You snooze, you lose – RMA and the developer

Agreements for sales off the plans will include sunset clauses – or "twilight" clauses as a client called them the other day.  I like that new name it seems more accurate somehow.  They will also be subject to s225 of the Resource Management Act.  It is an interesting section, aimed at protecting the purchaser.  First it gets…

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Can a lessor refuse to renew?

A lessor must tread very carefully when considering the position of a lessee who has not yet exercised its right to renew the lease.  The Property Law Act 2007 assists a lessee by providing relief in two situations where a right of renewal would otherwise be lost: • Where the lessee has breached a condition precedent to…

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Development funding anyone?

The changes to the NZ investor migrant policy that we flagged a couple of months ago have just been made operative.  This should be of interest to developers seeking development funding.  Migrants can now invest in residential property developments in order to secure residency.  Residential property development has been added as an “acceptable investment” for migration…

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You must read this if you are selling a unit title property

Many agreements being signed now will be subject to the new seller’s disclosure regime. Agreements for sale and purchase for a unit title property will be subject to the new disclosure regime if entered into before 20 June with settlement after 27 June 2011.  Agreements entered into on or after 20 June are also subject…

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Invalid cancellation of lease

Lessors are encouraged to take a lot of care and attention when cancelling leases under the Property Law Act 2007. The Supreme Court’s decision on 10 May 2011 in Ingram & Knee v Patcroft Properties Limited shows that care and attention is very important. The lessor was held liable to pay damages to the lessee…

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Overseas investors and residential property

We were interested to hear that the investor migrant policy is changing with effect from 25 July 2011. Residential property will be an "acceptable investment" for migrants relying on the ‘investor’ category to seek residency in NZ. The migrant’s own house will not be an acceptable investment. Investment will need to be made in new…

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Bodies Corporate – who pays for what?

Unit entitlements In the past all body corporate levies have been assessed on unit entitlements.  Because unit entitlements are based on value, historically different owners using the same facilities could be required to contribute to costs to differing extents.  This system was criticised as being unfair and imposing an irrelevant assessment model on costs.  In…

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Unit Titles Act 2010 Developers and Disclosure

Unit Titles Act 2010 Developers and Disclosure The impact of the Unit Titles Act 2010 on developers Disclosure requirements in general are introduced in a previous blog.  What follows is an analysis of the specific implications for developers and the additional “turnover disclosure” that is relevant when a development is completed.  Pre-contract Disclosure Pre-contract disclosure…

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Compulsory GST zero rating – new GST rules

What is CZR? From 1 April 2011 it became compulsory for certain land transactions to be compulsory zero rated (CZR).  This means that GST will be charged at the zero percent.  The regime will apply to almost all transactions involving land that are made between GST registered parties.  There are some limited exclusions.   It is…

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Destruction and leases

What is happening in Christchurch is impacting on the New Zealand property industry in all sorts of ways.  One of these is the debate regarding contractual obligations between the parties.  Most leases inadequately deal with the situation in Christchurch.  Whilst they may deal with partial destruction and total destruction they do not adequately cover many…

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Are body corporate management contracts ultra vires?

We have written previously about body corporate rules considered ultra vires by the Courts.  Contracts entered into beyond the powers conferred by the body corporate rules will be void and unenforceable.  On 21 February 2011 the High Court gave its judgement as to whether or not the body corporate secretarial services contract and management contract…

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