KEY POINTS:
A "gravy train" worth hundreds of millions of dollars has built up around the leaky homes crisis, say experts.
They claim lawyers, consultants and builders are becoming rich at the expense of owners - some of whom are spending hundreds of thousands of dollars on unnecessary repairs.
Bill Duval, of the Stop Leaky Buildings Group, said the Government's Weathertight Homes Tribunal wasn't working, and victims received "disgraceful" treatment from lawyers representing builders and councils.
"It's worse than bullying," said Duvall. "There is a huge difference in how they treat the council architects and consultants and [how they treat] the homeowners."
Duval said most victims emerged with only a quarter of the money they needed to pay their bills and the tribunal should be overhauled to "stop the gravy train".
"The Government system has enabled the consultants and lawyers to rip people off even further. It's absolutely shocking. A few consultants have made themselves millionaires."
Duval, who arbitrates and mediates in leaky building disputes, says New Zealand faces years of litigation involving up to 100,000 buildings.
He is investigating an Auckland apartment block that had $8 million in repairs - only for leaks to re-emerge. "There will be a major lawsuit there."
Homeowners and Buyers Association president John Gray, who estimates the problem will end up costing $11 billion to fix, said his biggest concern was the "enormous" amount people were spending on legal fees without their homes being repaired.
He knew of one project that had blown out by $5 million after a pre-repair settlement had been reached. Another building firm tendered for a remedial project with a price almost $200,000 higher than the average of three competing tenders.
"Many very good builders are shying away from this work because of their perception of the risks involved," said Gray. "That leads to the prices being ramped up and owners having to take it or leave it."
Ian Holyoake, who runs the Moisture Detection Company, estimated up to 350,000 properties built with untreated or under-treated timber could be affected by rot in the next 20 years. But he said many reconstruction and recladding jobs could be avoided.
Holyoake has developed a way to pinpoint problem areas using probes and a treatment that kills timber-rotting fungus.
He said targeted repairs could save leaky homes for a fraction of the cost of recladding, but claimed the Government, councils and building industry were resisting his research. "The gravy train people think, 'We don't want that'. Builders say, 'Ian, you're going to put me out of a job'."
The Herald on Sunday asked the Department of Building and Housing if it was worried about lawyers and consultants making excessive amounts of money from the leaky homes crisis.
In a statement, the department said legal representation was a matter for the parties involved in a tribunal case.
"Any contractual arrangements, including the costs of legal services, are matters agreed between the parties involved and their legal representatives," it stated.
