Body corporate designated resolutions
What is a designated resolution?
There are certain types of body corporate resolutions that are likely to be of importance to all unit owners and any other people with an interest in a unit.
These resolutions include decisions on the physical property itself (e.g. selling or buying common property) and decisions about existing property that can affect unit owners financially (e.g. redeveloping units or common property). The Unit Titles Act 2010 classes these decisions as “designated resolutions.”
The Act defines designated resolutions as any resolution relating to:
- a decision to subdivide a principal unit into a subsidiary (layered) unit title development
- whether to deposit a substituted proposed unit development plan if the developer wants to change parts of the development that are still under construction
- a decision to approve a method of apportioning utility interest other than by relative value
- decisions about the sale, lease or licence of common property or additions to common property
- decisions about granting, varying or surrendering easements over common property
- decisions about creating covenants over common property and the variation or surrender of those covenants
- decisions about redevelopments requiring deposit of a new unit plan
- decisions about application of insurance money for purposes other than reinstatement of the unit title development
- if the development is on leasehold land, decisions about purchasing the land the development sits on
- a decision to cancel the unit plan.
What responsibility does a body corporate have after it passes a designated resolution?
If the body corporate passes a resolution to do any of the actions described in the above list the body corporate must notify:
- every unit owner, and
- every person with a registered interest or claim over a unit.
If the resolution is to cancel the unit title development then the body corporate must notify:
- every person with a registered interest or claim over the common property, and
- any tenant of an unregistered lease or licence over the common property.
The notice will outline what resolution has been made, the person’s right to object to the resolution and how the person can object. From 26 of Schedule 2 of the Unit Titles Regulations 2011 prescribes a standard document for bodies corporate to use when notifying a designated resolution.
What rights do I have if I am served with a notice of designated resolution?
Any person served with a notice of designated resolution has up to 28 days to:
- give notice to the body corporate stating that they object to the designated resolution and intend to apply for relief; and
- file an application for relief with the Tenancy Tribunal or Court. (See “Dispute Resolution in a Unit Title Development” for information on the respective jurisdiction of the Tenancy Tribunal and the Courts)
Form 27 of Schedule 2 of the Unit Titles Regulations 2011 prescribes a standard document for people to use when they want to object to a resolution.
A person’s objection will have no effect if it is given to the body corporate or filed with the Tribunal or Court outside the 28 day period.
Any person wanting to make an objection should consider seeking legal advice.
What relief can the Tribunal or a Court order?
The Tribunal or Court can make any of the following types of order:
- confirming the resolution
- overturning the resolution
- requiring either the body corporate or the objecting party to pay compensation to the other
- granting an injunction restraining something from being done
- a work order to carry out repairs or to rectify something in the performance of services.
The order can include any other terms and conditions which the Tribunal or Court thinks fit. However, the Tribunal or Court must not make an order for relief unless it is just and equitable to do so.
If no objection is made, or if an objection is made but the decision is confirmed, the body corporate must lodge a certificate with Land Information New Zealand certifying the designated resolution was:
- served on everyone required to be served
- no objections were made, or objections were made and not filed within the timeframe required or were not upheld by the Tribunal or a Court; and
- any other requirements of the Act were met (see sections 30(8), 56(5), 62(6), 69(6), and 177(6) of the Unit Titles Act 2010)).
For Unit Titles advice and information call 0800 Unit Titles (0800 864 884), visit our website www.dbh.govt.nz/unit-titles or email us at email@example.com.
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