Econicorp Holdings Limited  v Minister of Education - SC 107/2011

Civil Appeal – Duty of care – The applicant, Enconicorp, trading as Ahead Buildings, built a school hall pursuant to a contract it had with the school’s Board of Trustees – Ahead Buildings engaged LHT Ltd, structural engineers, to assist with the design and specifications –  Three or four years after the hall was completed it became apparent that it had serious defects and was unusable – The Board issued proceedings against Ahead Buildings in tort and contract, and against LHT Ltd in tort, for loss suffered as a result of the defects – The land and buildings that comprise the school are owned by the Crown through the Ministry of Education and the Ministry provided around 70 per cent of the funding for the hall’s construction – The Minister of Education issued proceedings against Ahead Buildings and LHT Ltd for loss suffered as a result of its breach of the duty of care owed to the Ministry – Ahead Buildings applied to the High Court to strike out the causes of action against it – The High Court struck out the Board’ s contractual claim and the Minister’s claim in tort – The Court of Appeal overturned the decision of the High Court to strike out the Minister’ s claim against the applicant – Whether the applicant ought to face a claim if that claim could not be otherwise brought – Whether the Minister should be allowed to continue her claim when it will substantially later the nature and substance of the proceeding against the applicant – Whether the Court of Appeal erred in not taking account of the fact that the claim of the Board is still subject to challenge – Whether the Court of Appeal erred in allowing the appeal when the Board entered into a settlement agreement with the applicant for repair of the hall, which relates to the question of loss suffered. [2011] NZCA 450  CA 160/2011