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Vero loses waiver summary judgment

In Gabriel & ors v EQC & Vero [2018] 1255 the High Court dismissed an application by Vero for summary judgment against the current owner of an earthquake damaged house based on an argument that the original insured had waived the claim against Vero.  The original insured owner had apparently agreed with Vero in 2013 to close the claim, however, the evidence was uncertain about whether the claim referred to was only the “out of EQC scope claim” or the entire house claim.   So the Court refused to enter summary judgment and the claim continues against Vero by the current owner assignee.

 

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EQC ordered to pay 75% of legal costs

In Deo Gratias Developments Ltd v Tower Insurance Ltd & anor [2018] NZHC 767 the High Court (Osborne AJ) ordered EQC to pay 75% of the legal costs and disbursements a homeowner incurred in Court proceedings against EQC and the insurer where EQC paid cap after being sued and the insurer settled the claim one month after EQC paid cap.  In the three other proceedings considered in the judgment the Court ordered EQC to pay 50%.  EQC had argued that 50% was its maximum liability.  The closer the insurer settlement is to the cap payment the greater % of costs EQC ought to pay.

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Insurance claim/policy assignment

Here is a short video I did about the issues with assignments of EQC and insurance claims.  We are still waiting for a Court of Appeal decision after a hearing on 15 February 2018 about the ability to assign insurance claims/proceeds for replacement costs.

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Interest on EQC payments

Here is a short video I did about EQC’s liability to pay interest.  If EQC has not paid then a homeowner should sue now to get interest from when EQC ought to have paid.  For a cap payment this ought to be in excess of $30,000.  A homeowner must sue to get the interest.  EQC is very apprehensive about this new exposure.

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EQC changes

EQC Act Changes Announced

  • Dr Megan Woods
    HON DR MEGAN WOODS
Earthquake Commission

The Minister Responsible for the Earthquake Commission Megan Woods has today announced changes to the EQC scheme.

 

“Cabinet has carefully considered the proposals regarding changes to the Earthquake Commission Act,” Megan Woods said.

 

“The changes that we have agreed on will improve how the Act functions and enable the scheme to work more effectively for future natural disasters. These are widely agreed, common sense changes that can be made before the independent inquiry into EQC. I’ve asked for them to be brought forward so that, if the worst did happen and we had a major event shortly, these changes will have been made.

Read more

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Terms for EQC Independent Advisor

Terms of reference for Independent Advisor’s work released

  • Dr Megan Woods
    HON DR MEGAN WOODS
Earthquake Commission

The Independent Ministerial Advisor sent in to speed up EQC’s Canterbury claims be tasked with improving claims management, assessing operational, resourcing, policy and legislative constraints and assessing any constraints caused by processes with private insurers, Minister Megan Woods has announced.

“Today I am releasing the Terms of Reference that will direct Christine Stevenson, the Independent Ministerial Advisor’s work to ensure swift and fair settlement of the 2600 outstanding claims from the Canterbury Earthquakes.

“She will work with the board and management to identify and report to me operational changes needed to ensure timeliness, fairness and high professional standards in the resolution of these claims.

Read more

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Interest on EQC payments

Since the commencement of the Interest on Money Claims Act 2016 on 1 January 2018 EQC is now exposed to a liability to pay interest on late EQC payments from the date the money ought to have been paid until it was paid.  Previously the Court said it would only order EQC to pay interest as part of a substantive court judgment for the unpaid amount(s).  The new liability applies to court proceedings commenced after 1 January 2018.  It is an incentive to sue EQC now if you have not been paid as interest will be a substantial amount.  Here is a link to an interest calculator.

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EQC & New Apportionment of Damage Method

Under the Earthquake Commission Act 1993, EQC has to apportion the damage/cost between earthquake events as there is a cap per event that is usually $100,000 plus GST per event.  Where there were damage inspections between quakes then it is straight forward to apportion based on actual damage.  In the past EQC has apportioned damage in the absence of inspections based on damage % in the area.  It has now taken to apportioning based purportedly on remedial costs on properties  in the area.  It is important to get from EQC in relation to apportionment the addresses of the properties used by EQC, details of the method of construction of the properties and details of the remedial costs and method that it assessed the apportioned repair cost.  It must provide this information.  The court has ordered it to provide this information in cases.

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