New Zealand: Failed construction and the duty of care of Councils for building safety

When Stadium Southland's roof collapsed following heavy snowfall in 2010, the finger was pointed squarely at the Invercargill City Council (Council). How could such an event occur under the watchful eye of local council, given the regulatory functions they are required to perform under the Resource Management Act 1991 (RMA) and Building Act 2002 (Building Act).

It seems history was repeating itself when residents from 21 properties in the Bella Vista subdivision of Tauranga were forced to evacuate their homes on March 9 2018. Both of these events deemed to be local tragedies in their own right, raise the same question – are local councils doing enough to fulfil their duty of care when issuing and monitoring resource consents and building consents?

To rewind for a moment, we take a look back at the series of events that lead to the Stadium Southland roof collapse in 2010. Following the initial build in 2000, the roof was visibly sagging and remedial works were undertaken. When these works were completed, Council relied on a statement from the original engineer which confirmed the building as safe and up to standard. On that advice, the Council issued a code of compliance certificate and the building was opened. However, the building still had issues, including leaks and the roof moved during high winds. Despite these issues no remedial works were undertaken and the roof eventually collapsed in 2010 post heavy snowfall.

The Supreme Court found the initial award of upwards of $15 million would be halved due to the contributory negligence by the stadium owners as they failed to undertake secondary inspections on the building. However, the Court placed a large emphasis on the fact that local authorities need to ensure that any certification given by an expert still complied with building consent processes and a council cannot simply rely on the expert's certification.

Less than six months on from when the Supreme Court released its decision in relation to Stadium Southland we have a failed subdivision in Tauranga where it appears another local council has fallen short of the mark.

On the 1st of June the Honourable Paul Heath QC released a report which assessed the adequacy of the process followed by the Tauranga City Council (TCC). Key findings to take from the investigation were:

  • Of the 21 houses granted building consent, four of those properties have material defects and require significant remediation and should have never been granted code compliance certificates.
  • Structural defects on properties were there to be seen during framing and pre wrap inspections but were not identified when they ought to have been.
  • Failure to address geotechnical requirements meant that TCC could not be satisfied that the building work complied with the Building Code.
  • There was a need for more specialist assistance to assess compliance with geotechnical aspects of the building consents rather than general knowledge from a range of inspectors.
  • Concerns around the failure to build in accordance with approved plans and insufficient inspection by engineers.

With Bella Vista Homes in liquidation the only avenue residents were left with was to turn to the TCC. Given that investigative reports had identified deficiencies in the TCC's inspection processes for geotechnical and structural defects, a prompt engagement between the two parties was necessary.

Class action proceedings had been issued against the TCC by two of the home owners with the possibility of more disgruntled residents joining proceedings. Tauranga councillors have since unanimously voted in principle to buy the 21 homes in the failed subdivision. Residents are expecting full market value had the subdivision been completed properly.

These two cases send a clear message to councils that real care needs to be taken to ensure that building processes comply with current requirements.

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.

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