Insurance update - Southland Indoor Leisure Centre Charitable Trust v Invercargill City Council

The recent High Court judgment of Southland Indoor Leisure Centre Charitable Trust v Invercargill City Council and others [2015] NZHC 1983 has provided some useful statements on duty of care, contributory negligence, betterment, and GST.

Background

The Southland Indoor Leisure Centre Charitable Trust (Trust) owns and operates Stadium Southland. Construction of the stadium began in 1999, and was completed in early 2000. During construction it became apparent that the design of the roof trusses was defective, as they began sagging even while the stadium was being built. Remedial work was designed, consented, and undertaken during the building programme.

The Invercargill City Council (Council) issued a code compliance certificate (CCC) in November 2000, despite having not received some specific information required under the conditions of the building consent for the remedial work, being confirmation from the consulting engineer that the precamber of the roof trusses is in line with the specifications, and the provision of individual trusses' measurements. That exact information required was never provided, although other information, showing the height of each roof truss from the floor, which satisfied requirements of the Council, was provided in October 2001.

It transpired from the evidence given in the High Court that the Council's principal building officer had not authorised the issuing of the CCC. Instead the CCC was issued under the signature of a clerk in the consents team, "possibly because a CCC was required before the Trust could be issued with a liquor licence for an upcoming function in the stadium."

After a heavy snowfall on 18 September 2010, the stadium roof collapsed. Eight people were inside the stadium at the time, but all escaped unharmed.

There was no dispute in this case over how and why the stadium roof failed. It was agreed that a "combination of poor quality welding and a failure to follow the plans and specifications for remedial work to the roof trusses meant the roof was unable to carry the snow loadings experienced that day."

The issues for the High Court to determine were whether the Council breached a duty of care to the Trust to exercise reasonable skill and care in issuing the CCC, and if it did, whether the Council should be liable for the repair costs.

Did the Council owe a duty of care?

The Council claimed that this case had a unique factual matrix that should take it outside the circumstances in Body...