$2m bill spooks owners of leaky units

By ANNE GIBSON

Fears of a $2 million legal bill have forced plaintiffs in one of New Zealand's largest leaky buildings cases to settle on the eve of their court fixture.

Greenwich Park unit owner and weathertightness committee chairman Dean Sutcliffe said the terms were unsatisfactory but owners had to take the money because they could not afford to fight through the courts.

"We were told that some of the parties would take this all the way to the Supreme Court and owners just couldn't afford that," Mr Sutcliffe said.

In March, the body corporate of the 85-townhouse development between Spaghetti Junction and Symonds St made a $9 million claim which was to be heard in an eight-week trial in the High Court at Auckland from July 19.

It was to be a landmark case, attracting the interest of territorial local authorities, developers, builders, architects, building certifiers and various agencies facing litigation on other multi-unit projects in Auckland.

Greenwich Park owners now face the prospect of stripping claddings from their units, replacing rotten framing timber and re-cladding, a job estimated in their claim to cost $5.3 million.

"It's a less than satisfactory result," Mr Sutcliffe said. "The whole focus is now on the repair process and assisting owners to achieve that as quickly as possible. We've just got to take little steps to begin to solve this problem."

But lawyer Paul Grimshaw of Cairns Slane said owners should be pleased with the cash they got and the case had a successful outcome. He disagreed with Mr Sutcliffe on the prospect of a $2 million legal bill.

"The Building Industry Authority were very strident in their approach and when you are talking of a settlement you need to advise the owners of the pros and cons. It was likely the BIA would appeal any decision so it would be a costly exercise. But Dean may be confusing figures of a worst-case scenario involving the High Court, Court of Appeal and Supreme Court," Mr Grimshaw said.

"Owners have recovered a substantial amount of money. They had the option to go to trial but they would prefer the certainty of money in the hand."

Mr Grimshaw represents 3000 other leaky buildings complainants, mainly in Auckland.

The litigation and mediation involved large multi-unit residential projects with a projected repair bill of $50 million and Mr Grimshaw said he expected successful outcomes for the property owners in each of the cases.