Mike Colson: Stout Street Chambers partner on the class-action lawsuit over the Northland power outage

Businesses are taking class-action over a power outage to of all Northland last year - although the exact loss is still unknown.

In June, an inexperienced worker removed nuts from three legs of a pylon, which toppled, cutting electricity to almost the entire region.

An opt-out class action against Transpower and its lines maintenance contractor is progressing through the courts. 

Stout Street Chambers partner, Mike Colson, says losses will be calculated in due course. 

"It's giving Northland businesses an opportunity to be compensated - and second, an opportunity to incentivise those working on critical infrastructure to do a good job out of it." 

See omnystudio.com/listener for privacy information.

Episode Transcript

Speaker 1 (00:00):
Northland's entirely avoidable multi day power outage is headed to court.
Two firms, one of them are law firms, one as Australian,
one as New Zealand, have launched a class action lawsuit
against Transpower and the contractor Omixom, whose staff member pulled
the nuts out of the pylon's legs which caused the
thing to fall over. This whole thing cost Northland businesses millions.
Mike Colson Casey is helping with the case home.

Speaker 2 (00:20):
Mike, Hi, Hey, how are you?

Speaker 1 (00:22):
I'm very well? Thank you? What does it makes you
think you've got a case here?

Speaker 2 (00:26):
I can't get into the precise prospects of the case
because it's before the courts, but I think the two
independent reports really speak for themselves. There was one that
was commissioned by Transpower and there was one that was
commissioned by the Electricity Authority. There's some fairly strong factual
statements in those reports and that's really the basis for

(00:46):
the case.

Speaker 1 (00:47):
Do you have like a handle yourself on how much
business is up in Northland actually lost during this power outage?

Speaker 2 (00:54):
We don't have that precise a data at the moment.
There whereas you may recall reports at the time there
were estimates by economists as to what the losses were.
We have done some sampling amongst the businesses which we
can extrapolate that we probably don't want to or can't
get into the precise details of losses at this time.

Speaker 1 (01:14):
Now, can I deduce from the fact that Omni Bridgeway
is funding the case that Omni Bridgeway thinks there's a
reasonable chance of success here?

Speaker 2 (01:20):
Yes, I think that would be Omni Bridgeway's view. There
obviously a commercial litigation funder the use to making decisions
on which litigation they want to back, and they're backing
it with a considerable amount of money.

Speaker 1 (01:33):
When the payout, if there is a payout, when that
is finally determined, is it based on is it likely
to be based on what the actual losses were? Or
is it based on actual losses plus a whole bunch
of other stuff.

Speaker 2 (01:47):
Ultimately, if we were successful, and there's a whole lot
of hypotheticals associated with that, of course heither it would
be based on the businesses actual losses. So we would
be asking them to put forward swalling statements and other
evidence as to the losses they've suffered. And they'd be
distributed proportionately according to that. Again, I should say that's

(02:07):
all subject to the court's orders and applications at the
time in the future, but that's the usual process.

Speaker 1 (02:11):
Now, Mike, I heard a little bit of commentary this
morning on Mike Hoskins Show that suggested that this is
not the key we weigh and we don't want this
kind of litigation coming into the country. How do you feel.

Speaker 2 (02:19):
About it, Well, in terms of this type of litigation
coming into the country, it's just rereading a Law Commission
report from a couple of years ago which indicated there've
been forty seven class or representative actions approved in New
Zealand in the last twenty years. It's not something that's
particularly new. Some people may oppose class actions, and that's
understandable if they wish to do that. But I suppose

(02:42):
what this is about really is giving northern businesses an
opportunity potentially to be compensated, and second an opportunity potentially
to incentivize those working on critical infrastructure to take reasonable
care or do a good job out of it. Now,
as I should stress, the orders we are seeking what

(03:03):
are called opt out orders. That means that if Northland
businesses or a particular Northland business doesn't want to be
part of the litigation, they can opt out and they
will no longer be part of it. Otherwise they are
deemed to be in that it's entirely their decision as
to whether or not they want to remain in.

Speaker 1 (03:19):
Mike Listen, thanks for talking us WED appreciated. Mike Colson KC.

Speaker 2 (03:22):
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