Lessons for apartment buyers from tale of man blamed for 40 per cent of his leaky home losses | #romancescams | romancescams | #scams

OPINION: We are all, to some extent, the authors of our own financial failures, even when others play a leading role in them.

But it’s rare to see a court set a percentage figure on our share of culpability.

Whenever people lose money on things – investment failures, ponzi schemes, romance scams, church affinity frauds, leaky homes – there is a muttering of blame.

“How could they have been so stupid?” people say, often unfairly.

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This muttering has been especially pronounced over leaky buildings.

Living in a country that literally forgot how to build properly has been shattering for many people, costing them fortunes and eroding their trust in society, and their fellow humans.

But since the early 2000s we have all been on notice of our collective inability to build simple structures competently, or with proper care, especially during the 1990s and early 2000s, which was the era of peak awful bad and crooked building practice.


The Detail: It is massive in money terms – $250 million worth – but still a drip in the bucket when it comes to the decades-old leaky building saga.

When it comes to leaky buildings, owners of properties must be upfront during the sales process, but it would be wrong to think the mantra of buyer beware is dead.

The concept of “contributory negligence” under which a court can decide what portion of your loss is your fault remains current.

It is illustrated by the case of a man called Michael Roberts?, who bought an apartment in Wellington’s blighted 11-storey Sirocco Apartments.

This block was built out of materials entirely unsuited to Wellington’s climate.

Roberts bought his place for $397,000 ?in early 2014?.

Roberts relied on honestly meant, but misleading statements made by a body corporate secretary that Sirocco had experienced weathertightness issues, but these related only to walkways, and they had been rectified.

Later in 2014, the body corp billed him $11,460.62 to fix rotting timber and deteriorating steelwork.

The body corp secretary had been terribly, terribly wrong. The building suffered from serious weathertightness defects.

Tragically, assessing the true extent of the rot led to the body corporate billing Roberts the following year for $218,000 for his share of the cost to fix it.

This is the kind of life-changing financial horror leaky building owners have had to cope with.

Roberts sued the body corp management company, and the secretary, and was awarded $93,500 plus general damages of $25,000.

It would have been more, but the High Court found Roberts’ own negligence caused around 15 per cent of his loss, and factored that into the damages it awarded him.

It’s a miserable outcome for him, but his fight for financial justice has provided the rest of us with an apartment-buying lesson.

Roberts knew the possibility that buildings like Sirocco leaked, but he failed to obtain a specialist pre-purchase inspection report.

Roberts should also have reviewed the body corporate’s minutes of meetings, which told a depressing tale of leaks going back to 2007.

These minutes would have opened his eyes.

These two steps are a must for every apartment buyer, and the courts, it seems, will hold people accountable for not doing them.

As Roberts found, you simply cannot take people’s word on trust, though the courts in his case did not believe the body corp secretary misled him intentionally.

Apartment buyers must remember that body corporates can be strange beasts.

They represent owners, and owners are not always willing to look facts full in the face when it comes to anything that reduces the value of their apartments in the eyes of buyers.


  • Do your homework
  • Be cautious when buying apartments
  • Learn from others’ mistakes

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