Uni's quake payout could depend on court case

The amount of insurance the University of Otago can recover from the rebuilding of its Christchurch campus could depend on a court case due to start next week, the university's director of financial services, Grant McKenzie, says.

This comes as the university continues to repair buildings damaged in last February's earthquake. Staff moved back into parts of the university's main building in Christchurch last month after it underwent ''significant earthquake repairs''.

Mr McKenzie said at a university council meeting last week the university did not know how much it would recover from insurance and the amount could depend on a court case involving the University of Canterbury and the Christchurch City Council.

The Christchurch City Council's legal services manager, Chris Gilbert, said the case Mr McKenzie was referring to came about as a result of the Insurance Council of NZ seeking a judicial review of the council's 2010 Earthquake Prone Building Policy. The council was the respondent to the case and other parties, including the University of Canterbury, had applied to join the proceedings.

The case was about the standard to which buildings had to be repaired, with the Insurance Council arguing in its statement of claim that the council's policy was ''unlawful and invalid''. The Insurance Council will also argue that the council should not be able to require, as a condition for granting consent, that an existing building be strengthened to 33% of new building standard.

The case was set down to be heard in the High Court at Christchurch next Wednesday.

The University of Otago, the University of Canterbury and the Christchurch City Council all declined to answer how the case could affect their insurance payouts.

When questioned after last week's council meeting, Otago's chief operating officer, John Patrick, said: ''The university is expecting that all money spent on the rebuild ... will be covered by insurance, after allowing for our deductible''.

So far this financial year, the university had received $2.5 million in insurance proceeds, Mr Patrick said.

Asked about the court case, he said: ''The university is not party to the court case and so cannot comment.''

vaughan.elder@odt.co.nz