Cosgrove Clayton: Weathertight Homes Resolution Services AMENDMENT Bill — Second Reading 
Cosgrove Clayton: Weathertight Homes Resolution Services AMENDMENT Bill — Second Reading 
[Volume:636;Page:7157] 
Hon CLAYTON COSGROVE (Minister for Building and Construction) 
: 
 I move  
That the Weathertight Homes Resolution Services Amendment Bill be now read a second time 
. Firstly I thank the Social Services Committee especially its chair my colleague Georgina Beyer for the thorough work that she and the committee have undertaken in respect of this bill and for enabling the bill to be reported back to the House before Christmas. I also thank the submitters for their valuable input and feedback on the bill. I take this opportunity to remind the House briefly of how this bill came about and of what it contains and to summarise the select committee’s recommended amendments. 
The bill improves the effectiveness and efficiency of the Weathertight Homes Resolution Service through reform. It is essential to the Government’s commitment to provide a speedier low-cost alternative to the court system for resolving leaky building claims. The Weathertight Homes Resolution Service was set up in 2002 as a call to arms by the Government to deal with a major problem in our communities. This problem was not caused by any one factor; rather it was a systemic problem caused by a large number of factors but primarily and in large part historically by the deregulation of the 1990s which let the cowboys into the system and allowed them to run amuck within the building industry. In August 2005 a major review of the Weathertight Homes Resolution Service was undertaken which found the service wanting in several areas and the process being unnecessarily drawn out by lawyers and other experts. 
The bill will help the owners of leaky homes to settle their disputes faster hold those responsible—that is the liable parties—to account and get compensation from those liable parties to fix leaky homes faster. It will also enhance consumer protection for homebuyers. In developing these changes we consulted widely with organisations including the Leaky Homes Action Group and the Consumers Institute of New Zealand as well as building industry organisations and local government. Their collective input I have to say was invaluable in developing the policy that underpins this bill. 
As I have said the bill aims to improve the efficiency and effectiveness of each stage within the Weathertight Homes Resolution Service’s process. The reforms include allowing claimants to claim for potential as well as actual damage more comprehensive assessment reports that can become expert evidence thereby cutting down legal costs substantially for claimants and faster resolution of disputes through the introduction of compulsory pre-hearing conferencing for standard claims before claims move to time-limited mediation plus the fast-tracking of low-value claims. The bill sets the objectives for a less adversarial more investigative and swifter adjudication process. The bill introduces new offence provisions with fines attached to behaviours such as failure to comply with an adjudicator’s order or summons. That will help adjudicators to get on with the job. The bill also seeks to make the adjudication function independent of the Department of Building and Housing. The Ministry of Justice will be responsible for establishing and administering the new Weathertight Homes Tribunal. These measures will enhance consumer and respondent confidence in the adjudication service improve acceptance of the authority of the adjudicators and provide more institutional support for the adjudicators themselves. 
The bill removes the obstacles encountered by bodies corporate that wish to bring claims for multi-unit apartment complexes by setting voting thresholds that are not unanimous so that the so-called hold-out situations are less likely to occur. That is especially important given that around 70 percent of claimants with the Weathertight Homes Resolution Service are unit title apartment owners. 
This legislation was introduced to Parliament on 23 August this year and received its first reading on 31 August. The House set a shortened report-back date for the select committee. The committee has met that deadline and I am grateful for that. I thank members for their effort. The goal of having this bill passed before the end of the year and the reforms in place by April next year was ambitious but with the support of the committee and this House today I believe we will get there. Submissions made on the bill represented individuals consumer groups insurers the industry and organisations that represented many individuals. All of the submitters who asked to be heard by the committee were heard and there was general support for the majority of changes the bill proposes. There was unanimous support from the select committee for the bill as a whole. However I will come to some points later. 
One change made by the committee was to extend the land information memorandum—or “LIM”—notifications to existing claims. The committee sought to extend consumer protection by including existing claims—not just those claims made after 1 April 2007 as was originally proposed—on the land information memorandum reports. The committee also agreed that the Weathertight Homes Resolution Service will send a notice when a claim is brought instead of after it has been decided it is eligible. That is the best way to ensure people do not withdraw from the claim process and onsell their property without disclosure to unsuspecting buyers. The bill reflects and enhances current practice by territorial authorities. 
Other changes include a provision that where a claim is determined to be ineligible under one provision claimants can withdraw and bring back the claim under the correct provision provided it is submitted within 1 year. That will help claimants who are close to the 10-year limit for filing claims with the resolution service. Other changes include enabling the Chief Executive of the Department of Building and Housing to access information about mediation settlements for research and evaluation purposes; appointing a registrar for the new Weathertight Homes Tribunal; allowing settlements made by the resolution service to be enforced in the District Court; appointing additional adjudicators to complete any claims remaining under the previous system; and amending the commencement date to 1 May 2007 or earlier by Order in Council. I have to say that is a backstop provision. The Government intends to meet its commitment to claimants that the enhancements to the resolution service will be implemented by 1 April 2007. 
Some additional issues which were not part of the bill came up during the select committee consideration and were considered carefully. The committee decided unanimously that the 10-year limitation period which applies right across the building sector will remain in place. It decided by majority that legal costs should not be able to be claimed under the resolution service dispute resolution process. The committee took on board the comments made by submitters that it should make the bill more accessible in terms of using plain English and grouping related provisions together. To that end the committee therefore decided that a new bill was needed incorporating the amendment bill into an integrated new bill. 
The Government agrees with all the recommendations of the select committee. The Government is also putting forward Supplementary Order Paper 83 which deals with technical amendments to the new bill to improve its readability correct minor errors and ensure provisions are consistent across the various types of claims. 
To conclude the bill as reported back proposes in my view a large number of positive changes. Not only will the legislation improve the speed and efficiency with which weathertight homes claims can be dealt with it will also reduce evidential and legal costs for claimants and respondents reduce bureaucracy and be fairer for both claimants and respondents. I again thank the select committee and my colleague Georgina Beyer the chair of the committee for the cooperation they showed to ensure the bill met the report-back deadline. With the indulgence of the House we can have it passed today and thus enacted before Christmas.