In New Zealand, cross-lease titles are a unique form of property ownership, particularly common in urban areas. They allow multiple owners to share a single piece of land while having their own dwellings. However, navigating cross-lease titles can be complex, especially when defects arise.
What is a Cross-Lease Title
A cross-lease title is a title where multiple owners jointly own the land. Each have rights to a dwelling on the land with exclusive rights over certain parts of the land. The arrangement is governed by a legal document known as a lease, which outlines each owner's rights and responsibilities.
When is a Cross-Lease Title Considered Defective
A common problem with cross-lease properties is that it is very normal for them to be defective. A cross-lease title is considered defective when it does not comply with legal standards or when the lease and title documentation is flawed. Common issues include:
1. Incomplete documentation whereby missing signatures, unclear terms, or lack of essential details may render a title defective.
2. Where additions have been made to the dwelling which are not accurately recorded on the flat plan
3. If the cross-lease has incorrectly defined boundaries or owners have built over common use areas or restricting others from use of common use areas.
Consequences of a having Defective Cross-Lease Title
If your cross-lease title is defective, it may become problematic when the time comes to sell your property. A defective title will not only reduce the chances of selling, but it will also reduce the price in which someone will be willing to pay for the property.
What to Do If You Discover a Defective Title
If you discover that your cross-lease title may be defective, then you should seek legal advice from a lawyer. They can help assess the extent of the defect and advise on next steps. Next steps to correcting a defective title include engaging with a qualified surveyor to fix the title. Be aware that this comes at a substantial cost of approximately$20,000 and takes around one to two months to complete.
Conclusion
Dealing with a defective cross-lease title in New Zealand can be challenging, but understanding your rights and options is crucial. Always seek professional advice from a lawyer to navigate these issues effectively and ensure that you thoroughly compare flat plans given by the vendor to what you see at the property when you are viewing it. By addressing defects promptly, you can protect your investment and ensure a smoother property ownership experience. If you have questions about cross-lease titles or need assistance, feel free to reach out to the team at Absolut Legal for guidance.
