Leaky law hits reeling homeowners

By MATHEW DEARNALEY

Consumers' advocates are calling for an urgent law change to allow adjudicators to award legal expenses to owners of leaky homes, rather than just the cost of repairs.

This follows concern that a West Auckland couple who have been awarded just over $40,000 for repairs to their rotten and mouldy home are unable to recover legal bills of $16,000 from the builders or the local authority, which approved the building.

They received almost all they asked for in repair costs calculated by a Weathertight Homes Resolution Service assessor, which amounted to $48,900 after their stucco-clad house began disintegrating.

But they also expect to pay thousands on top of the $16,000 to fight an appeal which Waitakere City Council is taking against the service's first adjudication decision.

This is because the service's governing legislation, which was supposed to give thousands of desperate home owners a relatively fast and cheap resolution service, says those taking disputes to adjudication must bear their own legal costs.

The resolution service has received 2125 "active claims" and Consumers' Institute chief executive David Russell said yesterday that the net result for the pioneering Auckland couple was inequitable.

He called on the Government to pass amending legislation to ensure innocent victims of professional negligence received a fair deal, saying: "It has got to be cleaned up."

Commerce Minister Leanne Dalziel is not commenting on the initial case, given that it is under legal challenge.

But National housing spokesman Wayne Mapp, who claims some responsibility for the legislation as sponsor of a private member's bill on which he says it was based, called the inability to recover legal costs a mistake that needed correcting.

Auckland lawyer Paul Grimshaw, who represents owners in major claims such as against the Sacramento development in Botany Downs, said the Government had set up a clumsy and unnecessary "quasi judicial" body in kneejerk reaction to the leaky homes crisis.

He said most of his clients were using the normal court system, but those seeking redress from the watertight service were asking him to represent them after turning up unassisted at mediation sessions to find "everyone else has got a lawyer".

An Auckland building consultant who campaigned for Government action against leaky buildings, Greg O'Sullivan, said appeal costs would probably soar because of the ability of local authorities to challenge factual as well as legal findings in adjudicators' decisions.