Capital and Coast District Health Board has begun legal action against three construction companies including Fletchers, over extensive pinhole leaks in the pipes at the regional hospital built just eight years ago.
Fletcher was the main contractor in the building project, which cost more than $300 million.
The legal action, filed in the High Court, also targets Beca, which provided design and engineering services and Crane Group in Australia, which made the copper pipes.
The pipes were discovered to be riddled with tiny holes and will have to be ripped out and replaced.
The leaks are extensive in both the hot and cold water pipes across the more than 48,0000-square metre hospital in Newtown.
DHB chief executive Debbie Chin said it was not acceptable to have leaking plumbing in the hospital. She wouldn't speculate how much the legal action would cost and what she expected the outcome to be.
The leaks will be managed so health services are maintained, she said.