Lawyer backs ruling clarifying body corporate powers

31 October 2014

News Articles , Body Corporate

A specialist building and construction lawyer has backed a Supreme Court decision on an apartment owner's access to his Auckland block.

Paul Grimshaw of specialist building lawyers Grimshaw & Co agreed with this month's decision that clarifies body corporate power.

Chuan Wu sued the body corporate of the 19-level high-rise Empire Building after it sought to charge him $2500 to get access to his unit.

The case was heard in the Supreme Court last year and was the first Unit Titles Act case not involving a leaky building to go to the highest court.

Wu bought the Whitaker Place unit on the basis that it would be leased to student housing provider Academic Accommodation Management. But after about a year Academic Accommodation resigned and John Chen-founded company Theta took over. Chen is also a unit owner in the Metropolis tower

The decision said Theta imposed new rules at Empire, seeking to charge a refundable deposit of about $2500 for an access card. But Wu refused and took Theta to court, also representing several other owners.

Chief Justice Sian Elias, Justice Susan Glazebrook and Justice Andrew Tipping ruled there was nothing in the body corporate rules or the law that allowed Theta to make those new rules. There is a natural right of access attached to a unit-holder's title, the decision said.

Grimshaw backed that.

"The decision was the right one. While many of the owners leased their units to the management company, who in turn leased the units to students, other owners such as Mr Wu chose to lease direct to students, thereby cutting out the middle man - the management company," he said.

"Even though some owners like Mr Wu did not utilise the services of the management company, that company still sought to impose its informal rules on owners such as Mr Wu. Those rules included paying a security deposit as condition of access.

"The court held that those informal rules were so significant that, if they were to have effect, they needed to be included in the body corporate rules," he said.

"Therefore the court held that denying Mr Wu access amounted to trespass on the part of the body corporate and the management company, as they denied Mr Wu access to the common property."