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Body Corporate 46112 in Admin by Its Administrator Paul Crew v Gregan [2019] NZDC 24174

Published 09 March 2020

Application for summary judgment — interest and costs — unpaid levies — retrospective resolution — body corporate dispute — unit owner — estoppel — change in wording of rules — possible drafting oversight — jurisdiction of District Court Judge — Limitation Act 2010, s 11 — District Court Rules 2014, rr 1.3 & 12.2 — Gidden v IAG New Zealand Limited [2016] NZHC 948 — Unit Titles Act 2010, ss 80, 121& 135 — Chan v Body Corporate 10564 [2015] NZHC 2491 — Body Corporate 37466 v Kumar [2010] DCR 553 — BC16279 v Gilbert [2014] NZHC 567 — Wilson Parking New Zealand Limited v Fanshawe 136 Limited [2014] 3 NZLR 567 — Commonwealth of Australia v Verwayen (1990) 170 CLR 394. The plaintiff body corporate (BC) sought summary judgment against the respondent, an owner of units within the BC's apartment building. The plaintiff claimed the respondent owed $119,388.47 together with interest and costs in respect of unpaid levies for four units within the premises. For years the apartment building did not have body corporate meetings or undergo maintenance. In 2018 an administrator had been appointed by the High Court. He imposed levies back to the year 2010. Rule 12.2 of the District Court Rules 2014 provides that the court may give judgment against a defendant if the plaintiff satisfies the court that the defendant has no defence to any cause of action in the statement of claim or to a particular cause of action. The respondent raised three grounds for opposing summary judgments: the administrator could not apply retrospective levies, the Limitation Act barred backdating, and the house (unit I) where he lived was considered separate to the main apartment building, both in its geography and how the respondent and BC treated it. The first ground failed as the wording of the Unit Titles Act clearly gave the BC an unfettered power to impose levies as it saw fit, at any given time. There was no law preventing budgets or levies being imposed for previous financial years. As long as the levies were lawful they could not be challenged for retrospectivity. The second ground failed as the issue only arose in 2018, meaning it was within the realm of the six year bar set out in the Limitation Act. The third ground had a reasonable chance of being successful. As both the BC and the respondent had treated unit I separately up until the 2018 levies, the respondent may have an arguable defence based on estoppel. It was unclear whether summary judgment could be granted in respect of the levies relating to the other three units, so the Judge directed the BC file and serve a new memorandum indicating it will no longer pursue summary judgment, or alternatively, submissions in relation to the three units only. In reaching a decision, the Judge noticed an unexplained change in wording of the rule regarding summary judgments between the District Court Rules 2009 and the now relevant District Court Rules 2014. Judgment Date: 5 December 2019.

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