If you’re part of a Body Corporate in a unit titled development, disputes around levy contributions and fairness are not uncommon—especially when shared spaces, like upper-level decks or lifts, are used more heavily by some unit owners than others.

A recent example from a large unit complex highlights this issue: owners of lower-level units argued that those with access to a large upper-floor deck—used almost exclusively by a few—should pay higher levies. This raised the question: Can levy contributions be changed?

???? Ownership vs. Utility Interests: What’s the Difference?

Under the Unit Titles Act, each unit has both ownership interest and utility interest, which determine how levies and voting rights are calculated:

• Ownership Interests affect voting power and contributions to the capital improvement fund.
• Utility Interests influence how operating expenses (e.g., maintenance, insurance) are shared among unit owners.

By default, utility interests mirror ownership interests—unless formally reassessed.

???? Reassessment Options for Body Corporates

There are three ways to reassess interests:

1. Reassess Ownership Interests

   • Typically involves a registered valuer.
   • Based on unit size and underlying land value at registration.
   • Affects voting rights and capital improvement levies.

2. Reassess Utility Interests

   • More commonly used when certain units use shared facilities more (e.g., lifts, common decks).
   • Adjusts operating levy contributions, not voting rights.

3. Reassess Both Ownership and Utility Interests

   • Suitable when both usage patterns and value proportions have changed significantly.

???? What’s Involved in the Process?

Reassessment is a formal legal process that includes:

• Passing a special resolution by the Body Corporate.
• Allowing a 28-day objection period for all affected parties, including mortgage holders.
• Engaging the right professionals: a valuer for ownership interest changes, or potentially a surveyor if unit measurements are in question.

⚠️ Don’t Get Caught Out

Reassessing interests can cause division among owners if not handled properly. It’s crucial to follow the legal process and ensure transparency at all stages. Mistakes can lead to disputes, delays, or even legal challenges.

???? Need Help with a Unit Title Dispute or Levy Reassessment?

At Core Legal, we assist Body Corporates and unit owners across Masterton, Wellington, and the Wairarapa region with expert guidance on unit title law. Whether you’re looking to reassess interests or resolve a dispute, our experienced property lawyers can help.

We offer affordable fixed-price Initial Consultations so you can understand your options clearly and cost-effectively.

Get in touch with Core Legal today to ensure your unit title issues are handled with professionalism and precision.