In New Zealand, the Court of Appeal has recently upheld a High Court decision that the Building Act 10-year longstop does not apply to contribution claims against third parties.

Contribution claims are instead governed by s34 of the Limitation Act 2010. This means that time does not begin to run on contribution claims until settlement or judgment occurs. 

Insurers of third parties, such as professionals or construction entities, remain potentially ‘on the hook’ for much longer than previously thought.   

Background: Beca filed with third party proceedings

In October 2006, Wellington port operator CentrePort Ltd contracted the engineering and consultancy services of Beca Carter Hollings (Beca) for a new Bank of New Zealand (BNZ) building on the Wellington waterfront. Following construction, BNZ entered a long-term lease of the building in February 2011.

The building suffered devasting damage in the Kaikoura earthquake of November 2016 and BNZ were never able to return. The building was ultimately determined uneconomic to repair and has since been demolished.

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