Bianco off Queen leaky building appeal

The Bianco Off Queen is a two-tower apartment building with 157 units. It was built with defects. Body Corporate 406198, the Body Corporate for the Apartments, together with individual unit owners sued Argon Construction Ltd as head contractor and the Auckland Council in negligence.

In the High Court, Andrew J  awarded the sum of $5,344,816.55 in remedial costs (including a sum for escalation) as well as $779,500 in general damages.  This compared to the sum initially claimed by the Body Corporate of $40,739,870. Costs were awarded to the Body Corporate on a category 3B basis in the sum of $583,254 and disbursements of $579,514.73 notwithstanding a pre-trial Calderbank offer at nearly three times the damages award.

In BC406198 & ors v Argon Construction Ltd & ors [2025] NZCA 684 the Court of Appeal:

1. Dismissed the BC appeal;

2. Allowed the Argon & Council appeals about the award for consultancy and costs;

3. Allowed the Council appeal about escalation costs.

In relation to consultancy costs of $450,000 the Court found that the evidence proffered by the Body Corporate in support of the claimed consultancy costs was unreliable hearsay, the deponent being unqualified to give that evidence. But there being no dispute that some consultancy costs were incurred, the proper remedy is to refer this matter back to the High Court for reconsideration with the benefit of relevant evidence.

On costs the Court of Appeal said the trial Judge did not approach the significance of the Calderbank offer on the correct legal basis. Argon and the Council were entitled to their post-Calderbank costs unless there were compelling countervailing factors, and there needed to be exceptional reasons for making an award of costs against a qualifying Calderbank offeror. It referred the issue back to the High Court for reconsideration.  The Court did not disturb the apportionment of the costs award as 65% to council and 35% to Argon.

On defects and damage the Court preferred the evidence of Steve Alexander over that from Maynard Marks for the BC.

 

 

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Lawyers win Leaky Building Appeal

In Grimshaw & co v BC207624 [2025] NZCA 392 the Court of Appeal allowed an appeal from the High Court judgment by rookie judge Tahana J that found Grimshaw & co negligent for its advice to the body corporate of Spencer on Byron.  Cooke J in giving  the judgment of the Court of Appeal said that Tahana J had got it totally wrong by misapplying the relevant law.  Grimshaw & co was not negligent in its advice about the relevant unit titles act.  Additionally, the Cooke J said that Tahana J was wrong to recategorize the proceeding as cat 3 post judgment for costs purposes.  A total vindication for common sense.

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Christchurch City Council – leaky home loss

In the decision in Christchurch City Council v Attorney General & anor [2013] 2447 the High Court dismissed an application by the Christchurch City Council to set aside the decision about the eligibility of claimants to pursue a leaky home claim.  The Court was not satisfied that the DBH had applied an incorrect test as to when the relevant house was built.

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Delay in service and limitation periods

Recently I conducted a hearing for owners of a leaky home where the defendants had asked the High Court to strike out the claim by reason of delays in service of the court proceedings having affected their ability to cross claim and join third parties.  The defendants alleged that by reason of the expiry of the 10 year limitation period under the Building Act they had been so prejudiced that justice was no longer achievable.  In the decision in McConnel v Matthews & ors [2013] NZHC   1819 Christiansen AJ dismissed the application.  The defendants were unable to show prejudice and that they could not have brought cross claims and joined third parties.  The proceedings were commenced within the 10 year limitation period and served within 12 months of filing.

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EQC- leaky homes

Apparently EQC is now trying to avoid meeting its liabilities for earthquake damage by trying to identify damage to houses that  allegedly arose from weathertight issues.  Homeowners ought not accept EQC’s version of events and ought to engage a building surveyor to investigate the causes of damage.  If damage is caused by earthquake, EQC is liable.

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