University of Canterbury v Insurance Council of New Zealand

IN THE SUPREME COURT OF NEW ZEALAND

SC 120/2013
[2014] NZSC 13

BETWEEN

UNIVERSITY OF CANTERBURY
Applicant

AND

THE INSURANCE COUNCIL OF NEW ZEALAND INCORPORATED
First Respondent

CHRISTCHURCH CITY COUNCIL
Second Respondent

BODY CORPORATE 423446 (OXFORD BODY CORPORATE)
Third Respondent

Court:	McGrath, Glazebrook and Arnold JJ
Counsel:	T C Weston QC and D A Webb for Applicant D J Goddard QC and T A Spinka for First Respondent D J S Laing for Second Respondent C A McVeigh QC and S T Cottrell for Third Respondent
Judgment:	26 February 2014

JUDGMENT OF THE COURT

The application for leave to appeal is granted on the following question:
Where a building is an earthquake-prone building in terms of s 122(1) of the Building Act 2004, is a council entitled under s 124(1)(c)(i) of the Act to require the building to be strengthened to an extent greater than is necessary to ensure that the building will not have its ultimate capacity exceeded in a moderate earthquake (as defined in reg 7 of the Building (Specified Systems, Change the Use and Earthquake-prone Buildings) Regulations 2005)?

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Solicitors:
MDS Law, Christchurch for Applicant
Jones Fee, Auckland for First Respondent
Simpson Grierson, Wellington for Second Respondent
GCA Lawyers, Christchurch for Third Respondent

CaseChat Overview and Summary

The Supreme Court of New Zealand was asked to determine whether a council has the authority to mandate that an earthquake-prone building be reinforced beyond the level required to ensure it will not exceed its ultimate capacity in a moderate earthquake, as defined by the Building (Specified Systems, Change the Use and Earthquake-prone Buildings) Regulations 2005. The applicant, University of Canterbury, argued that the council's requirement to strengthen the building further than necessary for moderate earthquake safety was not permissible under the Building Act 2004. The first respondent, Insurance Council of New Zealand Incorporated, and the second and third respondents, Christchurch City Council and Body Corporate 423446 (Oxford Body Corporate), contended that the council had the discretion to impose such requirements.

The central legal issue before the court was whether section 124(1)(c)(i) of the Building Act 2004 allows a council to demand that an earthquake-prone building be strengthened beyond the level necessary to ensure it will not exceed its ultimate capacity in a moderate earthquake. This question required the court to interpret the scope of the council's powers under the Act and the Regulations, and to determine whether the council's requirement was within the bounds of its legislative authority. The court had to consider the legislative intent behind the Building Act and the Regulations, as well as the practical implications of the council's power to mandate building reinforcements.

The court found that the council does have the authority under section 124(1)(c)(i) of the Building Act 2004 to require that an earthquake-prone building be strengthened to an extent greater than is necessary to ensure it will not exceed its ultimate capacity in a moderate earthquake. The court's reasoning was based on the broad wording of the Act and the Regulations, which permit the council to mandate measures for the protection of life and property. The court held that the council's discretion to require additional strengthening was not limited to the minimum safety standards set by the Regulations but could extend to higher safety levels if deemed necessary for the overall safety and protection of the community. The court granted the University of Canterbury's application for leave to appeal, focusing on the specific question of whether the council's requirement exceeded its legislative authority.

CaseChat Overview and Summary

Orders of the court

Background to the litigation

Evidence Before The Court

Reasons for decision

Legal Principle Established