Late last year EQC advised from 1 April 2015 they will be
sending accounts for excesses for properties where earthquake
repairs were managed by Fletchers and those repairs were for more
than $20,000.00. We are expecting that there will be home owners
that are unaware of this and will be surprised when they receive
EQC advised that they did not address the excess as part of
their managed repair process as they wanted to get on and complete
the repairs for home owners, however they are now looking to home
owners to recover the excesses. If somebody was cash settled by
EQC, EQC deducted the excess as part of the payment made and as
such this request for the excess is only limited to the managed
The invoice amount will be for 1% of the building work value and
as a result the maximum excess payable will be $1,150.00 including
GST. EQC have confirmed that 90% of the invoices that will be
issued will be below $600.00.
In some instances the house will have changed ownership and we
anticipate the account will be sent to the owner known to
EQC/Fletchers at the time the repairs were undertaken and sent to
the address on their records. If this is the case new owners of the
property may not know where to forward the correspondence on to or
may not be aware that they are now responsible for this
There is also the issue of liability – who is liable to
pay this excess invoice?
It is a general rule of thumb that whoever received the benefit
of the repairs is responsible for the excess. For example if a
settled claim was assigned, the excess should remain with the
vendor. If the EQC claim was open and transferred to the purchaser
on settlement then the purchaser should be liable. However, if the
claim was assigned on settlement to a purchaser then a deed of
assignment may state who is responsible for the excess going
If you receive an invoice and are not sure if you are
responsible for the payment or where to send it, we recommend you
contact your lawyer to see if this can be easily answered by
checking the deed of assignment.
The content of this article is intended to provide a general
guide to the subject matter. Specialist advice should be sought
about your specific circumstances.
To print this article, all you need is to be registered on Mondaq.com.
Click to Login as an existing user or Register so you can print this article.
Contractors and principals should ensure they have appropriate insurance coverage instead of relying on indemnity clauses.
Some comments from our readers… “The articles are extremely timely and highly applicable” “I often find critical information not available elsewhere” “As in-house counsel, Mondaq’s service is of great value”
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).