EQC excess payments


Canterbury homeowners may be in for a shock if they are unaware they are liable for EQC excess payments where earthquake repairs valued at more than $20,000 were managed by Fletchers.

Late last year EQC advised from 1 April 2015 they will be sending accounts for excesses for properties where earthquake repairs were managed by Fletchers and those repairs were for more than $20,000.00. We are expecting that there will be home owners that are unaware of this and will be surprised when they receive this account.

EQC advised that they did not address the excess as part of their managed repair process as they wanted to get on and complete the repairs for home owners, however they are now looking to home owners to recover the excesses. If somebody was cash settled by EQC, EQC deducted the excess as part of the payment made and as such this request for the excess is only limited to the managed repair process.

The invoice amount will be for 1% of the building work value and as a result the maximum excess payable will be $1,150.00 including GST. EQC have confirmed that 90% of the invoices that will be issued will be below $600.00.

In some instances the house will have changed ownership and we anticipate the account will be sent to the owner known to EQC/Fletchers at the time the repairs were undertaken and sent to the address on their records. If this is the case new owners of the property may not know where to forward the correspondence on to or may not be aware that they are now responsible for this payment.

There is also the issue of liability – who is liable to pay this excess invoice?

It is a general rule of thumb that whoever received the benefit of the repairs is responsible for the excess. For example if a settled claim was assigned, the excess should remain with the vendor. If the EQC claim was open and transferred to the purchaser on settlement then the purchaser should be liable. However, if the claim was assigned on settlement to a purchaser then a deed of assignment may state who is responsible for the excess going forward.

If you receive an invoice and are not sure if you are responsible for the payment or where to send it, we recommend you contact your lawyer to see if this can be easily answered by checking the deed of assignment.

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