22.12.2014

University of Canterbury v Insurance Council of New Zealand Inc [2014] NZSC 193

The Supreme Court has upheld the Court of Appeal’s interpretation of the statutory powers of territorial authorities to require that work be undertaken on buildings which are earthquake-prone.

Under s 122 of the Building Act 2004, a building is earthquake-prone if:

  1. its ultimate capacity will be exceeded in a moderate earthquake (being an earthquake that would generate shaking that is of the same duration, but is one third as strong, as the earthquake shaking that would be used to design a new building at that site); and
  2. it would be likely to collapse causing injury or death or damage to other property.

The full bench of the Supreme Court confirmed that both criteria had to be met before a building was earthquake-prone.  Only buildings with a capacity of less than 34% of the New Building Standard (NBS) are capable of being earthquake-prone.

The Court split 3: 2 on the question of whether a territorial authority could require an owner to undertake work on an earthquake-prone building which was necessary to remove the likelihood of collapse but which would take the capacity of the building above 34% NBS.

Section 124(2)(c) of the Act empowers a territorial authority to issue a notice requiring work to be carried out on an earthquake-prone building to “reduce or remove the danger”.  The minority held that “the danger” was the danger of collapse in a moderate earthquake.  If the building’s characteristics meant that the danger could only be reduced if the building was strengthened above 34% NBS, then the territorial authority was empowered under s 124(2)(c) to order that work be done.  The majority, by contrast, took the view that the work required was limited to that necessary to ensure that the building was no longer earthquake-prone (i.e. that its capacity met 34% NBS).

The effect of this judgment is that a territorial authority cannot require a building to be strengthened to a capacity of more than 34% NBS, even if the strengthened building has features which make it likely to collapse in a moderate earthquake.

As noted in our report on the Court of Appeal judgment (click here), these decisions highlight the tension between the imposition of a nation-wide standard and the desire for Councils to respond to regional circumstances and/or deal with specific characteristics which make a building vulnerable to collapse.  The history of the Canterbury earthquakes makes it clear that buildings which meet 34% NBS may still have features which make them deadly when an earthquake strikes.

The Supreme Court’s judgment is consistent with the current draft of the Building (Earthquake-prone Buildings) Amendment Bill, which leaves the benchmark of 34% NBS as “the standard at which a building is considered sufficiently safe to take it outside the scope of the power given to territorial authorities… to require strengthening work to be undertaken.”[1]

Back to Summary Table

[1] Majority at [63]

Do you need expert legal advice?
Contact the expert team at Hesketh Henry.
Kerry
Media contact - Kerry Browne
Please contact Kerry with any media enquiries and with any questions related to marketing or sponsorships on +64 9 375 8747 or via email.

Related Articles / Insights & Opinion

iStock
Parker v Magnum Hire: A new era of personal grievance remedies awarded in the Employment Relations Authority?
If you heard a sudden loud noise last week – no it wasn’t a jet plane flying overhead, it was the gasp of employment lawyers across New Zealand when the Employment Relations Authority published it...
26.02.2024 Posted in Employment
employment dictionary website
Banding together: the Court’s new approach to awards for injury to feelings
One of the key remedies available to an employee who has successfully established a personal grievance in the Employment Relations Authority (Authority) or the Employment Court (Court) is compensation...
23.02.2024 Posted in Employment
Trust liability under the Health and Safety at Work Act
WorkSafe New Zealand v RH & JY Trust & ors
21.02.2024 Posted in Health & Safety & Private Wealth
New year, new government, new policies: what’s on the cards for employment law in 2024?
As we have been known to say once or twice (okay, maybe every year!) employment law never stands still. New governments can also spell major change, and this time is no exception. As you will likely h...
14.02.2024 Posted in Business Advice & Employment
Family Hands Paper Dolls Wide BW
Variations of Trust: Court’s Position Confirmed
Last year we published an article titled Variations of Trust: Obtaining the Court’s Blessing on the High Court decision in Re Jury Family Trusts [2022] NZHC 568 (Re Jury). In Re Jury, the High C...
05.02.2024 Posted in Private Wealth
Employment Law Wide
Trials and tribulations of trial periods – what an employer needs to know
If, like us, you were doing last minute Christmas shopping, you might have missed that the Employment Relations (Trial Periods) Amendment Act 2023 (Act) received Royal Assent and came into effect shor...
19.01.2024 Posted in Employment
iStock  Warning Speech Bubble Colour
A warning about warnings
It can be tempting for an employer to think that it is only a dismissal that requires a disciplinary process, and that a warning or a final warning can be issued simply by notifying the employee.  Be...
13.12.2023 Posted in Employment
SEND AN ENQUIRY
Send us an enquiry

For expert legal advice, please complete the form below or call us on (09) 375 8700.