The Supreme Court ruled yesterday against house cladding manufacturer James Hardie NZ’s attempt to stop a group of owners of leaky homes from having their claims heard as a class action.
Others who haven’t yet joined the group have been given until 30 January 2018 to do so.
High Court judge Rebecca Ellis ruled in 2016 that the group of owners of homes clad with James Hardie products Harditex & Titan board could take a class action against James Hardie & group company Studorp Ltd.
The Court of Appeal also ruled in favour of a class action in August this year.
Justice Ellis found 3 common issues which warranted making a representative order:
- whether James Hardie owed the owners a duty of care in tort
- whether James Hardie had breached that duty, and
- whether the statements made in James Hardie’s technical literature were misleading & deceptive for the purposes of the Fair Trading Act.
The Court of Appeal upheld those findings, saying on the issue of duty of care, the considerations would be “materially the same or similar” for all claims.
The Court of Appeal found that, when the substantive case is eventually heard, “determination of the 3 common issues will result in findings that are binding on James Hardie & all members of the class. Determination of other aspects of the claims such as causation & loss will be determined on an individual owner basis.”
The Court of Appeal also concluded that a class action would “better achieve the just, speedy & inexpensive determination of the proceedings than the test case procedure” for which James Hardie contended.
Wellington law firm Parker & Associates, representing the building owners, is now encouraging affected owners still outside the group to move quickly. Lawyer Dan Parker said: “We are dealing with a large number of inquiries, many from people who have seen and are responding to the claim for the first time. A number of owners have approached us, unaware of any problems with their properties until expert investigations identify issues. They have subsequently joined the claim.
“We will be pushing forward now to deal with owner inquiries and to get as many owners signed on as possible. As it is a self-funded action, the bigger the group is, the lower the costs/owner.
“The opt-in period will be the last chance for most affected owners to pursue any legal action for recovery of their losses. If they join during the opt-in period they will not be affected by a 15-year limitation longstop that will probably otherwise bar claims after the opt-in period expires. Also, the Supreme Court confirmed last year in the leaky schools litigation that the 10-year Building Act limitation longstop does not apply to a product liability claim like this.”
The group first took a product liability claim against James Hardie & Studorp for negligence & breach of the Fair Trading Act in 2015.
Owners alleged that leaks in their homes were attributable to inherent defects in James Hardie cladding systems, and that the company made misleading statements about its cladding systems in its technical literature. James Hardie denies the allegations.
Harditex was used in construction of thousands of homes from 1987 until the early 2000s, and Titan board was widely used from 1995.
Attribution: Supreme Court decision, Parker release.