Review of the Unit Titles Act 1972
II. Overview of the Discussion Document
What is the Unit Titles Act?
The Unit Titles Act 1972 is the legislation governing apartments, flats, townhouses, office blocks, shopping centres and other building developments where multiple owners hold a type of property ownership known as a "unit title".
A unit title is made up of individual ownership of a defined unit, such as an apartment, plus shared ownership with other unit title owners of shared areas known as "common property", such as a lobbies, lifts or driveways. Owners of unit titles are known as "unit owners".
A "body corporate" is a collective of all the owners of a unit title development. The body corporate manages and makes decisions about the building development and in particular the common property. All owners are entitled to be elected as members of a committee that manages and administers the body corporate. This committee is known as the "body corporate committee".
Broadly speaking, the Unit Titles Act covers the technical and legal aspects of creating and dealing with a unit title, and the rights and responsibilities of a body corporate.
Why Review the Unit Titles Act?
The Unit Titles Act was written in 1972, over 30 years ago. At that time unit developments, such as apartments and townhouses, were a new type of housing style. Since then the numbers of unit developments, and the variety of uses, has changed considerably. This trend is expected to continue and accelerate, particularly in the Auckland region where there is a significant increase in the number of medium- and high-density housing developments.3
The unit title form of ownership is complex, and changes to the way it is applied, or to the type of use it is applied to, can give rise to issues relating to the unit title itself and to the functioning of the body corporate.
The Act may no longer be appropriate to manage these current issues, or to create intensive development that is sustainable into the future.
Work on identifying issues with the Act has already been undertaken by the Law Commission and the Auckland Regional Council. The Auckland Regional Council, in consultation with unit title owners and representatives from across the industry, concluded that there are major deficiencies with the Act. Building on this work, the Government has decided to review the Act.
Purpose of this Discussion Document
The purpose of this discussion document is to raise key issues under three broad areas, and propose possible solutions, so that individuals, organisations and professions affected by the Unit Titles Act have the opportunity to make their views known through written comment known as a "submission". These submissions will be considered as part of developing any recommendations about changes to the Act for Cabinet to consider.
Broad Areas for Discussion
A summary of the issues raised under the three broad areas in this discussion document are:
i) unit titles: technical and legal aspects of creating, changing and administering a unit title
ii) bodies corporate: the need to have one; different types; voting and decision-making; role, duties and functions; financial responsibilities; relationships with developers, members, owners and purchasers; resolving disputes
iii) other forms of shared ownership such as cross-lease and flat owning companies.
At the end of each section there are questions to which you can respond in your submission.
Have Your Say
You can make your written comment on issues raised in this discussion document by way of a submission. You will need to send your submission to the Department of Building and Housing4 by 28 February 2005. The process for making a submission is described on page 33.