Civil litigation results

Cladding Action Q&As

Things you need to know about the Cladding Action against James Hardie.

Q: What is the Cladding Action?

A: The Cladding Action is a representative proceeding (better known as a class action) brought by representative plaintiffs on behalf of other owners of Harditex and Titan Board clad properties against cladding manufacturer James Hardie companies, Studorp Limited and James Hardie New Zealand (both referred to as "James Hardie").

Q: What is the claim about?

A: The plaintiffs allege that weathertightness issues in their properties are attributable to various alleged inherent defects in the cladding systems manufactured by James Hardie.  They also claim James Hardie made misleading statements about its cladding systems in its technical literature in breach of the Fair Trading Act.  James Hardie denies the allegation and will defend the claims.

Q: How is the claim progressing?

A: Very well.  On 27 November 2017, the Supreme Court dismissed James Hardie's application for leave to appeal the Court of Appeal's 30 August 2017 decision upholding the Representative Orders of the High Court made in December 2016 to allow the case to proceed as a representative (class action) proceeding in respect of three common issues and granting a five month opt in period for other class members to join the claim.  The Court of Appeal judgment stands, and the opt-in period for owners to opt in to join the claim closed on 31 January 2018.

Click here for the judgment of the Supreme Court dated 27 November 2017.

Click here for the judgment of the Court of Appeal dated 30 August 2017.

Click here for the judgment of the High Court dated 14 October 2016.

Click here for a copy of the sealed Representative Orders.

Class members can request a copy of the statement of claim upon confidentiality terms.  

Q: Who is James Hardie?

A: The Cladding Action claims are against James Hardie companies, Studorp Limited and James Hardie New Zealand.  The plaintiffs allege that these companies were responsible for the manufacture and supply of Harditex and Titan Board in New Zealand in the relevant period.  James Hardie's NZ website says that James Hardies companies operate in NZ, Australia, Asia, Europe and the United States, have 2,500 employees and generate A$1.55  billion a year.

Q: What is Harditex and Titan Board?

A: Harditex and Titan Board are fibre cement cladding products manufactured and sold by James Hardie.  Harditex was sold between 1987 and 2003 approximately.  Titan Board has been used since 1995 approximately.  Both products have been used extensively throughout New Zealand.

Q: Is it too late to join the Cladding Action?

A: Yes.  The Court of Appeal granted a five month "opt-in" period which expired on 31 January 2018.  Under the "opt-in period", owners of properties clad in Harditex and Titan Board that are suffering damage from the alleged inherent defects could join the claim provided they did so within the opt-in period.

Q: What are the opt-in periods?

A: Building owners had until 31 January 2018 to join the class action.  The opt-in period has now closed.

Q: Who are Tracey Cridge & Mark Unwin?

A: They were the first to lodge a claim as representative plaintiffs in the Cladding Action against James Hardie in respect of their Harditex clad property.  They are a Wellington couple who had experts investigate what they thought was a small leak at their property which turned out to be suffering from significant defects and hidden damage which is estimated to cost around $200,000 to repair.

Q: Who are Parker & Associates?

A: A specialist litigation law firm and leaky building experts who have resolved claims and achieved recoveries for hundreds of owners of residential houses, multi-unit apartments and commercial buildings. They have acted for over 500 home/unit owners of leaky homes and achieved circa $80m worth of recoveries for those clients in the last 11 years. They have also handled claims against James Hardie and others, which settled on confidential terms.

Q: How do I know if I am eligible to join the Cladding Action?

A: The opt-in period expired on 31 January 2018 so it is now too late to join the Cladding Action.  Opt-in was available during the opt-in period to current or past owners of buildings clad in Harditex or Titan Board which have suffered damage as a result of the alleged inherent defects.  

Generally expert investigations will be required to confirm the use of the products in question, the existence of defects and damage as a result of the alleged inherent defects.  Appropriate expert investigations can be arranged before or after you opt in.  

Q: I thought there was a 10 year limitation period for leaky building claims?

A: The 10 year limitation longstop in the Building Act does not apply to a product liability claim like this against a cladding manufacturer.  This was the finding in the 2016 Supreme Court decision in Carter Holt v Ministry of Education, which involves a similar claim against a cladding manufacturer.

The 15 year limitation longstop does not apply to these claims either because the representative proceedings were filed before that longstop came into effect.

Q: Will there be a litigation funder in the Cladding Action?

A: No.  The participants in this claim are pooling resources to fund the claim.  This means that they will receive the proceeds of successful litigation after repayment of their costs and will not have to pay a large percentage of that recovery to a litigation funder to repay the litigation funder's costs and commission.

Q: What will this cost and when will payments be required?

A: Details of the opt-in fees and levies were provided to prospective class members upon registration of interest and under confidentiality terms.  The larger the group the less each participant will need to pay to fund the litigation.  

Q: What kind of recovery can claimants achieve?

A: This will not be known until the case is determined by the Court or through a negotiated settlement.  Claimants will generally seek recovery of all actual or estimated repair costs (or alternatively lost value) and other claimable losses and costs.  The amount recovered, if any, will vary from claimant to claimant depending on a range of factors and risks.

Generally, a negotiated settlement will involve an element of compromise to reflect costs and risks.

The successful litigant after a hearing is generally awarded a contribution to legal costs based on scale, plus the reasonable experts' costs incurred (subject to assessment by the Court).

Plaintiffs face the risk of adverse costs against them on the same basis if they do not succeed in Court.

Q: How long will the process take?

A: The process has taken approximately 2 years to reach this point.  We anticipate another 2 to 3 years will be required to resolve the claim but this could be more or less depending on a range of unpredictable variables.