It’s not just another leaky home story.
This time, there’s a $500,000 lawsuit against a builder, a building inspector and a real estate agency boss. There are three senior real estate agents up before a disciplinary tribunal. A ‘secret witness’ nobody would name. And a very upset pensioner who lost her life savings when she bought a house nobody wants from the boss of one of our biggest real estate agencies.
The boss of the New Zealand arm of the world’s biggest real estate agency decides to sell her rental property in Hamilton. Nothing special.
Except that simple sale has turned into a fierce courtroom battle which sees Remax’s general manager effectively at war with her Waikato franchisee, each accusing the other of lying. Both of them before the real estate agency’s disciplinary tribunal, which relied on the testimony of a secret witness whom nobody can identify and the tribunal refused to name. The 70-year-old buyer of the house is suing not just the Remax boss and a building inspector who both told her the house was fine, but also a builder who previously worked on it.
The house is far from fine. It leaks. A lot. It cost $490,000 to buy, and the repairs to make it liveable are estimated at $500,000. It has sat empty for over a year.
It’s a complicated story, but an intriguing one. It can get confusing (watch pause and rewatch the animated video if you get stuck). It’s clear somebody is lying. It just depends on who you believe.
The one person in the whole sorry saga who definitely has nothing to answer for is Jean Warburton, who bought the modern three-bedroom house at 2B Edgecumbe Street, Hamilton, some three years ago.
“The market had gone crazy and I thought, ‘I am going to make this look fabulous’,” she recalls. “I’ve got a beautiful home in Te Awamutu, and I knew exactly what I was going to do here. I was going to make it look stunning... and in two or three open homes, it would have sold.”
The woman who sold Edgecumbe St to Jean Warburton was Corrina Mansell. Mansell was, and still is, general manager of Remax, which boasts it’s the biggest real estate firm in the world (but is a relative newcomer in New Zealand).
Mansell lives in Waihi Beach, works in Remax’s Auckland head office during the week, but also owned a rental home in Hamilton through her company, Corrina Rentals.
Naturally, when it came time to sell the rental, Mansell used her own company to do the deal. So she called Andrew Gibson, who owned Remax’s four franchises in the Waikato. Sensibly, given it was his boss on the phone, Gibson gave the listing to his number one selling agent, Cary Ralph. He had a good reputation, got most of his work from referrals and was regularly in Remax’s national top 10 sellers.
Ralph, who resembles a young Richard O’Brien, eschews the traditional agent’s suit for designer jeans but Gibson says his record means he’d never demand Ralph meet any dress code. This wasn’t his easiest assignment: Mansell didn’t want to spook her longstanding tenants, Ralph says, so he conducted his initial appraisal from the roadside (the house sits down a long driveway behind a stand of trees).
Cary Ralph, Remax agent
Corinna Mansell, general manager of Remax
Corinna Mansell, general manager of Remax
Andrew Gibson, Remax franchise owner
Andrew Gibson, Remax franchise owner
The Edgecumbe St house
The Edgecumbe St house
A listing form for the property, signed by Mansell suggests it was to be sold as a "silent listing," which typically means no advertising.
Nevertheless, within two weeks of listing the property, Ralph found some buyers: Jan and Kerry Dean, a couple both he and Gibson describe as friends. But then the Deans went to a dinner party, and heard a rumour the Edgecumbe St house leaked.
"[Jan Dean] rang me and said, 'Get me out of this deal'," Gibson says. "Corrina went off her tree and said, 'I've spent $60,000 on that house, it's not a leaky home'."
According to Gibson, Mansell’s initial anger just as quickly dissipated, and she said he could let the Deans out of the purchase. While the paperwork says the reason was because their bank wouldn't approve finance, Gibson says that was an easy cover story.
Mansell, in her court filings, absolutely denies the detail of that phone call, saying the only work she did on the house was minor storm repairs in 2014.
Ralph says Mansell was keen for a quick sale so then agreed to take the property to auction. Gibson says he told her she should address the leak rumours by commissioning a building report, and she told him that he could if he wished, but at his own expense.
With timing tight, Cary Ralph found it hard to find an inspector. He says Tony Bankier, the Hamilton franchisee of a company called Kiwi House Inspections, was the third or fourth builder he tried. Bankier's report said: "The dwelling is generally sound and of good construction …. built and finished to a high quality." The only problem he found was leaks from both showers, which were rotting the bathroom floors.
It’s then that Margaret ‘Jean’ Warburton became involved. She was a good friend of Gibson’s (they own neighbouring beach houses at Kawhia), and Ralph had shown her a few potential investment properties. But three days after Bankier reported back, and just a day before the house went to auction, he took her to see Edgecumbe St. She decided she wanted it. Although she read Bankier’s report, she didn’t get a building inspection of her own (a decision she now says was “dumb”). She was the only bidder at auction. It was hers.
Gibson and Ralph say they weren’t allowed to tell Warburton that the Dean deal had collapsed based on a rumour the house leaked. It would breach their fiduciary duties to the vendor under the Real Estate Agents Act to tell a buyer a negative rumour without supporting evidence. Ralph says, though, he hinted to Warburton what had happened. She says that’s simply not the case, and that’s led to a fallout between them.
Jean Warburton’s bad luck began early. She had two sets of tenants and neither lasted. She got the outside of the house painted and the painter used the incorrect paint (plaster houses need a paint with a waterproof membrane to prevent leaks). She took the painter to the Disputes Tribunal. So after six months, with the house empty, she decided it was time to start the renovations by getting those showers fixed and the bathrooms freshened up.
The house is in Whitiora, a decent part of town - close to the Waikato River, close to the stadium, directly overlooking the tree-lined Edgecumbe Park. But despite the beautiful views from the rooftop terrace, the property looks incongruously unkempt compared to the new-build villas across the street.
Jean Warburton has to force open the gate at 2B Edgecumbe St because two autumns of fallen leaves have become wedged behind it. The long driveway is overgrown; this year’s crop of lemons lie rotting on the cobbles and around the back, the Hills Hoist clothesline is being slowly choked by a spreading vine. Inside, it smells of damp and mould. She hasn’t set foot in here for two years, she says, despite driving past often. She’s only here to show Stuff around the investment that ate her life savings.
She’s been advised by her lawyer, Michael Talbot, not to talk to us - but she’s sick of waiting patiently for someone to be held accountable for what’s happened. She’s had to pay off the mortgage, keep paying rates, and leave the house empty while she tries to get restitution.
So far, she has spent $80,000 on legal bills and expects to outlay another $80,000. All of her cash is gone, she says, and so have her plans for international travel and to financially help her six grown-up children. “Everyone else has still got their money - except me,” she says.
The house is dated but Warburton points out her now-cancelled plans for it as we walk around: new bathrooms, new colour scheme, new carpets. Those carpets are still rolled up in her garage in Te Awamatu. In the lounge room, huge chunks of plaster are missing where weathertight investigators cut into the lining.
The master bathroom looks like something from a squat - chunks of floor and wall gone, whiteware dumped in the bathtub, just how builder Mark Peters left it on the day in June 2016 when everyone realised how bad the house was.
On his first morning on the shower repair job, Peters phoned Warburton and told her to come to the house immediately, but wouldn’t say why. Alarmed, she called Andrew Gibson, then found Tony Bankier’s leaflet in her car, and called him too. She and Gibson arrived almost simultaneously and went upstairs. “[Mark] took me straight there to the bathroom, and I started to cry,” she says.
Peters had pulled out the shower, and found that, as expected, the floor was rotten. But then he found the walls were too. In one place, a beam had rotted away to give him a clear view of the outside world. Gibson recalls him saying: “‘Andy, you need to come look at this because this house has got more leaks than the Titanic had'."
Gibson admits he was so shocked when he went inside he barely said a word.
Warburton says Peters took Bankier outside and showed him the seams in the walls bulging, a sign of a leaky home. She says Bankier offered to do whatever he could, free of charge. “I told him he had done enough.”
Unsurprisingly, Bankier himself says the bathroom shouldn’t have been a surprise because he had “made comments towards rot in the bathroom walls” in his report. He says you would have “100 per cent had to do invasive testing” (where inspectors cut into the wall lining) to discover the scale of the issues. He doesn’t do invasive testing and his report is clearly marked as such.
Peters went home, the renovation work stalled after just a few hours. “His wife said when he came home at lunchtime, he wouldn’t talk to her all afternoon because he was so upset for me,” says Warburton.
The next day, Andrew Gibson asked permission to conduct a second building inspection.
Ralph and Gibson’s office manager, Gayle Patterson-Gray, says she begged their regular inspector, John Leyden of Betta Inspect It, to look around. Warburton says he came out after an hour, saying “you’re wasting my time and your money’’ on what was palpably a leaky home, but Gibson insisted on a full report, which found a host of issues with the house. Leyden recommended a full inspection by a weathertightness specialist, Noel Jellyman, whose own report suggested a full re-clad, costing upwards of $317,000. That amount has since climbed to $502,000, thanks to rising costs, further deterioration and yet another report from a company called Quantum Surveyors.
Jean could hardly re-tenant the house after that, and an independent report she commissioned from Hills Laboratories said the house was so mouldy it could be a health hazard (Hills confirm they did the testing, but won’t comment on the results). So it sits empty. And while she has managed to pay off the small mortgage she took out on the house, Hamilton City Council continue to charge her rates.
And so she decided to take action. She consulted her lawyer, Talbot, a leaky homes specialist, who began preparing a case. After nine months, Jean Warburton sued Corrina Mansell, Tony Bankier and their companies in the Hamilton High Court.
But discovery - the process where all sides hand over any relevant documents to the others - changed the whole story once again.
Because during discovery, a report emerged that five years earlier had said that the house at Edgecumbe St had terrible leakiness problems. And Corrina Mansell had that report the whole time.