Leaky house win: Owners to continue fight

This leaky home owned by Olivia Waiyee Lee in Ruakaka could cost nearly $1 million to fix. Photo / John Stone

A win in the Supreme Court has paved the way for a Northland homeowner to continue her leaky building case against the Whangarei District Council (WDC).

Ruakaka homeowner Olivia Waiyee Lee's victory has set a precedent relating to the statutory timeframe in which legal proceedings against parties for alleged negligence over construction and inspections under the relevant laws can be filed.

Ms Lee said she lost her tour business in Ruakaka and was forced to find employment in Auckland as a result of the costly, protracted legal battle against the council and other parties which began in 2008.

Her fight against WDC is far from over as both parties will go back to the High Court next year.

Ms Lee is claiming WDC was negligent in inspecting her house while it was under construction on Sandford Rd, Ruakaka, between 2007 and 2008.

The house had weather-tightness defects and failed its final inspection in March 2008.
WDC sent a notice for Ms Lee to address issues with spouting, internal and roof gutters, and rainwater heads.

She went to the High Court under the Weathertight Homes Resolution Services' Act 2006 and claimed WDC, among others, was a potential liable party in its capacity as building surveyor and territorial authority.

The High Court, and later the Court of Appeal, ruled proceedings she filed against WDC on May 21, 2014, were brought out of time under the Limitation Act 1950 which has a time limit of six years.

Ms Lee argued because she applied for an assessor's report on August 12, 2008, the proceedings should be treated as having been "brought" on that date.

But the High Court and Court of Appeal ruled her cause of action was accrued before May 21, 2008, and referred to reports from the builder in February and April 2008 and cladding manufacturers in May 2008.

In a ruling this week, the Supreme Court said Ms Lee's application for an assessor's report "stopped the clock" for limitation purposes and ruled in her favour.

"The process for Ms Lee has been tortuous and fraught with procedural difficulties," the Supreme Court said.

The court ordered WDC to pay her $25,000 in costs plus disbursements.

An elated Ms Lee said other leaky building owners in the same situation should take note of the Supreme Court judgment and fight their cases.

"I really wish other homeowners read this judgment. It's a new lease of life for them."

Repair costs to her house, she said, would be nearly $1m while the building cost was $1.4m.

Ms Lee has urged WDC to seek proper legal advice on matters pertaining to leaky home cases rather than waste ratepayers' money on lawyers through drawn-out litigation.

WDC chief executive Rob Forlong said it was good to have legal clarification on a confusing area of law.

He said the Supreme Court judgment simply allowed Ms Lee to take her leaky building case to the High Court.

"In the new year we will assess the implications for our council, and the wider local government sector may take interest in the precedent that has been set."