Page 102 - Build 165

Departments/Legal
By Karen Shaw, Senior Associate, Harkness Henry, Hamilton
Building repairs that fail
Defective repair work is in the spotlight, including cases about Christchurch earthquake damage repairs and owners of leaky homes enduring a second round of repairs. What’s the situation when the xes fail?
IT IS WELL ESTABLISHED that claims for negligent building work become statute- barred after 10 years from the date of the work. However, what is the situation where repair works have been carried out and those works also fail to x a building defect? Is a new claim needed? Are those works time-barred as part and parcel of the original building defects, or is there a new claim for the failed work?
Claims regarding repairs can be more complicated to resolve due to such issues.
10 years from when repair work done
In 2003, the Court of Appeal considered this issue in Johnson v Watson. Mr and Mrs Johnson had engaged Mr Watson to build their home. In the years after their build, they noticed defects in the form of leaks and had Mr Watson return to the property several times to x them.
Eventually, however, the Johnsons brought a claim against Mr Watson for his negligent work. By this stage, it had been more than 10 years since their home was completed.
The Court of Appeal found the original work was time-barred.
However, the Court also acknowledged that the repair works could be a cause of loss alongside some of the original defects. The Court of Appeal said that it was su cient if
negligent prevention work was a substantial and material cause of loss. That work could be a new default that runs with the earlier fault so as to cause, or at least contribute to, the further damage that it was meant to prevent.
The result for the Johnsons was that parts of their claim against Mr Watson were not statute-barred. They could still make a claim for the negligent prevention works that had been carried out within 10 years of their issuing their proceedings. The onus was on them to prove that the losses owed from that negligent prevention work as opposed to the original statute-barred work.
When repairs didn’t cause more damage
In another decision, however, certain repairs had failed to x defects and damage to units in a body corporate property.
The Court of Appeal found that the contractor involved was not liable for failing to carry out a proper survey of the damage to the property. The contractor had expressly excluded liability for that in its contract with the body corporate.
100 — April/May 2018 — Build 165