Hillcrest Normal School heads to court over leaky building

Hillcrest Normal School had issues with its M Block after the admin building was finished in 2006.

Hillcrest Normal School had issues with its M Block after the admin building was finished in 2006.

A Hamilton primary school is seeking hundreds of thousands of dollars from a since collapsed company after it was left with a leaky building.

Hillcrest Normal School board of trustees and then-Education Minister Hekia Parata are after $324,000 to fix the faults.

But the liquidator says there is no money left in the kitty.


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Osborne Building completed the school's administration building in 2006 but the Ministry of Education claims in court documents that it had issues with weather-tightness, required substantial remedial works and did not comply with the New Zealand Building Code.

A claim for remediation was made by the minister and the school's board of trustees to the High Court in Hamilton in October 2014 against the building company, architect, plumber, Hamilton City Council and a waterproofing company.

The case was adjourned until 2016 but soon after the parties agreed to proceed Osborne Building was placed into liquidation.

Liquidator Kelera Nayacakalou said she applied to the High Court in April in the hope a judge would make a decision on the minister's claim to be a creditor, but after a two-year court battle the case is yet to be resolved.

In her initial liquidators' report Nayacakalou said Osborne Building director Darrell Osborne attributed the company's failure to it being blamed for a design problem and leaking issues on an old contract, for which the architect wanted to share the cost of fixing. 

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Osborne is in Portugal, but told Fairfax in an email "the company ceased trading eight years ago after the death of my wife. The liquidation has nothing to do with the Hillcrest School and the company had nothing to do with the design".

Nayacakalou was also seeking direction about how to deal with the request for a meeting of creditors by the Ministry of Education.

"When I liquidate a company it's basically working for the creditors to try and collect as much that's outstanding," she said.

"The company itself winded up about five years ago and that leaves me in a very difficult position because there are also no assets for the company.

"There's nothing at all. So for me, I'm struggling as to where to go to collect the $325,000 that the minister was asking for."

Nayacakalou said she did not consider the minister to be a creditor as the claim was still before the courts.

"It's a very difficult one to do, especially if the case is in court and there hasn't been any judgment so you don't know whether that is a debt to collect or not.

"Often in cases like this I'll write to the creditors to tell them there was nothing I could get and that would be the end of the liquidation.

"I don't know what to do if I can't get hold of any assets."

In April, a High Court judgment ordered Nayacakalou to either accept or reject the minister's claim, to make an estimate of the amount of the claim or to refer the decision to the courts and to call a meeting of creditors.

The ministry's head of infrastructure, Kim Shannon, said the liquidator breached her legal duties. 

"We consider that a proper investigation is needed to determine exactly what funds might be available for recoveries. In the circumstances we believe it would be appropriate for that investigation to be conducted by a new liquidator," Shannon said.

Hillcrest Normal School principal and the school's board of trustees did not respond to requests for comment.


 - Stuff

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