When the roof caves in - councils' duties to building owners
This article is featured in the February/March issue of New Zealand Construction News
In 2010 the roof of Stadium Southland, in Invercargill, collapsed under the weight of snow following a Winter storm. The root cause of the collapse however was seeded many years previously during the initial building of the stadium in the late 1990's. The steel trusses used to support the roof had been replaced by a lighter grade of steel and during the construction process the roof was seen to sag. Remedial works were approved but never undertaken.
The consulting engineer, Mr Major, failed to confirm that the remedial work was done and did not provide sign off, but Council subsequently approved the work and later certified the whole building Where does liability rest? The owners of the stadium for failure to remedy the defects; or the Council for its failure to inspect the remedial work while still issuing compliance certification.
The Southland Indoor Leisure Centre Charitable Trust (Trust) built Stadium Southland in the 1990's on land leased from Invercargill City Council (Council). The Trust engaged its own experts during construction, including consulting engineer, Mr Major.
During construction, an independent engineer found that Mr Major had miscalculated the loads on the steel trusses. A building consent for remedial work was required to resolve the error. A condition of the consent required that Mr Major provide a producer statement for construction review for the remedial work and in particular to confirm the truss measurements.
The Council issued a code compliance certificate (CCC) on 20 November 2000 for the remedial work. Significantly, Council did so despite the fact it had not received a producer statement from Mr Major, nor any confirmation of the truss details required by the Building Consent. Further, the Council had not inspected the remedial work itself (relying on Mr Major to do so in accordance with the Consent).
The Council issued a CCC for the whole building in April 2003, even though the Producer Statement Mr Major had later provided identified major steel issues and did not confirm the truss measurements, as required by the Building Consent.
The Trust obtained further advice from the independent Engineer in 2006 as to the status of the roof, after concerns that the roof of the stadium was leaking, and flexing under heavy wind. As part of this advice, the independent Engineer recommended that the Trust arrange for inspection of the trusses to look for degradation. The Trust did not do so.
The underlying faults in the design eventually led to the stadium roof collapsing.
Was the Council liable?
As a result of the roof collapse, the Trust sued the Council in negligence and negligent misstatement. The Council argued that they were not liable because the Trust had not relied on the CCC. They also said that the Trust had caused its own loss by failing to inspect the stadium in 2006, even though the independent engineer raised issues. The engineer responsible for monitoring the remedial work, Mr Major, was also a party to the proceeding but he took no active steps and agreed to contribute to the repairs. He was also expelled from IPENZ for his failures.
The case went all the way to the Supreme Court.
The Supreme Court found that the Council was liable in negligence for issuing the CCC for the remedial works, just as it would be had it been carrying out its other functions such as consenting or inspections. The involvement of other professionals in the construction process did not affect the Council's direct duty.
The Council accepted that, if there was a direct duty of care owed to the Trust in issuing the CCC, the Council had breached it, and the breach had caused the Trust's loss. The Court agreed that in issuing the CCC without confirming that the information required in the Building Consent (by way of producer statement) had been provided, the Council had been negligent.
The Court went on to find that the Trust's actions amounted to contributory negligence, when it failed to inspect the stadium in 2006. The majority agreed with the Court of Appeal's decision to set the level of contributory negligence at 50%.
Anthony Harper comments
"It is clear from this case that a local authority must take all due care, when issuing CCCs, to ensure that they have confirmed that the works comply with the terms of any consent granted.
While the local authority may rely upon the work of other professionals working on the project when issuing CCCs, this reliance must be reasonable and the duty remains to ensure that the correct inspection and sign offs have been given", said Karen Kemp, Construction Litigation partner at Anthony Harper.
This case is also an important reminder of the principles of contributory negligence - all parties involved in the construction, including owners, need to ensure they take responsibility for work being properly carried out and ensuring it complies with the building consent and Building Code.
To read the article in full, click here.