Many earthquake damaged houses that are less than 100m2 are likely to have been short paid by EQC.
EQC incorrectly applied its own EQC Act and calculated the cap by multiplying the floor area by $1,000 per square metre. This is not how the EQC Act works and if your house is less than 100m2 in floor area, and is over cap, you likely have a claim against EQC.
Grant Shand Barristers & Solicitors launched this class action in June 2021. We believe homeowners should have been correctly paid the EQC cap on their house.
What is this EQC Floor Area Class Action about?
Where houses were less than 100m2 in floor area, in many cases EQC had an incorrect practice of calculating the cap as $1,000 per square metre (so for an 80m2 house they would calculate the cap as $80,000 plus GST). This is not how the EQC Act says that the cap should be calculated.
Section 18(1) of the EQC Act states that the EQC cap is calculated as the lesser of three alternatives:
a) amount specified in the insurance policy where there is a replacement sum insured; if a). does not apply then
b) amount specified in the insurance policy for natural disaster cover (but this cannot be less than the square metres of the dwelling time $1,000 per square metre plus GST); and
c) $100,000 (plus GST, so $115,000) per dwelling.
So, unless the insurance policy with your private insurer specifies a replacement sum insured or a natural disaster cover value that is less than $100,000 (and these need to be stated as dollar values), then the EQC cap is always $100,000 plus GST regardless of the size of the dwelling.
Because of EQC’s incorrect practice of calculating the cap on houses less than 100m2 in floor area, many homeowners have not received the money that they should have.
We believe homeowners affected by EQC’s incorrect calculation of the cap on their house should have their losses compensated. If you were not fully and correctly settled by EQC by 27 April 2015 you may be able to join this EQC Floor Area Class Action.
Can I join the EQC Floor Area Class Action?
To be able to join this class action you need to ensure that you meet all of the qualifying criteria listed below (taken from the [draft] application to the Court for a Representative Order):
(1) An owner or former owner (who has the rights to EQC claim(s)) of a residential building that was insured by s18 of the Earthquake Commission Act 1993.
(2) The relevant contract of fire insurance between the residential building owner and the insurer of the residential building did not specify a replacement sum insured, or a natural disaster cover value under s18 of the Earthquake Commission Act 1993.
(3) The residential building was less than 100m2 in area.
(4) The residential building suffered natural disaster damage in an earthquake in the Canterbury Earthquake Sequence that commenced on 4 September 2010.
(5) Claim made to EQC for the natural disaster damage.
(6) EQC accepted the claim for natural disaster damage.
(7) EQC assessed the claim for natural disaster damage to be over its statutory cap.
(8) EQC did not settle the claim under s29 of the Earthquake Commission Act 1993 by payment of a cap figure of $115,000 ($100,000 plus GST).
(9) Any assessment and/or payment did not occur before 27 April 2015.
(10) There is no binding settlement agreement between the EQC and the residential building owner in respect of all assessments and any payments made.
Frequently Asked Questions (FAQs)
How much will it cost me to join this EQC Floor Area Class Action?
We will charge you a simple and clear fixed fee that we will deduct off any settlement. We will never ask you to pay us any money, and if the minimum fixed fee is greater than the amount due to you, then there is no charge.
Group members will have no liability for legal costs if the class action is unsuccessful.
This class action is currently not funded by a litigation funder; however, this may change as the case develops. If this class action does become funded by a litigation funder it will not change the fee structure that is detailed in the Fees section below (but you may need to complete a funding agreement with the litigation funder).
How much money will I get?
It is impossible at this stage to provide any specific figure on what you could expect to receive.
This is due to a variety of factors that are unique to each homeowner’s situation (for example how much EQC has already paid you, the area of land damaged, the costs to repair the land, etc.).
What are the chances for success for the EQC Floor Area Class Action?
Our team is confident that the case has strong merits, however litigation is inherently risky and it is not possible to predict the outcome, or how long the case will take.
What are the benefits of a class action?
Running each individual claim through the courts would be costly and time consuming.
Being able to combine class member’s claims that involve common questions of fact and law, reduces the average cost of litigation by only addressing the common issues once at trial, instead of multiple times.
Does it cost anything to register?
No, it costs nothing to register.
Will registering mean I become a client of Grant Shand Barristers & Solicitors?
No, registration will not make you a client of Grant Shand Barristers & Solicitors. It just gives us a way to keep you informed about developments and the progress of the class action.
We will charge you a simple and clear fixed fee that we will deduct off any judgment or settlement. We will never ask you to pay us any money, and if the minimum fixed fee is greater than the amount due to you, you will not receive anything and there will be no fees applicable.
Our Simple Fixed Fee Structure
If judgment/settlement sum is $1,000 or less, then you will not receive anything and there will be no fees applicable.
If judgment/settlement sum is between $1,001 and $5,000, our fixed fee is $1,000.
If judgment/settlement sum is between $5,001 and $10,000, our fixed fee is $1,500.
If judgment/settlement sum is between $10,001 and $20,000, our fixed fee is $2,500.
If judgment/settlement sum is between $20,001 and $40,000, our fixed fee is $5,000.
If judgment/settlement sum is greater than $40,001, then our fixed fee is $7,500.