Liability change will affect landscapers

The Government has announced the biggest overhaul of New Zealand’s building consent system in two decades, with a liability shift likely to affect landscaping projects that require consents

Building and Construction Minister Chris Penk has said he will shift liability in the construction industry from joint and several liability to a proportionate model. Currently, councils can be forced to shoulder the majority of costs when building failures occur, even if they were only partly responsible; often because the developer or building company is no longer in business.

This is because joint and several liability is a legal principle, in which each responsible party is liable for the entire debt or obligation, allowing the injured party to recover the full amount from any single party or combination of parties.

The idea is to ensure that the claimant is fully compensated for their loss, even if one or more of the responsible parties are absent, insolvent, or otherwise unable to pay their share.

Under a proportional liability arrangement, each party is only responsible for their share of the problem. There is no ‘last man standing’ to pick up the whole bill if the other parties have gone bust or done a runner – resulting in a lower maximum payout amount for all involved.

Penk believes the current sytem makes building consent authorities (BCAs) risk-adverse.

“Right now, councils are hesitant to sign off on building consents and inspections because

they could be held liable for all defects, leaving ratepayers to foot the bill,” Penk said.

“Under this new model, each party will only be responsible for the share of work they carried out.”

For landscapers, this could mean councils become less risk-averse, reducing requests for extra documentation and delays – says Local Government New Zealand vice president Campbell Barry.

“It will encourage [less] of the overly-cautious behaviour that maybe has developed over time, due to that liability falling on councils,” said Barry.

However, Ben Rickard, Construction Risk Management Expert at Builtin, says it may make life more difficult for tradies in the long run.

“While there are probably good things that will come from a move to proportional

liability, the benefit is likely to mostly go to councils in the form of reduced exposure to defective building claims.

“Regardless of how these changes eventually shake out, it’s hard to see where tradies will benefit.

“In fact, it seems likely that more admin and compliance obligations will be piled on them – yet again!”

Landscapers frequently require consents for structures such as retaining walls over 1.5m (or with surcharge), decks where it is possible to fall more than 1.5m, swimming pools and fencing around pools, pergolas with roofing, and garden buildings over a certain size.

Time for change

The changes will be implemented by amending the Building Act 2004, with a Bill expected in early 2026. Until then, landscapers must continue to follow current rules and check local requirements carefully.