Weathertight e-news
Issue 5 – March 2010
In this issue we cover:
Determining the “Date Built”
Identifying the ‘date built’ of a building is relevant to determining whether a Weathertight Homes Resolution Service (WHRS) claim is made within 10 years of construction.
A recent High Court decision Garlick Family Trust determined that the ‘date built’ is the date when the building was “physically complete to the standard that would meet approved plans and specifications in the building consent”.
To show how this interpretation works, if a final inspection was applied for and passed on first inspection, then the date of the application for that final inspection could be regarded as the ‘date built’. At the time of inspection application, the building did meet the standard for receiving a building consent.
The Garlick decision is being appealed on issues relating to the appropriate remedy in the case and costs.
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Mitigating your loss as a claimant
A claimant has a duty to take reasonable steps to mitigate the loss arising from defective building work, for example, by stopping a leak.
The claimant can not usually claim for damage arising due to their failure to take action.
The recent White v Rodney District Council decision says the onus is on the defendant to establish what reasonable steps the claimant should have taken. This will vary from case to case. For example, a claimant can not be expected to spend money on repairs if they have not got the financial means. Another example is that it may be reasonable for a claimant to wait until they know who may be paying for repairs before taking action.
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General Damages and Special Damages
Two types of damages that may be claimed along with compensation in a claim before the Tribunal are special and general damages.
Special damages are for those costs that do not necessarily arise as a matter of course from defective building work and can usually be costed precisely. These might include accommodation costs while remedial work was being done.
General damages arise as a consequence of the building work complained about but can not usually be costed precisely. An example would be an award of damages for inconvenience incurred in repairing the home
Damages can be awarded for things such as:
- reimbursement of remedial costs
- estimated costs of remedial work. This might be the amount in an assessor report or other quotes or estimates
- other costs associated with repairs such as project management expenses, costs of obtaining building consents or engineering reports
- loss of rental for a period the property was affected by moisture or uninhabitable
- interest on loans obtained to carry out repairs
- general damages for inconvenience and out of pocket expenses incurred in repairing the home
- accommodation costs if the claimant is required to move out of the house during repairs
- medical expenses
- stress.
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Two assessment options
Once a claim under the Weathertight Homes Resolution Services Act 2006 has been brought, the property is assessed by an independent assessor assigned by the Department.
Claimants have two options for assessment.
- An eligibility assessor’s report (the only choice if repairs have been undertaken); or
- A full assessor’s report
The eligibility assessor’s report is an appropriate option for claimants who:
- want to complete repairs before settling their claim, or
- have already completed repairs
The full assessor’s report is the better option for claimants who:
- want to resolve their claim so they can then pay for repairs
- want a full assessment before deciding whether to repair first or settle first.
Unlike a full assessor’s report, the eligibility assessor’s report provides insufficient evidential basis for resolving a claim. This means that you need to identify potentially liable parties and quantify your claim yourself. You will need to carefully record all evidence of leaks and damage during the repair process and keep all receipts for the cost of the repair as evidence for the resolution process later. Your claims advisor can discuss this in more detail, but cannot recommend particular parties or repair options. You may wish to seek advice from a technical and/or legal expert to help you with this.
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Do I need legal representation?
Claims advisors are commonly asked by claimants whether they need to be represented by a lawyer. In almost all claims to the Tribunal some of the parties will have legal representation. It’s not compulsory to have a lawyer but you can if you wish.
If you will be representing yourself it’s important that you have:
- a general understanding of why the house leaks
- some understanding of the law that relates to the claim
- a basic understanding of why some parties may want other parties to be joined or why parties should be removed from a claim
- the ability to present your own case
- the ability to question other parties' witnesses
- the ability to make submissions in support of your case and against the other parties' cases.
Find out more information about representing yourself 
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Weathertight Homes claims statistics
Current claims statistics can be found here »
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Report reinforces Government action on weathertightness
A PricewaterhouseCoopers (PwC) report released on 22nd December 2009 estimates that between 22,000 and 89,000 homes are affected by weathertight issues. The Government has accepted PwC’s “consensus forecast” - it is most likely that up to around 42,000 dwellings built between 1992 and 2008 could have been affected. The report notes this is an estimate and the large range reflects the high level of uncertainty about the number of homes affected.
The report says it is likely that only a minority of these leaky homes – around 3500 - have had repairs done to date, and around 9000 failures had now gone beyond the 10-year legal liability limit period.
Based on the consensus forecast of 42,000 failures, the report estimates the total economic costs of fixing the affected homes at $11.3 billion in 2008 dollars.
Read the full report here »
The issue is much bigger than anyone has ever previously acknowledged and reinforces the Government’s priority to get leaky homes repaired. The Government is currently working through a number of assistance package options for leaky home owners. It should not be a surprise to anyone that an issue of this size and complexity is going to take some time to resolve.
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