The Financial Assistance Package - Relief at last for Leaky Home Owners!

The Financial Assistance Package is now available to owners of “Leaky Homes” that meet certain criteria.  The Package is designed to provide the homeowner with up to 50% of the agreed repair costs from Central Government and participating Local Authorities.  The Whakatane and Opotiki District Council’s have signed an agreement with the Crown to become participants.  The Kawerau District Council has opted not to participate in the Financial Assistance Package.  Any other party involved in the construction of the building may also agree to contribute to any repair costs.

Do you qualify?

Any homeowner seeking to claim the Financial Assistance Package contribution must meet the criteria set by both the Department of Building and Housing and the Local Authority.

In order to receive the 25% contribution from the Crown, the homeowner must:

(a)    have an eligible claim under the Weathertight Homes Resolution Services Act 2006;

(b)   the dwellinghouse must not have been the subject of a settled Weathertight Homes claim with the relevant Local Authority;

(c)   have obtained a full Assessor’s Report from the Department of Building and Housing;

(d)   have a repair plan agreed with the Department of Building and Housing; and

(e)    demonstrate to the Department of Building and Housing that they can pay their share of the agreed repair costs.

In order to receive a contribution from the relevant Local Authority of up to 25%, the homeowner must:

(a)    meet the criteria set out above; and

(b)   the relevant Local Authority must owe a duty of care to the homeowner in respect of the damage outlined in the Assessors Report (i.e. if the Council has completed a final inspection and issued a Building Code of Compliance Certificate for the home).

Pursuing the contribution:

After submitting an application for an Assessors Report, the homeowner will need to secure funding for the balance (50 percent or otherwise) of the remedial costs which they will be required to pay. If required, the homeowner will be able to borrow the 50 percent contribution from a Bank which will be guaranteed by the Government (provided that the homeowner meets the Bank’s lending criteria).

After funding is secured the homeowner must prepare plans for the remedial works and submit them to the Government for approval. A building consent for the works must be obtained as well as quotes for undertaking the same. These quotes must be reviewed and accepted by the Government.

It is at this point in the process when the remedial works are ready to commence, that the homeowner will make the final decision whether to accept the financial assistance package or not.

The Contribution Agreement:

There is no room to negotiate either the terms of the contribution or the contribution agreement with the Government and Local Authority.  We recommend that subsequent contributing parties be encouraged to enter into negotiations to join the agreement. This can include any other person or business with potential legal liability in respect of the dwelling such as the builder who undertook the works and any other subcontractors or tradesman that carried out work on the building.

Pursuing the balance of the Claim in the Weathertight Homes Tribunal:

There is no restriction on homeowners pursuing contractors and other parties that do not contribute to the contribution agreement for the balance of the agreed repair costs.

We recommend that homeowners consider pursuing any other party that does not wish to contribute to the contribution agreement in the Weathertight Homes Tribunal.

Homeowners have the opportunity to commence proceedings in the Tribunal against other involved parties in order to recover some or all of the remaining 50 percent of the costs of remedial works.

Proceeding with the contribution agreement may not always be the right decision for the homeowner, especially where the Local Authority has liability that may exceed 25 percent of the repair costs.

Our Advice:

We recommend that effected homeowners consult us regarding the implications of the Financial Assistance Package so as to enable us to assist you to make the right decision for your circumstances.