Milestone for owners of leaky homes
13 December 2006
Milestone for owners of leaky homes
Building and Construction Minister Clayton Cosgrove today announced a milestone in the Government’s response to the leaky homes problem, with the passing of the Weathertight Homes Resolution Services Bill 2006.
The new legislation will help the owners of leaky homes settle their disputes faster, hold those responsible to account, get compensation from the liable parties, fix their leaky homes, and it will also enhance consumer protection for homebuyers.
"The Government made a commitment in May this year to owners of leaky homes to shake-up the Weathertight Home Resolution Service (WHRS). By April next year the new improved service will be up and running," Mr Cosgrove said.
Mr Cosgrove thanked the many stakeholders who contributed their ideas to the revamp of the WHRS.
"I would like to express my gratitude to the Leaky Homes Action Group and in particular its spokesperson John Gray, the Consumers' Institute, the Registered Master Builders Federation, the Certified Builders Association, the Construction Industry Council, local government, others in the building and construction industry and the wider community for their invaluable input. Their contribution has helped ensure the new legislation is relevant, workable and will help New Zealanders."
Mr Cosgrove said the changes will benefit homeowners at every step of the claims process.
"WHRS claimants will receive a more comprehensive assessment of, and be able to claim for, actual and potential weathertightness damage to their house and the work needed to repair it. Claimants will also benefit from faster claim resolution and lower legal costs," he said.
Mr Cosgrove said the new Act:
- Establishes
a new Weathertight Homes Tribunal
- Provides more
comprehensive assessor reports that can be used as expert
evidence during the claims process
- Improves the
information, advice and guidance given to claimants
-
Establishes an expedited process for resolving lower value
claims
- Provides the opportunity for a class action
approach to multi- unit claims, such as for apartments and
terraced townhouses
"These changes will help people access a faster, lower-cost alternative to court proceedings to get compensation from the liable parties and get their homes fixed, so they can get on with their lives," Mr Cosgrove said.
NB: The Government's two-year lending assistance pilot for WHRS claimants who are unable to access finance from private lending institutions is expected to be in place for 1 April 2007 - at the same time as the planned start date for the changes brought about by the new Act. The scheme will be run by Housing New Zealand Corporation.
Background Information
What are the key measures in the Weathertight Homes Resolution Services Bill?
- More
comprehensive assessor reports for WHRS claimants so people
can claim for potential, as well as actual,
weathertightness-related damage
- A new streamlined
process for lower-value claims
- A new process for
standard claims, involving preliminary conferences and
time-limited mediation before claims move to
adjudication
- The establishment of a new Weathertight
Homes Tribunal under the administration of the Ministry of
Justice to provide more independent adjudication
services
- Enhanced power and authority of members of the
new Tribunal, including new criminal offence provisions when
parties fail to appear when summoned or disobey an order of
the Tribunal
- Clear objectives for Tribunal members to
facilitate a more investigative approach
- Appointing a
registrar for the new Weathertight Homes Tribunal
-
Allowing WHRS settlements and determinations to be enforced
in the District Court regardless of value
- A change to
the required voting thresholds for bodies corporate to make
it easier for a class action approach to be taken by owners
of units within apartment blocks
- Requiring territorial
authorities to place WHRS notices of new and existing claims
brought, and their outcomes, on Land Information Memorandum
(LIM) reports
- Allowing claims relating to multi-unit
complexes that will not be eligible under new criteria to
withdraw and be brought under the correct provision within
one year without affecting limitation periods
When does
the Act come into force?
Most of the provisions are
planned to come into force on 1 April 2007 by Order in
Council, but some provisions to establish the Weathertight
Homes Tribunal start from the date of enactment. The Act
provides for the WHRS Chief Adjudicator to be the chair of
the Tribunal.
How will the Act help owners of leaky
homes?
The main benefits for homeowners include the
ability to claim for a wider scope of damage; receipt of an
accurate and comprehensive assessment of the damage to their
house and what work is needed to repair it; improved
information and case management; reduction in the average
time for claims to be resolved; lower legal and evidential
costs; and a reduction in barriers to claims by bodies
corporate and owners of homes in multi-unit complexes.
How
do the WHRS reforms fit into the bigger picture?
The WHRS
enhancements are part of a package of Government reforms
aimed at ensuring homes are designed and built right the
first time. That package includes: the licensing of those
who design and build, while protecting the Do-It-Yourself
(DIY) culture, the review of the Building Code, an
accreditation and auditing scheme for Building Consent
Authorities, sector and consumer education, building product
certification, a financial assistance scheme pilot to help
owners of leaky homes and investigation into options for
home warranty and professional indemnity insurance.
ENDS