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Legal class action against Southern Response?

Wednesday’s Press has an article Southern Response class action ‘no win, no fee’ here.

The proposal, offered by law firm GCA lawyers, is for “disgruntled customers of a major earthquake claims-holder to join “no win, no fee”class action lawsuit.”

Sounds too good to be true (and potentially is). Click on the link to continue.

The following extract from the Press article is important and needs to be read very closely:

The law firm had now found an international backer for the potential $1billion class action case, Cameron said Tuesday.

This meant homeowners would not have to pay for anything to join the action and were not at risk to face adverse costs.

If the action was successful, the firm backing the claim and GCA would take up to 20 per cent of the amount awarded in damages.

The backer, international consortium Litigation Lending Services, would pay any upfront costs, including engineers and other experts, and would take on the risk of paying for adverse costs if the case was lost, he said.

Sounds good, but perhaps not as good as you might hope. If you lose it probably won’t be too bad in that all you will lose is time – maybe lots of it. There is a huge amount at stake so Southern Response and it’s backers will put up a fight. How much time can you afford?  Might it not be quicker to act independently? Will the money be worth it?

Should you win then you will still lose at lot of time, plus some of the money awarded by the court. Will you come out better off?

So far so good? What about some of the legal aspects? Maybe a bit of editorial oversight at the Press would have helped.

As has been mentioned frequently in the recent past New Zealand law does not cater for “class actions”. This is an American process that cannot just be imported into New Zealand because it sounds like a good idea. Class actions are quite focussed with a number of claimants having exactly the same issue – not quite the same as the varied issues faced by a collective of insurance claimants. Surprisingly this was not flagged in the article.

Also not flagged was the enthusiastic sizing of the damage payments that might be anticipated. According to the law firm mentioned:

“Each claimant could get anything from $10,000 to $30,000 a household for costs and an additional $25,000 to $50,000 for intangible costs such as stress.”

New Zealand courts have proven very reluctant to award large amounts of costs (damages), and then only as a consequence of really really big stuff-ups with no mitigating circumstances. How mitigating will an unprecedented disaster be?

For a more qualified analysis of the legal hurdles faced by proposals for class action, whether or not New Zealand insurers actually have a legal duty of utmost good faith towards policy holders, damages pay-outs, and more, there is an interesting article Proposed utmost good faith class action ‘misleading’ on the website Insurance Business New Zealand here.

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Insurers – Changing a rebuild to a repair.

Today’s Press has an article by Lane Neave law firm partner Dr Duncan Webb on insurers changing a rebuild into a repair. This article is part of an on-going “agony uncle” series on how the law applies to certain situations.

The article is here, and worth reading. There is also an e-mail address at the bottom of the article if you have a question you would like to submit.

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Southern Response – update on Build options especially cross lease properties

Southern Response have updated their webpage on options available to those with rebuilds. Part of the new information relates to people with cross leased properties. The update is here and the cross lease information below (original here).

Making your Southern Response build decision when you have a cross lease property If your property is a cross lease property then there is some important information you need to know. The shape and location of a building on a cross lease property need to correspond to what is shown on the title for the property. If they don’t correspond, then this will mean that the title for the property is defective. In some cases that may mean that the property is harder to sell in the future. If you have a mortgage, your bank may also be concerned because a defective title may affect its security. In addition any building work which results in a change to the external dimensions of the building may constitute a technical subdivision under the Christchurch City Council’s Christchurch City Plan. To fix these things the following steps may be required:

  • A subdivision consent from your local authority
  • A resurvey of the title
  • The registration of a new cross lease (this is often but not always required)
  • Consent from the neighbours to making the change
  • Consent from mortgagees on the title (e.g. the bank) to making the change

The cost of these things is not covered by your insurance policy and therefore you will need to identify the steps required in your particular case and take these steps yourself. We are prepared to start the building work before you take these steps but only if you:

  • Acknowledge that you understand the situation
  • Get the consent of neighbours to the work proceeding
  • Get the consent of mortgagees to the work proceeding
  • Acknowledge that you will bear the cost and responsibility for taking the steps set out  above and that Southern Response will not be liable

We may include additional terms in your building contract with us to deal with the matters discussed in this document. This document should be read in conjunction with the document “Making your Southern Response build decision”

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Community Law Canterbury – update

Community Law Canterbury (CLC) reopened for 2013 from today.  For appointments and opening hours contact them on 03 3666 870.  The outreach clinics will reopen the week of the 14th of January. For the first time since since the February earthquake the drop in service is running again.  The service operates only from their Riccarton office on Monday, Tuesday and Thursday evenings (5.30pm – 7pm) and on Saturday mornings (9.30am – 12pm). More information is available on the CLC website here.

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Disturbing public order in the name of protest

Last year’s TIME Magazine Person of the Year was the protester. Public protest actions brought down dictators in Tunisia, Egypt, and Libya. The Occupy movement put economic inequality and financial reform on the agenda.

This is the opening of media law barrister Steven Price’s article on the website NZLawyer online (here).  The article discusses the value of protest speech and looks at the difference between what is considered protest, and what is deemed abuse, in the context of the UK and New Zealand. A particularly interesting part is Steven Price’s list of his top ten reasons why protest speech is undervalued. Number 10 reads:

10. Protesters are annoying: Might this be the biggest factor? Protesters are often self-righteous, disrespectful, combative, tunnel-visioned, and whiny. They dress badly. Some are crackpots. I suspect the police and judges find it difficult to see them as social critics with something important to say.

He concludes with the following:

We have come a long way from the lofty constitutional principles I described at the outset. And that is really my point. The grubby daily business of the law is much more closely related to these factors, I think, than the free speech ones. And that’s disturbing, because we can’t tell in advance which of these protesters will turn out to be our age’s anti-slavery campaigners or suffragettes.

A good read.