Back Home 5 News 5 Swimming pool owners fail in negligence claim against council

Swimming pool owners fail in negligence claim against council

17 May 2024

| Author: Andrea Hilton

Negligence – negligent misstatement – proximity –statutory setting  –protection economic interest –damages – Fencing of Swimming Pools Act 1987ss 3-4, 7-8 & 10 – Building Act 2004 ss 7-8,162-162E, 221,393–definition of building work – definition of building –Building Regulations 1992 cl F9 (Building Code) –Limitation Act 1950 – Limitation Act 2010 ss 11,14 –Carter Holt Harvey v Minister of Education [2016] NZSC 95–North Shore City Council v Body Corporate 188529 [2010] NZSC 158 (Sunset Terraces)–Attorney General v Carter [2003] 2NZLR 160 (CA)–Marlborough District Council v Altimarloch Joint Venture Ltd [2021] NZSC 11.

Tasman District Council v Louise Buchanan, Marshall & Donald as Trustees of the Buchanan Marshall Family Trust [2024] NZCA 133

 

The council successfully appealed the High Court’s decision that the council had made negligent misstatements in respect of swimming pool fencing, awarding damages to Buchanan (the owners) and declaring that the council had been negligent in issuing a building consent and code compliance certificate in 2006.

The High Court noted the proceedings appeared to be the first to claim a duty of care to protect economic interests under the Fencing of Swimming Pools Act (FOSPA).

The property – comprising a house, garage and studio built around a courtyard containing a swimming pool – was in the council’s district. The swimming pool and buildings were built at the same time in accordance with the same building consent issued by the council in 2004.

The pool was enclosed by the building and two fences, and there were gates in the fences and doors from the building to the pool surrounds. In reliance on the council’s inspections, the code of compliance certificate (CCC) for the house and pool was issued in 2006.

The owners purchased the property in 2008, after checking there was a code compliance certificate in place. They did not materially change the fencing between 2008 and 2019 and there was no material change to the legislation.

The council inspected the pool in 2009 and again in 2012 under the FOSPA and advised the owners that the fencing was compliant.

In 2019, the owners advertised the property for sale. The council reinspected the pool fencing and advised it was noncompliant. MBIE determinations upheld the council’s assessment. The owners made the pool fencing compliant and claimed the changes reduced the property’s value.

In December 2019, the owners issued proceedings against the council, claiming negligent misstatement, breach of statutory duty and negligence.

The High Court found that the council’s regulatory role in inspecting swimming pools under the Building Act 2004 (BA 2004) and the building of residential buildings was close enough to justify a duty of care in relation to pool inspections.

It awarded special damages for loss of a chance and general damages. The High Court also found that the 2009 inspection was time-barred under the BA 2004 s 393 10-year longstop.

Both parties accepted that a claim against the council relating to the building consent, building inspections and the issue of a code compliance certificate were time-barred. The main issues on appeal were the scope of the duty owed by the council and whether the 2009 and 2012 inspection were caught by se 393. Some of the less significant issues were, whether:

  • evidence of the standard of pool inspections was necessary to establish negligence; and
  • the damages awarded were excessive.

The Court of Appeal said the statutory context meant an analysis of the applicable legislation was necessary to determine the “existence and scope of a duty of care”.

It examined the purposes of FOSPA and subpart 7A of Part 2 of the BA 2004. The purpose in both Acts was to keep young children safe around residential swimming pools. The purpose of the BA 2004 in respect of building consents was to ensure homeowners had habitable dwellings.

To achieve this purpose, councils must have a duty of care towards house owners. The purpose of the legislation requiring pool inspections was safety, not the protection of economic interests of pool owners. Ongoing inspections of pools were necessary because fencing may change over time and the safety of a pool compromised.

The Court of Appeal applied the test in Carter Holt Harvey para 80 to determine whether the council was sufficiently proximate to the owners.

Unlike the High Court, the Court of Appeal found that the test was not satisfied because the council did not know the owners’ purpose. It did not accept that the owners acted on the advice because their position did not change. The Court of Appeal considered this was a “subsequent inspection” case indistinguishable from the Supreme Court-approved Court of Appeal decision where the focus was also on safety.

The Court of Appeal also distinguished the line of Supreme Court judgments upholding claims against councils in respect of building consents, inspections and code compliance certificates such as Sunset Terraces from Attorney General v Carter and these proceedings. The LIM case Altimarloch was also distinguished on the basis that an applicant for a LIM pays a fee and a LIM is produced for the applicant’s benefit.

 

Applicable principles: Proximity necessary for negligent misstatement – would liability be disproportionate to defendant’s carelessness? – whether defendants will be exposed to indeterminate liability – statute purpose important – policy considerations relevant in statutory context– statement to be used only for its intended purpose – evidence of standard sometimes unnecessary in negligence – FOSPA regulated owners not councils – damages calculated at date of loss –remediation costs inform assessment of damages – limitation time commences on date loss discovered –s 393 has limited application – rare declaratory relief and damages awarded in tort – limitation period not extended by negligent conduct– limitation period not extended by fraudulent concealment – additional evidence must be “fresh, credible and cogent”

 

Held: The orders made by the High Court were set aside. There was insufficient proximity between the parties for a claim of negligent misstatement and there were policy factors against “recognising a duty of care”.

In the context of the purpose of the BA 2004, the council did not have a duty of care to protect the owners from economic loss.

Since the council conceded it was negligent at the CCC stage, it was justifiable to accept that it was negligent in 2009 and 2012 and therefore evidence of standards was unnecessary.

The council’s application to adduce further evidence was declined.

The court also said if the appeal had been dismissed it:

  • would not overturn the High Court’s assessment of damages;
  • the 2009 inspection was not time-barred because s 393 of the BA 2004 did not apply and the extended time under s 14 ran from the time the loss was discovered in 2019; and
  • It was arguable that the owners could not rely on the 2009 and 2012 inspections to extend the time in relation to the original negligence by the council because that negligence is time-barred by s 393.

 

After 14 years as general counsel for a local authority, Andrea Hilton is now a sole practitioner practising local government law

 

Tasman 20240506-Tasman District Council v Buchanan & Marshall [2024] NZCA 133

Subscribe to

LawNews

The weekly online publication is full of journalistic articles written for those in the legal profession. With interviews, thought pieces, case notes and analysis of current legal events, LawNews is a key source of news and insights for anyone working within or alongside the legal field.

Sign in or
become a Member
to join the discussion.

0 Comments

Submit a Comment

Your email address will not be published. Required fields are marked *

Latest Articles

Loading...