Council approves theoretical repairs

Theoretical building consents are being issued to Christchurch homeowners disputing proposed earthquake repairs with their insurer.

The Christchurch City Council has given "assurance letters" to insurance companies stating that proposed repairs would likely meet the building code if consent was ever sought.

Repairability of homes on mostly red-zoned land has been the focus of several High Court cases where it was argued the work would never take place.

Council building consents department manager Aaron Haymes said the letters were "agreements in principle that what somebody is proposing would obtain a building consent if they went ahead".

"It's not an absolute yes that it complies and we're going to approve it when it comes through," he said.

The letters "proved a point" for insurance companies that a proposed repair was good enough for insurance settlement.

Lawyer Simon Munro said the process could be "equally useful to homeowners who disagree [with] their insurer's theoretical repair methodology".

His firm, Anthony Harper, is assembling homeowners for a possible class action lawsuit against the Earthquake Commission that could "confirm the standard of repair that EQC is required to meet".

The council has issued three assurance letters so far - all for houses in the residential red zone, all focused on foundation repairs and all approved the theoretical repair.

The letters appear to flow from the O'Loughlin v Tower lawsuit decided earlier in the year.

In that case, Tower proposed repairing the foundation of Matt and Valerie O'Loughlin's red-zoned Dallington home using a method that Justice Raynor Asher eventually found "no reasonable insured or insurer would . . . carry out".

Asher said if "Tower's repair methodology will get a consent and is an appropriate repair option, then Tower's offer was fair".

Haymes said the council preferred the full consent process to not be used to "test a point".

"That's why we've been open to giving these opinions, but we've not gone out and actively promoted it," he said.

Lawyer Munro noted that complying with the Building Code was not the only standard insurers had to meet.

Many policies declared repairs would return houses to an as-new condition, "which in some cases may be higher than the standard required for a building consent", he said.

The Insurance Council, which lobbies on behalf of the industry, said it was concerned the letters would reduce the council's ability to issue actual consents.

The Press