Eastgate v Walker-Prentice

[2021] NZHC 2438

IN THE HIGH COURT OF NEW ZEALAND CHRISTCHURCH REGISTRY

I TE KŌTI MATUA O AOTEAROA ŌTAUTAHI ROHE

CIV-2019-409-000283

[2021] NZHC 2438

BETWEEN

PETER CHRISTOPHER EASTGATE

Applicant

AND

SHARON BEULAH WALKER-PRENTICE

First Respondent

LOIS REBECCA BECKWITH
Second Respondent

WARREN REGINALD WALKER

Third Respondent

Hearing:

13 - 15 September 2021

Appearances:

J V Ormsby and B A Harkerss for Applicant G M Brodie for First Respondent

K W Clay, S J Jamieson for Second and Third Respondents

Judgment:

15 September 2021

Issued:

Reissued:

16 September 2021

17 September 2021

JUDGMENT OF GENDALL J

On Litigation Privilege

NOTE: I issue a corrected form of the judgment containing amendments to paragraph

[13] pursuant to the slip rule (Rule 11.9).

EASTGATE v WALKER-PRENTICE [2021] NZHC 2438 [15 September 2021]

[1]                 Shortly after the commencement of the hearing in this matter I addressed a challenge to the litigation privilege claimed by the applicant (Mr Eastgate) here. That challenge was made on behalf of the first respondent (Sharon) and advanced by her counsel, Mr Brodie.

[2]                 In doing so, I heard submissions from Mr Ormsby, counsel for Mr Eastgate, and from Mr Brodie, counsel for Sharon, and gave my oral decision then. That decision  dismissed  Sharon’s  challenge  to  the  litigation  privilege  claimed  by   Mr Eastgate and upheld that privilege. In giving that decision I indicated that my reasons for the decision would follow. I now give those reasons.

[3]                 Mr Eastgate brought the present application seeking a grant of probate in solemn form as the named surviving executor in the will of the late Zelda Rose (the deceased) signed by her in 2012. A later will in 2014 is challenged it seems on grounds of lack of testamentary capacity on the part of the deceased and a claim to undue influence.

[4]Background to the litigation privilege claim seems to be as follows:

(a)Mr Brodie, for Sharon, first asked to see Mr Eastgate’s litigation file by way of discovery on 31 January 2020. Counsel for Mr Eastgate responded at that time, confirming that access was available to all files other than Mr Eastgate’s own litigation file.

(b)On 2 September 2020 it seems Mr Brodie again insisted on inspecting Mr Eastgate’s litigation file. Again, counsel declined to waive privilege in respect of that litigation file.

(c)At a pre-trial conference in this matter, Nation J noted in a minute dated 5 August 2021:

(i)As recorded in an earlier 9 October 2020 minute of this Court, discovery in this matter was to proceed informally.

(ii)The minute further recorded that Mr Brodie had indicated there might be an issue over the discoverability of Mr Eastgate’s solicitor file associated with commencement of discovery. It further recorded that counsel opposed such discovery, on the basis of a litigation privilege claim.

(iii)The Court in the minute further recorded that counsel confirmed to the Court that:

a.Mr Eastgate had no contact or communication with Zelda or any of her children at the time she executed relevant wills; and

b.Mr Eastgate had no contact with any of Zelda’s children before he commenced the present proceeding.

(d)In his minute Nation J recorded that Mr Brodie had not suggested there was any continuing discovery issue at the time of the telephone conference on 9 June 2021 and that any further discovery applications were required to be filed and served by 9 July 2021.

(e)Mr Brodie advised in his memorandum of 2 August 2021 that he again wanted Mr Eastgate’s litigation file. This was opposed at the pre-trial conference and Nation J recorded the reasons for Mr Eastgate’s opposition.

(f)Nation J went on to direct that if Sharon wished to pursue an application for such discovery then the application was to be filed and served by 13 August 2021. It seems neither Sharon nor Mr Brodie made such an application by that time. Mr Brodie, however, claims that earlier communications with the Court make it clear that any application for litigation privilege here is opposed and should be set aside.

[5]                 As to all this, the discovery and privilege issues it seems are interlinked. This is because, as I understand it, what Mr Brodie has now indicated is that he intends to ask questions of Mr Eastgate about matters that are covered in the advice he has received as executor and, therefore, by litigation privilege. A reasonable argument exists, as I see it, that, as Nation J directed, a formal application in this regard should have been brought by Sharon by 13 August 2021 and this may have failed to occur.

[6]                 Nevertheless, litigation privilege arguments proceeded before me and I now address those.

[7]                 A longstanding principle prevails in many cases like the present to the effect that trustees enjoy litigation privilege in respect of files relating to general legal advice they have acquired. In Burgess v Monk1 this Court stated:

This does not mean that beneficiaries have a right to discovery of all legal

advice sought and obtained by trustees. If trustees are being sued by beneficiaries, then litigation privilege applies. Trustees are not liable to disclose legal advice obtained for the purpose of their defence. They are entitled to assert privilege in the usual way and the beneficiaries’ rights to disclosure under trust law make no difference.

[8]                An earlier passage in a Court of Appeal judgment in Re Harper was cited which read:2

…even although litigation against the trustees was contemplated the question was whether the dominant purpose of the solicitor who created the documents in issue was to enable him to advise the trustees in relation to the contemplated litigation.

[9]This general position has not changed as a recent Supreme Court decision in

Lambie Trustee Ltd v Addleman3 makes clear. There, the Supreme Court stated at [98]:

Despite these reservations, we are of the view that Lambie Trustee Ltd is entitled to assert privilege in legal advice received after the commencement of proceedings. This is consistent with the authorities to which we have already referred. It is, as well, consistent with the realities of the dispute.

1      Burgess v Monk [2016] NZHC 527 at [11].

2      Re Harper (1994) 7 PRNZ at 526

3      Lambie Trustee Ltd v Addleman [2021] NZSC 54.

[10]              On all these aspects, s 56 of the Evidence Act 2006 provides that litigation privilege attaches to preparatory materials where the “dominant purpose” is preparing for litigation. In litigation between beneficiaries and trustees like the present, there is, however, a joint interest exception to legal professional privilege (when Court-ordered disclosure of information to beneficiaries is under consideration) which sometimes arises. In the Lambie decision the Supreme Court did recognise this and noted that where parties’ positions and interests are aligned then there may be such a joint interest. The Supreme Court, however, rejected the suggestion that because litigation in question was not “hostile” there remained a joint interest between the trustees and beneficiaries in that or any similar case.

[11]              Here, Mr Brodie for Sharon suggests there is a joint interest in this litigation in the sense that, first, Mr Eastgate is not being sued as a trustee for some breach of his office and, secondly, that joint interest must exist between Mr Eastgate as trustee and the beneficiaries with respect to the exploration of the question as to which is the deceased’s final will here.

[12]I do not accept this argument that a joint interest exists in the present litigation.

[13]              Sharon and the other respondents here are also beneficiaries under at least the 2014 will. No application for probate of that will is before the Court, as I understand a caveat has been lodged. Mr Eastgate is an independent executor and trustee of the 2012 will. He says, and I agree, that he had an obligation to gather information and make his own decision about whether or not reasonable grounds existed to believe that the later 2014 will was not the deceased’s last valid will, such that he had an additional obligation to put this before the Court with regard to the position of the 2012 will for a decision. No other actions were being taken with respect to advancement or finalisation of the deceased’s estate over the question of which one constituted her last valid will. In reaching the decision he did, Mr Eastgate needed to make his own independent assessment of all the relevant facts here and to take appropriate legal advice, which he did. I am satisfied under all the circumstances he ought to be entitled to retain privilege in respect of his litigation file providing legal advice to him on the matters he confronted. What is clear, too, is that in light of the unfortunate family situation that had developed between Sharon and her siblings, the other respondents

to this proceeding, a situation that can only be described as acrimonious in the extreme given they are opposed on almost every matter, Sharon’s position is that the 2014 will (which favours her slightly more than the 2012 will) is the proper and last will of the deceased. The second and third respondents, Lois and Warren, support Mr Eastgate’s argument for the Court to determine that the 2012 will does represent the deceased’s last valid will.

[14]              In all the circumstances of the present case, I am satisfied Mr Eastgate has sought to assist all the parties, including the respondents (equal residuary beneficiaries under both the 2012 and 2014 wills in any event) on all matters that might seem to be relevant.

[15]              Mr Eastgate has disclosed here from whom he sought information either directly or indirectly before making his decision to bring the present application for solemn probate of the 2012 will. He has also, as I understand it, disclosed facts ascertained at the time from those various sources and has confirmed this on a number of occasions.

[16]              Notwithstanding this, Mr Eastgate contends that he should not be required to waive litigation privilege in relation to the legal advice he received from Mr Ormsby with respect to this matter, a matter which in any sense is truly contested.

[17]              Under all these circumstances, I am satisfied the parties’ positions and interests here are not so aligned that there can be any suggestion that a joint interest is involved.

[18]              I conclude, therefore, that litigation privilege with respect to the legal advice and reports from Mr Ormsby to Mr Eastgate must remain. I confirm the challenge to this litigation privilege advanced by Sharon was dismissed by me at outset of this trial for these reasons.

...................................................

Gendall J

Solicitors:

Cavell Leitch, Christchurch

Tavendale & Partners, Christchurch

Copies to:

Jared Ormsby, Barrister, Christchurch Geoffrey Brodie, Barrister, Christchurch Kevin Clay, Barrister, Christchurch