Body corporate rules - The changes you need to understand

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If you own or live in a multi unit style development then it is more than likely to be a unit title development meaning that the building and any common areas and land will be governed by what are called body corporate rules (“rules”).

Under the Unit Titles Act 2010 (the “new Act”) all existing rules will lapse on the 1st of October 2012 and unless the body corporate either revokes, adds to or amends their rules and registers them on the titles to the properties that are part of the unit title development before this date, then the default rules set out in the new Act will apply.

Under the Unit Titles Act 1972 (the previous Act), the default rules were extensive and covered such things as duties of the owners and the body corporate, body corporate committees (made up of unit owners); general meetings of the body corporate together with restrictions on the use of units, noise, whether animals were allowed and quiet enjoyment.

Many of these rules have now been incorporated into sections of the new Act and do not need to be included in any new rules. However the “default” rules under the new Act only cover very basic things such as the owner or occupier keeping the common area clear of obstruction and keeping the apartment and the common area clean and tidy the obligations owners and occupiers owe each other.

The default rules may be adequate for two or three unit developments but are not adequate for larger unit title developments and it is recommended that larger developments adopt new rules that are tailored to that particular development.

Your body corporate should discuss whether the default rules under the new Act meet the needs of your development and if not, what further rules should be considered.

Rules that could be tailored to a particular development include:

- What the unit can be used for;
- Prohibitions on certain kinds of activities; and
- Provide for restrictions on whether you can have pets.
Under the new Act there are restrictions on what Rules can be amended and what the Rules can include and these are set out in detail in the new Act but basically any Rules must relate to the control, management, administration, use and enjoyment of the units and common property or the regulation of the body corporate.  No powers may be placed on the body corporate that are not incidental to the powers set out in the Act. The new rules must also not be inconsistent with the provisions of the Act otherwise they will be deemed invalid.

Once new rules have been decided upon then they will need to be approved by resolution of the body corporate and registered with Land Information New Zealand. The new rules will not be effective until they have been registered.

If you have any questions regarding unit title properties or how changes to the Unit Titles Act (2010) affects body corporate rules, please contact experienced property lawyer, Wade Hansen by phone on 09 837 6885 or email wade.hansen@smithpartners.co.nz