Source: Radio New Zealand
The downed pylon at Glorit, just north of Auckland, cut power to about 180,000 people and 20,000 businesses across Northland. Supplied / Kawakawa Electrical Ltd
Class action has been filed against national grid operator Transpower and its maintenance contractor Omexom over the toppling of a power pylon in mid-2024 that cut power to the entire Northland region.
The legal action is being taken on behalf of the roughly 20,000 businesses affected by the outage and, if successful, could end up costing the two companies millions of dollars.
Hannah Brown, a partner in Sydney-based law firm Piper Alderman, said no specific sum was mentioned in the legal papers filed late on Wednesday – but an estimate last June by economic consultants Infometrics put the cost to businesses at $60 million while the Northland Chamber of Commerce gave a figure of $80m.
A report last year by Transpower found the pylon at Glorit, northwest of Auckland, fell over on 20 June last year when contractors removed the nuts from at least two of its legs at once.
Transpower staff working at dawn to install a temporary tower after a pylon collapse cut power to most of Northland in June 2024. Transpower
Brown said a subsequent review by the Electricity Authority concluded the collapse was caused by “entirely avoidable” factors including inadequate procedures and training.
“This wasn’t just another power outage or an accidental or unforeseeable event like a weather event or a storm. It was something that was completely avoidable, and for that reason, we think those responsible should be held to account, and if they aren’t, that just breeds a sense of complacency in the future.”
The power cut affected about 180,000 people.
Most homes had power restored within seven hours but some large businesses, such as timber mills and dairy plants, lost more than three days’ worth of production while restaurants had to throw away spoiled food.
After pressure from Northland MP Grant McCallum and the local Chamber of Commerce, Transpower and Omexom each contributed $500,000 to a “resilience fund” for projects designed to lift the region’s economy.
However, Brown said that amount was “completely disproportionate and insufficient” given the actual losses suffered by Northland businesses.
Along with Piper Alderman, the class action was being run by New Zealand law firm LeeSalmonLong and bankrolled by litigation funder Omni Bridgeway.
Brown said it was intended to be an “opt-out” lawsuit, which meant all affected businesses would be included unless they chose not to take part.
There was no cost to businesses taking part, but if the “no win, no pay” class action was successful, the law firms and funder would take a commission.
Without class action, Brown said it was hard for individual businesses to take on the might and resources of a state-owned enterprise like Transpower or a large multinational such as Omexom.
Omexom’s France-based parent company, VINCI Group, declared net income of just under $10 billion last year.
“This is about giving businesses access to justice and an opportunity to group together to fight for compensation,” she said.
Class actions have been rare in New Zealand, and reputedly hard to win, in the past.
However, Brown said that was changing thanks to recent reforms making class actions more accessible.
Successful cases, such as the ASB’s settlement in a banking class action over disclosure breaches, showed the legal landscape was evolving.
She said the law firms were confident they had a strong case, much of which was built on Transpower and Electricity Authority reports.
“We wouldn’t be pursuing this if we didn’t believe it had strong prospects,” she said.
Northland businesses affected by the outage would be invited to register and provide information about their losses.
Some were already on board but now that the class action had been filed, it would be much easier to engage openly with affected businesses across Northland.
If the class action was successful, Brown said compensation would be distributed among those businesses in proportion to their losses.
A Transpower spokesman confirmed legal papers had been served on the company late on Wednesday, but would not comment given that the matter was before the courts.
Omexom could not be contacted.
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– Published by EveningReport.nz and AsiaPacificReport.nz, see: MIL OSI in partnership with Radio New Zealand
