Auckland Council v Weathertight Homes Tribunal
[2016] NZCA 256
•14 June 2016
| IN THE COURT OF APPEAL OF NEW ZEALAND |
| CA552/2015 [2016] NZCA 256 |
| BETWEEN | AUCKLAND COUNCIL |
| AND | WEATHERTIGHT HOMES TRIBUNAL |
| AND | THE CHIEF EXECUTIVE OF THE MINISTRY OF BUSINESS, INNOVATION AND EMPLOYMENT |
| AND | BODY CORPORATE 19500 |
| AND | GEFEI LIANG & OTHERS |
| CA564/2015 | |
| BETWEEN | JAMES HARDIE NEW ZEALAND |
| AND | WEATHERTIGHT HOMES TRIBUNAL |
| AND | THE CHIEF EXECUTIVE OF THE MINISTRY OF BUSINESS, INNOVATION AND EMPLOYMENT |
| AND | BODY CORPORATE 19500 |
| AND | GEFEI LIANG & OTHERS |
| Hearing: | 9 February 2016 |
Court: | Ellen France P, Stevens and Winkelmann JJ |
Counsel: | S C Price, J K Wilson and H E Gillies for Appellant in CA552/2015 |
Judgment: | 14 June 2016 at 2.30 pm |
JUDGMENT OF THE COURT
AThe appeals are dismissed.
B The appellants must pay the respondents costs for a standard appeal on a band A basis and usual disbursements.
____________________________________________________________________
REASONS OF THE COURT
(Given by Ellen France P)
Table of contents
Para No
Introduction [1]
Background [3]
The statutory scheme [13]
Part 1 of the 2006 Act [14]
Part 2 of the 2006 Act [19]
The effect of s 141 [24]
Does s 141(4) apply to all claimants in the new claim? [25]
Our analysis [26]
Conclusion [46]
Does the new claim still have to independently meet the eligibility criteria? [47]
Discussion [48]
Result [55]
Introduction
The Weathertight Homes Resolution Services Act 2006 (the 2006 Act) repealed and replaced the Weathertight Homes Resolution Services Act 2002 (the 2002 Act). The issue on appeal concerns the effect of s 141 of the 2006 Act. A transitional provision, s 141 describes how existing claims which have been determined to meet the eligibility criteria under the 2002 Act but are yet to reach adjudication may be dealt with under the Act. Section 141(1) allows those 2002 Act claimants to withdraw their claims without meeting requirements for withdrawal that otherwise apply, but only if they do so to be part of or join a new representative multi-unit complex claim brought in respect of the dwellinghouse, common areas or both. Section 141(4) also provides that if having withdrawn their existing claim they then, within one year, join a new claim, the “stop-the-clock” date for that new claim under s 37 of the 2006 Act is the date the withdrawn 2002 Act claim was brought. Section 37 provides that for the purposes of the Limitation Act (and any other enactment that imposes a limitation period), applying for an assessor’s report under the 2006 Act has effect as if it were the filing of proceedings in a court.
It is common ground that s 141(4) allows the existing 2002 Act claimant to rely on the date their 2002 Act claim was brought for the purpose of the stop-the‑clock provision in s 37. The first issue raised by the appeals is whether all of the claimants represented in the new claim receive the benefit of the existing claimants’ preserved position on limitation, or rather just the existing 2002 Act claimants. The second issue is whether the new claim must independently meet the eligibility requirements of the Act. We address these questions after setting out the background and the statutory scheme.
Background
The Oteha Valley Estate is an 18-unit residential complex in Auckland with weathertightness issues. The cost of repairing the complex is estimated at $2.84 million.
The code compliance certificate for the complex was issued on 3 May 2000. Accordingly, the 10-year long-stop period applying to civil proceedings relating to the complex came to an end on 3 May 2010.[1] The owners of units H, O and Q (the 2002 Act claimants)[2] brought individual claims under the 2002 Act within the 10‑year long-stop period.[3] Their claims were determined eligible by an evaluation panel under the 2002 Act. That decision meant the claims were able to be resolved under the 2002 Act.
[1]Building Act 1991, s 91(2); and Building Act 2004, s 393(2).
[2]The fourth respondents comprise the 18 unit owners.
[3]Of the remaining 15 units, 13 were previously the subject of individual claims under the 2002 Act that were withdrawn or terminated due to ineligibility or the sale of the property.
After the 2006 Act came into force, two of the three 2002 Act claimants withdrew their individual 2002 claims to join a new claim, described as a multi-unit complex claim, made under the 2006 Act by Body Corporate 19500, the third respondent.[4] This new multi-unit complex claim was made on 9 November 2012, that is, after the 3 May 2010 cut-off date in terms of the 10-year long-stop but within a year of the withdrawal of the 2002 Act claims.
[4]The third remained an individual claim but, subsequent to the Chief Executive’s eligibility decision, this claim was consolidated with the new multi-unit complex claim by order of the Weathertight Homes Tribunal.
The Chief Executive of the Ministry of Business, Innovation and Employment, the second respondent, decided the new claim met the eligibility criteria under the 2006 Act including the requirement that the complex was built within the period of 10 years immediately before the day on which the claim is brought (the 10-year eligibility window).[5] The Chief Executive did so on the basis s 141 of the 2006 Act permitted this course.
[5]Weathertight Homes Resolution Services Act 2006, s 16(a) [the 2006 Act].
The Weathertight Homes Tribunal (the Tribunal) agreed with the Chief Executive’s decision and declined an application by the Auckland Council, one of the appellants, to remove the unit owners whose claims were brought outside of the 10-year long-stop period.
The Council sought judicial review in the High Court, arguing that both the Tribunal’s decision and the Chief Executive’s eligibility decision were based on an error of law. The second of the appellants, James Hardie New Zealand, was joined as a second plaintiff to the proceeding.[6]
[6]The Tribunal, the first respondent in both appeals, abides the decision of the Court on appeal.
Keane J declined the application for review.[7] The Judge considered s 141(4) deemed the new multi-unit complex claim to have been brought on the date on which the withdrawn 2002 Act claims were commenced.[8] This meant all of the claimants represented in the new claim received the benefit of the earlier date for the stop-the-clock provision in s 37. Keane J found this interpretation was consistent with the purposes of the 2006 Act, namely, to provide “access to speedy, flexible and cost‑effective procedures for the assessment and resolution of claims” and a measure of “financial assistance … to facilitate repair”.[9] Equally, it was consistent with the whole of complex approach inherent in the 2006 Act.[10] Finally, Keane J said, the limitation in s 141(4) requiring a multi-unit complex claim to be brought within one year of an extant 2002 Act claim being withdrawn prevents undue prejudice to respondents, who are already on notice as a result of the extant claim.[11]
[7]Auckland Council v Weathertight Homes Tribunal [2015] NZHC 2098 [High Court judgment].
[8]At [39].
[9]At [42] citing the 2006 Act, s 3.
[10]At [42].
[11]At [44].
Section 141(4) is accordingly a particular focus on these appeals. The subsection provides:
If, within 1 year after the claim is withdrawn to enable a new claim of the kind referred to in subsection (1) to be brought, a claim of that kind is brought, section 37 applies to the new claim as if it were brought when the claim was brought.
Section 37(1), in turn, states:
For the purposes of the Limitation Act 2010 (and any other enactment that imposing a limitation period), the making of an application under section 32(1) [essentially, bringing the claim] has effect as if it were the filing of proceedings in a court.
Section 37(2) provides that the section is subject to various other provisions including s 141.
The statutory scheme
The 2006 Act is in two main parts. Part 1 deals with weathertight homes resolution services. It makes provision for claims to be brought and, if eligible, to be dealt with by the processes provided for under the Act. Claims may be mediated or may be the subject of adjudication by the Tribunal established under the Act. Part 2 of the 2006 Act provides for amendments consequential on the repeal of the 2002 Act and sets out a number of transitional arrangements.[12]
Part 1 of the 2006 Act
[12]The 2006 Act, s 4(i).
Part 1 makes provision for different types of claims relating to weathertightness issues.[13] One of the significant changes introduced by the 2006 Act was the shift to a whole of building or whole of complex approach.[14] Broadly, the conception is that a single claim should be filed in relation to a multi-unit complex rather than a series of individual claims relating to individual units within the complex in order that the complex can be made weathertight.
[13]Schedules 1 and 2 provide a diagrammatic overview of the types of claims possible under the Act: s 5.
[14]Weathertight Homes Resolution Services Amendment Bill 2006 (75–1) (explanatory note) at 3.
This whole of complex approach is reflected in the provisions in the 2006 Act enabling representative claims to be brought in relation to dwellinghouses in a multi‑unit complex. A “dwellinghouse” relevantly means a building or an apartment, flat or unit within a building that is principally intended for occupation as a private residence.[15] A “multi-unit complex” means a complex, which may or may not be standalone, that contains two or more dwellinghouses, and one or more, or no, common areas and is a company-share complex, a cross-lease complex or a unit title complex.[16]
[15]Section 8, definition of “dwellinghouse”.
[16]Section 8, definition of “multi-unit complex”.
A claimant brings a claim under the 2006 Act by applying for an assessor’s report.[17] A “claim” is defined as a claim by the owner of a dwellinghouse that the owner believes, broadly, arises from water damage resulting from a design or construction flaw or from the materials used.[18] A “claimant” is relevantly a person who applies to the Chief Executive to have an assessor’s report prepared.[19] The claim is assessed for eligibility and, if found eligible, is investigated and evaluated by an assessor.[20] The claim is then dealt with by the Tribunal or may be mediated.[21]
[17]Sections 9 and 32; and see Osborne v Auckland Council [2014] NZSC 67, [2014] 1 NZLR 766 at [6](d).
[18]Section 8, definition of “claim”.
[19]Section 8, definition of “claimant”.
[20]Section 10 and subpt 4 of pt 1; and see Osborne v Auckland Council, above n 17 , at [6](e).
[21]Subparts 5 and 6.
The eligibility criteria for a multi-unit complex claim are set out in s 16. The claimant must be the representative of the owners of the dwellinghouses in the multi‑unit complex to which the claim relates. For present purposes the key criterion is that the complex has to have been built before 1 January 2012 and within the period of 10 years immediately before the day on which the claim is brought.[22] The complex must also have suffered damage as a result of water penetration resulting from an aspect of the design, construction or alteration of the building or of materials used in its construction or alteration.[23]
[22]Section 16(a).
[23]Section 16(b)–(c).
Representative claims for dwellinghouses in multi-unit complexes must be brought in the way set out in s 19. Of note are the requirements that the representative be authorised by the owners and that the owners together own at least 75 per cent of the dwellinghouses in the complex.[24]
Part 2 of the 2006 Act
[24]Section 19(a)–(b).
The 2002 Act is repealed by the 2006 Act.[25] As we have foreshadowed, pt 2 of the 2006 Act makes transitional arrangements following on from that repeal.
[25]The 2006 Act, s 126.
These transitional arrangements cover four possible situations reflecting the differing stages the 2002 Act claim may have reached.[26] For example, the first possibility is that a claim has been made but, prior to the transition date, eligibility has not been decided or is under review.[27] For each of the situations identified the 2006 Act sets out how pt 1 is to apply.
[26]Section 128.
[27]Section 129.
Subpart 4 is the subpt relevant to the present claims, that is, 2002 Act claims where the decision has been made they are eligible but where the claims are not in mediation or adjudication before the transition date of 1 April 2007.[28] Section 134 sets out the claims to which the subpt applies.
[28]Section 4(i).
Section 135 describes how pt 1 of the Act applies to the claim as follows:
(1)Part 1 applies to the claim as if it was one brought under this Act and that had reached the same stage, or the nearest equivalent stage, under this Act, and, in particular, any adjudication of it must be undertaken by the tribunal, on an application under section 62 to have it adjudicated.
(2)This section applies even if the claim does not comply with section 13 (eligibility criteria).
(3)This section is subject to sections 136 to 141.
Section 141 is the key provision for the purposes of this appeal. The section provides as follows:
141New claim in respect of same dwellinghouse, etc, in multi-unit complex
(1)The claim may, if it relates to a dwellinghouse, common areas, or both, in a multi-unit complex, be withdrawn, at the claimant’s discretion and without complying with section 67, for the purpose only of enabling the claimant, as soon as is practicable, to be part of, or to join, a new claim brought in respect of the dwellinghouse, common areas, or both under section 19, 20, or 21.
(2)If the claimant is part of, or joins, a new claim of the kind referred to in subsection (1), Part 1 applies to the new claim.
(3)Subsection (2) is subject to subsections (4) and (5).
(4)If, within 1 year after the claim is withdrawn to enable a new claim of the kind referred to in subsection (1) to be brought, a claim of that kind is brought, section 37 applies to the new claim as if it were brought when the claim was brought.
(5)Subsection (4) applies whether the claim concerned was withdrawn before, on, or after the transition date.
(6)This section overrides section 135, and does not limit the application to the claim of section 67.
The effect of s 141
We address the two questions that arise in turn, first whether s 141(4) applies to preserve the position of all claimants for the purposes of limitation in the new claim or just the transitioning 2002 Act claimants. Secondly, whether the new claim must still independently meet the eligibility criteria, particularly, the requirement the claim is brought within the 10-year eligibility window.
Does s 141(4) apply to all claimants in the new claim?
The appellants take broadly the same position on this issue. Their key proposition is that s 141(1) and (4) apply only to the specific dwellinghouse which is the subject of the 2002 Act claim. They emphasise that the focus of these provisions is on enabling the 2002 Act claimant to transition to the new regime. There is no warrant in the statutory wording to extend the benefit of the stop-the-clock date to other (non-transitioning) claimants. To do so would amount to a windfall.
Our analysis
Section 141(1) allows a 2002 Act claimant to withdraw his or her claim for the sole purpose of enabling the claimant to join a new claim. There is no dispute about that. Section 141(4) then deals with the consequences, in terms of s 37, on “the new claim”. It is plain on the wording of subs (4) that the “new claim” referred to is the new multi-unit complex claim contemplated by s 141(1). When the phrase “new claim” is read in this way, it is apparent this means the whole claim, not just the claim made by the 2002 Act claimant. That this is the correct interpretation of “new claim” is apparent if the steps envisaged by subs (4) are analysed.
First, under s 141(4) the 2002 claim must be withdrawn “to enable a new claim of the kind referred to in subs (1) to be brought”. The concept of “enabling” the new claim suggests more than solely a focus on the 2002 Act claim. The reference back to a claim of the kind contemplated by subs (1) is obviously a reference to the new multi‑unit complex claim. Secondly, a claim “of that kind”, that is, one contemplated by subs (1), must be brought within one year of the withdrawal of the 2002 Act claim. If the two prerequisites are met, the stop-the-clock provision in s 37 applies to the new claim “as if it were brought when the claim was brought”. “The claim” referred to must be the 2002 Act claim and the reference to “it” being brought within time makes no sense unless “it” refers to the new claim. Accordingly, the plain wording of s 141(4) leads to the interpretation adopted by the Judge.
The appellants also submit that the Judge’s approach has the effect of overriding their accrued rights, namely, their limitation defences in respect of the unit owners without extant 2002 Act claims.[29] However, our view is that the legislature has expressly provided for that.
[29]Yew Bon Tew v Kenderaan Bas Mara [1983] 1 AC 553 (PC) at 563.
It is helpful at this point to address the appellants’ submission that the transitional nature of s 141 suggests the focus is on consequences for the transitioning 2002 Act claimants only.
There are textual considerations supporting the appellants’ emphasis on the transitional nature of s 141. The overview of the 2006 Act describes pt 2 as transitional in nature and as specifying how claims under the 2002 Act are to be transitioned. Section 4(i) states that the relevant subpts of pt 2 repeal the 2002 Act, make consequential amendments and “[specify] how Part 1 … applies to, … claims under [the 2002 Act] that have not been disposed of before the transition date”. Section 128, which describes the various categories of claims dealt with in subpts 3 to 6, also provides that the application is to claims under the 2002 Act at their various stages prior to the transition date.
Further, pt 2 is headed “Repeal, consequential amendments, and transitional provisions”. Subpart 2 similarly is expressed to be an “Overview of transitional provisions for claims” under the 2002 Act that are not disposed of before the transition date.
Finally, other provisions in subpt 4 are transitional in nature. For example, s 136 makes it plain that if the claimant has paid the mediation fee required under the 2002 Act, the amount paid does not have to be refunded. But, if the claimant initiates adjudication on or after the transition date, the fee payable must be reduced by the amount already paid.
However, s 141 is not the usual type of transitional provision in that it provides to persons with existing claims under the 2002 Act the option of joining a type of claim, the representative multi-unit complex claim, which is new to the 2006 Act. In addition, there are other indications that suggest the scheme of the Act is not confined in the way suggested by the appellants.
The first point relates to s 54. That section adopts the same wording as s 141(4) in dealing with how s 37, the stop-the-clock provision, applies where a claim is terminated under ss 52(4) or 53(4). If the appellants’ approach to the treatment of s 37 in s 141(4) was applied in the context of s 54, as we shall explain, that would lead to some gaps which appear unintended.
The Chief Executive or the Tribunal must terminate claims brought in respect of a dwellinghouse in a multi-unit complex in certain circumstances.[30] For example, if a claim is brought in respect of a dwellinghouse in a complex and it subsequently emerges there is likely to be damage to other dwellinghouses in the complex, the Chief Executive must terminate the claim.[31]
[30]The 2006 Act, ss 52 and 53.
[31]The 2006 Act, s 52(1)(ii) and (4).
Section 54 provides for the application of s 37 where a claim is terminated in this way. The section reads as follows:
54Application of section 37 if claim terminated under section 52(4) or 53(4)
(1)This section applies if, within 1 year after the termination under section 52(4) or 53(4) of a claim to which section 52(1) or (2) or (3) or 53(1) or (2) or (3) applies,—
(a)a claim is brought under section 19 in respect of dwellinghouses including the dwellinghouse in respect of which the terminated claim was brought; or
…
(2)Section 37 applies to the claim under section 19 as if it were brought when the terminated claim was brought.
As Mr Stephen for the Chief Executive submits, under the 2006 Act, the ability to bring an individual claim for a single dwellinghouse in a multi-unit complex is limited.[32] That is because of the emphasis on the whole of complex approach. Accordingly, where a single dwellinghouse claim is eligible but a claim is later brought in relation to other parts of the complex or other damage is likely, the effect of the termination provisions in ss 52 and 53 of the Act is that the single dwellinghouse claim will be terminated. If the appellants’ narrow interpretation to the reference to s 37 is applied to s 54(2), unit owners with an originally eligible single dwellinghouse claim would, in some circumstances, have no avenue for recovery under the Act because a new multi-unit complex claim would be outside the 10-year eligibility window.
[32]Section 15(e) says such a claim can only be brought by an owner of a dwellinghouse in a multi‑unit complex where there is no damage to other parts of the complex.
The second point arising out of the statutory scheme is that it is difficult to see what purpose s 141 serves on the appellants’ analysis. As the respondents note, owners can be added to a multi-unit complex claim prior to adjudication.[33] Further, under s 138 the Tribunal ordinarily must consolidate individual claims that relate to the same multi-unit complex. While, on the appellants’ analysis, s 141 would at least ensure there was no bar to withdrawal, the mechanics provided for by s 141 on their approach would be a complicated response to that issue.
[33]The 2006 Act, s 26. On the appellants’ approach, it would be necessary to fashion a mechanism to allow the 2002 Act claimants who withdrew their claims the opportunity to have those withdrawn claims reinstated.
The third point is that the interpretation adopted by Keane J is also consistent with the move in the 2006 Act to a whole of complex approach and, accordingly, with the statutory purpose of getting buildings with weathertightness issues fixed in a speedy and cost‑effective manner.
The policy concern at the need for effective resolution of claims is a point made in both Auckland Council v The Chief Executive of the Ministry of Business, Innovation and Employment (Bamford)[34] and Body Corporate 85978 v Wellington City Council (St Paul’s),[35] albeit these cases deal with different statutory provisions. In Bamford and St Paul’s, additional claimants were able to “coat-tail” on an existing claim thereby avoiding any limitation issue.[36] Further, in Bunting v Auckland City Council, Duffy J saw the predecessor to s 37 as “balancing the rights of potential defendants to enjoy the protection of limitation periods against the needs of the claimants”.[37] The Judge saw this and other features of the Act as consistent with the statutory purpose.
[34]Auckland Council v The Chief Executive of the Ministry of Business, Innovation and Employment [2013] NZHC 912.
[35]Body Corporate 85978 v Wellington City Council [2013] NZHC 2852 [St Paul’s].
[36]St Paul’s, above n 35, at [43].
[37]Bunting v Auckland City Council HC Auckland CIV-2007-404-2317, 13 August 2008 at [18].
In Kells v Auckland City Council, Asher J noted that in addition to ss 54(2) and 141(4), ss 152(4) and 155(5) also provide for s 37 to apply to the “re-constituted claims as if they were brought when the original terminated claim was brought”.[38] The Judge said these provisions indicated the 2006 Act intended the clock would stop “for all purposes” when the initial request for an assessor’s report is made.[39] The context in which this observation was made was different but it is supportive of the approach to s 141(4) adopted by Keane J in the present case.
[38]Kells v Auckland City Council HC Auckland CIV-2008-404-1812, 30 May 2008 at [36].
[39]At [37].
The move to a whole of complex approach aimed to remove various barriers to claimants under the 2002 Act. For example, under the 2002 Act regime the body corporate might require every individual dwellinghouse owner to consent to a claim for common areas. Further, it is often the case that respondents across individual claims are the same, for example, the one construction company responsible for the complex. There were also difficulties for assessment of damage when assessment focussed on an individual dwellinghouse rather than the whole complex. Generally damage is suffered across a complex and repairs have to be made across it.
There is a helpful summary of the barriers that the new approach aimed to address in the background reports of the Department of Building and Housing provided to the select committee on the 2006 Bill. The report noted:[40]
Issues with approach under present WRHS Act
9The [2002] Act allows for a claim from a single dwellinghouse owner in a multi-unit complex. This creates problems for resolving claims that relate to multi-unit complexes. For instance, the damage suffered by a dwellinghouse (residential unit) on the 5th floor of a 10th floor apartment building is likely to be linked to damage in other areas in the building. To fully understand and address liability issues for the dwellinghouse, it may be necessary to examine other parts of the complex and to consider factors that relate to the complex as a whole.
10If damages were awarded for such a dwellinghouse in WHRS adjudication, the owner may encounter difficulties in repairing the dwellinghouse. It may be necessary to repair areas of the complex outside the individual dwellinghouse to prevent further damage to the dwellinghouse (eg further leaks coming from upper floors) or the claimant may be hindered from undertaking repairs if the cladding is jointly owned.
…
Bringing a multi-unit complex claim
12As far as practicable, claims for multi-unit complexes should promote a ‘whole of complex’ approach. Generally, damage is suffered across a complex and repairs need to be undertaken across the whole complex. Often, the same people are likely to be respondents for the whole complex (eg there was one designer for the whole complex, one developer, and one construction company involved). It is more effective, practical, and efficient for all claims relating to the same complex to be dealt with together as if they were one claim.
[40]Department of Building and Housing Background report to the Social Services Select Committee on the Weathertight Homes Resolution Services Amendment Bill (September 2006).
The Department expanded on the benefits in its later report responding to the select committee’s request for further information on the whole of complex approach.[41]
[41]Department of Building and Housing Departmental Report to the Social Services Select Committee: Additional Information requested to assist with consideration of the WHRS Amendment Bill (October 2006) at 1–2.
The legislative history is otherwise not particularly helpful. The select committee report on the 2006 Bill recorded that there were two situations in which new claims could “piggy-back” on an earlier claim “stopping the clock” for limitation purposes and allowing the original date of the claim to be regarded as the date of the new claim, namely, what is now s 54 and ss 152 and 155, which apply to eligible claims under the 2002 Act that are in adjudication before the transition date.[42] The report recorded:[43]
The first instance is in new clause 54, which applies when a claim is terminated because further damage is found that makes it ineligible under the provision under which it was first brought, and the claim needs to be resubmitted under a different provision. The other instance is in new clauses 150(4) and (5) and 153(5) and (6). These new clauses allow claimants who are in the process of WHRS adjudication to withdraw their claims and to file new proceedings with the tribunal, without being affected by limitation periods having expired. …
We also recommend that the bill make it clear when a “piggy-back” arrangement applies to a claim under the former Act that is withdrawn. Under new clauses 150(4) and 153(5), the “piggy-back” arrangement applies to the claim if it was withdrawn
·before or after the transition date under the new Act; but
·expressly for the purpose of making an application to the tribunal to adjudicate the withdrawn claim, or for the purpose of bringing or joining a new claim under the new Act in respect of the same dwellinghouse, common areas, or both.
Conclusion
[42]Weathertight Homes Resolution Services Amendment Bill 2006 (75–2) (select committee report) at 3. Section 141 was inserted into the Bill as cl 139A by a supplementary order paper after the select committee stage: Supplementary Order Paper 2006 (83) Weathertight Homes Resolution Services Bill 2006 (75–2).
[43]At 3.
For these reasons, Keane J was correct to interpret s 141(4) as allowing all of the claimants represented in the new multi-unit complex claim to receive the benefit of the date of the 2002 Act claim for the stop-the-clock provision in s 37. We agree with the Judge that approach reflects both the wording of the provisions and their purpose.
Does the new claim still have to independently meet the eligibility criteria?
The appellants say that s 141 and s 37 deal only with limitation issues. It follows, on their analysis, that a new multi-unit complex claim has to independently meet the eligibility requirements in pt 1 of the 2006 Act. In particular, the new claim must meet the requirement that the new multi-unit complex claim was made within the 10-year window.[44] They say Keane J has conflated concepts of eligibility and limitation. This argument turns in part on the proposition that eligibility and limitation are distinct concepts and on the wording of ss 135 and 141(2).
Discussion
[44]Section 16(a).
The interrelationship between eligibility and limitation was dealt with by the Supreme Court in Osborne v Auckland Council.[45] The Supreme Court in that case was considering s 14(a) of the 2006 Act, that is, the requirement that a dwellinghouse claim relate to a dwellinghouse built within the 10-year period before the day on which the claim was brought.
[45]Osborne v Auckland Council, above n 17.
The Court described eligibility as an assessment of a “screening” nature and not one involving the determination of “closely balanced issues”, which may be required in deciding on the availability of a limitation defence.[46] However, it is plain there is considerable overlap between the concepts. Hence, the Supreme Court said there were a number of difficulties with the notion that s 14(a) should be interpreted as imposing “an independently operating limitation period which is virtually, but not exactly, the same as the 10-year long-stop limitation period in s 393 of the Building Act [2004]”.[47] The Court concluded that s 14(a) should be interpreted as operating only to exclude claims necessarily barred by s 393.[48] Accordingly, if a claim is brought within the long-stop in s 393, it will meet the s 14(a) eligibility criterion.
[46]At [30].
[47]At [24].
[48]At [24].
The Supreme Court concluded that the legislative history suggested the purpose of s 14(a) was to “align” the eligibility criteria with the operation of s 393.[49] The eligibility criterion in s 14(a) was therefore “in substance” a limitation period.[50]
[49]At [17].
[50]At [24].
The fact the concepts are aligned in this way is not a complete answer to the appellants’ argument. However, the telling point against the appellants’ argument conceptually is that it would mean the eligibility criteria also applied to the 2002 Act claimant in the new claim. Since the appellants accept that s 141(4) gives the 2002 Act claimants the benefit of the s 37 stop-the-clock provision, it would be odd if they nevertheless were tripped up by the eligibility hurdle.[51] That would mean that an administrative screening tool was depriving parties of substantive rights.
[51]The same reasoning would apply to s 54.
The appellants also rely on the wording of ss 135 and 141. They point out that although s 135 provides that pt 1 applies to existing claims, even where those claims do not meet the pt 1 eligibility criteria, s 135 is subject to s 141. And s 141(6) states that s 141 “overrides s 135 and does not limit the application to the claim of s 67”. On the appellants’ argument “overrides” means that s 135 does not apply to claims where the s 141(1) process is used by existing claimants.
We consider s 141(6) can be given a sensible meaning. Section 135(1) provides that claims in this category will, in the normal course, continue on under pt 1, and must be adjudicated by the Tribunal if the claimant applies. That is the usual course. Section 141(1) creates an alternative pathway. Therefore, subs (1) overrides s 135 to that extent. “Overrides” in this context means where there is a meeting of provisions dealing with the same thing, one trumps the other.
Accordingly, we consider the new claim did not need to independently meet the s 16(a) eligibility criterion in that the date for eligibility is the date the 2002 Act claim was brought.[52]
Result
[52]This is in contrast to the other provisions in the 2006 Act which state that the eligibility criteria do not apply to a transitioning claim, that is, ss 133(1), 150(2), and 153(2).
For these reasons, the appeals are dismissed. The eligibility decision of the Chief Executive of the Ministry of Business, Innovation and Employment is confirmed.
The parties agree costs should follow the event. The appellants must pay the respondents costs for a standard appeal on a band A basis and usual disbursements.
Solicitors:
Minter Ellison Rudd Watts, Auckland for Appellant in CA552/2015
Chapman Tripp, Auckland for Appellant in CA564/2015
Crown Law Office, Wellington for Second Respondent in CA552/2015 and CA564/2015
Rainey Law, Auckland for Third and Fourth Respondents in CA552/2015 and CA564/2015
1
4
0