Westpac Rescue Helicopter capture footage of the New Zealand International Convention Centre fire. Video / Auckland Rescue Helicopter Trust
Fletcher Building subsidiary the Fletcher Construction Company is suing two waterproofing businesses it blames for 2019′s disastrous NZ International Convention Centre fire, with a 14-week trial pending where uninsured losses of $320 million are catalogued, although the waterproofers deny liability.
Justice Sally Fitzgerald, chief judge of the HighCourt, issued a procedural decision in the builder’s case against local businesses MPM Waterproofing Services and JEL Waterproofing.
Last decade, the Fletcher Construction Company (FCC) subcontracted MPM to do the membrane roof on the NZICC.
MPM then subcontracted JEL to do some of MPM’s membrane works on that roof.
“FCC alleges that the fire was caused by MPM and/or JEL. By these proceedings, FCC seeks recovery of uninsured losses which are significant,” the decision said.
Fletcher is represented by Jack Hodder KC and Bell Gully’s Sam Hiebendall while MPM is represented by Helen Macfarlane and JEL by Aaron Sherriff.
Fletcher is suing MPM for contractual indemnity, breach of contract and negligence and suing JEL for negligence.
The litigation is due to start next June but in April, MPM and JEL applied for a split trial: first, the case against them to be heard initially, then a separate case about Fletcher’s claim for losses subsequently.
“They seek orders that the liability claims and some other legal aspects of FCC’s claims are heard at a stage one trial in June 2025 and, to the extent necessary, all remaining issues, including the quantification of any of FCC’s losses able to be claimed from MPM and/or JEL, are heard at a later stage two trial,” the decision said.
Fletcher disputed there were any efficiencies by splitting the proceeding into two hearings and opposed that.
Firefighters battle the blaze at the NZ International Convention Centre in 2019. Photo / Michael Craig
Fletcher’s total losses from the fire are yet to “fully crystallise”, the judge said, but the company made a statement of claim last August where it estimated:
FCC direct losses estimated at $252,313,780;
Sub-contractor liabilities estimated at $11,486,219.99;
Liquidated damages payments estimated at $10,343,000;
What is referred to as the SP1 claim, being liabilities said to arise from a claim against FCC by SkyCity in relation to delayed delivery of car parks, estimated at $24,969,978;
What is referred to as the second tranche claim being a further claim by SkyCity against FCC for alleged delayed delivery of additional car parks, estimated at $17,863,990;
What is referred to as the MDBI claim, being another claim by SkyCity against FCC for reimbursement to SkyCity for alleged material damage and business interruption losses caused by the fire, estimated at $4,725,280;
Other unspecified losses or liability to third parties who are not involved in the convention centre project, referred to by FCC as third party liabilities, not yet subject to any particularisation or estimated quantum in FCC’s second amended statement of claim.
The decision did not say it, but those sums add up to just over $320m.
MPM and JEL deny that they caused the fire and advanced slightly different reasons as to why a split trial was appropriate.
MPM’s focus was directed to the fact that the type and quantum of Fletcher’s losses were yet to be ascertained and its concern at the prospect of late evidence and information sought to be advanced at next year’s hearing.
The waterproofing business suggested that it would be more efficient to determine matters relating to liability first, and then address quantum later, once the full extent of Fletcher’s alleged losses had crystalised.
The disastrous NZICC fire in 2019. Photo / Michael Craig
JEL’s focus was on the most effective and efficient means of progressing the claim from its perspective, and its view that a stage one hearing on liability could eliminate the need for it to participate in a lengthy stage two trial on quantum, or at least significantly limit the extent to which it need participate in a stage two hearing.
Fletcher opposed splitting the case into two, disputing there were any efficiencies to be gained.
While it acknowledged that its total losses would not have fully crystalised by next June, its position was that they would very largely have done so.
The judge rejected splitting the case into two but said a particularly troubling point was that some of Fletcher’s losses continued to accrue and were yet to be quantified.
The applications for a split trial were declined.
Fletcher Building issued an NZX announcement saying its subsidiary alleged that the fire was caused by MPM and/or JEL and it was seeking recovery of its uninsured losses, “which are significant, some of which are described in the judgment”.
The judgment relates to a procedural issue and makes no substantive findings in relation to the claims, it said.
The costs and claims noted in the judgment have been fully considered in the company’s current position on the NZICC project and do not change the provision position or risk factors disclosed as per its 2024 interim financial statements, Fletcher said.
The full annual result is due out next month.
Anne Gibson has been the Herald’s property editor for 24 years, written books and covered property extensively here and overseas.
