on 22 September 2023 at 5pm time expires for eligible class members to opt into the Mathias v EQC class action.  It is to enable purchasers of earthquake damaged houses to get cash compensation from EQC for EQC’s defective assessments and/or repair work.  The claims are funded by a litigation funder.  Here is a link to a website about the claims.



In Local Government Mutual Funds Trustee Ltd v Napier City Council [2023] NZSC 97 the Supreme Court dismissed the LGMFT appeal about its liability for a $12M building defects settlement paid by the Council about Waterfront Apartments.  The relevant insurance policy excluded liability from weathertightness defects.  The apartment owners alleged both weathertightness defects and non-weathertightness defects.  About $4.4M of the $12M paid related solely to non-weathertightness defects.  In this situation, where the Council faced liability for separate and divisible loss arising from breaches of the weathertightness and non-weathertightness aspects of the Building Code, only the former are excluded from cover notwithstanding that the claim was presented on a mixed basis.  The Wayne Tank principle that where there were two “equally efficient” causes of the loss, one within the policy and the other excluded, the exclusion applies.does not assist RiskPool here.  It is irrelevant to liabilities which, like the fire defects, result solely from non-weathertightness issues simply because those liabilities are a result (and only a result) of a non-excluded cause. In contrast to the position in Wayne Tank, it is possible in this case to apportion loss as between that caused by weathertightness (or by a mixture of weathertightness and other issues) and that not caused by weathertightness.

There is a class action against EQC in relation to Canterbury houses badly assessed/repaired by EQC after the Canterbury Earthquakes.  There may be in excess of 70,000 eligible homeowners.  Owners have to opt in to the proceeding by 22 September 2023.  A copy of the opt in notice is here.  The website for the class action is www.eqconsold.co.nz.

The 2016 Kaikoura earthquake damaged the BNZ’s building on Waterloo Quay, Wellington so that it required demolition.  In August 2019 BNZ sued the Wellington City Council in negligence for losses of $101M caused by loss of the building.  The Council joined Beca Carter seeking contribution under the Law Reform Act 1936 and for negligence based on Beca’s role in design/construction of the building.  In Beca Carter v WCC [2022] NZCA 624 the Court of Appeal upheld the High Court decision that refused to strike out/summary judgment the claim against Beca Carter for limitation.  The Court of Appeal decided that the Council’s contribution claim against Beca Carter was not subject to the 10 year longstop in the Building Act 2004, but was governed by s34 Limitation Act 2010 that provided a 2 year limitation period post determination of the Council’s liability to BNZ which had not yet been determined.  The cause of action in contribution accrues on a finding of liability.  Separately the Court said that there was conduct of Beca Carter within 10 years of the negligence claim by the Council so the Court could not enter summary judgment.

In Young v Attorney General [2022] NZCA 391 the Court of Appeal on 23 August 2022 dismissed an appeal by Steven Young against the High Court judgment that the Crown was not liable to him in nuisance/trespass in relation to rocks that fell onto and remained on his Redcliffs property in the earthquake(s) on 22 February 2011.  He claimed about $7M.  The rocks came from Mr Young’s property (72%) and neighbours’ properties (28%).  The Crown acquired the neighbouring properties in red zone offer(s) between 2012 and 2015.  Mr Young rejected any Crown red zone offer(s).  By the time the Crown acquired the neighbouring properties the Young property was already worth very little by reason of the previous rockfalls and zoning of property.  The Court held that the Crown has met any liability to abate the nuisance by offering to pay Mr Young $2M in 2015 plus enabling him to keep insurance proceeds in 3 houses on the site.  The order that Mr Young pay costs and disbursements of $329,093 to the Crown in the High Court was also confirmed.

In Napier City Council v LGMFL [2022] NZCA 422 the Court of Appeal allowed an appeal by the Council on its ability to recover from its insurer (“Risk Pool”) for its contribution of $12.355M to settle a leaky building claim about Waterfront Apartments.  The Waterfront plaintiffs claimed about $20M of which $16.2M comprised costs of remediation.  The relevant insurance policy excluded cover for claims about weathertightness.  The insurance policy did cover non-weathertightness defects.  Contrary to the High Court decision the Court of Appeal decided that the exclusion removed cover only for Council liability from weathertightness defects.  The Council could recover from Risk Pool for non-weathertighness defects.  The dispute was sent back to the High Court for it to apportion the settlement between weathertight and non-weathertight defects and to determine whether the settlement was reasonable.  

The High Court in Mathias v EQC [2022] NZHC 2097 has approved a class action against EQC for on sold properties.  These are earthquake damaged houses with EQC claims sold since the earthquakes in 2010/2011.  In 2019 EQC estimated that there were more than 50,000 on sold properties.  Here is a link to the class action website.  Details of how to opt in to the claim are still being finalised.  The claim will enable owners to get unconditional cash from EQC for rebuild or repair costs.

The Court of Appeal in its judgment in IAG v QBE & ors [2022] NZCA 208 considered the liability split between IAG as the insurer of the Sleights’ earthquake damaged house and QBE as the insurer of IAG’s project manager for the defective earthquake repair work, Hawkins.  IAG did not challenge that it was liable to pay the Sleights the cost to remediate the house after previous repair work by/for IAG did not restore the house to the insurance policy standard of “when new”.  IAG also challenged the High Court (Gendall J) decision to award interest on the repair costs from when the Sleights first complained in 2015, notwithstanding that the repair costs were calculated at the date of hearing in 2020.  Predictably the Court of Appeal overturned the interest award from 2015.  The Court of Appeal allowed IAG’s appeal and increased the QBE liability to include all key defects that were visible to Hawkins on inspection.  It allowed the QBE appeal and found that it was not liable for final certification of payments where IAG knew about defects before certification.  QBE and IAG are to go away and work out the quantum effects.

For all those people that settled their earthquake insurance claim with AMI Southern Response before 1 October 2014 here  is the link to the Southern Response DRA Package.  Register and provide information to Southern Response online.  Then get legal advice on the Southern Response DRA offer.  Southern Response will pay $2000 towards legal advice.  Advice should not cost more than that.  Use a lawyer that has experience in resolving these cases like Grant Shand.

Homeowners insured by AMI/Southern response that settled their claim before 1 October 2014 are now entitled to be paid up to many hundreds of thousands of dollars more. Make sure that you get what you are entitled to and do it now.  Grant Shand will charge only $2000 including GST to advise on and settle the claim.   He did the case of Avonside Holdings Ltd v Southern Response that changed the Southern Response practice and required it to pay a contingency and professional fees as part of a settlement.  Southern Response will reimburse the $2000 so owners effectively nothing to get the best advice and outcome.