Fran O'Sullivan: Problems for unit-holders ring loud and clear

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National MP Nikki Kaye holds a meeting at the Ley's Institute in relation to the reform of rules for city apartments. Photo / Dean Purcell
National MP Nikki Kaye holds a meeting at the Ley's Institute in relation to the reform of rules for city apartments. Photo / Dean Purcell

I was waspish when MP Nikki Kaye first stirred the pot on the contentious issues of body corporate governance.

The truth is that government officials are well aware of the problems besetting the apartment sectors and the deficiencies in the Unit Titles Act (UTA). Lawyers and others who are associated with body corporates have made submissions to the Ministry of Business, Innovation and Employment - but there has yet to be a formal review of the UTA.

It has been obvious that a blinkered approach by Cabinet Ministers is the critical blockage that has to be overcome before there is decent legislative reform.

As Anne Gibson reports, Kaye told a public meeting yesterday that she had discussed problems with three senior Cabinet ministers and the response she got was, "We don't see any major evidence of issues here."

She added that it was her intention to "provide her colleagues with the evidence".

This is good politics as far as the Auckland Central MP is concerned. Her stocks will be raised with Aucklanders if she makes progress.

If her campaign results in her colleagues finally coming to their senses, she will succeed. But it remains ridiculous that Kaye has to build support for a campaign to change other Cabinet Ministers' minds to get action.

There has been a huge explosion of apartment dwellers in Auckland.

This will escalate as the city continues to grow off the back of an immigration surge. And apartment owners - many of whom cannot afford to buy freehold dwellings in Auckland - deserve a legislative framework which enables better protection of their key assets.

Here's Anne Gibson with the rest of the story:

Kaye's body corporate campaign has netted a huge response.

Controversy over the lack of pre-purchase disclosure and the abuse or manipulation of proxy votes at body corporate meetings are the two issues which dominated the Auckland Central MP's public meeting to examine problems in the apartment sector. They feature repeatedly when body corporate chairpeople compare notes.

Kaye has called for more information from those who live in multi-unit blocks.

"We have to seriously think about how we make that a lot easier, more accessible and more transparent," she said of pre-contract disclosure problems.

It remains ridiculous that Kaye has to build support for a campaign to change other Cabinet Ministers' minds to get action.

Kaye also noted owner complaints that proxies were being used to vote at meetings without the proxy holder knowing what was being voted on or even agreeing to the way the vote was being cast.

Tim Jones, a body corporate lawyer and partner with Glaister Ennor, called for better pre-contract disclosure.

"People should be able to say 'this is a good unit' ... Many people in the room today will not have done full due diligence on their buildings," he added, citing conflicts between aspects of the Unit Titles Act.

Charles Levin said New Zealand compared most unfavourably with Australia on such issues.

"The Australian legislation is practical. The Unit Titles Act has been drafted very badly, ignoring the impacts of people's daily lives. You should not have to have a lawyer devoting half your week to running the body corporate."

The meeting also called for body corporate managers to be regulated and for a commissioner - as in Queensland - to be appointed to rule on disputes.

Other issues included inexperienced body corporate committees, lack of accessibility and transparency of information, issues around building managers and their roles and responsibilities and costs in multi-unit properties, including the long-term maintenance plan.

- with Anne Gibson

- NZ Herald

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Head of Business for NZME

Fran O'Sullivan has written a weekly column for the Business Herald since its inception in April 1997. In her early journalistic career she was a political journalist in Wellington and subsequently an investigative journalist who broke many major business stories including the first articles that led to the Winebox Inquiry in both NBR and the Sydney Morning Herald. She has specific expertise in relation to China where she has been a frequent visitor since the late 1990s. She is a former Editor of the National Business Review; has twice been awarded Qantas Journalist of the Year and is a multiple winner of the Westpac Financial Journalism Supreme Award.

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