Ministers should own up over leaky buildings

By DAVID THORNTON*

As the Government struggles to deal with the leaky building crisis, there must be no doubt about where ultimate accountability lies. It is with the Government itself. While the Prime Minister denies the Government has any legal liability, that is somewhat different to accountability for Governments' actions in introducing a system which includes the Building Act, the attendant building code and the regulations set out in the act.

Central government is also responsible for establishing the Building Industry Authority, which approves independent building certifiers. Among the requirements for certifiers is that they carry public liability insurance - from which insurance companies are now removing themselves.

There is nothing in the system to deal with this or to ensure home-buyers are protected financially from shonky building.

The system of building consent and certification was set up by Labour in the late 1980s, and National tinkered with it during the 90s. That makes the Government accountable, whatever its colour.

If there has been a systemic breakdown, as the Building Industry Authority report claimed, it is the system set up by the Government that has broken down. The chaos outlined in the report has developed because the system simply did not work.

Even now, while the Government introduces voluntary mediation, it is still being pointed out that litigation is the ultimate recourse for those already suffering a leaking home. But still no clear guidelines are being set on who to sue. In some cases, there should be a clear target - where, for example, buildings are found not to have complied with the requirements of the building consent.

Sue the builder, you would think. But what if the building has been issued with a certificate of compliance by the local council? Sue the council, you would think.

But what if the building was signed off by a private building certifier on the basis of which the local council, which may never have actually visited the building site, then issued a compliance certificate as required under the Building Act? Sue the private certifier? Or the developer? Maybe neither, because the council, once it learns of the problem, can issue a "notice to rectify" to the private certifier, who must then get his client - the developer or builder - to carry out remedial work.

If that does not work, the home-owner can still take the council to court because the council is always at the end of the trail. The council issues the compliance certificate and should carry ultimate liability.

That liability arises directly from obligations laid on local government by central government through legislation. Therefore, logically and morally, central government must be held accountable.

Local and central government's role is to regulate for an orderly society in which people's rights are protected. That is why we have laws that cover our daily lives and create and develop the framework within which we can live at peace with our neighbours and go about our daily business within a fair and equitable society.

When those laws prove inadequate, that framework is endangered. Such is the case with the leaky building crisis. The system has failed. It is now the responsibility of central government to give adequate financial help to owners of leaky homes.

That help could include legal aid to sue builders, designers, developers and anyone else who may have contributed. It could also include interest-free loans - or even grants in cases of dire need - to enable repairs to be carried out swiftly and efficiently.

Such measures would ease the immediate burden of those people suffering the stress and hardship this systemic failure has induced.

And what of the future? How can home-buyers be given confidence that they will not be subject to such a systemic failure again?

The basic framework of building control relies heavily on the role of the local council acting under clear and operable legislation. This means that local councils should continue to have responsibility for issuing building consents, inspecting buildings and issuing compliance certificates. And the councils should continue to accept liability when they certify that buildings have been constructed in accordance with tried and approved materials and building methods.

No council will ever admit, in individual cases, that such liability exists because such admissions would lead to cancellation of the council's own liability insurance. That is why many councils have admitted making "confidential" payouts to owners of faulty homes. They have recognised their liability.

Introducing substantial changes to the present system must reinforce that legal responsibility. First, all building certification should be carried out by fully qualified council staff. The law allowing private certifiers should be revoked.

In conjunction with that, the number of inspections carried out by councils must be increased to reflect the defects currently under appraisal. There must also be flexibility to carry out, and charge for, additional inspections if necessary.

Second, all builders should be registered, and registration must require proof of appropriate skills and qualifications. Allied to that, anyone other than a registered builder must be prohibited from being allowed to carry out any construction work.

Building consents would be issued only to registered builders. And all registered builders should be required to contribute annually to an industry indemnity fund to meet claims arising from faulty work.

Third, all property developers involved in constructing units and houses must also be made to contribute to the builders' indemnity fund, and be held accountable in law, with the builder, for building defects.

Fourth, councils should have the power to call for a bond for any new development from developers and builders to provide security for possible costs to councils in pursuing rectification of faults.

Finally, in relation to the standard and performance of building materials and products, a revised set of procedures must be introduced, including the requirement for new products to be performance-bonded for an appropriate number of years until proved reliable.

These measures would add to the cost of new homes or reduce profits for builders and developers. But they would also provide a much more robust system of building control and give greater confidence to home-buyers.

* David Thornton is a member of the Glenfield Community Board and a former North Shore City councillor.

* If you have information about leaking buildings,
email the Herald or fax (09) 373-6421.

Further reading
Feature: Leaky buildings

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