Investors allege Pandey-controlled CP Group running the Sofitel Auckland Viaduct Harbour Hotel put on the squeeze; blocking disgruntled absentee apartment owners from earning revenue hosting Airbnb guests, forcing some to sell at reduced prices to CP Group.
Viaduct Harbour has 175 residential units; the majority under control of the Pandey family. About eighty apartments are managed privately with owners mostly living offshore, predominately in Singapore and Malaysia. These private owners refuse to lease their apartments into CP Group’s Sofitel hotel operations. Each are having to pay annual body corporate levies of some $24,000 a year. They dispute the size of annual levies and are challenging CP Group’s use of common areas for hotel operations.
The High Court was told CP Group used its majority voting in September 2020 to amend body corporate rules, stopping private apartment owners from using other providers to let out their apartments. This left them with no revenue while still liable for corporate levies, disgruntled owners said. Five gave up, selling to a Pandey-controlled company for prices ranging between $150,000 and $170,000. CP Group has since conceded the new rules are invalid and cannot be enforced.
Litigation over disputed use of common areas carries on. CP Group stalled, demanding private owners stump up security for its legal costs. They live overseas and may not pay if they lose, it said. Associate judge Taylor ruled against security for costs. Offshore owners own assets in New Zealand; their apartments at Viaduct Harbour. CP Group’s attempt to block private owners from earning letting revenue counted against its demand of security for costs, Judge Taylor said.
Een v. Body Corporate 383911 – High Court (29.04.22)
22.080