The Post

Leaky-building claim settled

- Marty Sharpe marty.sharpe@stuff.co.nz

A multimilli­on-dollar leaky-building claim has been settled out of court by Napier City Council, but ratepayers will not know what it’s cost them.

The claim concerned the Waterfront apartments, in Napier, which were completed in 2007 and later found to be leaky buildings.

In 2013 apartment owners launched legal action against the council and 10 other parties involved in the constructi­on of the apartments.

The apartment owners claimed the council was negligent because as building regulator it owed a duty of care in performing regulatory functions as an inspector, and it breached that duty in each of the three components of that role (issuing building consents, inspection­s during constructi­on, and issuing code compliance certificat­es).

The owners said that as a result of these breaches the apartments were defectivel­y constructe­d. The cost of remedial work had been estimated at $9,336,298.

The owners and the council settled out of court last month.

Council chief executive officer Wayne Jack said the settlement was subject to a confidenti­ality agreement ‘‘which is customary in these cases’’, and he would not divulge the actual cost ratepayers.

‘‘It is good to get this settled, not only from a council perspectiv­e, but also for the owners of the apartments, as this matter has been going on for some time,’’ he said.

He said the laws around joint and several liability ‘‘need urgent review by the government’’.

‘‘Because a ‘last man standing’ system is not a fair system upon the ratepayer,’’ he said.

A spokeswoma­n for the Ministry of Business, Innovation and Employment said the ministry was providing advice on the issue.

‘‘Public consultati­on on proposals for legislativ­e change is expected to take place in the coming months,’’ she said.

Some of the faults on the Humber Street building involved weathertig­htness.

The council is insured under the Local Government Mutual Funds Trustee Ltd, or ‘RiskPool’.

In a High Court ruling last year, the council accepted it would not be indemnifie­d for any weather-tightness and any part-weather-tightness defects, but argued it could be indemnifie­d for the non-weathertig­htness defects.

The council, which is still arguing the case in the High Court, told Justice Anne Hinton that several of the issues in the building were unrelated to weather-tightness and it sought indemnity cover from Riskpool to cover it for its liability.

Riskpool wouldn’t indemnify the council and applied to strike-out the claim on the basis that the council had ‘‘no tenable claim for indemnity in respect of any liability’’.

Riskpool said the council was facing a statement of claim from a third party that arose from issues related to weather-tightness and on that basis it should be excluded from cover.

Justice Hinton did not agree with RiskPool’s argument.

‘‘RiskPool has failed to satisfy me that the council has no realistic prospect of establishi­ng a right to indemnity, in the event the council is found liable to the Waterfront Plaintiffs,’’ Justice Hinton ruled.

The matter is still before the court.

Remediatio­n of the buildings has been partially completed.

 ??  ?? The apartments on Humber St, Ahuriri.
The apartments on Humber St, Ahuriri.

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