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Johnson v Auckland Council

Johnson v Auckland Council

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IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

CIV-2010-404-837 [2013] NZHC 165

BETWEEN ROSS WAYNE JOHNSON, LINDA JEAN JOHNSON AND FIRST INVESTMENT TRUST LIMITED
Plaintiffs

ANDAUCKLAND COUNCIL Defendant

ANDSTEPHEN ROY JOHNSTON Third Party

Hearing: 21, 22, 23, 24, 25, 28 and 29 May 2012

Counsel: G B Lewis and L V Chapman for the Plaintiffs S A Thodey and K M Parker for the Defendant I J Thain and C Stacey for the Third Party

Judgment: 11 February 2013

JUDGMENT OF WOODHOUSE J

This judgment was delivered by me on 11 February 2013 at 4:30 p.m. pursuant to r 11.5 of the High Court Rules 1985.

Registrar/Deputy Registrar
……………………………………

Solicitors:
Mr G B Lewis / Ms L V Chapman, Grimshaws, Solicitors, Auckland
Mrs S A Thodey / Ms K M Parker, Heaney & Co., Solicitors, Auckland
Mr I Thain / Ms C Stacey, DLA Phillips Fox, Solicitors, Auckland

JOHNSON V AUCKLAND COUNCIL HC AK CIV-2010-404-837 [11 February 2013]

Table of Contents

Para No.

Introduction [1]
Contributory negligence: principles
The Contributory Negligence Act [8] Fault of the plaintiff [11] Causation [12] The standard of care [13] The plaintiffs’ submissions [18]

The evidence
1998-2004: building consent to code compliance certificate  [28]
Mr and Mrs Johnson’s house hunting  [32]
2009: O’Neills Avenue mortgagee sale: terms of sale  [35] Mr and Mrs Johnson’s renewed interest in O’Neills Avenue  [38] Evidence conflict: Mrs Johnson and Ms White  [43] Mrs Johnson’s discussions with Mrs Stevens  [49] Mr Johnston’s role and the third open home  [50] The reasonably prudent purchaser : expert legal opinion  [60] Mrs Johnson’s tender: conclusion of agreement to purchase  [62] Plaintiffs’ investigations of weathertightness: chronology  [69] What did visual inspection disclose?  [75] The plaintiffs’ original renovation intentions  [92] The plaintiffs’ interior renovations and remedial work: chronology:
expenditure  [95]
Valuation evidence  [100]

The conflicts of evidence between the witnesses of fact [104]
Mrs Johnson’s recollection of events [105] The conflict of evidence between Mrs Johnson and Mr Johnston [107] The conflict of evidence between Mrs Johnson and Ms White [122] The conflicts of evidence in general [126]

Contributory negligence: discussion and conclusion
Was there contributory negligence? [127]
Apportionment of liability [140]

Measure of damages
Principles [146] The plaintiffs’ submissions [161] Conclusion on the measure [172] Quantum [176]

Other claims of the plaintiffs [185] The Council’s claim against Mr Johnston [189] Result [190]

Introduction

[1] In April 2009 the plaintiffs purchased a residential property to be occupied as the home of the first two plaintiffs, Mr and Mrs Johnson, and their children.1

[2] Substantial alterations to the house had been carried out before the property was purchased by the plaintiffs. It is not in issue that this work was defective and as a result the house was not weathertight. The plaintiffs now claim from the defendant Council $1.925 million for the cost of repairs and some other sums for consequential losses. The plaintiffs contend that the Council was negligent in carrying out functions under the Building Act 1991. The Council admits that it was…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

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Details

Case: [2013] NZHC 165
Decision Date: 11 February 2013

CaseChat Overview and Summary

The case of Johnson v Auckland Council involved a dispute between the plaintiffs, Mr and Mrs Johnson and First Investment Trust Limited, and the defendant, Auckland Council. The plaintiffs sought damages for the cost of repairs and other consequential losses due to the defective construction of a residential property they purchased. The Council admitted negligence in failing to take reasonable steps to ensure that defects in the alteration work were rectified and that the alterations complied with the Building Code, and in issuing a code compliance certificate.

The primary legal issues in the case were whether there was contributory negligence by the plaintiffs, the proper measure of damages, and the quantum of the loss. The plaintiffs argued that they were entitled to the cost of repairs, while the Council contended that the measure of damages should be the diminution in value of the property. The court found that the normal measure of damages in cases of tortious negligence should be applied, which is the difference between the purchase price and the market value of the property in its affected state at the date of purchase.

The court also found that there was contributory negligence by the plaintiffs, as they failed to take reasonable steps to investigate the property's condition before committing to the purchase. As a result, the plaintiffs' damages were reduced by 30%. The final judgment awarded the plaintiffs $370,500 in damages, along with interest on the primary loss and general damages of $10,000 each for Mr and Mrs Johnson. The Council's claim against the third party, Mr Stephen Johnston, was dismissed.

Orders