Carter Holt Harvey continues to try and leave the taxpayer holding the leaky schools bill

Building supply company Carter Holt Harvey says it should not face legal action over hundreds of leaky school buildings because it is protected by the 10 year limitation on claims under the Building Act.

In a three-day hearing in the Supreme Court this week, the building supply company asked the court to apply the limitation, and throw out the Education Ministry’s claim that it was negligent in failing to warn that its cladding product, Shadowclad, might not work in the way the schools intended.

The company’s lawyer, David Goddard QC, told the court yesterday the only purpose of the product was to carry out building work, so the 10 year limitation on claims should apply.

“It supplied an input into building work for the purpose of carrying out building work in a manner that would – if properly applied – achieve compliance with the building code.

“The alleged defects in the product all depend on an intention that the product would be used to carry out building work.”

However, the Ministry’s counsel, James Farmer QC, said the claim was not about the way the cladding was used but about what Carter Holt failed to do.

“The defence that we’re going to face eventually in this case is that the product can be installed adequately or properly. We dispute that. We say the product is inherently defective.”

The 10 year limitation period applied only to building work, not building products, he said.

If Carter Holt succeeds in having the 10 year limitation applied, that will remove about 600 of the 890 buildings from the ministry’s claim in the High Court, which was given the green light by a Court of Appeal ruling last year.

At the same time the ministry is cross-appealing an Appeal Court decision that it cannot sue on the basis that Carter Holt negligently mis-stated claims about Shadowclad.

In court yesterday, another of the ministry’s lawyers, Nicholas Flanagan, said it was reasonable to assume that builders, architects and others relied on the company’s claims that its product met the building code.

Standard legal technique:  try to drag the process out until the statutory limit is reached or the litigant start dying off one by one.   Of course, the latter is impossible with the Government.

But essentially, the company is now saying “No longer relevant to discuss if we were responsible or not, it’s taken too long”.  Except, for the remainder of the buildings, not yet past the 10 year mark, they may still be held responsible.

My guess?  If they get a decision in their favour on the 10 year issue, Carter Holt will drag the remainder out in court until they all get past 10 years.

It’s strategy, but it is ugly.

And you and I will have paid for the products originally, paid for it to be fixed, and paid for it to go through the court system.

Thank you very much.




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  • Anthony

    The cracking and delaminating surfaces of shadowclad as seen on Fair Go a couple of years ago certainly look like obvious product failure to me.
    This makes me think of the typical fencing timber sold these days that splits, bows & twists as soon as you stop looking at it. I’d assume it’s coming from the same trees.
    If I was building a new house today, I’d probably go for precast aerated concrete panels with an exposed aggregate finish on the outside.
    But then one also has to be careful about the quality of cement and rebar, and faulty batching plants.

  • Gladwin

    Completely reclad a large house with H3 shadowclad in 1983 and the product is still going strong today. The only failures were when the builder used untreated shadowclad which was replaced with H3 treated without further problem. Product needs to be painted. This product was manufactured with marine glue. If you tick all the above boxes you have a completely reliable product.

  • taxpayer

    Much of the leaky building problems simply come down to poor design.
    All of a sudden architects decided that eves on a roof were ugly and needed to be got rid of.
    Neglecting the fact that eves perform a vital role, keeping the rain off both the very top and the top half of eternal walls.
    Even if the shadow clad has delamination, cracks or even holes in it, as long as the building was properly designed, with water tightness the number one priority (as it should be) leaking should not have been a problem.
    After 30 years in the trades I can tell you that architects, designers and engineers have a lot to answer for.
    Full of great looking ideas that don’t work, rarely take any blame, and are not often held to account for even major mistakes.
    Just ask some grieving families in Christchurch what they think of smarty pants engineers and architects.