Top court rules against insurer in valuation case
In a decision expected to apply to hundreds of Christchurch homeowners, this nation's top court has ruled against Tower insurance.
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See also: Tower talks down impact of Supreme Court valuation ruling
In a decision expected to apply to hundreds of Christchurch homeowners, this nation's top court has ruled against Tower insurance [NZX: TWR].
The Supreme Court has unanimously dismissed an appeal from Tower, which did not like the Court of Appeal's interpretation of one of its policies.
The dispute between Skyward Aviation and Tower was over a 20th century villa which Skyward bought in 2009 for $450,000. The property was damaged by earthquake and the land red-zoned.
Tower proposed a repair settlement of $165,000 based on the notion that a similar house, excluding land, could be bought for $365,000. However, Skyward says the repair cost is $682,524 – a difference of more than $300,000.
The key issue was whether the policyholder had the right to choose the cost of repairs or replacement under Tower's full replacement house policy.
A Supreme Court panel of Justices John McGrath, William Young, Susan Glazebrook, Terrence Arnold and Mark O'Regan found in favour of Skyward Aviation.
Tower's appeal application said out of more than 10,000 claims made after the Christchurch earthquakes, this issue was relevant to approximately 450 claims.
Skyward's lawyer Kevin Sullivan has described the decision as a "David versus Goliath" battle.
He told NBR ONLINE in July residents whose houses are uneconomic to repair should have the choice to rebuild on site or elsewhere or to buy a replacement house, and it should not be dictated to them by Tower.
Read the full judgment here.
Victoria Young
Mon, 15 Dec 2014
Mon, 15 Dec 2014
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Top court rules against insurer in valuation case
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