KEY POINTS:
Victims of leaky buildings have a choice of two options to get compensation to escape their plight: the state or the courts.
Victims can either use a Government service where they can go for adjudication or mediation, or go via the courts system, where they can sue parties responsible for putting up and inspecting their places and get money to compensate for pain and suffering and to fix their houses.
The court route can involve spending thousands of dollars in expert reports and lawyers' fees and claimants run the risk of having costs awarded against them if they lose.
The Government route, which has been criticised as too slow, is about to get a shakeup.
A new tribunal will be established next week under the Ministry of Justice to hear grievances. Wider remedies will be available for victims and multi-unit claims will become easier. Ponsonby resident John Gray took a claim to the Weathertight Homes Resolution Service and won $702,000, leaving him favouring that system over court action.
In one of the most high-profile cases, Hobsonville homeowner Colleen Dicks used the High Court to get her $250,900 payout from Waitakere City Council, which eventually ditched its challenge in the Court of Appeal.
She initially took her claim to the WHRS and got a mediation with the builder, but that was unsuccessful because he did not fix her place. So she ended up in court.
Auckland lawyers Tim Rainey and Paul Grimshaw have criticised the state service for being slow, inefficient, highly expensive for taxpayers and ultimately a failure for everyone.
But John Green, an Auckland chartered arbitrator, adjudicator and mediator, questions why people would choose civil litigation over the state system, saying lawyers are making millions of dollars defending victims - money which could be spent on repairs. Claimants should instead use the state system which serves people well, he says.
As a WHRS adjudicator, Mr Green believes many people are heading down the wrong path when they choose civil litigation. For the $200 for mediation and $400 for adjudication, people could get a successful outcome.
But he believes those who use WHRS often trip at the first hurdle, opting for mediation instead of adjudication. Mediation tries to negotiate a suitable agreement, whereas adjudication makes a binding, enforceable determination.
Mr Gray agrees, saying mediations are "a French farce" because more powerful bodies such as councils get an advantage over weak claimants.
"Claimants who attempt mediation are lied to and misled by respondent parties and their experts, all done under the cloak of confidentiality agreements wrapped around such settlements.
"There is an extreme conflict of interest when it comes to councils' involvement because they wear their liability hat to the mediation table and seem to discard their regulatory responsibilities around building controls," he said.
"This is where they convince the owner that the repairs perhaps don't need a building consent or are not to the extent as claimed and that perhaps only a targeted repair is all that is warranted.
"There have been several instances of this occurring where the owners walk away with a full and final settlement based on that premise and heavily discounted, but when the owner sets about getting their home fixed the councils wear their regulator hat and say work does need consent, placing claimants in an impossible situation."
Victims' Choices:
Government system:
* Via Weathertight Homes Resolution Service/Weathertight Homes Tribunal.
* Taxpayer-funded so minimal costs.
* Mediation attempts to resolve issues.
* Adjudication hands down a decision.
* This has the status of a court ruling.
* That decision can be challenged via the courts.
Civil litigation:
* Claim made via the High Court.
* Funded by victims employing lawyers.
* Claims are often against councils.
* Ruling can go to Court of Appeal
* Final recourse is Supreme Court.
