LGOIMA Request Details

As a Building Consent Authority (BCA), the Council has several key liabilities. These are tied to its role in ensuring that building work complies with the relevant building codes. The liabilities stem from ensuring compliance throughout the building process. Section 391 of the Building Act establishes that the Council can be held liable for negligence if it fails in its duties. Additionally, under Section 393, the Council may be liable for up to 10 years. 

Some of the key liabilities may include, but are not limited to: 

Compliance with the Building Act (2004) & Building Code 

The Council, as a BCA, must act in accordance with the Building Act 2004, which governs building work, including issuing building consents, inspections, and code compliance certificates (CCCs). 

Under Section 49 of the Building Act, the Council must grant a building consent if it is satisfied, on reasonable grounds, that the building work will comply with the provisions of the Building Code, assuming it is completed correctly in accordance with the plans and specifications submitted with the application. Similarly, under Section 94, the Council is required to issue a Code Compliance Certificate if it is satisfied, on reasonable grounds, that the completed building work complies with the building consent. 

To fully guarantee that all consented building work complies with the Building Code, and thereby eliminate any potential liability, the Council would need to have a building inspector present on every site 24/7. 

Liability: If the Council fails to properly carry out its duties under the Act, it may be held liable for any damage or harm caused by building work that doesn't comply with the building code. 

Issuing Building Consents 

As mentioned above, the Council is responsible for issuing building consents for building work, ensuring that the proposed work complies with the Building Code. 

Liability: If the Council wrongly approves a building consent for non-compliant work, it could be held responsible for any issues that may arise from that work. This could include structural failures, fire safety issues, or other hazards. 

Conducting Inspections 

The Council must carry out inspections of building work during construction to ensure that it meets the approved plans and the Building Code. 

Liability: If the Council fails to conduct adequate inspections or fails to identify issues it could face legal or financial liability for any defects that arise later. 

Issuing Code Compliance Certificates (CCCs) 

Once building work is completed, the Council must issue a Code Compliance Certificate (CCC) to confirm that the work complies with the approved plans and the Building Code. 

Liability: If a CCC is issued for work that doesn't comply with the Building Code or is substandard, the Council may be held responsible. 

Acceptance of Producer Statements 

A producer statement is a professional opinion based on sound judgment and specialist expertise. It is not a product warranty or guarantee of compliance. 

The producer statement system is intended to provide Building Consent Authorities (BCAs) with reasonable grounds for the issue of a Building Consent or a Code Compliance Certificate, without having to duplicate design or construction checking undertaken by others. 

Liability: Although producer statements are commonly used and well-established, they do not carry any specific legal status under the Building Act 2004. They serve as one of the sources of information that the Council may consider when assessing whether building work complies with the Building Code. However, because producer statements are not legally binding under the Act, the Council assumes full liability upon accepting them as part of the compliance assessment process. 

The total financial exposure the Council faces in its role as a BCA? 

The total exposure is unknown as it is depended on the value of work being undertaken. 

Council is covered under PI – Professional Indemnity Insurance. 

The annual cost to ratepayers to maintain BCA related liability cover. 

Council does not have this information, as we do not hold separate BCA coverage; it is included under our Professional Indemnity (PI) insurance. 

The Council does not allocate a separate budget specifically for BCA claims. Instead, any claims are covered under the Legal Expenses budget. For the 2023-24 financial year, this budget was set at $16,000. According to the Council's Revenue and Financing Policy, funding for the Building Control Activity is divided into 40% from rates and 60% from user fees. As such, the rates-funded portion of this budget amounts to $6,400. 

Council does not maintain a reserve specifically for BCA claims. It does maintain a self-insurance reserve, but this is not allocated for specific activities. For the 2023-24 this reserve had a balance of $890,000 

Council does not have this information. 

Legal expenses for the past three years totals $52,001.