Village residents engage lawyer as fees dispute simmers
Waimea Village residents are preparing for a legal battle in their long-running dispute over rental fees.
MP Nick Smith and Tasman district councillor Kit Maling both advised the group to seek legal representation after being approached for advice.
Barrister Warwick Heal was employed by the committee last week. He described the situation as deep-rooted, saying the conflict's cause dated back to the original lease that was signed when owners Michael and Carolyn Wright bought the village in 2005.
Residents and management have been unable to settle on a fair rental levy since January last year. The residents own their homes but lease their land for a monthly fee, which was $50 in 2005.
Mr and Mrs Wright first proposed raising the village's rental fees to $280 in 2011 but, after the residents committee protested, an independent arbitrator set the rental fees at $125.
After lodging a complaint, the couple waited until January this year to raise the rent to $284. A second arbitrator was appointed, and they set the fees at $182.76.
Mr Heal said he sent letters yesterday to Mr Wright and his lawyer Graeme Downing about the levy, and where the money went after it had been paid.
The question of whether or not the most recent round of arbitration took place was one of the subjects Mr Heal wished to discuss with Mr Downing. Editor of Waimea Village's newsletter, Anne Senior, said last week that the residents did not believe any arbitration had taken place, as they had not heard from the arbitrator directly. Mr Downing confirmed to the Nelson Mail last week that arbitration did occur.
Mr Heal said he hoped to resolve a "wide range" of matters through discussion with Mr Wright and Mr Downing, but added that court proceedings were a possibility if progress was not made within several weeks.
"It's a situation that lay dormant for 10 or 20 years and it's only the new owner who's started a fairly aggressive policy that has woken the sleeping giant," he said.
Mr Wright said legal costs had contributed to the increase in rent. During arbitration he requested $19,690 from the leasees to cover last year's arbitration plus administration costs, but was awarded only $11,850.
"It's not a matter of holding [residents] accountable, it's here in the lease that the leaseholders have to pay the running costs and the administration of the company," said Mr Wright. "All we're doing is going by the lease."
He said this year's arbitration would cost him and the committee between $17,000 and $18,000 each.
Besides legal fees, Mr Wright said the levy increase helped to cover his managerial salary, car and accommodation. Mr Wright also argued that he was entitled to a 10 per cent yearly management fee for general administration, rates and insurance on top of his salary, but these fees were declined. The arbitrator awarded Mr Wright a total of $96,720 to cover his salary, transport and housing.
Mr Wright said the expenditure of Waimea Village as a company continued to be higher than its income, claiming $23,626 under "recovery of excess costs" for the 2011 business year during arbitration. He was awarded $13,836.
Mr Wright said there had been no official communication between himself and the committee since the arbitrator's decision became public last Tuesday, but he had obtained a recording of a residents-only committee meeting held on Sunday. He voiced concerns about the committee, saying it misled residents by claiming to resist the arbitration process while taking part in it. Both parties will attend a meeting today.
The Nelson Mail