Whiting v Earthquake Commission - [2014] NZHC 1736

IN THE HIGH COURT OF NEW ZEALAND CHRISTCHURCH REGISTRY

CIV-2013-409-000079 [2014] NZHC 1736

BETWEEN
JACQUELINE ELLEN WHITING AND

KENNETH JAMES JONES AND RICHARD SCOTT PEEBLES Plaintiffs

AND

THE EARTHQUAKE COMMISSION First Defendant

IAG NEW ZEALAND LIMITED Second Defendant

Judgment: 24 July 2014

JUDGMENT OF MANDER J (Dealt with on the papers)

Introduction

[1] The plaintiffs seek an award of costs against the first defendant (EQC). The plaintiffs sued EQC and the second defendant, IAG New Zealand Limited (IAG) alleging failure to settle claims in relation to earthquake damage caused to a house they purchased in May 2012.

[2] The plaintiffs allege that the conduct of EQC in not promptly meeting its statutory obligations necessitated the filing of proceedings. They say these proceedings ultimately succeeded in causing EQC to alter its position and meet its obligations. In turn that enabled the plaintiffs and the second defendant to settle the insurance claim.

[3] EQC resists any award of costs arguing that it has not admitted the claim and denies that it has breached any legal obligations owed to the plaintiffs. Further, that
it settled the plaintiff’s insurance claims independently of the proceedings and on the

WHITING v EARTHQUAKE COMMISSION [2014] NZHC 1736 [24 July 2014]

same basis that it would have otherwise settled in the absence of those proceedings having been issued. EQC submits costs should be awarded in its favour upon the discontinuance of the proceedings by the plaintiff.

Factual background

[4] In May 2012 the plaintiffs entered into an agreement for the sale and purchase of a house situated at 64 Garden Road, Christchurch. That agreement became unconditional in June 2012 and was settled in September of the same year. The vendor of the house made claims with IAG and EQC in respect of the September 2010, February 2011 and June 2011 earthquake events. Upon settlement of the sale, the vendors assigned these claims to the plaintiffs.

[5] At the time of the house purchase the plaintiffs were provided with a copy of EQC’s scope of works carried out in the wake of each earthquake event. They also obtained expert professional advice which agreed with the EQC assessment after the February 2011 earthquake that new foundations and piles would be required for the house. The plaintiffs’ experts advised that the cost to repair the house would be well over EQC’s statutory liability of $100,000 plus GST for one or more events.

[6] Mr Brendon Stiven, EQC’s manager of the Canterbury Home Repair Programme, has confirmed that inspections were carried out by EQC after each of the earthquakes. He deposes that as a result of these inspections the property was referred to EQC’s Canterbury Home Repair Programme (CHRP) in October 2012. Mr Stiven explained that the reference of a claim to CHRP indicates that EQC considers it likely that it will elect under s 29 of the Earthquake Commission Act (the Act) to reinstate earthquake damage rather than settle the insurance by payment. Repairs estimated at up to $100,000 plus GST…

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.

Continue reading Whiting v Earthquake Commission

Details

AGLC: Whiting v Earthquake Commission [2014] NZHC 1736
Case: [2014] NZHC 1736
Decision Date: 24 July 2014

CaseChat Overview and Summary

Whiting v Earthquake Commission [2014] NZHC 1736 was a case brought by the plaintiffs, Jacqueline Ellen Whiting and Kenneth James Jones and Richard Scott Peebles, against the Earthquake Commission (EQC) and IAG New Zealand Limited. The plaintiffs sought an award of costs against EQC after they alleged that EQC failed to settle claims in relation to earthquake damage caused to a house they purchased in May 2012. The plaintiffs argued that the conduct of EQC in not promptly meeting its statutory obligations necessitated the filing of proceedings. EQC resisted any award of costs arguing that it had not admitted the claim and denied that it had breached any legal obligations owed to the plaintiffs. The court had to decide whether the plaintiffs' litigation against EQC was reasonable and whether EQC's settlement of the claim represented vindication of the plaintiff’s decision to issue proceedings. The court found that the plaintiffs' litigation against EQC was reasonable and that EQC's settlement of the claim represented vindication of the plaintiff’s decision to issue proceedings. The court ordered that EQC pay to the plaintiffs 50% of the costs and disbursements set out in the schedule to the plaintiffs’ memorandum of 4 June 2014, with some adjustments made for the number of appearances at case management conferences.

Orders