Body Corporate 323716 v Manson Developments Limited - [2016] NZHC 728

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

CIV-2012-404-3811 [2016] NZHC 728

BETWEEN
BODY CORPORATE 323716 A BODY

CORPORATE CONSTITUTED TO THE UNIT TITLES ACT 1972

First Plaintiff

JAMES GLOVER MASON and MARGARET MARY CONSTANCE MASON and Others

Second Plaintiff

AND

MANSON DEVELOPMENTS LIMITED First Defendant

ECM DEVELOPMENTS LIMITED Second Defendant

AUCKLAND COUNCIL Third Defendant

MANSONS TCLM LIMITED Fourth Defendant

Hearing: 19 April 2016

Appearances:

C J Booth and S F Panzic for plaintiffs

R P Coltman and S J Connolly for first, second and fourth defendants

S C Price and J K Wilson for third defendant

Judgment:

19 April 2016

JUDGMENT OF LANG J [on interlocutory applications]

This judgment was delivered by me on 19 April 2016 at 4.30 pm, pursuant to Rule 11.5 of the High Court Rules.

Registrar/Deputy Registrar

Date……………

BODY CORPORATE 323716 v MANSON DEVELOPMENTS LTD [2016] NZHC 728 [19 April 2016]

[1] This proceeding is a “leaky building” claim in relation to an apartment building known as 7 The Promenade Takapuna Apartments. The proceeding is scheduled to be the subject of a three week trial commencing on 13 June 2016.

[2] It recently became apparent that several interlocutory issues needed to be determined as a matter of urgency before trial. As a result, Faire J held a telephone conference with counsel on 6 April 2016. In a minute issued following that conference, the Judge directed any outstanding applications to be heard today. Leave is required for each of the applications because they have been filed after the setting down date.

[3] Leave is sought in respect of the following applications:

(a) An application by the first, second, third and fourth defendants for leave to amend their statements of defence to the fifth amended statement of claim to include a defence based on the Limitation Act
1955 in respect of two defects identified in the statement of claim.

(b)An application by the third defendant (the Council) for orders declaring part of the evidence of Andrew Gray to be inadmissible.

(c) An application by the Council for orders declaring parts of the evidence given by Mr Mark Powell and Mr Roger Twiname to be inadmissible on the ground that it is hearsay.

(d)An application by the first, second and fourth defendants (the Manson interests) for orders under r 9.34 of the High Court Rules permitting them to carry out destructive testing on the building that is the subject of the application.

Application for leave to file amended statement of defence

[4] This application relates to alleged defects in the building that the plaintiffs refer to in their fifth amended statement of claim as defects D and J. The defendants contend that the plaintiffs included these defects for the first time in their fourth and

fifth amended statements of claim, both of which were filed after 25 September

2013, the expiry date of the ten year “long stop” period prescribed by the Building Act 2004. As a result, the defendants seek leave to amend their statements of…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

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Details

Case: [2016] NZHC 728
Decision Date: 19 April 2016

CaseChat Overview and Summary

In this case, Body Corporate 323716 and others are suing Manson Developments Limited, ECM Developments Limited, Auckland Council, and Mansons TCLM Limited in relation to defects in a building known as 7 The Promenade Takapuna Apartments. The defendants have filed interlocutory applications seeking leave to amend their statements of defence, to declare certain evidence inadmissible, and to carry out destructive testing on the building. The court has to decide whether to grant the defendants' applications and the implications of such decisions.

First, the defendants seek leave to amend their statements of defence to include a limitation defence in respect of two defects identified in the plaintiffs' fifth amended statement of claim. The defendants argue that the defects were not included in earlier versions of the statement of claim and were identified after the expiry of the ten-year "long stop" period prescribed by the Building Act 2004. The plaintiffs argue that the defects are particulars of the overall cause of action based on negligence and that the defendants have been guilty of inordinate and unexplained delay in seeking to advance these defences. The court grants leave to file the applications but only in respect of defect D, as it is arguable that the amendment of the fourth statement of claim resulted in the plaintiffs introducing a new claim after the expiry of the long stop period.

Second, the third defendant, Auckland Council, seeks an order declaring part of the evidence of Andrew Gray to be inadmissible on the ground that he is not qualified to give that evidence. The Council contends that Mr Gray is not an expert to give evidence on the issue of what a prudent Council officer ought to have done in relation to the construction of the plaintiffs' apartment building. The court declines to grant the Council leave to file the application, as the issue needs to be determined at trial when the trial Judge will be in a far better position to consider it.

Third, the Council seeks an order declaring parts of the evidence given by Mr Mark Powell and Mr Roger Twiname to be inadmissible on the ground that it constitutes inadmissible hearsay evidence. The Council contends that the documents referred to by each witness are hearsay statements and cannot satisfy the criteria for admission under s 18(1) of the Evidence Act 2006. The court declines to grant the Council leave to file this application as well, as it needs to be determined at trial.

Lastly, the Manson interests seek leave to carry out destructive testing on the apartment building. The defendants wish to test a grouting and waterproofing process prior to trial so that the Court can have confidence in the solution they propose. The plaintiffs oppose the proposed testing, as they believe the defendants will not be able to succeed with this defence at trial. The court grants leave to file the application and grants the application as sought, as the defendants need to be able to offer alternative forms of remedy if they are suitable.

In conclusion, the court grants leave to file the applications and grants the applications in respect of defect D and the testing process. The defendants should be required to bear the consequences of their failure to identify earlier the shift in the plaintiffs' position in relation to defect J. The issues of admissibility of evidence and the proposed testing process should be determined at trial.

Orders