13 Legal Executives New Zealand Spring 2026 When former Prime Minister, Sir Geoffrey Palmer, described New Zealand as an “irredeemably pluvial country,” he was expressing a fact of life whose impact many homeowners have come to rue. Weathertightness issues have long plagued property owners in this country and, although most of the publicity about leaky homes related to timber-framed houses and apartments built between 1988 and 2004, weathertightness defects continue to be a problem to this day. Two cases reached Court of Appeal The Court of Appeal has recently dealt with two cases involving leaky homes. The judgments underline the importance of legal executives considering weathertightness issues in all property sales and purchases. Purchasers should be advised to obtain all information possible about the weathertightness of the property, and to ask detailed questions about the possibility of leaks and the reasons for - and standards of - any repairs carried out. Leaky homes ongoing issue for legal executives in property sales and purchases Registered Legal Executives acting for vendors should ensure that they are aware of their obligations of disclosure, and of the legal consequences of failing to provide information or to be candid. In particular, vendors should understand that legal liability can arise not only from positive misrepresentations, but also from evasions and omissions. Correct method to calculate losses In the first case, the Court of Appeal explained in detail the correct approach to calculate the losses on which damages awards in leaky homes cases should be based. Rahal v Bhargav [2026] NZCA 176 involved the purchase of a residential property by Ameet Bhargav and Renu Khajuria from Davinder Rahal and First Trust Ltd. It quickly became apparent that the property was leaky and the purchasers brought proceedings for breach of contractual warranty and misleading or deceptive conduct under section 9 of the Fair Trading Act 1986. Continued on page 14...
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