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Joint and several liability changes could go further

For immediate release

Joint and several liability changes could go further

Local Government New Zealand (LGNZ) is pleased to see the suggested changes to joint and several liability regime announced by the Law Commission today, but the changes do not go far enough.

While it is good to see improvements to the current regime, LGNZ is disappointed that its preferred option of proportionate liability was not recommended by the Commission. Under a proportionate liability model, liability is limited to the extent of a person’s contribution to the fault at issue.

The proposed continuation of the joint and several liability rule, should the Government agree, would mean that councils and their ratepayers will continue to be the ‘last man standing’ in disputes where there are multiple parties and where the real nub of the fault lies with other parties.

LGNZ President Lawrence Yule says LGNZ sees the opportunity for putting into place better incentives around consenting and risk sharing.

“If speedier decisions on building consents are desired by Government, then the chilling effects on the speed of processing arising from a joint and several liability regime - even with the additions suggested by the Law Commission - will need to be addressed,” Mr Yule says.

“That said, we welcome the Commission’s recommendation that councils as building consent authorities, should have their future liabilities capped so that ratepayers aren’t seen as ‘deep pockets’ by claimants. We also welcome the suggestion that the Courts should be given the discretion to grant relief to a truly ‘minor defendant’ where that party has a very low share of responsibility for the relevant harm done. “

The Law Commission’s report urges the Ministry of Business, Innovation and Employment to continue to work on proposals for a comprehensive residential building guarantee scheme. LGNZ agrees with this call.

We need to put a stop to the system whereby poor performance by some members of the building industry is essentially underwritten by local ratepayers.


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