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Home / Rotorua Daily Post / Property

$40k council's spend on sinking homes saga

Rotorua Daily Post
5 Aug, 2013 07:44 PM3 mins to read

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The Rotorua District Council has so far spent close to $40,000 on issues surrounding the troubled Oakland Estate subdivision.

But the council says any other legal fees are likely to be covered by insurers, but they can't yet be specific about the amount.

However, one of the affected homeowners, Grant Collins, said he didn't believe the council had only spent that much.

"It's a bloody load of hogwash... I know that people have spent a lot more than that fighting the council."

He said the council had had lawyers involved from when the appeal was lodged at the end of 2011 and he couldn't count the number of phone conferences the council's lawyer had been involved in.

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Mr Collins said he was aware of some affected parties who spent much more than that.

The developer of the subdivision, Geoff Kenny, said the amount spent by the council on legal fees was "small". He estimated he would have spent between $400,000 and $500,000 on legal bills and estimated the total amount spent by all parties involved on legal bills would have been well over $1 million.

Figures released under the Official Information Act show the council spent $18,570 on legal fees for its appeal against the Department of Building and Housing's reversal of the building consents and code of compliance certificates of Western Rd properties belonging to Mr Collins and his partner Shirley Vos, John and Eileen Grundy, Richard and Katy Davis.

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Subsidence had caused damage ranging from uneven floors and loose bricks to doors and windows which would barely close and cracks in foundation walls in their homes.

The council's corporate and customer services group manager, Jean-Paul Gaston, said the council's insurers retained legal counsel throughout the process. He said the council also spent about $30,000 on independent engineering advice.

Action was taken in the High Court involving the insurers of the initial engineers MTEC, insurers for the council and Mr Kenny, and affected parties were invited to make claims, of which several did.

Mr Gaston said there were additional legal costs for other matters relating to the wider issue but those were still being determined. He said most if not all legal costs would be covered by insurers.

Mr Kenny, the council and the engineers involved in the project reached a settlement with affected property owners worth more than $5 million.

Mr Collins said whatever amount spent on the appeal was a waste.

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