James Hardie sold Harditex cladding for five years after evidence of leaking — court told

Tuesday, 18 May 2021

A $220m class action claims cladding was sold without adequate testing, but it ended after only a few weeks with a settlement which was a win for the respondent James Hardie.

James Hardie continued selling its Harditex exterior home cladding system for five years after it had evidence it was prone to leak.

It also did not alert the owners of homes clad in Harditex cement and wood fibre boards to the high likelihood that they would become leaky buildings.

The claims were made by Simon Hughes, the lawyer for about 1000 owners of leaky homes, who are suing James Hardie for about $220 million in compensation at the High Court in Auckland.

During the first day of the class action trial on Monday, Hughes said James Hardie had launched Harditex without testing whether it would be weathertight in New Zealand’s high-rainful climate.

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Many homes covered in ‘monolithic’ cladding were built on untreated wood framing. When cladding failed to keep put moisture, the wood beneath in many homes became moist, and rotted.

Hughes said the Harditex exterior cladding for homes, “did not work, and has never effectively worked”.

The homeowners claim James Hardie owed them a duty of care to only sell cladding systems which had been tested and proven to work in New Zealand conditions.

They also claim James Hardie knew, or should have known, that Harditex was not suitable to clad homes in New Zealand.

James Hardie is defending the claim, and is expected to open its defence later on Tuesday, or on Wednesday.

Hughes on Tuesday read out an internal James Hardie memo from 2000, which said: “The present system (Harditex) does not give a high standard of finish and is prone to systems failure. The system is tolerated because it is economic.”

Despite that, Hughes said, James Hardie continued to sell Harditex until 2005 when the company withdrew it from the market.

Hughes said monloithic cladding had become popular in the late 1980s and 1990s, both due to changes in design preferences, but also because of James Hardie’s marketing through “education” seminars to builders, and advertising in magazines like Woman’s Weekly.

On Monday, Hughes told the court that in 1999, James Hardie had begun a project to “improve” the performance of Harditex, prompted by weathertightness complaints from homeowners, and James Hardie’s own concerns the company faced a growing threat of legal action for compensation from the owners of leaking, rotting buildings.

Another memo from a James Hardie employee in 2000, said Harditex readily took up moisture, which could cause durability issues to the timber framing of a house, hughes said.

“This is an explicit acknowledgement that Harditex takes up moisture,” Hughes said.

But James Hardie did not alert builders or homeowners, he said.

“What they don’t seem to have done is think to themselves, ‘On the basis of all the work we have done, and all the potential problems we have identified, why don’t we go to the market, and warn the market that Harditex has these problems?’” Hughes said.

“No reference or thought [is] given to the customers who are all the while in the 2000s buying Harditex, buying the system in the faith that it will work, and keep the houses dry.”

Hughes said that in a June 2000 email to a senior James Hardie employee, weathertight homes expert Philip O’Sullivan, who styled himself as “Dr Rot”, recommended field testing be done to gather data on how Harditex-clad homes were performing.

“No-one knows, not Hardies, not Branz, not even Dr Rot,” Hughes quoted O’Sullivan has having written.