary dispute was Unit Titles.

Where can I read the official tribunal order for case 9050924?

The official Ministry of Justice published order is available at https://forms.justice.govt.nz/search/Documents/TTV2/PDF/10579994-UTA_Tribunal_Order.pdf.

What was the outcome of Tenancy Tribunal case 9050924?

The tribunal order states: The Tribunal declares that the applicant did not require the consent of the Body

How much money was awarded in case 9050924?

Individual award amounts are in the official MoJ PDF. Claim amounts appear on this page when claims and net totals reconcile.

What type of tenancy dispute was case 9050924?

The primary dispute was Unit Titles.

Where can I read the official tribunal order for case 9050924?

The official Ministry of Justice published order is available at https://forms.justice.govt.nz/search/Documents/TTV2/PDF/10579994-UTA_Tribunal_Order.pdf.

Three Kings, Auckland Tenancy Tribunal Case 9050924 — Unit Titles

Order

The Tribunal declares that the applicant did not require the consent of the Body Corporate in order to build the pergola on unit 7.
The Tribunal declares that the notice from the Body Corporate that the pergola at unit 7 did not comply with the body corporate operational rules, and needed to be removed, is invalid.
Boutique Body Corporate Limited and Body Corporate 326889 must pay Sheryll Anne Simons the sum of $712.75 immediately.

Reasons

The Tribunal must consider an application filed by a Unit Owner. The dispute relates to a pergola the Applicant has installed in her backyard, which the Body Corporate considers to breach the Body Corporate Rules and seeks to have removed.

BACKGROUND

This dispute relates to a unit titled housing development. The unit plan indicates there are some 57 units in the complex. From the information on file, the units which are relevant or mentioned have an enclosed backyard with wooden paling fences on each side, the fences being around head height.
The relevant dwellings are two storeys in height. The ground floor levels open onto a paved or decked area.
The Applicant is the owner of unit 7.
The Applicant installed a proprietary gazebo. The structure appears to be primarily powder-coated aluminium, with a louvre roof. On one side at least is a pull-down blind, which would provide privacy or shade on that side of the structure. The structure is not affixed to the existing dwelling but rather sits on four posts secured onto the concrete patio.
It is the case that the Applicant did not obtain consent from the Body Corporate before the structure was built. After the structure was built, there were complaints from neighbours. The Body Corporate determined that the pergola breached its body corporate operational rules (the Rules), and therefore issued a breach notice requiring the structure to be removed. The Applicant paid the fee associated with that notice ($212.75).
The Applicant then applied for retrospective consent from the Body Corporate, and that consent was declined. The Applicant is displeased with the process of the Committee in reaching that conclusion.
On 20 February 2024 the Applicant filed this application with the Tenancy Tribunal, seeking orders to clarify the lawfulness of the structure, and seeking orders around the actions of the Body Corporate.

APPLICANTS CASE

The Applicant is represented was represented by Ms Bhana, the unit owner’s daughter.
Ms Bhana advised that the unit owner installed a pergola in December 2023, and that her interpretation of the Rules at the time was that consent did not need to be obtained, because of the size, location and the fact it was not a permanent structure.
Subsequently, a complaint was received from the Body Corporate, which resulted in a breach notice being issued (which she paid for). Then the unit owner applied for retrospective permission for the pergola which was not granted.
The Unit Owner challenges the process in which the application was considered, and views it as unfair, particularly given there was involvement with a neighbour on the committee who was not supportive of the pergola.
The Unit Owner seeks confirmation from the Tribunal as to the lawfulness of these sorts of works, and how the Committee’s assessment should be made.
Ms Bhana noted that there is another unit that has a similar pergola, that is unit 10. That pergola is higher than the unit 7 pergola and closer to the fence. This pergola was approved at an AGM.
The Unit Owner considers that there has been a breach of the Committee’s Code of Conduct.

BODY CORPORATES CASE

The Body Corporate was represented at the hearing by Mr Leishman.
Mr Leishman submitted that the Unit Titles Act 2010 (UTA) does not define what a structure is, but a dictionary definition would mean it is something of many parts that are put together. In this case, it is a structure of significant size, and would be considered a structure.
It was submitted that it is not relevant that the structure is not attached to the building.
It was submitted that the Unit Owners reliance on section 79 does not assist them, because she would not cross the threshold of having needed to obtain consent under section 80(1)(h) or (i).
Mr Leishman submitted that if the unit owners were correct in their position, then an owner could erect an 11-metre structure in their backyard, which cannot be correct.
In this case it was submitted that the structure is unpleasant to view from the neighbouring property, is unattractive, and a colour not in keeping with other colours used in the complex.
Mr Leishman considered that the building of the pergola impacts the neighbour’s quiet enjoyment of their units.
It was submitted that there would be an impact on the ownership interest, given this is an improvement which would increase the value of this property, therefore increasing ownership interest for this unit owner.

ANALYSIS

The issues which arise in this case are primarily legal. The question is whether Ms Simons was able to put up the pergola in her backyard without the consent of the body corporate? Answering that question requires consideration of both the UTA, and the Rules, because the criteria under both are different. Erecting structures under the UTA
The primary legislation governing the operation of unit-titled premises is the Unit Titles Act 2010 (UTA). Sections 79 and 80 of the UTA, set out, prescriptively, the rights and responsibilities of owners of principal units. Under section 79(e), each unit owner is expressly granted a statutory right to make “any” alterations or additions to the unit “so long as these are within the unit boundary and do not materially affect any other unit or common property”.
The Court of Appeal summarised the relevant provisions in the case of Body Corporate 203780 v Bell [2020] NZCA 665, as follows: [16] Under s 79(e), the owner of a unit is able to make alterations to their unit provided that the alterations are within the unit boundary and do not materially affect any other unit or common property. Notice of proposed additions or structural alterations must be given to the body corporate (s 80(1)(h)). If an alteration within the unit boundary would materially affect other units or common property, the unit owner can only carry out the alteration after obtaining written approval from the body corporate (s 80(1)(i)). [17] These provisions are designed to strike a balance between the goals of protecting the integrity of the development as a whole and establishing a flexible and responsive regime for governance of unit title developments. The Act permits changes to be made to individual units subject to certain safeguards, including the safeguards set out in s 80(1)(h) and (i).
In terms of those specific provisions in the UTA, they are as follows:
Section 79 relates to the rights of principal unit owners like Ms Simons, and confirms that: An owner of a principal unit- ... (e) subject to section 80(1)(h) and (i), may make any alterations, additions, or improvements to his or her unit so long as these are within the unit boundary and do not materially affect the use, enjoyment, or ownership interest of any other unit or common property:
Section 80(1)(h) and (i) relates to the responsibilities of principal unit owners, and hold: An owner of a principal unit – ... (h) must notify the body corporate of his or her intention to carry out any additions or structural alterations before the commencement of any work: (i) must not make any additions or structural alterations to the unit that materially affect the use, enjoyment, or ownership interest of any other unit or the common property without the written consent of the body corporate:
I note the commentary to section 80, in the legal reference Land Law, Lexis Nexus online, indicate a view of the authors that where the proposed works were of a free standing nature (as it the case with the pergola before me), that there would be no requirement for consent to be obtained: In terms of s 79(e), each proprietor is expressly granted a statutory right to make “any” alterations or additions to the unit “so long as these are within the unit boundary and do not materially affect any other unit or common property”. The obligation not to “materially affect any other unit or common property” without consent is reiterated in s 80(1)(i), which s 79(e) is expressly subject to. However, under s 80(1)(g) there is also a responsibility on owners of principal units to: “... 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 element, any infrastructure, or any other unit in the building.” This is an advance on the position commonly found concerning body corporate rules under the Unit Titles Act 1972, which invariably required the consent of the body corporate before any alteration was made to a unit. Where buildings within the three-dimensional title space are freestanding and not attached to other units, good argument can be made that alterations and improvements can be undertaken without the involvement of the body corporate.
The authors refer to the Court of Appeal decision of Wheeldon v Body Corporate 342525 [2016] NZCA 247, in which the Court observed. [37] The right under s 79(e) to make alterations or additions is also limited; it is subject to s 80(1)(h) (notification required to the body corporate) and s 80(1)(i) (prohibits additions or alteration to the unit “that materially affect any other unit or the common property without the written consent of the body corporate”). Taking the decks as an example, Mr Brill submitted that if unit owners were entitled (as he contended) to add, alter or improve a deck, it would seem strange if they were not also entitled to maintain and repair it. This submission is flawed because it assumes an unqualified right to undertake additions, alterations and improvements. If a building element relates to more than one unit it will, inevitably, materially affect those other units. It follows that the unqualified right to improve or alter components only exists in relation to those that do not fall within s 138(1)(d). In all other circumstances, s 79(e) effectively excludes any right for a unit owner to alter, add to or improve building elements other than those authorized by the body corporate. 1
Based on those references, because the pergola was entirely free-standing, then Ms Simons would not have required the consent of the Body Corporate in order to build it.
However, even if I were wrong in that interpretation, I would still conclude that it was permissible for Ms Simons to build the pergola without consent, for these reasons.
Again the starting point is that Ms Simons had a ‘right’ to make any alteration, addition or improvement to her unit, providing the work was within her unit boundary (which it was), and providing it did not materially affect the use, enjoyment or ownership interest of any other unit or common property. I will address section 80 separately below.
It must be emphasised, that section 79(e) is qualified in that it looks to impacts that “materially” affect the other units. The term ‘materially’ is not defined in the UTA, so it must be given its plain English meaning. The Oxford English Dictionary (on-line version) defines the word ‘materially’ as follows: To a material or important extent; significantly, substantially, considerably
Having considered the photographs presented, including the photographs from the neighbour’s properties, I do not consider that any reasonable committee could reach a conclusion that the unit 7 pergola would result in an impact on the neighbours in their use or enjoyment of their property that was important, significant, substantial or considerable. Certainly, there could be a minor (probably very minor) impact, but that would not be close to the necessary standard of being a material impact.
Mr Leishman submitted that there would be an impact on the ownership interest from the pergola because it would increase the value of unit 7. The argument being that if the value of unit 7 went up, that would change the ownership interest. That is true, but then that same argument could be made for virtually any changes an owner did. Even having a nice garden would then be viewed as shifting the ownership interest. Given the value of the pergola, I do not consider that in the scheme of things, that it would materially – that is 1 Section 138(1)(d) is a provision relating to building elements serving more than one unit, a roof covering multiple units for example. significantly, substantially or considerably - affect the ownership interest. I also make the observation that even if it did, that would not be in the favour of Ms Simons, because if her ownership interest increased, then so would her liability to fund capital improvements etc in the complex. I doubt that Parliament would have intended that the consideration around ownership interest being negatively viewed when the person proposing the work would be the one adversely impacted.
That means the expectation under section 79(e) is that Ms Simons would, subject to section 80(1)(h) and (i), have the ‘right’ to proceed with building her pergola.
Section 80(1)(h) and (i) relates to the responsibilities of principal unit owners, and hold: An owner of a principal unit – ... (h) must notify the body corporate of his or her intention to carry out any additions or structural alterations before the commencement of any work: (i) must not make any additions or structural alterations to the unit that materially affect the use, enjoyment, or ownership interest of any other unit or the common property without the written consent of the body corporate:
It is important to recognise that section 80 is not a provision that the Body Corporate can use in order to refuse consent for works, it is a provision which does no more than set out the “responsibilities” or expectations on a unit owner.
In terms of sub-subsection (h), assuming that building a pergola was an addition to the unit, then I would agree that Ms Simons should have notified the Body Corporate of her intention to do that work. But this provision does not carry any consequence should the unit owner not notify their body corporate. Certainly you could say there has been a technical breach, but that would be as far as the Body Corporate could take it.
Sub-subsection (i) does no more than restate the expectation seen in section 79(e), prohibiting certain works being undertaken without consent, but by putting this in section 80, confirms that it is a ‘responsibility’ of the unit owner, because section 79 only deals with ‘rights’ of unit owners.
But for the reasons I have set out above, I do not consider there was any requirement for consent to be obtained in order to undertake the works, because there was no material effect arising from it.
It was further submitted that the pergola impacted the quiet enjoyment of the neighbours. It is not clear to me how the neighbours would have the quiet enjoyment impacted from a neighbour having a pergola. Ms Simons is of course entitled to use her backyard, she is welcome to spend time on it, and entertain if she should wish. If Ms Simons turned out to be rowdy, that might impact the quiet enjoyment of her neighbours, but simply having a pergola would not. Furthermore, it is difficult to see how having a structure lawfully built that would comply with the UTA, would impact a person’s quiet enjoyment.
For the above reasons, I find that Ms Simons did not need to obtain the consent of the Body Corporate in order to build the pergola. That means that any notice from the Body Corporate suggesting the pergola did not comply and needed to be removed, would not be valid.

Would the pergola offend the Rules?

While I have concluded that the construction of the pergola did not need consent of the Body Corporate, and complied with the UTA, the question then is whether it complied with the Rules.
The Body Corporate claims that the pergola offended rule 29 which is as follows:
Exterior of the Building An Owner must: (a)... (b) Make no alteration to the colour scheme or appearance of the exterior of the Unit or in any way alter the elevation or external appearance of the Unit without the written consent of the Body Corporate.
It is immediately clear that this rule departs from the requirements under the UTA in two important respects. Firstly the rule places restrictions on changes around the exterior appearance of the unit, and secondly, it would otherwise require written consent for all works.
A body corporate may act, only as empowered by the Act and only for the purpose of performing its duties or exercising its powers (see UTA sections 77 and 78).
The body corporate’s powers include amending, revoking or making additions to the body corporate rules, provided any amendments or additions to the body corporate rules relate to the control, management, administration, use, or enjoyment of the units and common property (see section 105(2) and 106(1)(a)).
A body corporate in exercising a statutory power, it is also required to act reasonably in a public (administrative) law sense. 2 Body corporates are only empowered to make rules that they are empowered by the Act to make and in implementing such rules, they are fettered by public law obligations. In Wu v Body Corporate 366611 (2009) 10 NZCPR 917 at 40 the Court stated: While it has been observed that the body corporate model is essentially democratic, it would be wrong to regard the body corporate as the equivalent to the authorised Parliament of the proprietors. It does not have unbridled power.
Importantly, Parliament has limited the extent to which a body corporate can introduce rules, as restricted in section 106 of the UTA: 106 Amendments, revocations, and additions to body corporate operational rules (1) Any amendment or addition to the body corporate operational rules must relate to— (a) the control, management, administration, use, or enjoyment of the principal units, future development units, accessory units, or common property; or (b) the regulation of the body corporate. (2) No powers or duties may be conferred or imposed on the body corporate that are not incidental to the powers and duties conferred or imposed on the body corporate under this Act. (3) ... (4) Any amendment or addition that is inconsistent with any provision of this Act or any other enactment or rule of law is invalid.
Importantly, the Body Corporate cannot introduce a rule which is not incidental to the power and duties the Body Corporate already has under the UTA.
In my assessment, Rule 29(b) goes beyond the powers and duties conferred by the UTA, because it does not limit when that Rule would exist, and on the face of it, would at all times require consent of the body corporate. To put that another way, this rule interferes with the unit owner’s statutory entitlement under section 79 which allows minor alterations without the consent of the Body Corporate. 2 Taggart “Administrative Law” [2006] NZLR Rev 74 at 99-100 and Velich v Body Corporate No 164980 Supra.
The circumstances of this case are similar to that considered by the Court of Appeal in Velich v Body Corporate No 164980 CA CA116/04. That dispute concerned a decision by a body corporate, who in reliance on a body corporate rule, refused consent for a unit owner to make alterations to his unit. The dispute in that case related to the construction of a deck. The body corporate initially approved the construction, but that approval only lasted for two years. But then when the unit owner again applied for consent to build the deck, that consent was declined with the body corporate relying on its rule, which is quite similar to the Rule in Ms Simons case. The rule in the Velich case is as follows: (f) make no additions or alterations to the unit (including any alteration to installations for the supply of gas, water or electricity) or in any way alter the elevation or external appearance of the unit without the consent in writing of the Body Corporate. The consent of the Body Corporate shall not be unreasonably or arbitrarily withheld or delayed where...
It is important to note that the Velich case was determined by applying the Unit Titles Act 1972, which has been replaced with the now current Unit Titles Act 2010. But the basis upon which the Court of Appeal reached its decision, will still apply to the current 2010 legislation, as the relevant provisions are materially similar.
The Court in Velich determined that rule 2.1.(f) was ultra vires, which means that it was without lawful authority. The Court said: [29] Rule 2.1(f) undoubtedly relates to “the powers and duties of the body corporate”. For this reason it is within the scope of the proviso to s 37(5). Accordingly it is only valid if the new powers and duties conferred can fairly be seen as “incidental” to the performance of powers and duties imposed on the body corporate by the Act. [30] The only duty imposed by the Act which could be invoked to justify rule 2.1(f) is that provided by s 15(1)(a), “to ... carry out any duties imposed on it by the rules”. As a matter of common sense, it is only powers and duties which are extant at the time of the rule change which are relevant. So the only new powers or duties which may be conferred by rule change on a body corporate are those which are “incidental” to existing powers and duties. [31] At the time rule 2.1(f) was adopted, there was no rule in place which required the body corporate to carry out the functions contemplated by rule 2.1(f) to the extent that they go beyond those required by default rule 1(f). So rule 2.1(f) expanded the powers and duties of the body corporate and further, did so appreciably. A rule which appreciably expands the existing powers and duties of the body corporate (as rule 2.1(f) purports to do) cannot fairly be regarded as merely “incidental” to those existing powers and duties. [32] It follows that rule 2.1(f) is ultra vires.
In Velich, the Court determined that the particular body corporate rule under consideration was nevertheless ultra vires, because it exceeded the body corporate’s powers (and was not incidental thereto).
Returning now to the case of Ms Simons. I would conclude that Rule 29(b) is not of an incidental nature, and therefore is ulta vires, and therefore invalid. Actions of the Committee
Ms Simons further seeks orders in relation to the actions of the committee.
While the Code of Conduct for body corporate members does include requirements around acting fairly, and complying with the Act, on balance, I accept that the committee was acting on a misunderstanding as to its legal authority and obligations of unit owners (Ms Simons). I am not persuaded that further orders are necessary, or should be made in relation to the Committee for that reason. Charges
When the Body Corporate raised its notice that the pergola was invalid, it charged an administration fee of $212.75. Given my finding that the notice was invalid, it must follow that there was no basis to charge that fee under section 127, because this is not a situation where money has been recovered where a person was at fault. Filing fee
Ms Simons has been substantially successful, and therefore the Body Corporate must reimburse the filing fee which is $500.00.

CONCLUSION

For the above reasons, I find that Ms Simons did not need to obtain consent from the body corporate to proceed with building her pergola. That means the decision of the Body Corporate stating that the pergola offended the Rules, and needed to be removed, was invalid.
The Body Corporate must reimburse the charge raised of $212.75.
The Body Corporate must also reimburse Ms Simons the Tribunal filing fee $500.00.
Finally, I decline to make orders in relation to the actions of the Body Corporate Committee.

Tenancy Tribunal case 9050924 — Unit Titles in Three Kings, Auckland

Tenancy Tribunal case 9050924 — Unit Titles in Three Kings, Auckland

Order

Reasons

BACKGROUND

APPLICANTS CASE

BODY CORPORATES CASE

ANALYSIS

Would the pergola offend the Rules?

CONCLUSION

Property management

Order

Reasons

BACKGROUND

APPLICANTS CASE

BODY CORPORATES CASE

ANALYSIS

Would the pergola offend the Rules?

CONCLUSION

Property management