Cross-leases: Do I need to update my Flats Plan?

July 27, 2023

in Property

When it comes to selling your property, cross leases can cause a headache. This is the case if there are improvements to the land that are not represented on your flats plan.

Many people often obtain the relevant building consent but forget to obtain their neighbours’ written consent and update their flats plan. Failure to obtain these can result in a defective title and/or a breach of the underlying terms of your cross lease.

Updating a flats plan can be time consuming and costly.  It involves engaging a surveyor and a lawyer, obtaining resource consent from the Council, obtaining the consent of the other owners of the cross lease and the consent of their (and your) bank/mortgagee, registration of a new deposited plan at Land Information New Zealand and obtaining issue of new cross lease titles.

Fortunately, under the standard (ADLS/REINZ) sale and purchase agreement, the initial starting point for requiring an update of the flats plan is whether the improvement alters the exterior dimensions of the flat. “Altering the exterior dimensions of your flat” is defined as anything that is attached and enclosed. Therefore, if the improvement is not enclosed or attached to the flat then the title may not need to be updated pursuant to the standard sale and purchase agreement.

A carport could be attached to the property but is not enclosed so would not be seen as altering the external dimensions of the flat. Decks and verandas are also not enclosed and typically do not require an update to the flats plan.

 A standalone garage or shed would be enclosed but is not attached to the flat so these do not meet the definition for altering the external dimensions of the flat and you would usually not need an update to the flats plan to comply with the terms of the sale and purchase agreement.

However, as mentioned this is simply the starting point. It is important to read the lease documents to ensure that the improvements do not breach any terms of the lease, that they are located within your zone of exclusive use and not on common property and that all fellow landowners in the cross lease have given their written consent to any new structure.

If you require any advice or further information on the matters dealt with in this publication please contact the lawyer at Farry Law who normally advises you, or alternatively contact:

Benjamin McKee

09 353 6677

The information contained in this publication is intended as a guide only.  It does not constitute legal advice and should not be relied upon as such.  Professional advice should be sought before applying any of the information to particular circumstances.  While every reasonable care has been taken in the preparation of this publication, Farry Law does not accept liability for any errors it may contain. 

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