Review of the Unit Titles Act 1972
IV. Issues
Dispute Resolution
Disputes involving bodies corporate and owners range from the apparently straightforward (recovery of unpaid levies), through intensely contested "neighbour" issues15 to complex matters relating to fundamental differences between owners over the future of developments themselves.16
The Law Commission focused on the issue of the difficulties bodies corporate can have in recovering levies from unit holders who do not pay what is due from them. It suggested ways of addressing this, involving section 36 certificates and imposing liability on first mortgagees. It stopped short of recommending that bodies corporate have a power of sale of the unit in question to recover unpaid levies.
The Auckland Regional Council’s Case for Review, noting that the current provision in the Unit Titles Act is generally for unit owners to seek redress through the High Court, took a broader approach. It proposed that a framework for dispute resolution should be set up at a much lower level than the High Court. It noted that one approach could be to provide an adjudication or resolution process within the legislation, and that another was to set up a "Land Tribunal" to hear and determine disputes relating to unit title matters and a wide range of other land issues. It pointed to the Construction Contracts Act 2002 as an example of the former approach.
Other jurisdictions, for example New South Wales, provide an intensive dispute resolution process for body corporate disputes. Victoria is currently considering a new, four-tier dispute resolution process, reflecting elements of the relevant provisions of the Strata Property Act 1998 of British Columbia.17
Questions
77. Do you agree that a new framework is required for resolving disputes involving bodies corporate, unit owners and other parties?
78. If so, what do you think the main elements of such a framework should be?
79. Do you agree with the "self help" remedies proposed for bodies corporate by the Law Commission for recovery of levies? Would you extend these to include a power of sale?
80. What do you think would be the impact of your answers on unit owners, bodies corporate and on business owners?