Mastering the practical implications of building and construction law

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The 6th Annual Building & Construction Law, Disputes & Contract Management Conference — being run by Conferenz, New Zealand’s leading business conference experience — is to take place on February 25 and 26 at Rydges Hotel in Auckland.

Attracting corporate level decision makers from the construction industry, the conference will provide details coverage, analysis and practical guidance on:
• Building Act 2004, Construction Contracts Act 2002 and the Building Code,
• contract management, techniques and systems,
• project management — accounting for legislative and regulatory impacts,
• risk and liability — mitigation, management and allocation,
• collaborative working arrangements and project alliance contracting, and
• dispute resolution.

The following column is by Jonathan Kaye, a public law consultant and principal at Jonathan Kaye Law, who will be speaking on risk and liability.
His presentation will provide an overview of the risks for different participants in the construction industry by drawing on examples from recent cases.

While some construction professionals may consider that once their weathertightness liabilities are behind them their worries will all be over, the reality is quite different.
Buildings are becoming more complex, products are becoming less tolerant of errors in application or use, and owners and occupiers are becoming more demanding of the amenities their buildings must provide.

The liability rules for construction professionals are a harsh reality that few can avoid, and the incorporation of a limited liability company will not generally protect a builder/director who undertakes building work.

While a number of construction professionals carry professional indemnity insurance, it is not the norm among builders or specialist sub-trades, and thus successful claims against them will have a much greater impact on their businesses and lives.

Many risks during construction are easily identifiable and able to be managed.
However, risks that concern the interrelationship of different products or overlap between two professions or areas of expertise can be much more difficult to identify.

Potential liability may arise from something as small as the subtly different use of a tried and tested product.
Such a risk may not even be apparent to an experienced professional or building practitioner.

In addition, the application of the liability rules developed by the courts can seem unfair as they are designed to recompense the owner of the building as opposed to ensuring a fair apportionment of responsibility among the relevant construction professionals.

For example, full liability will be carried by a single party when the other parties involved in the construction of the building are no longer in existence to share that liability.

• Mr Kaye’s presentation will identify some of the risks that commonly become liabilities, and some of the ways in which these risks and liabilities can be managed.
If you have any queries or would like any further information on risk and liability please contact Jonathan Kaye at jonathan@jonathankayelaw.co.nz, or phone 04 499 9465.