$12,000 fine for extra bedrooms

A Dunedin developer has been fined $12,000 after illegally adding bedrooms to a property in the student quarter.

Developer Patrick Crowley initially entered a not guilty plea for the charge, but eventually entered a guilty plea after indications from the judge that he was personally responsible for the actions of his company, Campus Flats Ltd, his lawyer said.

"What changed was that the court said that simply knowing that something had happened and not doing anything to stop it was sufficient to be guilty,'' Mr Crowley's lawyer, Len Andersen, said.

The "something [that] happened'' was the addition of two extra bedrooms to the property, at 99 Clyde St.

That brought the total number of bedrooms to 13, two more than allowed under the Resource Management Act 1991.

Before it was deregistered in January 2015, Campus Flats Ltd owned 99 Clyde St.

The company sold the property to Alan and Kay McKay, the current owners, in December 2013.

Because Campus Flats Ltd has now been closed, charges could not be brought against the company itself, so the charges were brought against Mr Crowley, the company's director.

Dunedin City Council planner Kirstyn Lindsay said the McKays were responsible for bringing the 99 Clyde St property into compliance with the Resource Management Act.

Mr Andersen thought the DCC should also be bringing charges against the McKays, because "they bought it knowing [the extra rooms were] illegal''.

Their knowledge of the two rooms was used as evidence in the case, Mr Andersen said.

Mr Crowley told the McKays about the rooms, therefore he must have had knowledge of the rooms himself.

Mr and Mrs McKay declined to comment when contacted.

Mr Crowley is also director of another company, County Cork Investments Ltd, that was fined $12,150 in July, also for illegally adding rooms to another North Dunedin property.

However, DCC counsel Allie Cunninghame said Mr Crowley "had to be treated as if he were a first offender, even though he's previously been associated with a company that did the same thing ... because a company is a separate legal person''.

That meant Judge Craig Thompson reduced Mr Crowley's fine by $1800 - 10% off the "generous'' starting point of $18,000 - for Mr Crowley's "previous good record''.

The summary of facts notes Mr Crowley was asked about 99 Clyde St while being interviewed by council officers in 2014 about breaches at the County Cork Investments Ltd property.

"Mr Crowley stated that he sold the property as an 11 habitable room property in 2013. ‘‘When asked if any property he had been involved in had any extra unauthorised rooms, he said ‘no'.''

The council went on to discover the breach at 99 Clyde St and establish the extra rooms had been added before the property was sold in December 2013, just under a year before Mr Crowley's interview with council officers.

Mr Crowley's position as a director of four companies - County Cork Investments Ltd, West Cork Ltd, Go Forth Ltd, and Otago Tertiary Accommodation Ltd - is also noted in the summary of facts.

Altogether, the companies own eight Dunedin residential rental properties.

Mr Crowley was also director of three other companies that owned Dunedin properties and which have been voluntarily struck off the register.

One of those was Campus Flats Ltd.

Judge Thompson set Mr Crowley's fine at $12,000, plus court costs. Of the fine, 90% was to be paid to the city council.

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