In Settlers Crescent Partnership v IAG New Zealand Ltd  NZHC 2775 the owners of 4 adjoining buildings at 14 Settlers Crescent, Ferrymead (funded by Risk Worldwide) sued to recover for damage in the June 2011 earthquake notwithstanding that they had cash settled for $10,233,973.80 with IAG for damage to the buildings in the September 2010 and February 2011 earthquakes on the basis that those buildings were recommended for demolition as being destroyed. The Court unsurprisingly found that the partnership suffered no further loss in the June 2011 and the claim failed.
A demolition contractor, Nicon, has sued Tower Insurance/Stream Group for allegedly unpaid fees on post earthquake demolition work and quote provision. Nicon claims $350 plus GST for each of the 1083 quotes it gave to Tower/Stream ($379,050). It also claimed that Tower was obliged to give it the work for any actual demolition carried out on the quoted jobs. In Nicon Ltd v Tower Insurance Ltd & anor  NZHC 2005 the High Court (Gendall J) decided four preliminary questions about the alleged agreement with Tower/Stream. The Court decided that a written heads of agreement between Nicon and Stream was binding and it required Tower/Stream to offer Nicon first the demolition work on jobs it quoted on. Tower/Stream did not do so. The Court decided that the evidence did not prove the existence of a $350 quote fee. The claim likely continues now as one for loss of profit by Nicon on demolition jobs that Nicon was not given in breach of the agreement.
In Self Realisation Meditation and Healing Centre Charitable Trust (New Zealand) v IAG New Zealand Ltd  NZHC 2077 the High Court (Osborne AJ) struck as parties two builders joined by IAG to claims by a property owner about earthquake damage to two Christchurch houses. Each builder had minimal allegedly defective work and the property owner sued only IAG based on the policy without alleging defective remedial work.
Here is the link to our EQC & Insurance Newsletter #19.
Here is a link to the Canterbury Earthquakes Insurance Tribunal Bill introduced on 1 August 2018. It appears to create a tribunal that is a replica of the Weathertight Homes Tribunal. Notably the Tribunal can only consider claims by an original insured against EQC and/or any insurer. The Act expressly does not apply if ownership of the property is transferred following the insured physical loss or damage. The Tribunal has the power to direct parties to mediation and appoint independent experts. It also has the express power to restrict cross examination of witnesses and disallow the use of experts unless they are necessary. A big negative is that the Tribunal is not empowered to award costs based on success, but can only award costs if there is proven bad faith, meritless allegations or unreasonable delay. Any appeals are to the High Court, but only with leave of the High Court. This Tribunal is about 7 years too late and repeats the errors that make the WHT a bad choice for many homeowners. It also excludes the “on solds” that are the most prevalent claims now. A positive is that it enables people to prosecute land claims cheaply without much risk of adverse costs. Another query is why does the Act not apply to Kaikoura claims?
The High Court on review in Deo Gratias Developments Ltd v Tower Insurance Ltd & ors  NZHC 1881 has overturned a previous High Court decision to award an earthquake claim plaintiff 75% of the 2B cost and disbursements. Davidson J decided that there was insufficient evidence that EQC was responsible for the costs being incurred to justify more than the 50% usual award. The short time between EQC paying cap and the insurer settling the claim was insufficient to justify an inference of greater EQC responsibility. Interestingly Davidson J says that an insurer is not bound to wait for EQC to declare over cap or pay cap before settling with an insured. The loss covered by the EQC Act requires objective assessment, not simply EQC’s view. The insurer is not bound by EQC’s subjective view. Additionally the Court upheld the cost awards against EQC on all 4 claims because the claimants had by the court process recovered more than EQC ever offered as costs.
The 2016 Kaikoura earthquake damaged Deloitte House in Wellington. Precinct Properties Holdings Ltd owns the building. OMV New Zealand Ltd leased the ninth and tenth floors of the building. OMV says the earthquake damage has rendered it untenantable and that the lease has automatically terminated. Precinct denies this and has claimed for unpaid rent, seeking summary judgment in the High Court. OMV asked the High Court to stay the rental summary judgment pending arbitration of wider issues such as misrepresentations by Precinct about the earthquake rating of the building and untenantability. The Court of Appeal in OMV New Zealand Ltd v Precinct Properties Holdings Ltd  NZCA 240 dismissed an appeal by OMV from the High Court decision that a claim for rent was not subject to the arbitration clause in the lease. So the claim for unpaid rent could continue in the High Court. OMV has to pay the actual legal costs of Precinct under the lease.
In QBE Insurance (International) Ltd v Allianz Australia Insurance Ltd  NZCA 239 the Court of Appeal upheld the High Court decision that Allianz was not liable for earthquake damage because its insurance policy did not commence until 4pm on 4 September 2010 in relation to the earthquake that occurred at 4.35am. The QBE policy ended at 4pm on 4 September 2010 so it was solely liable. The agreement between the insured’s broker and Allianz on placement was that the Allianz policy would incept on the expiry of the QBE policy. Any later documents could not affect that agreement.
In Robin v IAG & ors  NZHC 1464 the High Court (Gendall J) reversed the decision of Matthews AJ in Robin v IAG & ors  NZHC 204 about joining as defendants people involved in post earthquake repair work. Ms Robin owned 214 Fitzgerald Avenue. She sued IAG alleging that the earthquake repair work done did not restore the house to the policy standard. She also sued the manager of the repair work, Canterbury Reconstruction Ltd. IAG joined Hawkins who monitored/assessed the remedial work as a third party. IAG then asked the Court to join as defendants Houselifters Ltd, Max Contracts Ltd and the Christchurch City Council. Ms Robin opposed the joinder. Gendall J said that Matthews AJ was wrong not to join them as defendants. They were involved in the allegedly defective work and no other party could/would join them as third parties. It would not be onerous for Ms Robin to formulate and prove the claim(s) given she had sued CRL.
Here is the most recent link to our latest EQC & Insurances newsletter.
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