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Court action over quake-risk buildings

High Court legal action over the structural integrity of buildings has been initiated by Masterton Trust Lands Trust against a structural design company, the Masterton District Council, and the council’s peer reviewer.

The trust is seeking to recover the costs involved with remediating structural shortcomings of two of its buildings that have been found not to meet the seismic design standard for new buildings.

It has filed court action against the structural designer of the buildings, Kevin O’Connor & Associates, as well as Masterton District Council as the consenting authority, and the peer reviewer engaged by council to review structural aspects of the building designs, Spencer Holmes Limited.

The claim is for the estimated costs of remediating the trust’s buildings at 61 and 73 Dixon St Masterton, being McKenzies Carpet Court and Beaurepaires.

The buildings were built in 2011 and 2007 respectively.

The trust is considering its options in relation to a further nine of its buildings, all of which were structurally designed by Kevin O’Connor & Associates.

Of those, four buildings have been assessed as not meeting the New Building Standard.

The remaining five buildings are undergoing detailed reviews by independent engineers after initial assessments identified potential structural design issues.

Overall the 11 buildings, all built between 2003 and 2016, make up about 20 percent of the value of the trust’s total property assets, owned on behalf of the Masterton community.

Trust chairwoman Leanne Southey said the decision to take legal action had been carefully considered by the trustees after receiving independent advice from structural engineering and legal experts.

“We have a duty to our owners, the Masterton community, to make sure that the costs of resolving these issues are met by those responsible for designing and signing off the buildings,” she said.

Trust general manager, Andrew Croskery, said the claim for the two buildings needed to be made now to preserve the trust’s ability to seek remediation costs without encountering timing issues.

“The design deficiencies that have been identified in the first six buildings mean that the cost of remediation will be significant,” he said.

“While the legal process will take some time, we expect to start remediation works in mid-2017.”

Miss Southey said community grants in the coming year were likely to be “significantly reduced”.

“There is also likely to also be a negative impact on the trust’s property portfolio valuation.”

The trust has already confirmed its financial commitment to Aratoi and will be giving priority to education grants in the coming year.

In May this year the trust was advised by the Ministry for Business Innovation and Employment (MBIE) that the Institute of Professional Engineers NZ (IPENZ) had asked MBIE to review the design documents for six trust buildings after an IPENZ member raised concerns.

The trust agreed to MBIE commissioning Initial Seismic Assessments (ISAs) of the six buildings and helped MBIE in the review process.

Of those six buildings, three were found to be ‘earthquake prone’ (less than 34 per cent of the New Building Standard – NBS) after a further Detailed Seismic Assessment.

The other three were assessed as ‘earthquake risk’ (between 34 and 67 percent of the NBS).

In July, the trust commissioned Initial Seismic Assessments of five other commercial buildings structurally designed by the same engineering firm.

Initial Seismic Assessments assessed them all as potentially between 50 and 70 percent of the NBS.

In September the trust commissioned Detailed Seismic Assessments of those buildings and is awaiting the results.

Masterton District Council Chief Executive Pim Borren said yesterday he could confirm court papers had been received.

“The council has sought advice from its liability insurers in the first instance.

“As a result of the court proceedings we are not at liberty to respond more fully other than to say that Masterton Trust Lands Trust has kept us fully informed of their position throughout this process to date.

“We will not be able to comment further until this matter is resolved.”

Masterton Trust Lands Trust is a 145-year-old community-owned trust formed to own and manage surplus land not sold to Masterton’s working class settlers.

Income from property investments is distributed in grants to educational, cultural and community activities in Masterton.

Emily Ireland
Emily Ireland
Emily Ireland is Wairarapa’s Local Democracy Reporter, a Public Interest Journalism role funded through NZ On Air. Emily has worked at the Wairarapa Times-Age for seven years and has a keen interest in council decision-making and transparency.

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