A major class action against the James Hardie group has been settled this week, mid-way through a High Court trial in which homeowners were seeking $220 million.

The James Hardie group were defendants to a class action brought by over 1,000 homeowners who alleged the Harditex cladding product caused weathertightness issues (known as the White litigation).

A 17-week trial was underway in the High Court when the settlement was reached between the parties. The claim was settled with no admission of liability and on the basis that Harbour Litigation Funding (Harbour), who was funding the homeowners’ claim, would pay the James Hardie group $1.25 million “in full and final settlement of all claims arising directly or indirectly out of the White litigation in relation to the Harditex cladding product”. Homeowners will not receive any compensation from the settlement.

This settlement has been reached before a judgment from a parallel class action against the James Hardie group that went to trial in 2020 (often referred to as the Cridge litigation) has been delivered. A third class action (known as the Waitakere litigation) is due to be heard in May 2023.

The settlement comes off the back of the recent discontinuance of a separate class action by homeowners against Carter Holt Harvey for allegedly defective cladding products, which was also funded by Harbour, because Harbour withdrew its funding for that claim.

In the meantime, the Law Commission is continuing its increasingly important review of the law relating to class actions and litigation funding in New Zealand, in which it is considering issues such as access to justice, the court’s involvement in approving settlements and whether and to what extent litigation funding should be regulated.

Thanks to Rachael Machado and Chaowei Fan for their assistance in writing this article.