Supreme Court Judgment: Southern Response Earthquake Services Ltd V Avonside Holdings Ltd
- Created: 28 July 2015
Our main objective is to see Cantabrians in safe, quality homes as quickly as circumstances allow.
Given the doubt arising from the respective rulings between the High Court and the Court of Appeal in this case, we considered it important to have the law clarified by the Supreme Court, and are pleased that this has now taken place.
As a result of the decision, we have determined the following policy going forward for customers choosing to buy another house.
All future "buy another house" settlements:
- A full 10% contingency allowance and a full allowance for actual or estimated professional fees will apply to all "buy another house" settlement calculations from today.
Buy another house settlements entered into after the Court of Appeal’s decision on 1 October 2014
- Southern Response’s policy is that no customer should be disadvantaged as a result of Southern Response’s decision to appeal the Court of Appeal’s judgment. Its policy is that for any settlement agreement to buy another house entered into after the Court of Appeal’s decision on 1 October 2014, contingencies and professional fees would be addressed once the result of the appeal was known (to the extent not already provided for). Accordingly, Southern Response will work with customers who entered into settlement agreements to buy another house after 1 October 2014 to identify the appropriate amounts payable in light of the Supreme Court’s decision.
Buy another house settlements entered into prior to the Court of Appeal’s decision on 1 October 2014
- For "buy another house" settlements entered into prior to the Court of Appeal’s decision on 1 October 2014, there is to be no change. Those claims were settled in good faith on a full and final basis, and will not be reopened.
We will be working closely with affected customers to determine how this decision relates to their specific claim.
Please contact your claims specialist or any of our team members for further details on 0800 501 525
 Although in Avonside, which was an architectural build, professional fees of 10% were allowed, the extent of professional fees to be calculated for each of the affected customers will vary depending on both the costs incurred (that were effective and useful to date) and the nature of the insured house’s construction (Group or Non-group).