Legal Brief with Alan Tate of Harris Tate www.harristate.co.nz

If you live in a property governed by a Body Corporate, you should by now have come to grips with the changes in how your property is governed that came into effect in June 2011.

Most larger Unit Title properties have professional managers who should have either advised the owners of the effect of the changes and the decisions that owners need to make. There are, however, a lot of smaller buildings the owners manage themselves who have not yet caught up with the changes.

Some of those changes are major and include:

• Unless the owners agree not to do it, a Body Corporate must adopt a 10 year maintenance plan for their building and pay into a maintenance fund to cover the cost of that work. This can result in a substantial increase in levies.
• Existing rules that the Body Corporate has may cover important things that apply to the building such as the use of common property, car parking, keeping of pets, renting out of units and other practical issues the owners have agreed on will. All these existing rules become redundant unless the owners agree to adopt them as part of the new rules. That has to be done by October 2012.
• How each owner's share of levies is determined has also changed. Currently the levies are assessed on the value of each apartment in relation to the value of all other apartments. It is now possible to change that to a concept known as ‘Utility Interest' to lighten the load on those who do not use a particular part of the common property, for example ground floor owners can be exempt from contributing to the cost of lift maintenance.
• The process of buying and selling a Unit Title has changed. An owner now needs to provide disclosure statements to interested purchasers both before the contract is signed and before settlement takes place. These statements require detailed information about the building and its management.
• Disputes between owners and between owners and the Body Corporate can now be dealt with, initially at least, through the Disputes Tribunal.

These are just some of the changes that are going to happen. If you do own a Unit Title property and all of this is news to you, then you should either contact your Body Corporate manager or get some other professional help so that you can understand how those changes will affect you.