New Zealand Case Law: Decisions & Judgments | LexChat

Topic

Notional rebuild

Legal area

Court

22 Jul 2015

SOUTHERN RESPONSE EARTHQUAKE SERVICES LIMITED v AVONSIDE HOLDINGS LIMITED [2015] NZSC 110

Citation

[2015] NZSC 110
Court

Supreme Court

The Court held that the correct approach is to estimate the actual cost of rebuilding on the site and that such an estimate properly includes reasonable contingency allowances and professional fees assessed by orthodox quantity surveying practice; a notional rebuild does not eliminate the existence of risks or justify excluding contingencies or realistic professional fees, so the Court of Appeal's approach was correct and the appeal was dismissed.
1 Oct 2014

AVONSIDE HOLDINGS LIMITED V SOUTHERN RESPONSE EARTHQUAKE SERVICES LIMITED CA520/2013 [2014] NZCA 483

Citation

[2014] NZCA 483
Court

Court of Appeal

The Court held that the notional rebuild cost for the 'buy another house' option must reflect the costs that would be incurred if the property were actually rebuilt on the same site, including reasonable contingency allowances and professional fees; however, external works that can be repaired to an 'as new' condition may be valued at repair cost when calculating the insurer's cap, and the High Court decision on external works was confirmed.