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Weathertight Homes Resolution Services Amendment Bill

Year: 2015 Number: 6

The departmental disclosure statement for a government Bill seeks to bring together in one place a range of information to support and enhance the Parliamentary and public scrutiny of that Bill.

It identifies:

the general policy intent of the Bill and other background policy material;
some of the key quality assurance products and processes used to develop and test the content of the Bill;
the presence of certain significant powers or features in the Bill that might be of particular Parliamentary or public interest and warrant an explanation.

This disclosure statement was prepared by the Ministry of Business, Innovation and Employment.

The Ministry of Business, Innovation, and Employment certifies that, to the best of its knowledge and understanding, the information provided is complete and accurate at the date of finalisation below.

21 November 2014.

Part One: General Policy Statement

The purpose of the Bill is to:

to remove any doubt about the validity of the criteria in clauses 1B and 1C of the notice published under the authority of the Act in Gazette on 28 July 2011 “Contribution Criteria: Financial Assistance Package” (the notice); and

to deem certain claims determined as ineligible on the basis of the meaning of the term built in sections 14 to 18 to be eligible claims (as a result of the Supreme Court’s decision in Osborne v Auckland Council [2014] 1 NZLR 766 (SCNZ)); and

to widen the definition of qualifying claimant in section 125B of the Act to include claimants that are actively progressing claims so that these persons are not prevented from having recourse to the provisions in the Act relating to the financial assistance package (the FAP) established in Part 1A of the Act.

Criteria

The criteria 1B and 1C are two of a number of criteria that a person needs to meet in order for the person to be a qualifying claimant for the purpose of receiving financial contributions to agreed repairs from the Crown, and in some cases the relevant territorial authority, under the FAP.

The Act provides for contribution criteria that are specified by the chief executive by notice in the Gazette in respect of the FAP (see paragraph (b) of the definition of qualifying claimant in section 125B(1)). It is the notice, rather than the Act, that contains the detail of the FAP contribution criteria.

The notice was issued in 2011 following consultation between the Chief Executive of the Department of Building and Housing (now the Ministry of Business, Innovation, and Employment) and relevant territorial authorities. The contribution criteria in the notice are only applicable to a relevant territorial authority that has agreed to become a participating territorial authority (PTA) for the purpose of the Act.

The effect of criterion 1C is that, where a FAP claimant commences civil proceedings against a PTA, the claimant can no longer qualify for a Crown contribution under the FAP unless the PTA agrees to the claimant receiving the contribution and the claimant discontinues the civil proceedings entirely. The criterion in clause 1B imposes a similar requirement in relation to adjudication proceedings brought under the Act.

Recent consideration of criteria 1B and 1C has raised the question as to whether or not the criteria, which give PTAs the power not to permit the owner of a dwellinghouse to be eligible for a Crown contribution under the FAP, would better be located in the Act rather than a Gazette notice. The matters in criteria 1B and 1C go to the heart of the relationship between the FAP and civil proceedings, and were an integral reason why the relevant territorial authorities agreed to become PTAs.

In order to avoid any doubt as to the intended effect of the criteria in clauses 1B and 1C, this Bill moves those criteria into the Act so there is no question of inconsistency with the Act. The Bill also validates all previous decisions made in accordance with criteria in clauses 1B and 1C.

The protections in the criteria sit alongside the protection from civil proceedings in section 125G of the Act. However, the protection from civil proceedings in section 125G applies only to PTAs that agree to make contributions to a claimant and only from the point at which the PTA actually makes its first contribution to a claimant. Protection of PTAs from civil proceedings while FAP assessment is underway is, as stated above, an important part of the PTAs’ collective decision to become PTAs for the purpose of the FAP.

The FAP is intended to channel resources that would otherwise be used in litigation into repairing leaky homes. This Bill furthers that purpose as it clarifies, so there is no doubt, the intended effect of criteria 1B and 1C. The FAP is a time-limited scheme that expires in July 2016.

“Built date”

To have an eligible claim under the Act, claimants must meet a series of statutory criteria, including that the claim must be made within 10 years of the date on which the affected structure was built (see the requirements of sections 14(a), 15(c), 16(a), 17(a), and 18(c) of the Act).The term “built” is not defined in the Act.

On 10 June 2014, the Supreme Court held that section 14(a) of the Act, when construed in context and with regard to the Act’s purpose, should be interpreted as a paraphrase of section 393 of the Building Act 2004. It held that the word “built” in section 14(a) was intended to be construed by reference to the expression “building work” in section 393, which encompasses certifications.

The effect of the decision in the Osborne case is that access to the scheme in the Act now runs for ten years from the date the code compliance certificate (if any) is issued which allows for a larger number of claimants than the previous interpretation which was from the date of final inspection (sometimes being a date earlier than the issue of a Code Compliance Certificate).

The Bill deems claimants who were found ineligible due on the basis of the previous interpretation of built but who would have been eligible had the decision been made based on the Supreme Court interpretation of built to be eligible.

“Qualifying Claimant”

In order to apply for the FAP under the Act a ‘notice to proceed’ must be issued. The claimant must become a ‘qualifying claimant’ so that a ‘notice to proceed’ can be issued. To become a ‘qualifying claimant’ there a number of steps involved, including obtaining an assessor’s report; arranging funding; signing a homeowner agreement; commissioning a repair plan; obtaining a building consent; obtaining quotes; and agreeing to a payment plan.

The Act sets a deadline for the FAP of 23 July 2016 which means that claimants who wish to access to the FAP need to progress their claim to the ‘notice to proceed’ stage by 23 July 2016.

The Bill makes an amendment to the definition of ‘qualifying claimant’ to ensure that claimants actively progressing towards the ‘notice to proceed’ stage will be in a position to make an application for the FAP before 23 July 2016 and, therefore, continue to progress under the scheme after 23 July 2016.

Part Two: Background Material and Policy Information

Published reviews or evaluations

2.1. Are there any publicly available inquiry, review or evaluation reports that have informed, or are relevant to, the policy to be given effect by this Bill?

Relevant international treaties

2.2. Does this Bill seek to give effect to New Zealand action in relation to an international treaty?

Regulatory impact analysis

2.3. Were any regulatory impact statements provided to inform the policy decisions that led to this Bill?

A regulatory impact statement was not required as the Bill involves technical “revisions” or consolidations that substantially re-enact the current law in order to improve legislative clarity or navigability (including the fixing of errors, the clarification of the existing legislative intent, and the reconciliation of inconsistencies).

The Department of Building and Housing produced a regulatory impact statement on 23 November 2011 to help inform the main policy decisions taken by the Government relating to the contents of the Weathertight Homes Resolution Services (Financial Assistance Package) Amendment Bill. This is available at: http://www.dbh.govt.nz/ris-financial-assistance-package and http://www.treasury.govt.nz/publications/informationreleases/ris.

Extent of impact analysis available

2.4. Has further impact analysis become available for any aspects of the policy to be given effect by this Bill?	NO

2.5. For the policy to be given effect by this Bill, is there analysis available on:
(a) the size of the potential costs and benefits?	NO
(b) the potential for any group of persons to suffer a substantial unavoidable loss of income or wealth?	NO

2.6. For the policy to be given effect by this Bill, are the potential costs or benefits likely to be impacted by:
(a) the level of effective compliance or non-compliance with applicable obligations or standards?	NO
(b) the nature and level of regulator effort put into encouraging or securing compliance?	NO

Part Three: Testing of Legislative Content

Consistency with New Zealand’s international obligations

3.1. What steps have been taken to determine whether the policy to be given effect by this Bill is consistent with New Zealand’s international obligations?

No steps were taken in relation to determining consistency with New Zealand’s international obligations because the provisions of the Bill do not affect New Zealand’s international obligations, and are relevant only to domestic law.

Consistency with the government’s Treaty of Waitangi obligations

3.2. What steps have been taken to determine whether the policy to be given effect by this Bill is consistent with the principles of the Treaty of Waitangi?

No steps were taken in relation to determining consistency with the principles of the Treaty of Waitangi because the provisions in the Bill were not considered to have implications for Māori as individuals, communities or tribal groupings.

Consistency with the New Zealand Bill of Rights Act 1990

3.3. Has advice been provided to the Attorney-General on whether any provisions of this Bill appear to limit any of the rights and freedoms affirmed in the New Zealand Bill of Rights Act 1990?	YES
Advice provided to the Attorney-General by the Ministry of Justice, or a section 7 report of the Attorney-General, is generally expected to be available on the Ministry of Justice's website upon introduction of a Bill. Such advice, or reports, will be accessible on the Ministry's website at http://www.justice.govt.nz/policy/constitutional-law-and-human-rights/human-rights/bill-of-rights

Offences, penalties and court jurisdictions

3.4. Does this Bill create, amend, or remove:
(a) offences or penalties (including infringement offences or penalties and civil pecuniary penalty regimes)?	NO
(b) the jurisdiction of a court or tribunal (including rights to judicial review or rights of appeal)?	NO

Privacy issues

3.5. Does this Bill create, amend or remove any provisions relating to the collection, storage, access to, correction of, use or disclosure of personal information?

External consultation

3.6. Has there been any external consultation on the policy to be given effect by this Bill, or on a draft of this Bill?

Other testing of proposals

3.7. Have the policy details to be given effect by this Bill been otherwise tested or assessed in any way to ensure the Bill’s provisions are workable and complete?

Part Four: Significant Legislative Features

Compulsory acquisition of private property

4.1. Does this Bill contain any provisions that could result in the compulsory acquisition of private property?

Charges in the nature of a tax

4.2. Does this Bill create or amend a power to impose a fee, levy or charge in the nature of a tax?

Retrospective effect

4.3. Does this Bill affect rights, freedoms, or impose obligations, retrospectively?

YES

The Bill is validating legislation that has the purpose of removing any doubt about the validity of criteria 1B and 1C of the notice in the New Zealand Gazette issued under the Weathertight Homes Resolution Services Act 2006 entitled “Contribution Criteria: Financial Assistance Package”.

Validation is necessary to address recent consideration of criteria 1B and 1C that raised the question as to whether or not the criteria would better be located in the Act rather than a Gazette notice.

In order to avoid any doubt as to the intended effect of criteria 1B and 1C, the Bill confirms both the validity of criteria 1B and 1C and the validity of previous decisions based on them (clause 6, new sections 161-162 refers) and moves those criteria into the Act so there is no question of inconsistency with the Act. The Bill does not change the substance of, or the policy behind, the existing Financial Assistance Package Contribution Criteria.

Criteria 1B and 1C are two of a number of criteria that need to be met in order for a person to be a qualifying claimant for the purpose of receiving financial contributions to agreed repairs from the Crown, and in some cases the relevant territorial authority, under the financial assistance package (FAP) established under the Weathertight Homes Resolution Services Act 2006.

The matters in criteria 1B and 1C, which give a participating territorial authority the power not to permit the owner of a dwellinghouse to be eligible for a Crown contribution under the FAP, go to the heart of the relationship between the FAP and civil proceedings, and were an integral reason why the participating territorial authorities chose to become, and remain, part of the FAP. The FAP is a time limited scheme which expires on 23 July 2016.

Strict liability or reversal of the usual burden of proof for offences

4.4. Does this Bill:
(a) create or amend a strict or absolute liability offence?	NO
(b) reverse or modify the usual burden of proof for an offence or a civil pecuniary penalty proceeding?	NO

Civil or criminal immunity

4.5. Does this Bill create or amend a civil or criminal immunity for any person?

Significant decision-making powers

4.6. Does this Bill create or amend a decision-making power to make a determination about a person’s rights, obligations, or interests protected or recognised by law, and that could have a significant impact on those rights, obligations, or interests?

Powers to make delegated legislation

4.7. Does this Bill create or amend a power to make delegated legislation that could amend an Act, define the meaning of a term in an Act, or grant an exemption from an Act or delegated legislation?

4.8. Does this Bill create or amend any other powers to make delegated legislation?

Any other unusual provisions or features

4.9. Does this Bill contain any provisions (other than those noted above) that are unusual or call for special comment?

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