Agency 'knew of leak problem for six years'

Owners of the Sacramento Apartments in Botany Downs, Manukau City, are leading the litigation charge. Picture / Dean Purcell

The Building Industry Authority knew about leaky building problems for six years before it took any steps towards halting the crisis, according to a legal claim lodged in the High Court at Auckland.

Owners of Sacramento, the multi-unit East Auckland housing complex, have filed a $19 million statement of claim against the Government agency and others.

The claim heavily criticises the just-axed authority, suing it for negligence and breaches of statutory duty.

Its failure to warn any Government minister, building industry official, local authority, certifier or members of the public about the problem when it knew for many years is a cornerstone aspect of the claim.

The Government abolished the authority on November 30 and any remaining functions are being performed by the expanded Ministry of Building and Housing.

The authority has so far tried to escape the Sacramento litigation - the largest leaky building claim - applying to be withdrawn from the action. A decision on its application is expected from the High Court in February.

The Sacramento claim said the authority was in charge of regulating the building industry and knew about the leaky building crisis in 1998, yet failed to act.

It was not until last year that building rules were changed and treated timber brought back into more use.

"From April 24, 1998, the authority failed to issue the warning when it knew or ought to have known the information and when it was receiving mounting correspondence from [building inspection and consultancy firm] Prendos relating to serious issues raised by the use of face-fixed monolithic claddings such as Harditex ... over untreated timber," the claim said.

The seriousness of the problem was compounded by mounting evidence of the leaky condo crisis coming in Canada.

Yet the authority failed to warn people "of the potential serious and severe implications for the health and safety of occupants".

Sacramento owners had bought new or nearly new housing and had inspection certificates stating the building work complied with the building code, the statement said.

Yet they had no real ability to protect themselves.

"The [authority] was in a better position than councils and building certifiers to be aware of 'big picture' issues relating to the building industry, such as in this case the implications of face-fixed monolithic claddings over untreated timber," the statement said. "It also had, unlike councils and building certifiers, the powers to enable it to respond to this issue in a prompt and effective way."

The Building Research Association is being sued for negligence for approving a cladding system as meeting the requirements of the building code.

"The [association] holds itself out as having a worldwide reputation in areas including durability of building materials and systems, weathertightness, ventilation and structural engineering," the claim said.

"The purpose of [its] appraisal certificate is to have participants in the building industry rely on them."

Yet it had failed to warn the plaintiffs, other buyers and potential buyers about the Harditex cladding system at Sacramento which "does not manage moisture ingress".

Lawyer Paul Grimshaw, acting for Sacramento owners, said he did not expect the case to get to court until later next year.

THOSE BEING SUED

The Government's Building Industry Authority - axed last month.

Building companies Akita Construction, Ellerslie Park Holdings associated with Macrennie Construction and Link Construction.

Cladding manufacturer James Hardie NZ, which made the Harditex cladding.

The Building Research Association for not warning people about the cladding system.

Tim Manning's Taradale Property Developments, which developed the village.

Various Sigatoka Investments companies associated with Taradale and Manning.

Approved Building Certifiers which inspected and certified units.

Progressive Building Systems which distributed the Eterpan cladding system.

Stan Powley Architects of Northcote, for plans, designs, drawings and specifications.

Sacramento project manager/co-ordinator Dalton Management.