Leak woes fixed at a slow drip

By GEOFF CUMMING

Nearly two years after the Government set up a service to deal with leaky buildings, no headway is being made against the rising tide of claims.

The Weathertight Homes Resolution Service has received 2273 claims; latest figures show it has resolved just 152. While it is averaging 7.5 settlements a month, new claims are arriving at an average of 76 a month.

Homeowners report waiting up to a year for weathertight service hearings. But going to court is just as cumbersome, and much more expensive - taking a case can cost $40,000 to $50,000, lawyers say.

One Auckland firm alone, Cairns Slane, says it has around 3000 clients - many in large apartment blocks - effectively barred from using the service by rules that make each owner apply individually.

Thousands more homeowners, unaware of hidden rot or daunted by the complexity of leaky home issues, have yet to emerge.

"Banks won't lend to them, they can't sell unless they find some unsuspecting person - people will lose their homes," said one apartment owner who negotiated an out-of-court settlement. "This thing's going to go on for 10 to 15 years."

Weathertight service national manager Lisa Ferguson said the issue was "much bigger than anyone ever imagined".

"Two years ago, people may have thought we would complete the bulk of the process by now," she said. "I don't think anyone thinks that now.

"People need to be better educated about the [pre-purchase] processes they need to go through and about holding people accountable."

In a bid to speed the processing of claims, the service plans to open an Auckland office next month.

However, critics say the disputes resolution process is the wrong way to solve the leaky homes crisis.

Claimants and building experts say weathertight service settlements often cover less than half the cost of repairs.

The service was conceived in late 2002 as a low-cost option for homeowners who could not afford court action or whose claims were minor. With a less formal mediation and adjudication process, many people represent themselves. But they come up against lawyers from as many as a dozen co-respondents, ranging from architects and plasterers to the Building Industry Authority. One successful claimant was approached by an Asian immigrant with limited English, who owned a townhouse.

"We tried to explain how [the service] process worked ... she wouldn't stand a chance."

Many claimants settle for much less than the repair costs. The service legislation also makes it difficult to recover legal costs.

Some developers and builders escape by winding up companies.