Review of the Unit Titles Act 1972
IV. Issues
Creation and Aministration of Unit Titles
This section focuses on a number of somewhat technical aspects of the way unit titles are initially created by the deposit of unit plans. It also focuses on the administration of unit plans, and particularly changes to the details of unit titles as defined on those plans, over time.
These, however, can be very practical issues for unit title owners. For example, the Unit Titles Act currently makes very minor changes to boundaries a costly and complicated exercise.
Physical dimensions of units
The Law Commission recommended that the Unit Titles Act should be amended to expressly provide that units should be able to be made up partly or wholly of open space. Although the definition of the term "unit" in the Act does allow for this, a variety of other provisions effectively require units to be defined by reference to the physical boundaries of buildings. The Law Commission identified a number of advantages to their recommendation, including facilitating the protection of privacy and the making of alterations and extensions to units. It reported general support for this proposal.
Questions
1. Have you ever been involved in problems relating to boundary definitions under the Unit Titles Act?
2. Do you agree with the Law Commission’s recommendation that the definition of the term "unit" should expressly allow for units to be made up of partly, or wholly, open space? What are your reasons?
3. If this change was made, would other issues need to be addressed, for example standard rules for minor alterations such as the addition of porches or conservatories?
4. What do you think would be the impact of your answers on unit owners, bodies corporate and on business owners?
Boundaries
At the moment, a developer is free to determine where the boundaries of each unit will be and, subject to the statutory easement provisions of section 11 of the Unit Titles Act, which parts of the development will be common property and which parts will be individually owned. This leaves to each developer and surveyor a number of very significant decisions that can have a major impact on the future maintenance and administration of the development. The lack of consistency in such decisions is considered to be a significant cause of many disputes. For example:
• if the boundary between two units is the centre of a common wall, who is actually responsible for the maintenance of the wall
• if the outer walls of a development are not common property, but owned individually, what happens in a high-rise development when the walls of a unit on level 23 start to leak, causing problems all the way down the building, or if the building needs painting?
Questions
5. Have you ever experienced difficulties or problems relating to where the boundaries of units have been? If so, how serious a problem has it been?
6. Should the Unit Titles Act control more strictly where the boundaries should be on a unit plan and what parts of a unit development are required to be common property? If so, describe how these could be provided for, for example by way of standardised formats for plans or minimum requirements.
7. How should exclusive use areas that effect the whole property be dealt with? For example, is there a case, particularly for large developments, for the individual unit title to include only the interior surface of the unit, and for all other structural elements to be common property?
8. Are there other ways of addressing this issue, for example giving the body corporate a right to undertake work on units, as opposed to the common property, or requiring unit owners to repair defects within their own unit title if failure to do so could cause damage to the building? Please describe your proposal and how you think it would solve the problem.
9. Have you ever experienced difficulties or problems relating to the ownership of utilities such as water pipes and electricity lines? If so, how serious a problem has it been? How could the problem be addressed?
10. What do you think would be the impact of your answers on unit owners, bodies corporate and on business owners?
Staged developments
The Unit Titles Act was amended in 1979 to provide for what are known as "staged developments". These provisions enable owners of land to deposit unit plans that do not provide for the complete development of the land into units. Rather, part of the plan sets out what is known as a future development unit. That future development unit is, in turn, developed at a later date, under a further unit plan.
The Law Commission identified certain issues with these staged development provisions such as the cost of producing a new unit title plan, and the difficulty in obtaining consent to a new plan from all parties involved, if a variation is made to the future development unit.
However, the Law Commission concluded that if units can be comprised wholly of open space:
• there was no further need for the "staged development" provisions of the Act
• "early" owners of units in a unit title development could be adequately protected from subsequent development by provisions in a contract and by the Resource Management Act. The Law Commission saw the position of owners of units of a
yet-to-be completed unit title development as being essentially the same as the position of house buyers in a yet to be completed subdivision.
Questions
11. Do you agree that, if units can be comprised wholly of open space, the staged development provisions of the Unit Titles Act are no longer required?
12. Were that reform to be adopted, do you think unit owners require any special protections from the future development of "open spaces"? If you agree with the Law Commission that contractual provisions and the Resource Management Act can protect unit owners from subsequent development, do you nevertheless think it would be a good idea to provide for statutory protection as a consumer protection measure?
13. What do you think would be the impact of your answers on unit owners, bodies corporate and on business owners?
Access ways, easements and covenants
The Unit Titles Act does not currently provide for jointly owned access lots to unit title properties, or for variations or surrender of easements on unit titles once the unit plan has been deposited. The Law Commission recommended amending the Act to:
• allow for jointly owned access lots to unit title properties
• clarify that, for most purposes, heritage covenants and other similar covenants are easements under the Act
• allow for the variation or surrender of easements on unit title plans.
Questions
14. Have you ever experienced problems relating to access lots, easements or covenants under the Unit Titles Act?
15. In your view, should the Law Commission’s recommendations be adopted? If not, are there any other ways these problems could be addressed?
Minor changes to common property and to boundaries of units
From time to time unit owners wish to make minor changes to their unit or the common property, perhaps to modernise the design, improve functionality or make architectural improvements. Currently any change to a unit plan, such as an addition of a conservatory, requires the deposit of a new plan. This can be a costly and complicated exercise.
The Law Commission recommended amending the Unit Titles Act so that minor changes might more easily be made to the common property and to the boundaries of units. The Law Commission also proposed giving district land registrars power to dispense with that requirement in appropriate circumstances, after consultation with the chief surveyor.
Questions
16. In your view, is there any reason not to adopt these recommendations? Is there a better way of dealing with this issue?
17. If such an amendment is made, should the circumstances where the discretion may be applied be spelled out or should that be left to the district land registrar on a case-by-case basis?
Leasehold land
Under the Unit Titles Act, unit titles are able to be created on leasehold land.
Question
18. Have you experienced any issues in relation to unit titles on leasehold land? Are the provisions in the Unit Titles Act adequate? If not, how could they be improved? Are there issues that arise in relation to bodies corporate on leasehold land?