A recent Court of Appeal decision has clarified when a cross-lease neighbour can refuse consent for alterations, bringing greater certainty to an area that has often caused frustration for property owners. As cross-lease properties continue to be adapted and redeveloped, the decision provides clearer direction on how consent should be approached in practice.
In Liow v Martelli [2026] NZCA 101, the Court confirmed that cross-lease owners do not have an automatic right to veto their neighbour’s proposed changes. Consent can only be withheld where it is reasonable, taking into account the interests of all parties and the nature of the cross-lease arrangement.
This reflects the reality that properties evolve over time, and that decisions should be based on real effects rather than default positions.
What is still relevant
Neighbour consent is still required under a cross-lease. The difference is that objections must now be based on real, measurable effects rather than preference alone. Relevant considerations may include:
- Privacy and outlook
- Loss of light or amenity
- Impacts on future development potential
For those who own a cross-lease property, or are considering buying one, this reduces some uncertainty around the ability to make alterations or pursue redevelopment in the future, but due diligence remains essential.
Understanding both the lease terms and planning rules is key. Our planning team works alongside landowners and developers to assess what is feasible and provide clarity early in the process.
Looking ahead
While this decision creates more flexibility, many cross-lease properties still carry inherent limitations. Given the complexity of these arrangements, seeking independent legal advice is a prudent first step before relying on the decision or progressing any works that may affect neighbouring properties.
For some owners, this also raises a broader question: is it time to move beyond those constraints?
In certain cases, exploring a conversion to freehold (fee simple) title can unlock longer-term value and simplify future development. If you’re weighing up your options, you can also read more about the pros and cons of cross-lease versus fee simple ownership.
Whether you’re planning an extension, upgrade, exploring development potential, or considering a cross-lease conversion, talk to our team about how to navigate cross-lease requirements with confidence.
References
- Liow v Martelli [2026] NZCA 101, Court of Appeal decision, New Zealand
- Court of Appeal summary and judgment.
- Simpson Grierson, “No more neighbour vetoes: Court of Appeal clarifies alteration rules for cross-lease properties”
