Regulatory Systems (Building and Housing) Amendment Bill

Regulatory Systems (Building and Housing) Amendment Bill

Government Bill

191—1

Explanatory note

General policy statement

This Bill is an omnibus Bill and 1 of a package of 3 omnibus Bills that contain amendments to legislation administered by the Ministry of Business, Innovation, and Employment (the Ministry). This Bill, the Regulatory Systems (Building and Housing) Amendment Bill, makes amendments in the building and housing areas. The policy objective of each Bill is to maintain the effectiveness and efficiency of the regulatory systems established by the Acts amended by the Bills and so reduce the chance of regulatory failure. The amendments will achieve this objective by—

  • clarifying and updating statutory provisions in each Act amended to give effect to the purpose of that Act and its provisions; and

  • addressing regulatory duplication, gaps, errors, and inconsistencies within and between different pieces of legislation; and

  • keeping the regulatory system up to date and relevant; and

  • removing unnecessary compliance costs and costs of doing business.

The amendments were identified as part of the Ministry’s regulatory systems work programme, which arises from the chief executive’s responsibility to relevant Ministers, under section 32 of the State Sector Act 1988, for the stewardship of the legislation administered by the Ministry.

The Bills respond to the New Zealand Productivity Commission’s June 2014 report, Regulatory Institutions and Practices. The New Zealand Productivity Commission found that it can be difficult to find time on the Parliamentary calendar for “repairs and maintenance” of existing legislation. As a result, regulatory agencies often have to work with legislation that is out of date or not fit for purpose. This creates unnecessary costs for regulators and regulated parties and means that regimes may not keep up with public or political expectations.

This Bill, the Regulatory Systems (Building and Housing) Amendment Bill, is a vehicle for these smaller regulatory fixes in the building and housing areas to be progressed in a timely and cost-effective fashion in order to deliver the flow-on benefits to business and the wider economy. It includes the following amendments:

Building Act 2004 (see Part 1)

The purpose of the Building Act 2004 amendments is to make minor fixes to improve the overall quality of the Act. This will be achieved by fixing cross-referencing errors and removing a redundant provision.

Unit Titles Act 2010 (see Part 2)

The purpose of the amendments to the Unit Titles Act 2010 is to reduce unnecessary compliance burden and to clarify matters in relation to unit plans, body corporate operational rules, reassessment of ownership interests and utility interests, the registration of easements and covenants, leases and licences of common property, and extraordinary general meetings of the body corporate.

Departmental disclosure statement

The Ministry of Business, Innovation, and Employment is required to prepare a disclosure statement to assist with the scrutiny of this Bill. The disclosure statement provides access to information about the policy development of the Bill and identifies any significant or unusual legislative features of the Bill.

Clause by clause analysis

Clause 1 is the Title clause.

Clause 2 relates to commencement. The Bill comes into force 2 months after Royal assent.

Part 1Building Act 2004

Clause 3 provides that Part 1 amends the Building Act 2004.

Clause 4 amends section 12 to cross-refer to a specific clause in Schedule 1 in order to better assist users of the Act.

Clause 5 amends section 96 by repealing a redundant provision.

Clause 6 amends section 177 to correct a cross-reference.

Clause 7 makes consequential changes to section 38 of the Building Amendment Act 2012, which is not yet in force, relating to the redundant provision repealed by clause 5.

Part 2Unit Titles Act 2010

Clause 8 provides that Part 2 amends the Unit Titles Act 2010.

Clause 9 amends section 4, which sets out an overview of the Act. The amendment alerts users of the Act to the location of transitional, savings, and related provisions in new Schedule 1AA, which is inserted by clause 47.

Clause 10 makes technical and consequential amendments to the definitions of body corporate operational rules, ownership interest, proposed ownership interest, and utility interest.

Clause 11 amends section 6 to standardise terminology. Instead of the body corporate being described alternately as fixing or assigning ownership and utility interests, the term assign is used throughout.

Clause 12 amends section 7 to clarify that a principal unit (that meets the other requirements in that section) can be 1 or more car parks.

Clause 13 inserts new section 9A into the Act, which cross-refers to new Schedule 1AA, which is for transitional, savings, and related provisions.

Clause 14 amends section 15, which contains provisions relating to the relationship between the Act and the Public Works Act 1981. Subsection (3) is replaced to clarify when subsection (4) applies; that is, where the acquisition of land for a public work triggers the requirement for a new unit plan or an amendment to a unit plan under the Unit Titles Act 2010. The requirement for the body corporate to request in writing that the authority undertaking the public work prepare and pay for the new unit plan or the amendment to the unit plan is removed from subsection (4). Subsection (5) now provides that the Registrar-General of Land (the Registrar) may do anything necessary to give effect to any acquisition under the Public Works Act 1981 that relates to a unit title development, whether that acquisition is by Proclamation or otherwise (for example, by agreement).

Clause 15 repeals section 32(3)(b), consequential to the repeal of section 41(2), and amends section 32(2)(b), consequential to the changed terminology in section 38(2) (see clauses 20 and 16 respectively).

Clauses 16 and 17 amend sections 38 and 39. These sections relate to the initial process of assessing and assigning ownership interests and utility interests when a unit plan is deposited under various sections of the Act, as well as setting out, on a non-exclusive basis, the range of matters that the ownership interest and utility interest are used to determine. The amendments to these sections include—

  • stating who is responsible for assigning ownership and utility interests to the units before the deposit of the plan. This is the role of the registered proprietor or owner. The registered valuer’s role is to assess the original ownership interests for the units. The registered proprietor or owner must assign the ownership interests (as assessed by the valuer) to the units, before the unit plan is deposited. The registered proprietor or owner also assigns the utility interests before deposit of the plan:

  • clarifying that, after the unit plan is deposited, ownership interests may be reassessed, and new ownership interests assigned to the units, in accordance with the Act:

  • providing that the utility interest assigned to a unit (other than a future development unit) before deposit of the unit plan will be the same as the assessed ownership interest unless some other utility interest is determined by the registered proprietor or owner to be fair and equitable and is shown on the documentation lodged with the plan.

Clause 18 amends section 40, which relates to the process of assessing and assigning a deemed utility interest to a future development unit as soon as that unit is in use. The amendments include stating who is responsible for assigning the deemed utility interest.

Clauses 19 and 20 relate to the reassessment of ownership interests and utility interests. Clause 19 inserts a new cross-heading above section 41. Clause 20 makes a number of amendments to section 41. A key change is that the body corporate is no longer required to reassess the ownership interest and utility interest for a principal unit that is subdivided to create a subsidiary unit title development. However, the body corporate may resolve to do so (see new section 41(1) and (3)(b)).

Clause 21 makes a technical change to section 42(2).

Clause 22 repeals section 48(b), consequential on the repeal of section 32(3)(b) (see clause 15).

Clause 23 replaces section 56(7). New section 56(7) clarifies that the proceeds received by a body corporate as a result of any sale, lease, or licence of or over the common property must be distributed to unit owners in shares proportional to what was their ownership interest at the date that the payment giving rise to the proceeds fell due.

Clause 24 corrects a minor grammatical error in section 58.

Clause 25 amends section 62 by extending the powers of a body corporate under that section in respect of easements and covenants over the common property.

Clause 26 amends section 63, which sets out the ability of the owner of a unit in respect of easements and covenants. Existing section 63 permits the owner of a unit, with the consent of the body corporate, to grant an easement or enter into a covenant over the unit, but is limited to easements and covenants for the benefit of other land. The amendments remove this limitation. As such, the ability of an owner to deal with a unit under that section (for example, by granting an easement in gross over the unit) is expanded. Any dealings with a unit under the amended section will remain subject to body corporate consent under existing section 63(4).

Clause 27 replaces section 65(1), which sets out the type of redevelopment that requires an amendment to (but not the deposit of a new) unit plan. Section 65 applies, in certain circumstances, to redevelopments that consist solely of a boundary adjustment between 1 or more units. The effect of new section 65(1) is to clarify and tighten the circumstances that must be met in order for a redevelopment to fall under this section.

Clause 28 makes a technical change to section 67.

Clause 29 amends section 69, which sets out the requirements for new unit plans in relation to certain redevelopments. The amendment to section 69(4) reflects the role of the valuer in assessing, rather than assigning, ownership interests. New section 69(5A) requires the body corporate to assign to the units the ownership interests that are assessed by the valuer. Other amendments are technical and for consistency with other amendments made by this Part.

Clause 30 amends section 73 to clarify that the incidental rights in this section are in respect of all the land to which the unit plan relates.

Clause 31 amends section 84, which sets out powers and duties of body corporates. Aside from a consequential update to a cross-reference, the amendments remove a reference to sections 38 and 39. This is a technical change: except to the extent those sections set out matters that the ownership interest and utility interest are used to determine and highlight the ability to change the ownership interest in accordance with the Act, sections 38 and 39 relate to things done before a unit plan is deposited and the body corporate comes into being.

Clauses 32 and 33 respectively insert new section 89A and consequentially amend section 90. The amendments relate to the situation of a written request, made by notice signed by or for the unit owners of not less than 25% of the principal units, for an extraordinary general meeting to consider and decide motions proposed in the notice. The amendments specify the time frames for calling and holding that meeting, which, respectively, are not less than 5 working days and 3 weeks after the chairperson receives the notice.

Clause 34 replaces section 105, which relates to body corporate operational rules. The key change is to clarify that the original owner may lodge, for deposit with the unit plan under the Act, body corporate operational rules that are different to those prescribed by regulations.

Clauses 35 and 36 update cross-references in sections 107 and 108, consequential on the changes made to section 105 by clause 34.

Clause 37 makes a technical change to section 163(4), for consistency with the rest of that subsection. There is no substantive effect.

Clause 38 amends section 165, which relates to leasehold land, and includes provisions as to when and how a lessor or licensor may apply for the cancellation of the unit plan. The amendment is consequential on changes made to section 189 by clause 45. The 6-month period for the lessor or licensor to apply to the Registrar for the cancellation of the plan (following a declaration of the High Court) is retained.

Clause 39 replaces section 167, which also relates to leasehold land. The key change is a new provision that permits the body corporate, by special resolution, to vary the lease. A resolution for this purpose will be a designated resolution for the purposes of subpart 3 of Part 5 of the Act, which means that the objection process set out in sections 213 to 216 of the Act will apply. New section 167(2) and (3) also—

  • clarifies that the other special resolutions provided for in section 167 (which relate to exercising and approving the terms for a renewal or expiry of the lease, or exercising an option to purchase the reversionary estate in the base land and approving the terms of the purchase) are also designated resolutions:

  • states that none of the matters contemplated by new section 167(1) (for example, varying the lease) have the effect of terminating the unit title development, merging any estate, or discontinuing any easement, covenant, or other registered interest.

Clause 40 amends section 169, which sets out provisions relating to leasehold land and merger, where the lessor has purchased or acquired the stratum estates in leasehold in all the units in the unit plan or where the owners of all the units have purchased or acquired the reversionary estate in the base land. The amendments—

  • state that no merger can occur unless and until the base land is free from all registered interests other than easements or covenants and there are no caveats or notices of claim entered on the register over the whole or any part of the base land (see new section 169(2)(a) and (3)(b)):

  • set out the effect of a merger on the lease and on registered interests, caveats, and notices of claim (see new section 169(4)(c) to (e), (6), and (7)):

  • require the Registrar, if satisfied that the merger has occurred, to make additional entries (see new section 169(5)(b) and (d)) and to cancel the computer register for the base land (see new section 169(5)(e)). The requirement to note the effect of section 169 on the lease and any computer register created for it (see existing section 169(5)(c) of the Act) is not continued in new section 169 because it is redundant.

Clause 41 amends section 177 by removing the requirement for a body corporate to reassess the ownership interests and any proposed ownership interests of the units in the unit title development before applying to the Registrar to cancel the unit plan. The body corporate may reassess those interests or, by special resolution setting out the reason for the decision, may decide not to reassess those interests. A special resolution for this purpose is a designated resolution to which the objection process in sections 213 to 216 of the Act will apply. (See also clause 45, new section 189(5)(aa): the requirement to reassess the ownership interests and any proposed ownership interests of the units in the unit title development is retained in relation to the cancellation of unit plans following a decision of the High Court, subject to the direction of the Court.)

Clause 42 corrects a minor style matter in section 180.

Clauses 43 and 44 amend sections 182 and 183 respectively. The amendments are consequential on the amendments made to section 177 by clause 41.

Clause 45 amends section 189, which relates to the cancellation of a unit plan following a decision of the High Court. Clause 45(1) removes the 6-month time limit imposed for applying to the Registrar for cancellation once all conditions and directions imposed or given by the High Court have been met. An application for cancellation will need to be accompanied by a certificate certifying that all conditions and directions imposed or given by the High Court have been complied with (see new section 189(3)(c)).

Clause 46 amends section 212, by adding resolutions to the list of designated resolutions for the purposes of subpart 3 of Part 5 of the Act and by updating a cross-reference, in both cases consequential on changes made by this Part.

Clause 47 inserts new Schedule 1AA into the Act (see the Schedule), which provides for transitional, savings, and related matters.

Clause 48 amends Schedule 2, which contains modifications to the Act applicable to timeshare resorts. The amendments—

  • repeal a redundant provision:

  • are consequential on new section 89A, inserted by clause 32, and the amendments to section 90 made by clause 33. These sections relate to extraordinary general meetings.

Hon Steven Joyce

Regulatory Systems (Building and Housing) Amendment Bill

Government Bill

191—1

Contents

Explanatory note
1Title
2Commencement
3Principal Act
4Section 12 amended (Role of building consent authority and territorial authority)
5Section 96 amended (Territorial authority may issue certificate of acceptance in certain circumstances)
6Section 177 amended (Application for determination)
7Consequential amendments to Building Amendment Act 2012
8Principal Act
9Section 4 amended (Overview)
10Section 5 amended (Interpretation)
11Section 6 amended (Meaning of control period)
12Section 7 amended (Meaning of principal unit)
13New section 9A inserted (Transitional, savings, and related provisions)
9ATransitional, savings, and related provisions
14Section 15 amended (Relationship with Public Works Act 1981)
15Section 32 amended (Restrictions on deposit of unit plans)
16Section 38 amended (Ownership interest)
17Section 39 amended (Utility interest (other than for future development units))
18Section 40 amended (Utility interest for future development unit)
19New cross-heading above section 41 inserted
20Section 41 amended (Reassessment of ownership interest and utility interest)
21Section 42 amended (Registrar to be notified of reassessment)
22Section 48 amended (Noting of subsidiary unit title development)
23Section 56 amended (Sale, lease, or licence of common property)
24Section 58 amended (Additions to common property)
25Section 62 amended (Powers of body corporate in respect of easements and covenants over or for benefit of common property)
26Section 63 amended (Ability of owner of unit in respect of easements and covenants)
27Section 65 amended (Redevelopment requiring amendment to unit plan)
28Section 67 amended (Deposit of amendment to unit plan)
29Section 69 amended (Requirements for new unit plan under section 68)
30Section 73 amended (Incidental rights)
31Section 84 amended (Powers and duties of body corporate)
32New section 89A inserted (Requirement for extraordinary general meeting: request by unit owners of not less than 25% of principal units)
89ARequirement for extraordinary general meeting: request by unit owners of not less than 25% of principal units
33Section 90 amended (Who may call general meetings)
34Section 105 replaced (Body corporate operational rules)
105Body corporate operational rules
35Section 107 amended (Conflict between body corporate operational rules)
36Section 108 amended (Delegation of duties and powers)
37Section 163 amended (Implied guarantee by unit owners)
38Section 165 amended (Lessor may apply for appointment of administrator or cancellation of unit plan)
39Section 167 replaced (Renewal or expiry of lease and purchase of reversionary interest)
167Variation of lease, renewal or expiry of lease, or purchase of reversionary interest
40Section 169 amended (Merger)
41Section 177 amended (Application by body corporate for cancellation of unit plan)
42Section 180 amended (Effect of cancellation of unit plan—standard unit title development or head unit title development)
43Section 182 amended (Effect of cancellation of stage unit plan)
44Section 183 amended (Extinguishment of registered interests, etc)
45Section 189 amended (Cancellation of plan following decision of High Court)
46Section 212 amended (Designated resolutions)
47New Schedule 1AA inserted
48Schedule 2 amended
89AWhen extraordinary general meeting is required

The Parliament of New Zealand enacts as follows:

1 Title

This Act is the Regulatory Systems (Building and Housing) Amendment Act 2016.

2 Commencement

This Act comes into force immediately after the expiry of the 2-month period that starts on the date of Royal assent.

Part 1 Building Act 2004

3 Principal Act

This Part amends the Building Act 2004 (the principal Act).

4 Section 12 amended (Role of building consent authority and territorial authority)

In section 12(2)(c), replace “Schedule 1” with “clause 2 of Schedule 1”.

5 Section 96 amended (Territorial authority may issue certificate of acceptance in certain circumstances)

(1)

In section 96(1)(c), delete “; or”.

(2)

Repeal section 96(1)(d).

6 Section 177 amended (Application for determination)

In section 177(3)(c), replace “paragraph (k) of Schedule 1” with “clause 2 of Schedule 1”.

7 Consequential amendments to Building Amendment Act 2012

(1)

This section amends the Building Amendment Act 2012.

(2)

In section 38(1),—

(a)

replace “and (d)(iii) are” with “is”; and

(b)

delete “in each case”.

(3)

After section 38(1), insert:

(1A)

In section 96(1)(c), after “consent) apply”, insert “; or”.

(4)

Repeal section 38(2).

(5)

In section 38(3), replace “(e)” with “(d)”.

Part 2 Unit Titles Act 2010

8 Principal Act

This Part amends the Unit Titles Act 2010 (the principal Act).

9 Section 4 amended (Overview)

In section 4(1)(l), after “transitional provisions”, insert “(see also Schedule 1AA for further transitional provisions)”.

10 Section 5 amended (Interpretation)

(1)

In section 5(1), replace the definition of body corporate operational rules with:

body corporate operational rules, in relation to a particular body corporate, means the rules that apply to that body corporate under section 105(2) as altered from time to time by the body corporate under section 105(3)

(2)

In section 5(1), replace the definition of ownership interest and proposed ownership interest with:

ownership interest, in relation to a particular unit, means the ownership interest assigned to that unit (see, for example, section 38)

(3)

In section 5(1), replace the definition of proposed ownership interest with:

proposed ownership interest, in relation to a particular proposed principal unit or proposed accessory unit, means the proposed ownership interest assigned to that unit (see, for example, section 38)

(4)

In section 5(1), replace the definition of utility interest with:

utility interest, in relation to a particular unit, means the utility interest assigned to that unit (see, for example, section 39)

11 Section 6 amended (Meaning of control period)

In section 6(2)(a)(ii), replace “fixed” with “assigned”.

12 Section 7 amended (Meaning of principal unit)

Replace section 7(1) with:

(1)

In this Act, principal unit means a unit—

(a)

that is designed for use (whether in conjunction with any accessory unit or not) as a place of residence or business or for any other use of any nature, and that is shown on a unit plan as a principal unit; and

(b)

that—

(i)

contains a building or part of a building or is contained in a building (although the unit may or may not be bounded by the physical dimensions of the building); or

(ii)

is 1 or more car parks.

13 New section 9A inserted (Transitional, savings, and related provisions)

After section 9, insert:

9A Transitional, savings, and related provisions

The transitional, savings, and related provisions set out in Schedule 1AA have effect according to their terms.

14 Section 15 amended (Relationship with Public Works Act 1981)

(1)

In section 15(2), replace “proclamation” with “Proclamation”.

(2)

Replace section 15(3) with:

(3)

Subsection (4) applies if—

(a)

an estate or interest in land in a unit title development is acquired under the Public Works Act 1981 (whether by Proclamation or otherwise); and

(b)

in respect of the transfer of that estate or interest, this Act requires a new unit plan, or an amendment to a unit plan, to be deposited.

(3)

In section 15(4), replace “If the body corporate requests in writing, the authority” with “The authority”.

(4)

In section 15(5), replace “a proclamation under the Public Works Act 1981” with “an acquisition under the Public Works Act 1981, whether by Proclamation or otherwise,”.

15 Section 32 amended (Restrictions on deposit of unit plans)

(1)

In section 32(2)(b), replace “fixed under section 38” with “assessed under section 38(2).

(2)

Repeal section 32(3)(b).

16 Section 38 amended (Ownership interest)

(1)

Replace section 38(1) and (2) with:

(1)

Before a unit plan is deposited under section 17(1), 21(1), or 24(2)(a), the registered proprietor or owner (as the case may be) must assign—

(a)

an ownership interest to every principal unit and every accessory unit; and

(b)

a proposed ownership interest to every proposed principal unit and every proposed accessory unit.

(2)

The ownership interest or proposed ownership interest assigned to a unit is that assessed by a registered valuer on the basis of the value of the unit relative to each other unit and shown on the documentation required to be lodged—

(a)

with the unit plan (in the case of a unit plan deposited under section 17(1) or 21(1)); or

(b)

with the proposed unit development plan (in the case of a stage unit plan or complete unit plan deposited under section 24(2)).

(2)

Replace section 38(6) with:

(6)

After a unit plan is deposited, the ownership interest or proposed ownership interest of a unit may be reassessed, and the new interest assigned to the unit, as set out in this Act.

17 Section 39 amended (Utility interest (other than for future development units))

Replace section 39(1) and (2) with:

(1)

Before a unit plan is deposited under section 17(1), 21(1), or 24(2)(a), the registered proprietor or owner (as the case may be) must assign a utility interest to every principal unit and every accessory unit.

(2)

The utility interest assigned to a unit is the same as the ownership interest assessed for the unit under section 38(2).

(2A)

Alternatively, the registered proprietor or owner may assign to a unit a different utility interest if that different utility interest is—

(a)

fair and equitable, in the view of the registered proprietor or owner, having regard to the relevant benefits and the costs to units; and

(b)

shown on the documentation lodged with the unit plan.

18 Section 40 amended (Utility interest for future development unit)

Replace section 40(1) and (2) with:

(1)

As soon as a future development unit is in use as a place of residence or business or otherwise, the registered proprietor, owner, or body corporate (as the case may be) must assign a deemed utility interest to that unit.

(2)

The deemed utility interest assigned to the future development unit is the total of all the proposed ownership interests assigned to the proposed principal units and proposed accessory units in the future development unit under section 38.

(2A)

Alternatively, the body corporate (if any) may assess and assign the first deemed utility interest for a future development unit by special resolution at a general meeting under section 41 (with all necessary modifications).

19 New cross-heading above section 41 inserted

After section 40, insert:

Reassessment

20 Section 41 amended (Reassessment of ownership interest and utility interest)

(1)

Replace section 41(1) with:

(1)

A body corporate may, by special resolution at a general meeting, decide to reassess the ownership interest or utility interest, or both, for each unit and assign to each unit the new interest or interests.

(2)

Repeal section 41(2).

(3)

Replace section 41(3) to (6) with:

(3)

However, a decision by the body corporate under subsection (1) may be made only if—

(a)

at least 36 months have passed—

(i)

since the date of deposit of the unit plan; and

(ii)

since the effective date of the last reassessment (if any) of the relevant interest or interests; or

(b)

the reassessment is for the purpose of the deposit of a unit plan to subdivide a unit in the unit title development to create a subsidiary unit title development.

(3A)

Subsections (1) and (3) do not prevent an assessment or a reassessment, and the subsequent assignment of the new interest or interests, under another section of this Act (see, for example, section 177).

(4)

A reassessment under subsection (1) takes effect, and the new interest or interests are assigned to each unit, on the earlier of—

(a)

the date (if any) determined as part of the special resolution under subsection (1); and

(b)

the date of the valuer’s assessment.

(5)

Any reassessment of the ownership interest of a unit must be made by a registered valuer assessing the value of each of the units relative to each other.

(5A)

A reassessment of the utility interest may be made by the body corporate on a fair and equitable basis, having regard to the relevant benefits and the costs to units.

(6)

If, as a result of a reassessment, a utility interest is to be assigned other than on the basis of the value of the unit relative to each other unit, the body corporate must, by special resolution, approve the method of apportionment of the utility interest.

21 Section 42 amended (Registrar to be notified of reassessment)

Replace section 42(2) with:

(2)

The Registrar must record the new ownership interest or utility interest, or both, assigned to each unit.

22 Section 48 amended (Noting of subsidiary unit title development)

(1)

In section 48(a), delete “; and”.

(2)

Repeal section 48(b).

23 Section 56 amended (Sale, lease, or licence of common property)

Replace section 56(7) with:

(7)

Proceeds distributed to the unit owners under subsection (6) must be distributed in shares proportional to their ownership interest (including any proposed ownership interest) as at the date that the payment giving rise to the proceeds fell due under the terms of the sale, lease, or licence.

24 Section 58 amended (Additions to common property)

In section 58(1)(c), replace “either— ” with “either,— ”.

25 Section 62 amended (Powers of body corporate in respect of easements and covenants over or for benefit of common property)

(1)

Replace section 62(1) with:

(1)

The body corporate may, after a special resolution to do so, grant an easement or enter into a covenant over the whole or any part of the common property.

(2)

In section 62(3)(b), delete “for the benefit of any unit or any other land”.

26 Section 63 amended (Ability of owner of unit in respect of easements and covenants)

(1)

In section 63(2), delete “, for the benefit of other land,”.

(2)

In section 63(3)(b), delete “for the benefit of other land”.

27 Section 65 amended (Redevelopment requiring amendment to unit plan)

Replace section 65(1) with:

(1)

This section applies if a redevelopment consists solely of the adjustment of the boundary between 1 or more units shown on a unit plan but the adjustment does not—

(a)

affect the common property; or

(b)

materially affect the use, enjoyment, or ownership interest of any unit the boundary of which is not being adjusted; or

(c)

change the number of units.

28 Section 67 amended (Deposit of amendment to unit plan)

In section 67(1)(b)(i), replace “determining the ownership interest of” with “showing the ownership interest assessed for”.

29 Section 69 amended (Requirements for new unit plan under section 68)

(1)

In section 69(3), replace “registered valuer— ” with “registered valuer,— ”.

(2)

In section 69(3)(b), replace “reassessing the ownership interests of” with “showing the ownership interests reassessed for”.

(3)

Replace section 69(4) with:

(4)

A reassessment of ownership interests for the purpose of subsection (3)(b) must be made by the registered valuer assessing the value of each of the units relative to each other.

(4)

In section 69(5), replace “reassess” with “assess”.

(5)

After section 69(5), insert:

(5A)

The body corporate must assign the reassessed ownership interests to the relevant units.

30 Section 73 amended (Incidental rights)

(1)

In section 73(1) and (2), delete “base”.

(2)

In section 73(4), replace “base land” with “land to which the unit plan relates”.

31 Section 84 amended (Powers and duties of body corporate)

(1)

Replace section 84(1)(a) with:

(a)

sections 40 to 42 (which relate to the assignment and reassessment of ownership interests and utility interests):

(2)

In section 84(1)(g), replace “section 105(3)” with section 105(4).

32 New section 89A inserted (Requirement for extraordinary general meeting: request by unit owners of not less than 25% of principal units)

After section 89, insert:

89A Requirement for extraordinary general meeting: request by unit owners of not less than 25% of principal units

(1)

This section applies if the chairperson receives a notice that—

(a)

asks for an extraordinary general meeting to consider and decide motions proposed in the notice; and

(b)

is signed by or for the unit owners of not less than 25% of the principal units.

(2)

The extraordinary general meeting must be held not later than 3 weeks after the date that the notice is received.

33 Section 90 amended (Who may call general meetings)

(1)

In the heading to section 90, replace Who may call with Notice of.

(2)

Replace section 90(2) with:

(2)

An extraordinary general meeting of a body corporate to which section 89A applies must be called by the chairperson—

(a)

by the date that is 5 working days after the date that the chairperson receives the notice; and

(b)

in accordance with the regulations.

(3)

An extraordinary general meeting of a body corporate may be called at any other time by the chairperson or the body corporate committee in accordance with the regulations.

34 Section 105 replaced (Body corporate operational rules)

Replace section 105 with:

105 Body corporate operational rules

(1)

Every body corporate must have, at all times, body corporate operational rules.

(2)

The first body corporate operational rules that apply to a particular body corporate are—

(a)

the rules prescribed by regulations made under section 217(i); or

(b)

if the original owner lodges altered rules for deposit with the unit plan under this Act, those altered rules.

(3)

The body corporate may amend, revoke, or make additions to the body corporate operational rules at any time after the date that the unit plan is deposited (see section 106).

(4)

The body corporate operational rules are binding on—

(a)

the body corporate; and

(b)

the owners of principal units; and

(c)

any person who occupies a principal unit; and

(d)

any mortgagee who is in possession of a principal unit.

(5)

For the purpose of subsection (4), principal unit includes a future development unit.

35 Section 107 amended (Conflict between body corporate operational rules)

In section 107(2), replace “in accordance with section 105” with “in accordance with section 105(3).

36 Section 108 amended (Delegation of duties and powers)

In section 108(2)(c), replace “section 105(3)” with section 105(4).

37 Section 163 amended (Implied guarantee by unit owners)

In section 163(4)(b), replace “; and” with “; or”.

38 Section 165 amended (Lessor may apply for appointment of administrator or cancellation of unit plan)

In section 165(3)(b), after “section 189”, insert “(other than subsection (2))”.

39 Section 167 replaced (Renewal or expiry of lease and purchase of reversionary interest)

Replace section 167 with:

167 Variation of lease, renewal or expiry of lease, or purchase of reversionary interest

(1)

The body corporate may, by special resolution,—

(a)

agree to vary the lease (and agree the terms of the variation):

(b)

in the case of a lease that gives the lessee a right of renewal or extension of the lease, exercise the renewal or extension (and agree the terms applying):

(c)

in the case of a lease that gives the lessee an option to purchase the reversionary estate in the base land, exercise the option (and agree the terms of the purchase).

(2)

Sections 212 to 216 (which provide for an objection process) apply to a resolution under subsection (1)(a) or (c).

(3)

None of the following has the effect of terminating the unit title development, merging any estate, or discontinuing any easement, covenant, or other registered interest:

(a)

a variation of lease by agreement:

(b)

the exercise of a right of renewal or extension of lease:

(c)

the exercise of an option to purchase the reversionary estate in the base land.

40 Section 169 amended (Merger)

Replace section 169(2) to (5) with:

(2)

If the lessor has purchased or acquired the stratum estates in leasehold in all the units shown on the plan, those estates do not merge with the lessor’s reversionary estate in the base land unless and until—

(a)

the base land is free from all registered interests other than easements or covenants and there are no caveats or notices of claim entered on the register over the whole or any part of the base land; and

(b)

the lessor deposits with the Registrar a declaration that it is his or her intention that such a merger should occur.

(3)

If all the owners of all the units shown on the plan have purchased or acquired the reversionary estate in the whole of the base land, that estate does not merge with the stratum estates in leasehold in these units unless and until—

(a)

that reversionary estate is purchased or acquired by those owners in shares proportional to the ownership interest of their respective units; and

(b)

the base land is free from all registered interests other than easements or covenants and there are no caveats or notices of claim entered on the register over the whole or any part of the base land; and

(c)

the registered owners deposit with the Registrar a declaration that it is their intention that a merger should occur.

(4)

The effect of a merger is as follows:

(a)

if the lessor has purchased or acquired the stratum estates in leasehold in all of the units shown on the plan, the stratum estate in freehold in each of the units vests in the lessor:

(b)

if all the registered owners of the stratum estates in leasehold in all of the units shown on the plan have purchased or acquired the reversionary estate in the base land, the stratum estate in freehold in each of the units vests in the person who immediately before the merger was the owner of that unit:

(c)

the lease is extinguished:

(d)

any easement or covenant of a kind to which section 62 applies continues, and any sublease of the common property continues as a lease, over the whole or part of the common property of the freehold unit title development:

(e)

any registered interest, and any caveat or notice of claim existing on a computer register for the stratum estate in leasehold in a unit, continues over the whole or part of the stratum estate in freehold in the unit.

(5)

On the deposit of any declaration under subsection (2)(b) or (3)(c), the Registrar, if satisfied that the stratum estates in leasehold in all of the units shown on the plan have merged under the provisions of this section with the reversionary estate in the base land, must—

(a)

note on the supplementary record sheet a memorial of the merger; and

(b)

enter on the existing computer register for the base land a memorial of the merger; and

(c)

cancel the existing computer register in respect of the stratum estate in leasehold in each of the units and create a computer register in respect of the stratum estate in freehold in each of the units to the person entitled to it in accordance with subsection (4)(a) or (b); and

(d)

in the case of any registered interest, caveat, or notice of claim existing on a computer register for the stratum estate in leasehold in a unit immediately before cancellation, enter that registered interest, caveat, or notice of claim on the new computer register for the stratum estate in freehold for that unit; and

(e)

cancel the existing computer register for the base land.

(6)

The merger has no effect on any easement or covenant to which the base land is subject or on any easement or covenant that is appurtenant to the base land.

(7)

Sections 60 and 61 apply to any easements and covenants referred to in subsection (6) (with all necessary modifications).

41 Section 177 amended (Application by body corporate for cancellation of unit plan)

(1)

Replace section 177(3) with:

(3)

Before making an application under subsection (1), the body corporate—

(a)

must agree by special resolution to the cancellation; and

(b)

must—

(i)

arrange for an assessment of the ownership interests and proposed ownership interests (if any) of all the units in the unit title development by a registered valuer, and assign the reassessed interests to the relevant units; or

(ii)

decide, by a special resolution that sets out the reason for the decision, not to reassess the ownership interests and proposed ownership interests (if any).

Example

The special resolution records that a body corporate has decided not to reassess the ownership interests and proposed ownership interests on the basis that they were recently reassessed for and assigned to all units.

(2)

In section 177(5)(b), replace “resolution” with “resolution under subsection (3)(a).

(3)

In section 177(6), replace “In addition” with “In relation to the resolution under subsection (3)(a), in addition”.

(4)

Replace section 177(7) with:

(7)

The application for cancellation of the unit plan must be accompanied by—

(a)

a certificate from a registered valuer showing the ownership interests and proposed ownership interests (if any) reassessed for all the units in the unit title development; or

(b)

the certificate required under section 216 in relation to the resolution under subsection (3)(b)(ii).

42 Section 180 amended (Effect of cancellation of unit plan—standard unit title development or head unit title development)

In the heading to section 180, replace with : .

43 Section 182 amended (Effect of cancellation of stage unit plan)

In section 182(4), replace “, assessed as required by section 177(7),” with “(as reassessed if section 177(7)(a) applies)”.

44 Section 183 amended (Extinguishment of registered interests, etc)

Replace section 183(1) with:

(1)

This section applies if an application is made under section 177 and the Registrar has received a certificate or certificates from the body corporate that comply with the requirements of sections 177(6) and (7) and 216.

45 Section 189 amended (Cancellation of plan following decision of High Court)

(1)

In section 189(2), delete “, within 6 months after the date of the declaration,”.

(2)

Replace section 189(3) with:

(3)

The application—

(a)

must be in the prescribed form; and

(b)

must be accompanied by or have lodged in support of it a copy of every declaration or order made by the High Court under section 188 in relation to the body corporate or unit plan; and

(c)

must be accompanied by a certificate given by the applicant or the applicant’s successor in title certifying that all conditions and directions imposed or given by the High Court have been complied with.

(3)

After section 189(5)(a), insert:

(aa)

the application must be accompanied by a certificate from a registered valuer showing the ownership interests and proposed ownership interests (if any) reassessed for all the units in the unit title development, unless the High Court directs otherwise:

(4)

In section 189(5)(b), replace “sections 177(7), 180,” with “sections 180,”.

46 Section 212 amended (Designated resolutions)

(1)

After section 212(i), insert:

(ia)

variations of leases under section 167(1)(a):

(2)

In section 212(j), replace “section 167(3)” with section 167(1)(c).

(3)

After section 212(k), insert:

(l)

not reassessing the ownership interests and proposed ownership interests (if any) before applying, under section 177, for cancellation of a unit plan (see section 177(3)(b)(ii)).

47 New Schedule 1AA inserted

Insert the Schedule 1AA set out in the Schedule of this Act as the first schedule to appear after the last section of the principal Act.

48 Schedule 2 amended

(1)

In Schedule 2, repeal the item relating to section 65(1)(b).

(2)

In Schedule 2, after the item relating to new section 84A, insert:

Section 89A

Omit and substitute:

89A When extraordinary general meeting is required

(1)

This section applies if the chairperson receives a notice that—

(a)

asks for an extraordinary general meeting to consider and decide motions proposed in the notice; and

(b)

in the case of—

(i)

a timeshare resort comprising both timeshare units and principal units that are not timeshare units, is signed by or for not less than 20% of the timeshare owners and by or for the unit owners of not less than 20% of the non-timeshare units; or

(ii)

a timeshare resort comprising timeshare units only, is signed by or for the timeshare unit owners of not less than 20% of the timeshare units.

(2)

The extraordinary general meeting must be held not later than 3 weeks after the date that the notice is received.

(3)

In Schedule 2, repeal the item relating to section 90.

Schedule Transitional, savings, and related provisions for amendments to Unit Titles Act 2010

s 47

Schedule 1AA Transitional, savings, and related provisions

s 9A

Part 1 Provisions relating to Regulatory Systems (Building and Housing) Amendment Act 2016

1 Interpretation

In this Part,—

commencement date means the date of commencement of Part 2 of the Regulatory Systems (Building and Housing) Amendment Act 2016

regulations means the Unit Titles Regulations 2011.

2 Saving provision for existing notices requesting extraordinary general meeting

(1)

This clause applies to any notice that is given to the chairperson, in accordance with the requirements of section 90(2)(a) (including as modified and applied by Schedule 2), before the commencement date and in relation to which a meeting has not been held before the commencement date.

(2)

Section 90(2)(a) and any related regulations, in each case as in force immediately before the commencement date, continue to apply in relation to that notice despite the enactment of Part 2 of the Regulatory Systems (Building and Housing) Amendment Act 2016.

3 Saving provision for existing High Court declarations authorising cancellation of unit plan

(1)

This clause applies to any declaration of the High Court that is made under section 188 (including as applied by section 165 and Schedule 2) before the commencement date and that authorises the cancellation of a unit plan.

(2)

Section 189 and any related regulations, in each case as in force immediately before the commencement date, continue to apply in relation to that declaration despite the enactment of Part 2 of the Regulatory Systems (Building and Housing) Amendment Act 2016.