MEDIA RELEASE
SOUTHERN RESPONSE CONCEALMENT CLASS ACTION
Southern Response obstructs disclosure
of how much it has concealed from policyholders
12 February 2020
The Southern Response Concealment Class Action has about 3,000 participants and is pursuing recovery of several hundred million dollars from the Crown. The case commenced after Southern Response, a government entity, misled and deceived its customers when proposing insurance claim settlement terms.
The company deliberately withheld from its customers the true cost of rebuilding their earthquake damaged homes. It did this by sending the customer an abridged version of its repair / rebuild estimate which left out significant cost items including contingencies, project management costs and design fees. In many cases the concealed costs amounted to six figure sums.
Some customers found out about the extra costs after they made Privacy Act requests and obtained copies of their Southern Response file. Those files revealed the full repair / rebuild estimates withheld from policyholders.
In July 2015 the Supreme Court held Southern Response’s behaviour to be unlawful and so all policyholders expected the company to correct its gross error. Instead, the company decided to correctly settle only those settlements that occurred after 1 October 2014 and to ignore the 3,000 policyholders it now knew to have been incorrectly settled prior to that date.
In August 2019, the High Court found the company guilty of misleading and deceptive conduct and ordered it to pay Mr and Mrs Dodds more than $200,000 in damages.
Despite these court decisions, in September Minister Grant Robertson claimed that, the government still needed “clarity” and Southern Response lodged appeals.
Grant Cameron, Solicitor for the class action, confirmed today that contrary to years of agreed practice, Southern Response is now refusing to provide electronic copies of class action members’ documents.
“For many years, policyholders’ Privacy Act requests have been generally complied with and there has been no issue about the delivery of the relevant documents. However, with a change in senior management, Southern Response now says it is unable to provide the documents because it would, ‘impair the efficient administration of Southern Response’.”
“We are gravely concerned at this development and my clients interpret this as a blatantly obstructive manoeuvre, presumably designed to further delay full and fair disclosure of how much Southern Response has concealed from its policyholders. It’s absurd that a government agency that knew of these obligations, would now claim that it has no resources with which to properly comply.”
Brendan Ross, the Class Action Representative said,
“The position is outrageous as not only has the company concealed vital information, and withheld payment of our entitlements, but it now proposes that our lawyers must go around and sort through their files to find the truth. That is to force the costs of finding its own information, onto class members and this just adds insult to injury.”
“We are all very concerned about what guidance the government must be giving to Southern Response because it seems inconceivable that as the owner of Southern Response, it is not in control of the situation.”
Enquiries to: Grant Cameron, 0274 323 066, or grant@gcalawyers.com
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