INDEPENDENT NEWS

Southern Response boss silent as calls for inquiry grow

Published: Tue 20 Aug 2019 03:49 PM
From Checkpoint, 5:09 pm on 19 August 2019
Logan Church , Checkpoint video journalist
The Southern Response boss was nowhere to be found today as calls for a public inquiry into the state insurer's conduct reignited today.
It comes hot on the heels of a precedent-setting High Court ruling that found the organisation had engaged in misleading and deceptive conduct when it deliberately withheld information from a customer that left them thousands of dollars out of pocket.
The ruling has also left experts wondering whether Southern Response could close up shop by the end of the year as planned, as thousands of settled cases could now be reopened.
In the case of Karl and Alison Dodds, the High Court heard Southern Response gave them an edited version of a detailed repair analysis (DRA) for the rebuild of their home.
That abridged assessment was tens of thousands of dollars less than the full estimate that the insurer kept secret from them.
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The couple unwittingly settled on the lesser figure in 2013 - meaning they were shortchanged almost $200,000.
For insurance advocate Dean Lester, this court ruling is about time.
"What a stunning judgement from the court to have deceit, bad faith and such awful behaviour that affects families, whānau is quite disturbing."
Many families have been battling the state insurer for years in the hopes that Southern Response would honour their policy.
Insurance advocate Ali Jones was glad the Dodds' case has been brought to light.
"I think it's really important that we get to find out what else has been going on inside Southern Response over the last seven or eight years before it winds up. People will disappear, they will go away, the offices will close ... we need to get in there are shine some light into all of the cracks are crevices within Southern Response before it's no longer a company."
The organisation has previously been criticised for allegedly spying on claimants through controversial security firm Thompson and Clark.
Southern Response's chairperson Ross Butler resigned over the fiasco.
The issue of the two different repair assessments is the subject of a class action led by Grant Cameron of GCA lawyers.
He wasn't surprised at the High Court judgement on Friday and said more than 3000 customers could be affected potentially costing taxpayers at least another $300 million dollars to rectify.
"On the pattern, we've seen with people on the class action so far, most have lost about $100,000 on average, some are high as $200,000 ... there's a lot of money at stake."
But Mr Cameron said, in the end, this is a government organisation and a solution should come from the government.
"It's going to be hard going into election year to sway Cantabrians that they're being dealt with fairly if this hasn't been resolved."
Meanwhile, the lawyer for the Dodds, Peter Woods of Anthony Harper Lawyers, said one of the big questions now was over how Southern Response could still plan to shut when a tsunami of angry homeowners - with now a legal leg to stand on - could be on its way.
"There's no way Southern Response can just close up shop and walk away. Those claims have to be resolved."
Sources have told Checkpoint that EQC is being explored as a possible destination for those claims.
Former EQC Minister Gerry Brownlee said he was unaware of any deceptive behaviour by Southern Response.
Mr Brownlee would not comment on the case, but said he didn't think there was any deception from Southern Response's senior management.
"I don't believe either the board or the senior managers who were part of the board reporting to the government were being deliberately dishonest."
In discussing the problems around onsold Canterbury homes with improper quake repairs, Mr Brownlee said the term "botch-up" annoyed him.
Anthony Honeybone, Southern Response chief executive since September 2017 and prior to that its general manager for claims settlement since 2015, declined interview requests.
The minister responsible for Southern Response, Grant Robertson was not available for an interview.
Southern Response has 20 days to appeal the High Court decision.
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