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Yesterday, 07:29 PM
#2501
![Quote](images/misc/quote_icon.png) Originally Posted by moka
Western Australia Plumbing Issues Update 13 October 2023
https://fletcherbuilding.com/assets/5-news/pdfs/WA-Plumbing-Issues-Update-Presentation.pdf
FBU said in October that evidence points to installation as the reason leaks are occurring in some houses in Perth, and that installation practices have deteriorated over time.
The plumbing failures are specifically occurring in Perth and Western Australia, not in other parts of Australia or internationally. The issue appears to be isolated to homes built in WA using Iplex Australia's Pro-fit pipe product.
The issues are not present on the East Coast of Australia or in other geographies where similar products are used.
Approximately 35% of relevant WA homes are expected to experience one or more leaks over time.
Seems like FBU have decided $150 million is the price needed to get a deal together and move on. Their main worry was a product recall which has been mitigated but it still looks open ended with the main builder not yet committing and the WA government extending the liability period to 15 years. Obviously they have got the best legal advice and the market likes it but lots of unanswered questions as to why is this happening in just WA and why not cap it as the WA government have done with their 20% contribution?
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Yesterday, 08:02 PM
#2502
![Quote](images/misc/quote_icon.png) Originally Posted by Paint it Black
Seems like FBU have decided $150 million is the price needed to get a deal together and move on. Their main worry was a product recall which has been mitigated but it still looks open ended with the main builder not yet committing and the WA government extending the liability period to 15 years. Obviously they have got the best legal advice and the market likes it but lots of unanswered questions as to why is this happening in just WA and why not cap it as the WA government have done with their 20% contribution?
Like the NZICC, this open-ended negotiated liability has the potential to bleed FBU for years and years to come. Note that the WA government contribution is capped at $20m but FBU's is unlimited?
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Yesterday, 09:11 PM
#2503
Historically NZ inc has/had the highest priced residential housing market in the world.
Am I wrong.
I understand that in the US a 4/2 piece of timber is at least 70 % cheaper than in NZ.
And white ware is probably 50 % cheaper.
This plumbing issue ...FGS....thats what happens when companies decide to go deride abuse their customers in favor of their egos and bonuses...
Last edited by troyvdh; Yesterday at 09:30 PM.
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Plumbing failures in Perth have become a significant issue, particularly with newly built homes.
A major issue affecting Perth homes is burst pipes, occurring at an alarming rate of almost seven per day. This problem primarily involves polybutylene water pipes manufactured by Iplex and installed in homes built between 2017 and 2022.
Potential Causes
There are conflicting views on the root cause of these plumbing failures:
Manufacturer's Perspective:
Fletcher Building, Iplex's parent company, attributes the issues to faulty installation. They claim their investigations and testing point to installation as the primary cause, citing a correlation between basic plumbing installation failures/mistakes and the location of plumbing failures.
Builder's Perspective:
BGC, a major Perth builder, believes the problem lies with the pipes themselves. They claim Iplex changed an ingredient in the pipe manufacturing process in 2017, specifically the resin (TYPLEX-1050 from Korea), which they believe is the source of the problem.
The issue is widespread, potentially affecting thousands of homes.
BGC estimates that pipes may need to be replaced in almost 12,000 homes in Western Australia.
Approximately 1,908 homes in Perth have reported leaks in the last two years, compared to only 28 in the rest of Australia.
Several other factors may contribute to plumbing issues in Perth:
Perth's sandy soil can lead to blocked drains by entering cracks in pipes or being washed in during heavy rains.
The city's variable climate can cause pipes to expand and contract, leading to weaknesses or cracks.
Older properties often feature clay sewer pipes, which can be invaded by tree roots seeking moisture.
Ongoing Investigations
The Western Australian government is conducting investigations into these plumbing failures:
- The building and plumbing regulator has ruled out installation work practices and workmanship as the cause of pipe failures.
- A separate investigation by the Consumer Protection division is looking into cases where people have been injured due to these plumbing issues.
As the situation continues to develop, homeowners, builders, and manufacturers are awaiting definitive answers and solutions to this widespread plumbing problem in Perth
https://www.abc.net.au/news/2023-10-...ipes/102969932
Builder and manufacturer trade blows as pipes burst in newly built homes across Perth 12 Oct 2023
https://www.commerce.wa.gov.au/annou...igation-update
Plumbing pipe investigation update
https://www.rnz.co.nz/news/business/...-pipe-failures
Fletcher Building criticises 'crude' attempt to deflect blame for pipe failures 14 June 2024
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It is clear that the WA government was going to impose a product recall which FBU has averted by agreeing to the open ended liability settlement to fix the problem.
Given how vehemently FBU initially denied culpability but now accepts responsibility (irrespective of what the agreement says), it is likely that BGC will continue with its court case against Iplex/FBU - need to estimate how much FBU may have to pay for damages etc.
Add the initial $168m estimated settlement cost to the $1.3 billion FBU paid for Crane Industries in a hostile takeover which was executed with no due diligence. So how much is Crane worth now?
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The in-principle agreement in perspective for affected homeowners and BGC.
Lots more water to flow under the bridge - so to speak.
https://www.watoday.com.au/national/...30-p5k6ou.html
Thousands of West Australians are part of a federal class action against Iplex over the matter.
BGC is also pursuing litigation.
In a statement, Iplex said it intended to defend the lawsuits.
“Despite reaching an in-principle agreement on the Joint Industry Response, legal and financial risks remain for Iplex AU and Fletcher Building.,” it said.
“If a current or future matter was successfully brought against Iplex AU, it may have a material adverse impact to the group.”
Last edited by Balance; Today at 11:21 AM.
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