No council negligence found after CCC issued for leaky building

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A recent Weathertight Homes Tribunal decision from Wellington in the Simpson Family Trust v Wellington City Council and Others case demonstrates the completeness of the limitation defence.

It also finds a council not liable in negligence despite issuing a CCC for a leaky building.

The facts of that decision were as follows:
• The Simpsons purchased land in 1992 and commissioned an architect to complete concept drawings (Conroy). They then commissioned Jeanette O’Callaghan, an architectural draughtswoman, to prepare working drawings.

• A Firth Masonry Villa was first drawn but due to cost the materials were revisited.
• Glenclad was recommended by the builder and so the house was redesigned and costed. The revised plans were submitted to the council in May 1994.

• On or about 23 June 1994, the consent was issued by the council and uplifted by Ms O’Callaghan.
• In June 1994 Heyhoe Builders and the Simpsons entered into a building contract.
• Although a practical completion certificate was signed on 12 April 1995, a CCC was not issued by the council until 13 August 1999. This was after the house had been the subject of an episode of My House My Castle on television. 

• It seems that the construction of this house was problematic from early on, and that there were well documented problems with leaks going back as far as 1995.
The original claim brought by the Simpsons was for $1.1 million. However, during the course of the hearing this was reduced to $170,000.

Limitation

The Tribunal was asked to consider the limitation defence argued by the respondents. The claim with the WHRS was lodged by the filing of an application on 27 November 2002.
It was argued by the respondents that the claimant had identified all the damage more than six years earlier (27 November 1996). Accordingly, the claim against the respondents was statute barred.

In response, the claimant conceded that there had been many leaks over a very long period. The claimant said all the leaks were fixed as soon as they became evident, and the house did not begin to leak again until 2002.

Claim not statute barred

The claimant argued that each fresh leak would constitute a fresh cause of action and, thus, their claim was not statute barred.
However, the Tribunal found that as far back as 1995, the claimant was aware of the leaks and they were not latent. A period of dormancy of a fault does not make the fault a new cause of action.

Accordingly, it was found that apart from the council, the limitation period runs from the date on which the Simpsons knew, or ought to have realised, that the leaks were defects.
This meant that the proceedings had been commenced outside the limitation period.

The council

As set out earlier, the council issued a CCC on 13 August 1999. It was alleged that the council had been negligent in:
• failing to check cladding material was suitable for the site and fit for purpose,
• failing to ensure it was adequately installed,

• failing to ensure that there were control joints,
• failing to notice that the earthworks behind the slab were inadequate to permit the drainage of water, and
• failing to ensure through its inspections that, in fact, the building work complied with the building code.

Evidence was adduced by council and the claimant of frequent attendances over an extended period in an attempt to bring the building up to compliance.
The council also adduced evidence as to some defects not being able to be identified by a council inspector.

Acted without negligence

The council also adduced evidence to the effect that where it may have missed defects, these defects had not caused damage.
Also, where damage was shown to have occurred, the council was able to establish to the Tribunal that it had acted without negligence.

Accordingly, we have in this decision the somewhat unusual finding that council has not breached its duty of care, where a house is deemed to be leaky, despite the council issuing a CCC.