What did Brownlee know about Southern Response’s misleading and deceptive conduct?

Written By: - Date published: 4:37 pm, September 8th, 2020 - 27 comments
Categories: christchurch earthquake, Gerry Brownlee, national, uncategorized, you couldn't make this shit up - Tags:

I am just asking questions.  But they need to be asked.  What did Minister of CERA Gerry Brownlee know about Southern Response’s apparent policy to mislead claimants about the amount they should have been repaid?  Because this was not a one off event, it appears that it was business as usual for Southern Response.

The detail is provided in this Court of Appeal decision.  Mr and Mrs Dodds sued Southern Response essentially on the basis that they had been unlawfully misled about their actual entitlement under the policy with Southern Response.  The summary of the background is contained in this passage:

The Dodds entered into a Settlement Agreement with Southern Response under which they settled their insurance claim on the basis that a “fair and reasonable estimate for the rebuild cost of the insured property, and the sum insured under the policy, is $907,321”. This figure was based on the figure shown in the Abridged [detailed rebuild/repair analysis document], with some adjustments that are immaterial for present purposes.  The Dodds subsequently discovered that a more extensive DRA had been prepared by Arrow for Southern Response (the Complete DRA). The Complete DRA set out a number of additional costs that Arrow estimated Southern Response would incur if the house was rebuilt on its existing site, including allowances for professional fees and contingencies. Those additional costs amounted to approximately $205,000.”

The Court held that Southern Response’s behaviour constituted a misrepresentation under section 35 of the Contracts and Commercial Law Act 2017 which justified an award of damages and that it also breached Fair Trading Act in that it was misleading and deceptive conduct.  From the Judgment:

We consider that the Judge was right to find that Southern Response had made misrepresentations about its estimate of the cost of rebuilding the house, and about the absence of any other report from Arrow setting out a different rebuild cost. The Judge was also right to find that by making these misrepresentations, Southern Response breached the [Fair Trading Act].”

Pretty clear eh.  The kicker for Southern Response is that it appears this was not a one off event.  From Radio New Zealand:

Lawyer for the Dodds, Peter Woods, said the decision delivered “clarity” in spades.

“The Court of Appeal was absolutely clear Southern Response had made representations that were false, that the Dodds had relied on those, they were induced to enter into an agreement based on those misrepresentations, that the misrepresentations were also misleading and deceptive, and the Dodds were entitled to almost their full claim, so it totals up to about $250,000.”

Woods said the government should now have “perfect clarity”, which could apply to thousands of other cases.

“In the High Court, Southern Response’s evidence was there was at least 1600 other claims in a similar position. If they are all valued at $250,000 then you do the maths on that … the government’s probably exposed to in excess of $500 million as a result of this.”

And one of the successful plaintiffs, Karl Dodds, has asked some very pertinent issues.  Again from Radio New Zealand:

[Dodds] said decisions were made by the “highest level of the organisation” and renewed his call for an inquiry into Southern Response, by the likes of Dame Silvia Cartwright.

It would need to be similar to the inquiry into EQC, but with one difference.

“EQC made a lot of mistakes but they were really caught off guard. Nobody expected the magnitude of the disaster. They were understaffed, ill-equipped and perhaps one could say they did their best, but with that said we spent the first two years battling EQC, with letters flying backwards and forwards and getting more and more fiery as we went.

“But with Southern Response they don’t have the same excuse. They came into existence after the disaster and therefore were well-equipped to behave professionally and competently and this they failed to do.

“When an independent person digs deep enough they will be able to find all sorts of additional dubious practices of which we are well aware but we are not going to disclose at this point in time, which will really push the whole case, as to their behaviour, beyond another level.”

So at what level was the decision made to engage in what the Court of Appeal has said was misleading and deceptive conduct and what did Brownlee know about it?  We deserve an answer.  After all it seems that 1,600 Christchurch residents and couples have been short changed by about half a billion dollars because of this decision.

27 comments on “What did Brownlee know about Southern Response’s misleading and deceptive conduct? ”

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  1. ianmac 1
    8 September 2020 at 4:49 pm

    I am just asking questions. But they need to be asked. What did Minister of CERA Gerry Brownlee know about Southern Response’s apparent policy to mislead claimants about the amount they should have been repaid?

    Oh boy! Although there are some people who resent questions being asked, clearly the Hon Jerry Brownlee is not one. His response will be very interesting. Ask away.

    • Pat 1.1
      8 September 2020 at 6:20 pm

      The questions were asked years ago….the (non)response was typical Brownlee. I doubt he will change tack now

  2. Bazza64 2
    8 September 2020 at 4:57 pm

    That photo of Brownlee in army uniform reminds me of Schultz off Hogan’s Heroes. When being hassled about anything Schultz would say “I know nothing” A good defence for GB.

    • Anne 2.1
      8 September 2020 at 5:11 pm

      What did Brownlee know?

      There's your answer.

      • karol121 2.1.1
        9 September 2020 at 3:33 pm

        Perhaps more, or less than he has indicated, perhaps not.

        Perhaps he was simply the recipient of disinformation from various factions who advocate NOT telling certain politicians that which they DO NOT wish to hear.

        Bear in mind too, that in so far as it pertains to New Zealand Court of Appeal decisions, there are those judges who seem to convey (without openly expressing it), that the taxpayers pool and other insurance related pools are NOT bottomless pits.

        Matters brought appear to often be viewed by these bench panelists as muck raking litigants who just cannot get it into their dull, litigant heads that the NZ system does things its way, and that there is little room or patience for what they seem to view as being misleading cases, nor those cases considered contentious and possibly either costly or embarrassing for the “Crown” (not being an establishment of any representative monarch but simply a figurehead mechanism serving the interests of those who appear too matter in NZ).

        At the end of the day, it is your pool, and so even if such decision making by a court or a minister of the Crown does appear to short change claimants, it is usually considered to be more money in your coffers as contributors.

    • Red 2.2
      9 September 2020 at 9:04 am

      Duh, I think that was the point of the photoshop

  3. Stuart Munro 3
    8 September 2020 at 5:09 pm

    Brownlee was granted exceptional powers to do exactly what he did. The Key government's economic policies were a resounding failure, and they were happy to loot the funds that should have gone to the Christchurch rebuild to prop up the sagging facade of competence. When one looks over the ruins of Christchurch, the villain is not hard to find. Napier was rebuilt in two years – Christchurch is still a wreck.

    Belushi is more convincing than Brownlee.

    • Dean Reynolds 3.1
      8 September 2020 at 9:42 pm

      Stuart, both Hastings & Napier were rebuilt in 2 years, by 1933, in the middle of the Great Depression. Financially short changing ChCh was just part of Key's strategy to finance his unecessary & unaffordable tax cuts for the wealthy. Labour needs to go on the offensive over this & destroy Brownlee's reputation before polling day.

  4. Ad 4
    8 September 2020 at 5:13 pm

    Good work Mickey.

    That's mountains of stress that these people were put through, in order to rip away the lies and deceit of this government entity.

  5. bwaghorn 5
    8 September 2020 at 5:49 pm

    Can the press please make it clear that it's under the national parties sound economic management that the government became liable for a $500 million payout.

  6. Tricledrown 6
    8 September 2020 at 6:43 pm

    On top of the$500 million for dodgy repairs that Gerrybuilt.

  7. Pat 7
    8 September 2020 at 6:50 pm

    "The issue of the two different repair assessments was the subject of a class action led by Christchurch lawyer Grant Cameron.

    He told Checkpoint he was surprised Mr Brownlee did not know of Southern Response's actions before Friday's judgement.

    "Nevertheless if Gerry is saying he didn't know, we have to accept that. But the question has to be, how could that possibly be when as minister in an arrangement where the Crown has entered into a Crown support deed to provide cash to AMI, and very stringent processes for reporting on liabilities were put into place at the beginning, how ministers couldn't know these things."

    https://www.rnz.co.nz/national/programmes/checkpoint/audio/2018709371/brownlee-denies-knowledge-of-southern-response-deception

    • Pat 7.1
      8 September 2020 at 7:10 pm

      But in 2015

      "Earthquake Recovery Minister Gerry Brownlee says a lawsuit against Southern Response over insurance settlement delays is part "ambulance chaser".

      The claims management company, which handles AMI Insurance's cases, is the target of a class action from customers claiming it took too long to process claims and frequently undersettled them.

      Commenting on Southern Response's move to offer customers free legal advice about the class action, Brownlee labelled the lawsuit opportunistic."

      https://www.stuff.co.nz/the-press/news/69614565/gerry-brownlee-southern-response-lawsuit-opportunistic

    • mickysavage 7.2
      8 September 2020 at 8:54 pm

      Thanks Pat. I recalled an even more damning statement but could not find it.

      • Pat 7.2.1
        8 September 2020 at 9:09 pm

        Theres been many but theres too much too trawl through to find them, including stuff that is no longer available…i.e. radio interviews with tame hosts

  8. stuff the politicians 8
    8 September 2020 at 7:39 pm

    It is time that the taxpayers of NZ stopped paying Gerry's salary.

    He was, and is incompetent to be an MP any longer.

  9. peter sim 9
    8 September 2020 at 10:30 pm

    Brownlee, of Finland tact and knowledge, and airport security, is a brilliant choice as 2ic to St judith. Bring it on!

  10. tony 10
    9 September 2020 at 1:37 am

    Is that the same brownlee who tried to wrench an elderly Gentleman’s hand from the banister at the pigs party convention? Back when I was religious I used to pray he would come my way and I would break his wrist with the tightness of my grip on his bully hand, with religion well behind me I still hope for the same opportunity ..

  11. Maurice 11
    9 September 2020 at 2:44 am

    It is often not necessary to ascribe to "conspiracy" that which can be adequately explained by incompetence …. particularly when governments are involved!

    • Stuart Munro 11.1
      9 September 2020 at 5:56 am

      Among certain Gnat members, notably Key, conspiracy is the default setting. Brownlee is certainly incompetent, but it would be naive to ignore his ever-present malice.

  12. Peter 12
    9 September 2020 at 7:20 am

    Boot on other foot. If it were the Labour Party in Office at the time and exactly the same scenario had happened would Gerry Brownlee be on all the news shows this morning demanding answers, putting the boot in? And headlining the newspapers.

    And Judith Collins and Chris Bishop demanding answers.

    They're making a play on their competence and this is it?

    Brownlee and Collins would ride it for all it's worth. The same should happen to them.

  13. Tony Veitch (not etc.) 13
    9 September 2020 at 8:00 am

    What did Brownlee know about Southern Response’s misleading and deceptive conduct?

    Gerry knew all about the attitude of Southern Response because he was 'responsible' for it!

    • Pat 13.1
      9 September 2020 at 9:55 am

      Of course Gerry (and by extension Key and English) knew…given that the government were funding it AND Treasury were overseeing it then any major decision re liability would have been communicated to those holding the purse strings….the only question is, is there a paper trail available to discover that will require Brownlee to concede that his memory has ‘failed’ him.

  14. Tiger Mountain 14
    9 September 2020 at 8:46 am

    “I know Nothink, Commandant Collins…”

  15. Ken 15
    9 September 2020 at 4:01 pm

    I'm wondering what they've done with Nick Smith – he's the only Nat politician that I recognise apart from Judith and Gerry, and they seem to be keeping him locked away in a closet like the retarded cousin you don't want anyone to know about.