Tonight ` It's bloody awful. the tradesman who is causing frustration and heartache. Why should somebody like him come along and take our money that we've worked so hard for? Come with me. And we have a surprise. You can come out now, Derek. You can come out now, Derek. < DELIGHTFUL CHUCKLING We think this is unfair on homebuyers. We knew nothing about it when we bought the house, and we couldn't possibly have known anything about it, but we are still getting charged for it, and I just think that's unfair. And... I can waddle, and I can quack. (IMITATES DUCK QUACK) Copyright Able 2015 Welcome to Fair Go. Bit of a building, buying, renovating special tonight. A need-to-know about building guarantees. A vicious council fish hook for buyers. And first up, a renovation shocker ` the tradie who takes the money but does not do the business. Can we get a happy ending to a kitchen fiasco? Here's Mary-Jane. Camping... in her own kitchen. She's no Bear Grylls. It's pensioner Robyn Smith, and she's reached boiling point. It's bloody awful. Unbelievably, Robyn's kitchen's been in this state for almost a year. The old one was ripped out, but the new one never came. Well, Robyn, it's a good thing I've bought supplies. Hi! Hi! What's happened here? Well, it's like camping, only my idea of camping's in a motel. How much money have you paid for this? How much money have you paid for this? $14,496. 14.5 grand, and nothing to show for it. Robyn bought this Tauranga house to be her retirement home, but not surprisingly she doesn't spend much time here. You've brought everything with you, and I've got the kitchen sink. So, what did you want the new kitchen for? Well, I just wanted to bring it up into this era, really. So she got some quotes and went for this one from a company run by Phil Budgen. I honestly believed that I would get my kitchen from him originally. So Robyn paid $7950 to Phil Budgen's company, which was a Dream Doors franchise, almost two years ago. Then the franchise was terminated by agreement because he couldn't pay his fees. He continued in business. Robyn's next instalment of $6546 was made out to his new company, Big Save Kitchen Renovations. Why did you pay him that second instalment of money? Because the kitchen had come out. And normally when a kitchen comes out, the next day a new kitchen goes in. But it's been a lot of days. I hate to think how many days. And there's been no kitchen and no sign of a refund from Phil. She got this letter last November. 'I am deeply sorry for the situation that you are in, and I am, of course, happy to refund the payment. 'Unfortunately at this time, I am unable to provide a refund in full 'and will have to make payments to you.' But she hasn't seen a cent. Well, I used to always try and ring him, because I prefer to... to actually talk to people. And did you have any joy communicating with him? Occasionally, but most times no. So you've got a whole lot of goodies here just waiting for the new kitchen. On top of the $14,000 she's already paid, Robyn has invested a couple of grand on appliances. Oh, yes ` $3139. Frankly it's been a nightmare. We're taking our camping gear down the road. It's not just Robyn; the Stone family live five minutes away. They too have paid $14,000 for a new kitchen ` haven't seen a crumb. He needs to be stopped. Like Robyn Smith, Melanie Stone is angry and worried. It has been very stressful. I've lost weight over it. I've lost sleep. You know, I'm thinking, 'Oh my gosh. How are we going to get out of this?' Time for a coffee. Melanie wanted a new kitchen to update the lovely green one she's got now. I just don't like the colour. It's just... You know, things are just starting to fall to bits. It's not well set out. Like, if you open up the fridge, someone coming in, they can't come in. Like Robyn, Melanie too got a quote; this time Phil Budgen's company was Payless4. She paid a $14,056 ` a 50% deposit ` in two instalments. He said that the kitchen would be in for December, and I was going, 'Yes! Right before Christmas. We can have Christmas at our house. It'll be wonderful.' When did things start to go sour? He said, 'Blame it on the suppliers. They've closed down,' and all that. So January went and gone, and then February. I was just, like, 'Oh, hang on,' you know? And it was always apologies after apologies, excuses after excuses. And since then things have really deteriorated. So that's all your paperwork. So that's all your paperwork. Yeah. That's a lot of stuff for one kitchen that you haven't even got. That's a lot of stuff for one kitchen that you haven't even got. Mm-hm. So then we told him we want our money back. That prompted Phil to make something for the Stone family ` he crafted his own trespass notice. Things have really broken down. I don't want anyone else to become victims. Um... You know? We've worked damn hard to do that, and why should somebody like him come along and, you know, take our money that we've worked so hard for? It's not just Robyn and Melanie. Fair Go has spoken to several Tauranga suppliers who say they are each owed thousands by Phil Budgen. Time to pay him a visit. We've come to find Phil. Looks like he's home. Looks like we've come to the right place. Hi. It's Mary-Jane from Fair Go. I'm after Phil. Hi, Phil! Can we have a word, please? Phil, can we talk to you about Robyn's kitchen and Melanie's kitchen? MAN: Close the door, babe. > MAN: Close the door, babe. > Sorry. MAN: Close the door, babe. > Sorry. Come on, guys. Where's the money? But Phil Budgen didn't want to talk to Fair Go. We tried him numerous times... We'll just try Phil again, see if he will talk to us. ...and we've had plenty of emails, but he wont let us use the information publicly. He's told me he's been in the business five years and has many satisfied customers. But we have got hold of someone. Since Fair Go got involved in this story, Dream Doors, who Phil used to hold a franchise with, has very generously come forward. We're going to go and find Robyn now. We've got a bit of a surprise for her. Dream Doors managing director Derek Dell is waiting in the wings. Hi, Robyn. How are you? Now come out here. I told a bit of a fib ` we don't really need to come and get some more shots of your kitchen. Come with me. We've just got someone hiding. You can come out now, Derek. < ROBYN: (CHUCKLES) How are you? How are you? I'm good. How are you? Good to see you. Hey, today I've got some wonderful, wonderful news for you. You have? You have? Dream Doors is going to replace your kitchen. (GASPS) Really? Oh! Oh! All your worries are over. Oh! All your worries are over. Can I have a cuddle? ALL CHORTLE CHEERILY It's all going to be done. It's all going to be done. Thank you very much! I'm just so pleased this is a happy outcome for everybody. I'm just so pleased this is a happy outcome for everybody. Oh God. Oh, that'd be primo. (CHUCKLES) Oh, that's lovely, isn't it? Oh, that's lovely, isn't it? I do love it when we can do that. Really nice. And thank you so much to Derek Dell of Dream Doors. They had absolutely no legal obligation to fix this, so we are deeply grateful. The Stones are taking Mr Budgen to the Disputes Tribunal. We've tried and tried and tried to get a comment from him. He won't say anything on the record. Now, we think homebuyers, especially in Auckland, are being badly let down. < Did you take out this loan? < Did you take out this loan? No, we didn't, no. < Did you take out this loan? No, we didn't, no. < Is it your loan? No. No. But who's paying it? No. But who's paying it? Yeah, We're paying for it, but it's not our debt, and we didn't sign up for it. And... I'm a true-blue Cantabrian, and the plight of this lady who'd saved for all of this job, and... I just felt it was another case of Big Brother, Company Carters not backing up their own products. And... Quack-quack! There's more. Quack-quack, isn't it? (LAUGHS) Welcome back. It's hard enough buying a house in Auckland these days without the sellers ` and the council ` adding a nasty and not-so-little fish hook ` how about another five grand of debt you didn't know about? It's called a retrofit loan, a council loan for heating and insulation. There's $35 million worth out there. You might have absolutely no idea you're getting one thrown in with the new house. Here's Hannah. When this cosy three-beddie home found its new owners just two years ago, Frank and Julie McPherson had been looking for quite a while. They had a bit of a routine. Probably I'd go round and have a look at the piles and insulation and all of that. I'll look at the building, and Julie comes and looks at the insides and the carpets and things. We were looking for quite a bit of space for a cheap price. Right price, right size and a bonus ` new floor and ceiling insulation and a heat pump. I've never had a heat pump, yeah. I thought it was really good. And the heat pump will be even better now that they've cleaned the filters. I didn't even know you were supposed to clean these until I saw it on TV the other day. Here's the second. We're going to clean them. A little bit of dust, though, is not a problem. But there was a much nastier secret hiding in the heat pump ` a retrofit loan had been taken out with Auckland Council to cover the cost of the heat pump and insulation. < Did you know what a retrofit loan was? < Did you know what a retrofit loan was? Uh, no. Not really. (LAUGHS) Did you take out this loan? Did you take out this loan? No. No, we didn't. Is it your loan? Is it your loan? No. But who's paying it? But who's paying it? Yeah, we're paying for it, but it's not our debt, and we didn't sign up for it. Since 2012, Auckland Council has processed over 13,000 retrofit loans totalling $35 million. The retrofit contract says that the homeowner must tell any prospective owner about the loan and must include that info in the sale and purchase agreement. But the previous owner of this house didn't do that, and council says because the retrofit loan is attached to the property and the rates, these guys now owe a debt of... We knew nothing about it when we bought the house, and we couldn't possibly have known anything about it, but we are still getting charged for it. And I just think that's unfair. Frank says before buying the house in 2013, he checked council's records thoroughly. I've been and looked through the whole file. Probably... 30, 35 documents inside that file, and all, uh... nothing after 2010. So I didn't think there was any issue at all. No mention of the retrofit loan on the sales and purchase agreement. I don't know why that is. And there was no red-flag of the retrofit loan in the rates information their lawyer saw, which could have at least warned them prior to settlement. No mention of it. No mention of it. So it hasn't appeared on the rates till 2014. They'd owned the house for a full year before this first mention of retrofit on their rates bill. It's weird how the loan can suddenly become rates. And if this sounds a bit familiar, new homeowner Kev Carter had the same problem in November last year. It seems like the loan's stuck to the rates, and we now take on the rates. How much of this debt had the vendors actually paid off? They've paid off around $400 of the loan and left the $3000 balance, including interest, up to us. (LAUGHS) (LAUGHS) < So stuff all, actually. (LAUGHS) < So stuff all, actually. So nothing. Julie and Frank have already paid off... $698.88. $698.88. $700 already. It's a dirty business. Left to pay off almost $5000 of someone else's debt, they did try and get hold of the previous owner, but no response. And council told them it's an issue of non-disclosure by the vendor, so 'unfortunately council is unable to become involved with any disputes between vendor and purchaser'. Really? Surely the council should be going for the previous owner and getting the money from them. But instead the heat's on them. We're stuck with it. Seems to be... there's nowhere to go. Oh, that seems so unfair. Council's sticking to the line that this is something the new owner has to sort out with the old owner. They say they'll try and help with that, though. Crucially, the council's made two major changes, which will help new property owners. The exitence of any retrofit loan will now be included in the property file and the rates information the lawyer sees before settlement. Now, that'll certainly help from now on. But it does suggest those things should have been in place all along, and for that reason we think councils should not continue to pursue people like Frank and Julie for loans they did not agree to. Yes. Now, we've done a number of stories on a Carter Holt Harvey cladding product called Shadowclad and its seconds version UtilityClad. Around the country we heard of cracking and delaminating Shadowclad. We're staying on this, and Brodie's been back to see the lady who kicked off the saga ` Kath Molloy in North Canterbury. Ah, Shadowclad ` a word which caused Kath Molloy an eight-month-long headache. I think it'd be wonderful if it was fixed, yes, cos there's no other solution. You see, the Shadowclad on her house was cracking and delaminating, and no one would help her. Carter Holt Harvey, who make the product, wasn't having a bar of it, claiming the builder had used UtilityClad, their seconds product not suitable for homes. But builder Louis Turnbull said it was not the seconds product. I ordered Shadowclad. It was delivered. It looked like Shadowclad, and it was marked as Shadowclad. Anyway, it went around in circles for a bit until we managed to get a resolution. All right. So, we are back at Kath's house to see how her new Shadowclad is going. 'A year after she first noticed the trouble.' Oh! Oh! What do you think? All finished. Yeah. It's all finished? Yeah. It's all finished? Yes, all finished. Builder Louis did the work out of his own pocket, replacing the old Shadowclad with new stuff supplied by Carters. I was just happy to help Kath out and just get it done for her. And a big ups to Resene in Rangiora for hooking up the paint and a shout-out to Mark Backhouse, supplying his scaffolding at no cost at all. I'm a true-blue Cantabrian, and the plight of this lady who'd saved for all of this job, and... I just felt it was another case of Big Brother, Company Carters not backing up their own products. Kath's just stoked that after a year, her house is back to the way it should be. You must be pretty happy. You must be pretty happy. Very happy, Brodie, very happy. Thanks to Fair Go. No, the outcome's been wonderful. Good on you, Kath. And good on Louis the builder and everybody else who mucked in. Nice one. Yes, yes. Now, the builder guarantees his work with a lovely Master Build Guarantee. So you should sleep easy in your new home, shouldn't you? But we have a question ` if that guarantee looks like a duck and quacks like a duck, what is it really? Now, I can waddle, and I can quack. (IMITATES DUCK QUAKE) I feel quite upset and frustrated about the Master Build Guarantee. And that's why our obscure question is actually quite important. Quack-quack, isn't it? (LAUGHS) Welcome back. Building or renovating. So many things can go wrong, so you get a building guarantee. The Master Build product is the best known. I've done quite a few stories about people trying to claim on it. And I stumbled upon a question. Now, the question is way bigger than it sounds. So what is that question, and why on earth did Gordon put on a duck suit to ask it? There's an old saying, isn't there? If it waddles like a duck and quacks like a duck, it's a duck. Now, I can waddle and I can quack. (IMITATES DUCK QUACK) But, uh, of course, I'm not a duck. But what about this, the Master Build Guarantee ` is it a duck? OK, this sounds ridiculous. I'm using this silly duck metaphor because the guarantee says it is not insurance. Insurance has more protection for you than a guarantee. So that is my big question ` is it insurance or guarantee? Is it a duck or not? OK, it all sounds a bit obscure. To explain why it's important, let's go to Wellington. DUCKS QUACK 'The things I do for journalism.' We flew into Jun Zhang's place above the harbour. It was finished in 2010, and it's got a Master Build Guarantee. I feel quite upset and frustrated about the Master Build Guarantee. Jun's problem doesn't look like much ` those little rust marks. But look what is causing them ` galvanised nails gone rusty. There's hundreds of them. They should not have been used. The builder, prodded by Master Builders, has started fixing it. Not up to scratch, says Jun. I write about 150 emails to Master Builder and the builder trying to get this issue resolved. So Jun claimed on his Master Build Guarantee, but the claim was rejected for three reasons ` one is that Master Build say the builder is willing and able to attend. OK, says Jun, but he's not happy with the work. Jun didn't claim within 90 days of seeing the problem, and he can't claim for defects after two years. Two years' defects cover for this sort of thing seems pretty standard. It's that 90-day time limit that gets us. Remember this says it's not insurance. If it were insurance that time limit just wouldn't fly. The law says time limits are almost entirely unenforceable for insurance claims. Now, if this were insurance, Jun Zhang could go to an independent disputes outfit and he'd have other legal protections. And that's why our obscure question is actually quite important. It's very very important, because there is a whole body of insurance law and protections that's aimed at consumer insurance. Two other competing products are covered by those protections. The Stamford Insurance and Homefirst Guarantee are both offered by insurers. The Master Build Guarantee says it's not insurance, and it gets a free pass. So we asked four experts ` is it guarantee or insurance, quacking duck or not? First, Canterbury-based Duncan Webb. It does look like a duck. It looks like a duck because it's a third party out there who's giving it. It walks like a duck because there's a premium in there, and here you've got a situation where the claim's water off a duck's back by the look of it to the insurer. So, verdict one... Yeah, well, quack-quack isn't it? (LAUGHS) We went to university for a sober view on our duck question. Victoria University's Bevan Marten was pretty excited about it. We looked at the 10-year premium version... He even got his insurance law students to have a vote. Please raise your hands. A thumping majority said yes, it's insurance, and so does Bevan. Verdict two... Well, I'd say quack. But remember, the document itself says it's not a duck; it's a guarantee, not a contract of insurance. It's got enough in it that looks like a contract of insurance. I know they've said it's not, but the law gave up on that sort of obfuscation a long time ago. I reckon it's a duck. No matter what you call it, if you call it a guarantee, it doesn't make it a guarantee, because it if it waddles and quacks, it's a duck. So verdict three is pretty clear. In my opinion it's definitely insurance. Back to university again. This time it's Auckland Uni. Lecturer Rohan Havelock is paddling against the tide. No, I don't think it quacks and waddles like a duck, no. Well, well, verdict four ` not a duck. But, having said that, I do think it's a turkey. And it's a turkey, he says Rohan, on his own experience as a lawyer in disputes with the Master Build Guarantee Company. Well, Master Build say that this guarantee is supposed to make you sleep easy. But based on my experience it's given some nightmares. All four of our lawyers agree on one thing ` if this were insurance, Master Build just could not use that 90-day time limit to decline Jun's claim. So I'm feeling I'm just wasting money to get the Master Build Guarantee. In the end, what those lawyers say doesn't really matter. What the Reserve Bank says does, and right now the bank is deciding whether this thing quacks or not. (IMITATES DUCK QUACK) You look like you were enjoying that. I've got a kid's birthday party coming up. Are you available? At a reasonable fee, absolutely. By the way, no bread to ducks. Apparently it's not good for them. Really? Didn't know that either. Really? Didn't know that either. I didn't know that. So, guarantee or insurance? Master Builders sent us a High Court ruling from 2000. It says it's a guarantee, not insurance; it's not a duck. But a new insurance law came in five years ago, and that's why those three lawyers say quack. Some rather good news ` Master Builders are going to review that 90-day time limit because of our story. They say it was to encourage parties to resolve issues more quickly. And we're working on a way to get Jun's house finished; nothing locked down yet. Now, I've said this before, and I'm gonna say it again ` it is my strong personal view that it's a conflict of interest for Master Builders to offer a membership association and a guarantee company. Put it this way ` if Richie McCaw gets cited for foul play ` heaven forbid ` you wouldn't put Steve Hansen, the All Blacks coach, on the committee that decides if he's guilty or not. So, that is the show, but we will be on Facebook for the next half-hour to answer your questions. Our programme is all about your problems, your thoughts, so do get in touch. We are on Facebook. Email us ` Write to us ` And next week ` firewood. Winter's just around the corner, so if you've got a fire or a wood burner, you'll be in the market for some of this stuff. We caught up with young entrepreneur Carlos Ter Huurne, owner of Ignition & Manukau Firewood Yards, to ask him what we should be looking for. You're looking for wood that's been seasoned. You want to know how long it's been seasoned for, and if it's winter, you want to make sure that you're ordering dry wood. This is unseasoned pine. It hasn't been airing out for long enough, and you can tell ` there's no cracks that go through it, which would show the dryness, as opposed to some of this other seasoned wood. There's cracks going through it; radial cracks going out from the centre. It's dry. 'That's next week. Goodnight.' Copyright Able 2015