Oaks Shores’ body corporate asked the court to decide whether a 2016 decision by the Ministry of Business, Innovation and Employment (MBIE) was lawful under the Weathertight Homes Resolution Services Act.
MBIE’s stance means the 70-plus owners of the lakeside complex below Frankton Rd are missing out on a 25% contribution towards the estimated $12m cost of remediating the last of its four buildings.
However, Justice Laura O’Gorman found MBIE’s decision was lawful, and the ministry had correctly excluded block 4 from eligibility because its main use was non-residential.
It had been consented as a commercial rather than a residential building, and therefore did not meet the definition of a "dwelling house" as required by the Act, Justice O’Gorman said.
Although block 4 contained several apartments, the rest of the building contained a reception area, restaurant and other facilities.
The case is the latest development in the owners’ efforts to put right a litany of weathertightness and other building defects that emerged in the 84-unit complex after it was completed 18 years ago.
Remediation work began in 2019, and is still under way on blocks 3 and 4.
The owners pursued a $163m claim against the Queenstown Lakes District Council for signing off on the building, but settled out of court in 2022 for a confidential sum.
Body corporate chairman Graeme Kruger said it sought the judicial review to resolve a "grey area" in the law.
Were the appeal to fail, there would be $3m less in the body corporate’s "pot of money", but the remediation work would not be impacted.
It had been receiving funding from MBIE for the remediation work on the other three buildings, and had always found the ministry’s officials excellent to deal with.
"Even through this legal process, there’s been no animosity and no tension.
"We’re not viewing it as a combative approach, but rather to try to understand and interpret the law around this issue."
Remediation work on block 4 began late last year and was expected to be completed by next July, he said.
Work on block 3 was due for completion in mid-2026.
The appeal is set down for a hearing in October.
