Mainzeal collapse costs $620,000

JOEL MAXWELL
Last updated 10:43 21/08/2014

Relevant offers

Kapiti Observer

You're not seeing double: there will soon be two SH1s in the Wellington region Long walk home from Wellington to Kapiti to test commuters' disaster preparedness Kapiti Island buzzing with new honey venture and 30 beehives Cowboys and cowgirls get cut off at the pass in turf war for Kapiti reserve land Levin to Waikanae bus trial supported by Wellington Kapiti council closes water feature because it could 'evaporate' Waikanae youngster Arabella Layton wins Just Cook Challenge egg category Porirua amputee says care-giving company 'don't seem to care' Horowhenua-Kapiti's Nathaniel Payton makes Heartland under-19 squad Waikanae park-and-ride further delayed after asbestos discovered in concrete

The Kapiti Coast District Council has taken a $620,000 bath after it paid out subcontractors left in the lurch after the collapse of building company Mainzeal.

On Monday, the council announced it would not recoup all $1.8 million owed after the collapse of Mainzeal, contracted to build the Coastlands Aquatic Centre.

The decision left the council covering $620,000 from its own coffers - a move that would save further legal costs with no guarantee of success, mayor Ross Church said.

Church said he was satisfied the council made the right call in cutting its losses.

"If we wanted to go further and try and get more money back out of Mainzeal and pursue people we'd have to then spend money on legal costs . . . we could spend half a million to get back half a million. It just gets to a point where you've got to stop bashing your head against a brick wall."

He said the council paid subcontractors to encourage them to return to the project after Mainzeal went into receivership in February last year.

Community services group manager Tamsin Evans said a substantial portion of the $1.8m was used to pay the subcontractors.

"While we haven't been able to ensure they are paid in full for all their work, protection of the subcontractors since receivership has been a priority for the council."

Church said it was "hugely disappointing" to cover the costs but the collapse of Mainzeal had been completely unexpected.

News of the Mainzeal collapse came in February 2013, just weeks short of the expected completion of the centre.

This month the council celebrated the first birthday of the centre.

Ad Feedback

- Kapiti Observer

Special offers
Opinion poll

Should Kapiti have international airport?

Yes, there's plenty of land there

No, it's too far for people to travel to

Maybe

Don't care

Vote Result

Related story: (See story)

Featured Promotions

Sponsored Content