Auckland City to plug building inspection gap

By ANGELA GREGORY


The Auckland City Council is stepping into the breach left by private building certifiers who cannot afford to continue.

But its counterpart in Manukau City says it will do so only as a last resort.

A major company, A1 Building Certifiers, closed last week because the leaky buildings crisis meant it could not renew its insurance cover, and other certifiers fear they will also be forced out of business as their policies come up for renewal over the next year.

The Building Industry Authority requires certifiers to be insured against leaky building claims.

Auckland City Council's principal building officer, Bob de Leur, said yesterday that it seemed inevitable much of the building inspection work would have to return to local authorities.

Since 1991, the Building Act had given people the choice between councils and private certifiers.

He said councils administered the act and there would be no option but to pick up the work of the private certifiers.

This was "very unfortunate" because the 1991 legislation had provided choice and competition.

Mr de Leur said that while there was no denying the leak problem, he did not believe the reality was as widespread as the perception.

The council was preparing to take on the extra workload, which he believed was manageable.

"We have foreseen this - we have a strategy."

He said he had told A1 Building Certifiers there would be jobs at the council.

Councils were not as vulnerable as private providers to insurance difficulties because most local authorities insured together in one large company, said Mr de Leur.

Manukau Mayor Sir Barry Curtis said his council would take up any extra inspection work only as a last resort.

He wanted the private certifiers to remain viable, which in his view was the responsibility of the Building Industry Authority.

Unless the authority took urgent steps to address insurance and certification, there would be major economic impacts on everyone with an existing building project.

Sir Barry said the Government should intervene to organise insurance cover.

He was concerned at the "hysteria" and "media beat-up" that he said was harmingthe entire building industry.

The incidence of leaking or rotting buildings in Manukau was not as big as had been claimed, Sir Barry said.

Since 1997, his council had issued about 20,000 consents and had only 14 claims relating to weathertightness.

Eight were settled without legal action.

He said the issue was still manageable and could be worked through in a measured way without forcing people out of business.

"There can be no one solution for a kaleidoscope of issues, and it's wrong to think private certifiers should take the blame.

"Clearly there need to be guidelines for liability issues as well as a review of suitable design and materials."

The Government initiative to establish a mediation process, while of some value, would not address the immediate crisis, Sir Barry said.

Anxious private certifiers in Auckland have been meeting daily since the collapse of A1.

Papatoetoe certifier Rob Woodger was concerned about his firm's future.

He said he had renewed his insurance in June and expected to be covered for the year from then.

But given the fate of A1 Building Certifiers, he was not confident his insurer would continue with the present level of cover.

Mr Woodger said that while the work could pass back to council inspectors, he doubted that they would be able to cope with the volume.

He was frustrated by the leaky building debacle, which he believed had been blown out of proportion.

"There is hysteria out there ... people who are creating a frenzy."

Mr Woodger said that among three Auckland companies, including his own, there had been only three claims in the past eight years.

An Auckland University insurance law lecturer, Neil Campbell, said insurance companies would withdraw their cover where they perceived that risks were becoming near-certainties.

People were now much more likely to discover leaks in their buildings, he said.

Insurance companies would want exemptions from claims against leak damage, such as they had successfully sought for millennium bug computer complications.


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Further reading
Feature: Leaky buildings

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