New Zealand: Review of the Unit Titles Act 2010

Last Updated: 13 February 2017
Article by Emily Quested


Triggered by a report from property professionals, the Ministry of Business, Innovation & Employment (MBIE) have announced a review of the Unit Titles Act 2010 (Act). It is a timely review of the Act especially as the number of unit title complexes are increasing.

The objective of the review is to ensure that the law regulating unit titles is "functioning well and is fit for purpose in a growing market". A discussion document has been released and written submissions on the proposals raised can be made by Friday, 3 March 2017.

We summarise the main areas for review as below.


There are already existing disclosure requirements to potential purchasers of a unit under the Act – pre-contract disclosure, additional disclosure and pre-settlement disclosure. The review aims to ensure purchasers have the best information available to them throughout their decision making process to purchase a unit.

At present, the main issues are:

  • The operation of the current disclosure regime results in purchasers not receiving all the information available due to time and cost constraints. In a growing and competitive market, purchasers are often unable to obtain additional disclosure prior to having to confirm their purchase.
  • There is no recourse available for a purchaser where disclosure is incorrect or incomplete.
  • If disclosure is not made a purchaser can cancel although it is not overly clear how this operates in practice.
  • The current disclosure does not work appropriately for off the plan units.
  • Often there is a lack of information or poorly maintained records to disclose.

It is clear some modification of the regime is needed as the bulk of the information to be disclosed (i.e. body corporate manager contacts, whether or not there are proceedings or weather-tightness issues, financial statements, body corporate and committee meeting minutes) should be prior to entry into a contract or very soon after it, certainly before the contract becomes unconditional.


Governance is an ongoing issue in many body corporates. The aim of the review is to enable owners to be effective decision makers regarding their respective developments.

The issues that have been identified are:

  • Provisions to address conflicts of interest at body corporate and committee level. There is no current provision in the Act to deal with this although it can arise often. At the very least it appears that the review suggests that conflicts are disclosed with consequences where a conflict is present.
  • More guidance is required from the body corporate committee to the owners in relation to their delegated powers and this should be reported more than annually. There should be guidance as to the role and responsibilities of body corporate committees. This may be more relevant to large scale developments.
  • Clarification of quorum, alteration to units and minority relief are required. There are some contradictory terms in the Act which require amendment or clarification.
  • There can be unfair use of proxy votes for body corporate decisions. At times a large number of proxies can be held by one person on behalf of absentee owners and can be a way of ensuring a certain decision is made. The suggestion is to limit the amount of proxies held by one person.
  • Lengthy and unfair contracts that the body corporate has no ability to terminate or renegotiate. Currently there is only an ability in respect of service contracts but perhaps should be expanded to consider all contracts.

Governance is often where problems arise in the day-to-day operation of the body corporate and development, especially in larger developments. Having clarity on some of the areas may make being part of a body corporate or body corporate committee easier for an owner.

Ensuring professionalism for body corporate management

It is now quite common for a body corporate to engage a body corporate manager. This can be very useful for ensuring the efficient and correct management of the body corporate. Managers in New Zealand are unregulated compared to Australia where there is an industry body running an accreditation and education programme.

The issues in this area largely relate to the reliance of the body corporate and/or body corporate committee on the manager in relation to information and compliance with the Act. This can be an issue where the manager acts outside of the scope of their contract, or mislead the body corporate. Further, there can be issues where the contract for the manger ends and they are then less than willing to provide previous information about the development.

The Ministry discusses in their paper the need to regulate managers to an extent – in particular requirements about holding accounts and providing information. They also suggest that it may be a requirement to have a manager in a development over a certain number of units.

Long term maintenance regime

A long term maintenance plan (LTMP) is a very important requirement of the Act. The rationale behind having such a plan is so current and prospective owners can appreciate the costs of owning a unit in that particular development, and the maintenance planned for the future.

The main issues that will be considered by the review are:

  • Is the 10 year period long enough? This doesn't necessarily contemplate longer term maintenance issues like roofs which when replaced result in a large unexpected levy. It is suggested that 30 years would be more appropriate.
  • Often LTMP are prepared by developers or bodies corporate who have no qualifications or experience to create such a plan. This can result in items being missed and not budgeted for. It is proposed that the LTMP would need to be signed by a member of the New Zealand Institute of Building Surveyors, or Royal Institute of Chartered Surveyors, or Institute of Professional Engineers New Zealand.
  • There is no enforcement of the LTMP and even though they are a requirement under the Act many developments do not seem to have one. It is suggested an ombudsman or similar be set up to ensure compliance.

It is no uncommon currently to find a smaller development with no LTMP. While a development is still relatively new this may not be a major issue however as certain parts of the units and common property age, a LTMP is essential to ensure there is adequate funding to complete requirement maintenance and no unexpected and expensive cost is incurred. Arguably, this requirement is even more crucial in a larger scale development.

Disputes and resolution

Currently the Act provides for dispute resolution by way of self-resolution, mediation, the Tenancy Tribunal and access to courts. The review aims to provide cost effective access to an appropriate resolution process.

It is thought the application fee to the Tenancy Tribunal may be too high at present. The application fee ranges from $850-$3,300. The level of the fee can reduce the number of trivial claims. Further, often people are confused as to the involvement of the Tenancy Tribunal given the name suggests it deals with tenancies as opposed to issues under the Act.

The Tenancy Tribunal does not have the ability to enforce compliance with an order – this can limit the effectiveness of its decisions. To ensure an order is enforced parties are currently having to apply to the District Court.

Given there can be the potential for disputes with complex issues this is also an area that requires review to ensure that disputes can be addressed in a cost effective and timely manner.

There are significant areas of the Act that clearly require review. The Ministry as part of the discussion document have produced a number of questions to assist with their review and are calling for submissions. Should you wish to make a submission or discuss any of the specific issues further please do not hesitate to contact one of our commercial property experts.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on

Click to Login as an existing user or Register so you can print this article.

Emily Quested
Some comments from our readers…
“The articles are extremely timely and highly applicable”
“I often find critical information not available elsewhere”
“As in-house counsel, Mondaq’s service is of great value”

Related Topics
Related Articles
Up-coming Events Search
Font Size:
Mondaq on Twitter
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
Email Address
Company Name
Confirm Password
Mondaq Topics -- Select your Interests
 Law Performance
 Law Practice
 Media & IT
 Real Estate
 Wealth Mgt
Asia Pacific
European Union
Latin America
Middle East
United States
Worldwide Updates
Registration (you must scroll down to set your data preferences)

Mondaq Ltd requires you to register and provide information that personally identifies you, including your content preferences, for three primary purposes (full details of Mondaq’s use of your personal data can be found in our Privacy and Cookies Notice):

  • To allow you to personalize the Mondaq websites you are visiting to show content ("Content") relevant to your interests.
  • To enable features such as password reminder, news alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our content providers ("Contributors") who contribute Content for free for your use.

Mondaq hopes that our registered users will support us in maintaining our free to view business model by consenting to our use of your personal data as described below.

Mondaq has a "free to view" business model. Our services are paid for by Contributors in exchange for Mondaq providing them with access to information about who accesses their content. Once personal data is transferred to our Contributors they become a data controller of this personal data. They use it to measure the response that their articles are receiving, as a form of market research. They may also use it to provide Mondaq users with information about their products and services.

Details of each Contributor to which your personal data will be transferred is clearly stated within the Content that you access. For full details of how this Contributor will use your personal data, you should review the Contributor’s own Privacy Notice.

Please indicate your preference below:

Yes, I am happy to support Mondaq in maintaining its free to view business model by agreeing to allow Mondaq to share my personal data with Contributors whose Content I access
No, I do not want Mondaq to share my personal data with Contributors

Also please let us know whether you are happy to receive communications promoting products and services offered by Mondaq:

Yes, I am happy to received promotional communications from Mondaq
No, please do not send me promotional communications from Mondaq
Terms & Conditions (the Website) is owned and managed by Mondaq Ltd (Mondaq). Mondaq grants you a non-exclusive, revocable licence to access the Website and associated services, such as the Mondaq News Alerts (Services), subject to and in consideration of your compliance with the following terms and conditions of use (Terms). Your use of the Website and/or Services constitutes your agreement to the Terms. Mondaq may terminate your use of the Website and Services if you are in breach of these Terms or if Mondaq decides to terminate the licence granted hereunder for any reason whatsoever.

Use of

To Use you must be: eighteen (18) years old or over; legally capable of entering into binding contracts; and not in any way prohibited by the applicable law to enter into these Terms in the jurisdiction which you are currently located.

You may use the Website as an unregistered user, however, you are required to register as a user if you wish to read the full text of the Content or to receive the Services.

You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these Terms or with the prior written consent of Mondaq. You may not use electronic or other means to extract details or information from the Content. Nor shall you extract information about users or Contributors in order to offer them any services or products.

In your use of the Website and/or Services you shall: comply with all applicable laws, regulations, directives and legislations which apply to your Use of the Website and/or Services in whatever country you are physically located including without limitation any and all consumer law, export control laws and regulations; provide to us true, correct and accurate information and promptly inform us in the event that any information that you have provided to us changes or becomes inaccurate; notify Mondaq immediately of any circumstances where you have reason to believe that any Intellectual Property Rights or any other rights of any third party may have been infringed; co-operate with reasonable security or other checks or requests for information made by Mondaq from time to time; and at all times be fully liable for the breach of any of these Terms by a third party using your login details to access the Website and/or Services

however, you shall not: do anything likely to impair, interfere with or damage or cause harm or distress to any persons, or the network; do anything that will infringe any Intellectual Property Rights or other rights of Mondaq or any third party; or use the Website, Services and/or Content otherwise than in accordance with these Terms; use any trade marks or service marks of Mondaq or the Contributors, or do anything which may be seen to take unfair advantage of the reputation and goodwill of Mondaq or the Contributors, or the Website, Services and/or Content.

Mondaq reserves the right, in its sole discretion, to take any action that it deems necessary and appropriate in the event it considers that there is a breach or threatened breach of the Terms.

Mondaq’s Rights and Obligations

Unless otherwise expressly set out to the contrary, nothing in these Terms shall serve to transfer from Mondaq to you, any Intellectual Property Rights owned by and/or licensed to Mondaq and all rights, title and interest in and to such Intellectual Property Rights will remain exclusively with Mondaq and/or its licensors.

Mondaq shall use its reasonable endeavours to make the Website and Services available to you at all times, but we cannot guarantee an uninterrupted and fault free service.

Mondaq reserves the right to make changes to the services and/or the Website or part thereof, from time to time, and we may add, remove, modify and/or vary any elements of features and functionalities of the Website or the services.

Mondaq also reserves the right from time to time to monitor your Use of the Website and/or services.


The Content is general information only. It is not intended to constitute legal advice or seek to be the complete and comprehensive statement of the law, nor is it intended to address your specific requirements or provide advice on which reliance should be placed. Mondaq and/or its Contributors and other suppliers make no representations about the suitability of the information contained in the Content for any purpose. All Content provided "as is" without warranty of any kind. Mondaq and/or its Contributors and other suppliers hereby exclude and disclaim all representations, warranties or guarantees with regard to the Content, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. To the maximum extent permitted by law, Mondaq expressly excludes all representations, warranties, obligations, and liabilities arising out of or in connection with all Content. In no event shall Mondaq and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use of the Content or performance of Mondaq’s Services.


Mondaq may alter or amend these Terms by amending them on the Website. By continuing to Use the Services and/or the Website after such amendment, you will be deemed to have accepted any amendment to these Terms.

These Terms shall be governed by and construed in accordance with the laws of England and Wales and you irrevocably submit to the exclusive jurisdiction of the courts of England and Wales to settle any dispute which may arise out of or in connection with these Terms. If you live outside the United Kingdom, English law shall apply only to the extent that English law shall not deprive you of any legal protection accorded in accordance with the law of the place where you are habitually resident ("Local Law"). In the event English law deprives you of any legal protection which is accorded to you under Local Law, then these terms shall be governed by Local Law and any dispute or claim arising out of or in connection with these Terms shall be subject to the non-exclusive jurisdiction of the courts where you are habitually resident.

You may print and keep a copy of these Terms, which form the entire agreement between you and Mondaq and supersede any other communications or advertising in respect of the Service and/or the Website.

No delay in exercising or non-exercise by you and/or Mondaq of any of its rights under or in connection with these Terms shall operate as a waiver or release of each of your or Mondaq’s right. Rather, any such waiver or release must be specifically granted in writing signed by the party granting it.

If any part of these Terms is held unenforceable, that part shall be enforced to the maximum extent permissible so as to give effect to the intent of the parties, and the Terms shall continue in full force and effect.

Mondaq shall not incur any liability to you on account of any loss or damage resulting from any delay or failure to perform all or any part of these Terms if such delay or failure is caused, in whole or in part, by events, occurrences, or causes beyond the control of Mondaq. Such events, occurrences or causes will include, without limitation, acts of God, strikes, lockouts, server and network failure, riots, acts of war, earthquakes, fire and explosions.

By clicking Register you state you have read and agree to our Terms and Conditions