Brothel brothers won't be prosecuted over hotel collapse - council

Demolition crews move in to pull down the Palace Hotel in Victoria Street, Auckland last year. File photo

The Auckland Council will not prosecute the owners of a heritage hotel, which was last year at the centre of a demolition stand-off.

The 124-year-old Palace Hotel building in central Auckland was reduced to rubble after large cracks started appearing in its walls in November last year.

Michael and John Chow of the Chow Group purchased the building on Victoria Street for $3.3 million in 2008 and were renovating it for use as a brothel, to be ready in time for the Rugby World Cup, when the council order was made.

A council commission report later found that the owners had failed to ensure the building was being safely renovated and that the building was moving by up to 5 millimetres an hour towards the street when the decision was made to knock it down.

The council said at the time it was considering prosecuting the brothers, but today said it did not have strong enough evidence to do that.

General Counsel Wendy Brandon said the council had worked closely with several parties to examine all evidence and technical information obtained from its investigations into the hotel's collapse, and to determine what avenues of prosecution may be available.

"However, the advice Auckland Council has received is that there is not sufficient evidence as to the specific cause of the collapse to provide a reasonable prospect of a successful criminal or regulatory prosecution."

Brandon said the Chows had not paid the legal bill of more than $200,000 - the council's costs arising from the building's collapse - as far as she was aware, but that the bill was not in dispute.

Brandon said the total bill had risen by $50,000 to $100,000, largely due to damage done to the neighbouring Fiddlers Bar, during the demolition.

The council said it was considering if the hotel's collapse should be referred to any professional body for further enquiry.