James Hardie loses appeal bid

Retirement village company Metlifecare has scored a legal victory in its battle to win damages of as much as $200 million from multi-national building products company James Hardie.

Some Metlifecare retirement villages were built using James Hardie cement fibre cladding products Harditex, Monotek and Titan Board, which Metlifecare claims were defective and leaked.

But James Hardie, which is defending the claim, applied to the Supreme Court to have its Irish parent company, and two other overseas James Hardie ‘‘holding companies’’, excluded from the claim. It argued that New Zealand courts had no jurisdiction over James Hardie International (JHI), James Hardie NZ Holdings or RCI Holdings Pty. Had the argument succeeded, it would have left the Metlifecare companies seeking damages suing only four James Hardie companies based in New Zealand and Australia.

But the Supreme Court has ruled a delay to the Metlifecare claim caused by hearing an appeal on jurisdiction would not serve the interests of justice. ‘‘There is a distinct disadvantage to the claimants if the progress of their claims is further delayed,’’ justices Susan Glazebrook, Sir William Young and Mark O’Regan ruled.

Throughout the 1990s and early 2000s, tens of thousands of leaky buildings were erected throughout the country, including retirement villages, schools, apartments and individual homes. The retirement villages covered in the claim against James Hardie are Forest Lake Gardens in Hamilton, Pinesong and Dannemora Gardens in Auckland, and Coastal Villas in Paraparaumu.

The villages were built between 1983 to 2010, though the majority of claims arise from installations between 1994 and 2003.

In a hearing in 2017 at the High Court in Auckland, the plaintiffs’ ‘‘best guess’’ was that their claim was likely to exceed $200m.

The plaintiffs, which are companies in the Metlifecare group of companies, claim James Hardie was negligent in its manufacture, marketing and sale of the cladding products.

Harditex was withdrawn from the New Zealand market on 1 July 2005.

The ruling follows a similar ruling late last year in which James Hardie lost a bid to have JHI removed from a different $250m leaky building claim.

Lawyer Adina Thorn launched a class action lawsuit on behalf of around 1000 leaky building owners. James Hardie Industries PLC sought to be removed from the Thorn claim arguing that courts around the world had consistently held that the use of a group management structure did not make the ‘‘parent liable for the acts of a subsidiary’’.