Grace v Orion New Zealand Limited

[2020] NZHC 701

IN THE HIGH COURT OF NEW ZEALAND CHRISTCHURCH REGISTRY

I TE KŌTI MATUA O AOTEAROA ŌTAUTAHI ROHE

CIV-2017-409-000454

[2020] NZHC 701

UNDER

the Forest and Rural Fires Act 1977

BETWEEN

CECILE GRACE and OTHERS

Plaintiffs

AND

ORION NEW ZEALAND LIMITED

First Defendant

AND

LEISURE INVESTMENTS NZ LIMITED PARTNERSHIP

Second Defendant

Hearing:

11 March 2020

Appearances:

C M Stevens and B R D Cuff for Plaintiffs

T C Weston QC and R J H Scott for First Defendant W J Hamilton and L A Merrick for Second Defendant

Judgment:

6 April 2020

JUDGMENT OF ASSOCIATE JUDGE PAULSEN

This judgment was delivered by me on 6 April 2020 at 3.30pm pursuant to Rule 11.5 of the High Court Rules

Registrar/Deputy Registrar Date: 6 April 2020

GRACE v ORION NEW ZEALAND LIMITED [2020] NZHC 701 [6 April 2020]

Introduction

[1]    The plaintiffs are residents/landowners or business owners who suffered loss as a result of a fire that started in Early Valley Road (EVR) on 13 February 2017. The first defendant, Orion New Zealand Limited, (Orion) carries on business as an electrical lines company and is the owner/operator of power lines located on the boundary of EVR.

[2]    Orion has made an application for further discovery from the twenty-seventh plaintiffs Kenneth and Denise McKenzie. Orion seeks discovery of the McKenzies’s landline and mobile telephone  records  for  calls  made  or  received  by  them  on  13 February 2017.

[3]    The McKenzies’s solicitors did not respond to a request made by Orion’s solicitors for the telephone records on 2 December 2019. This application was filed on 23 December 2019. On 29 January 2020, the opposition to the application was filed on the grounds that:

(a)the telephone records are not relevant to any matter in issue;

(b)given the lack of relevance, ordering disclosure would be an unreasonable breach of the McKenzies’s privacy;

(c)it would be oppressive to require the McKenzies to obtain the documents from their telephone providers; and

(d)it is not in the interests of justice to order discovery.

The pleadings

[4]    The main issue between the parties concerns the cause of the fire. The plaintiffs say the fire was caused by molten particles emitted from the operation of   a fuse on Orion’s network located on a power pole identified as AX728. It is common ground that the fire started close to Pole AX728 and that there was an overcurrent event at 5:39:56pm and that the fuse operated three seconds later at 5:39:59pm.

[5]    Orion denies that the operation of the fuse caused the fire. While having no burden in this regard, Orion says the fire started before the operation of the fuse and it was the fire that caused the fuse to operate.

[6]    It will be immediately apparent that the time the fire started is critical in determining its cause. If the fire started before 5:39:59pm it logically follows that the operation of the fuse was not its cause and the plaintiffs’ case proceeds on an incorrect basis. As the time the fuse operated has been so accurately determined, an exact time-line of events is critical. A finding that the fire started before 5:39:59pm may determine the outcome of the litigation.

[7]    The plaintiffs’ pleadings at [76] to [78] of the fourth amended statement of claim are relevant. At [76], the plaintiffs plead the fire commenced “at approximately 5.43pm” on 13 February 2017 but the plaintiffs now accept the pleading is incorrect and the fire started at 5.39pm. At [77], the plaintiffs plead that the fire originated in the area at the bottom of Pole AX728, the power pole being part of the electricity lines infrastructure and operated by Orion. At [78], the plaintiffs plead the cause of the fire was the operation of an expulsion dropout fuse located on Pole AX728, as upon the rupture of the fuse element, hot plasma and molten metal particles were discharged onto the ground igniting vegetation. The mechanism for operation of the fuse is said to have been either two lines being blown together by wind or by a branch falling across two lines. The fuse is said to have operated at 17:39 hours on 13 February 2017.

[8]    At [4] to [6] of its statement of defence to the fourth amended statement of claim, Orion has put in issue the following:

(a)the time the fire started (before or after the fuse operated at 5:39:59pm);

(b)the cause of the overcurrent event at 5:39:56pm (which, in turn, caused the fuse to operate); and

(c)the cause of the fire (operation of the fuse or otherwise).

The telephone calls

[9]    Following the fire, the McKenzies were interviewed by Paul Donnellan of Corporate Risks Ltd and also by the Police. On 4 July 2017, Corporate Risks Ltd released a summary report. The report  contains  records  of  interviews.  Mr  and Mrs McKenzie are recorded as saying that on the day of the fire Mrs McKenzie was at home and called Mr McKenzie on his cell phone at 5.49pm to advise him of the fire. She also said that she tried to call 111 but was not successful. The relevant record of the interview is as follows:

10.10.4   … [Mr McKenzie] received a call from [Mrs McKenzie] at 5.49pm saying that there was a fire coming onto their property up the hill.

10.10.5   The insured told us he made his way down Early Valley Road and came past (sic) a fire which was burning from the roadway opposite Roger Beattie’s house. … He said that along the road he met [Mrs McKenzie] who had made her way down the hill, he knew she was safe.

10.10.6   Mr McKenzie said he believed the fire had started down near the power poles on the road but when he drove past (sic) he hadn’t actually seen any real fire. The gorse had been burnt and there was just smouldering on the ground …

10.10.8   [Mrs McKenzie] said she could see a wall of flames coming up the hill from Early Road (sic) towards her. She called [Mr McKenzie] at 5.49pm and had also tried to dial 111 but couldn’t get through.

10.10.9  ... She said she met [Mr McKenzie] by the driveway entrance at Early Road (sic).

10.10.10   … [Mr McKenzie] said that after he knew that his wife was safe, he went with Andy Nicholson and started fighting fires …

[10]   Mr Donnellan took handwritten notes of his interview with the McKenzies dated 21 February 2017 which record Mr McKenzie saying “Wife called me 5.49pm (our phone history). Said fire”. Mrs McKenzie is quoted as saying “Wall coming up towards me 5.49pm. Tried to dial 111. No response.”

[11]   In a Police interview on 22 February 2017, Mr McKenzie said that he received a call from Mrs McKenzie whilst at a Mr Gerard’s property in nearby Potters Lane at “about 5.49pm according to the call history.” He goes on to say that:

I exited the house of where I was & drove straight back through Early Valley Road.

It would be about 5 mins after I received the call from [Mrs McKenzie] before I drove past Roger’s place.

It was strong north west wind at the time.

The seat of the fire was around the power line junction where it starts going up the hill. It’s across the road of Roger’s.

…

I kept driving to the entry of my property & that where I spoke to Andy NICHOSON (sic) who was retreating down from the drive as it’s getting too dangerous for them to stay at my house which is the 1st house up on the driveway.

…

I turned around & drove back out the valley with Andy.

After I drove them to old Tai Tapu Rd. I turned around & went back into the valley.

I stopped at where the Fire Truck was, spoke to the officer in charge & drove him up towards my house.

But the fire was developing so quick which stopped us getting close to my house so I backed out & dropped him back off.

After that I went to Grant’s place which is the driveway on the right past our driveway. …

…

I went there & started fighting the fire with Grant.

Issues arising from the statements

[12]   Mr McKenzie’s statements are to the effect that after Mrs McKenzie called at 5.49pm (when he was at Potters Lane) he drove to EVR in a north-easterly direction past the fire burning opposite Roger Beattie’s house (roughly opposite to Pole AX728) and on towards the cattle stop at his own property at 134 EVR. The Police interview contains the information that his journey took approximately five minutes. Based on the statements, Mr McKenzie was driving into EVR in the period of 5.49 to 5.54pm.

[13]   However, a witness to the fire, Aurora Velicias, was on EVR and took a video recording of the fire near Pole AX728 at 5.51pm. The video shows a vehicle driven by Mr McKenzie travelling on EVR in a south-westerly direction. Mr McKenzie is alone in the vehicle.

[14]   The video raises doubt as  to  the  time  of  the  call  by  Mrs  McKenzie  to Mr McKenzie (said to be at 5.49pm) and raises questions, also, about Mr McKenzie’s movements following it. Furthermore, the accounts given by Mr McKenzie to the Police and Mr Donnellan as to the state of the fire around Pole AX728 are not entirely consistent with each other.

[15]   Not surprisingly, Orion seeks an explanation. Mr McKenzie has not made an affidavit. The notice of opposition is supported by an affidavit of Mr Donnellan who, as noted earlier, interviewed the McKenzies after the fire (on 21 February 2017) and contributed to Corporate Risks Ltd’s summary report.

[16]   Orion objected to Mr Donnellan’s affidavit and was right to do so. The affidavit purports to give evidence about matters that Mr McKenzie could have given first-hand evidence about. Furthermore, Mr Donnellan purports to give evidence drawn together from knowledge gained by him in his investigations which is inconsistent with Mr McKenzie’s statement to the Police. It also contains speculation, most notably about whether Mr McKenzie’s statement is consistent with Ms Velicias’s video.

[17]   As an  example  of  the  unacceptable  content  of  the  affidavit,  at  [18.5]  Mr Donnellan says:

From knowledge obtained during inquiries in relation to the Early Valley Fire, I am aware that after knowing that his wife was evacuated to a safe area he has driven back along the road towards towards (sic) Roger Beattie’s address. He had watched the progress of the fire had spread towards his home from standing in the Beattie paddocks.

That account is not consistent with Mr McKenzie’s statement to the Police where he said that after driving to his property:

I turned around & drove back out the valley with Andy.

After I drove them to old Tai Tapu Rd. I turned around & went back into the valley.

I stopped at where the Fire Truck was, spoke to the officer in charge & drove him up towards my house.

The legal principles

[18]   Orion’s application is made in reliance upon rr 8.18 and 8.19 High Court Rules 2016. The  parties  agree  that  the  correct  approach  is  set  out  in  Assa  Abloy  New Zealand Ltd v Allegion (New Zealand) Ltd, where Asher J said:1

I will follow therefore a four stage approach in considering this r 8.19 application:

(a)Are the documents sought relevant, and if so how important will they be?

(b)Are the grounds for belief that the documents sought exist? This will often be a matter of inference. How strong is that evidence?

(c)Is discovery proportionate, assessing proportionality in accordance with Part 1 of the Discovery Checklist in the High Court Rules?

(d)Weighing and balancing these matters, in the Court’s discretion applying r 8.19, is an order appropriate?

[19]   The plaintiffs submit that in addition to the principles in Assa Abloy, the cases establish the following relevant propositions concerning relevance and “fishing expeditions” as follows:

(a)The documents sought must be relevant by reference to those matters which will necessarily be in issue before the Court. Relevance is to be assessed according to the pleadings.2

(b)Particulars of the pleaded allegations will also shape relevance, given properly drawn and particularised pleadings establish the ‘perimeters of the case’.3

(c)The  documents  required  must  be  described  in  some  detail   in   the application to enable the court to see exactly what is being sought.

The rule should not be used as a fishing expedition.4

(d)“Fishing” is defined as being where one party seeks “to obtain information or documents … in order to discover a cause of action different from that pleaded or in order to discover circumstances which may or may not support a baseless or speculative cause of action”.5 The same equally must apply to a speculative or unpleaded defence.

1      Assa Abloy New Zealand Ltd v Allegion (New Zealand) Ltd [2015] NZHC 2760 at [14].

2      Robert v Foxton Equities Ltd [2014] NZHC 726, [2015] NZAR 1351 at [18].

3      Minister of Education v James Hardie New Zealand Ltd [2019] NZHC 1760 at [28].

4      Body Corporate 366611 v Downer New Zealand Ltd [2013] NZHC 3110 at [34].

5      AMP v Architectural Windows Ltd [1986] 2 NZLR 190.

Discussion

Relevance

[20]   The McKenzies’s telephone records are relevant to matters put in issue in the pleadings. The parties have very different cases as to how the fire started. Because it is known exactly when the fuse on Pole AX728 operated, the issues of the cause of the fire and the time at which it started are indissolubly related. An important aspect of determining when the fire started will be what people observed and when they observed it. Establishing a credible timeline is essential to determining the cause of the fire.

[21]   I accept Orion’s argument that the various discovered materials, and investigations undertaken by the parties, include many approximate timings offered by witnesses. Orion is entitled to confirm times by reference to objectively verifiable data which in this case includes the time at which Mrs McKenzie reported the fire to Mr McKenzie.

[22]   Orion wishes to test the accuracy of the claimed 5.49pm phone call. It is important that it do so  when  the  timing  of  the  call  appears  inconsistent  with  Ms Velicias’s video. My view is bolstered by the contents of Mr McKenzie’s proposed evidence. His brief of evidence to be given at trial was provided for my consideration. In it he refers to  the  time  that  he  received  the  telephone  call  as  having  been  “at approximately 5.49pm”. He then goes on to speak to his observations of the fire as he drove towards his property on EVR. Clearly the plaintiffs consider this evidence relevant and Orion is entitled to test it.

[23]   The plaintiffs argue that the telephone records are not relevant to any matter in issue on several bases. First, that there is a considerable amount of photographic, video and documentary evidence and expert and witness statements as to the cause of the fire and no credible link between the time of Mrs McKenzie’s telephone call to Mr McKenzie and when the fire started. It is correct there is a great deal of evidence available as to the cause of the fire. But that does not mean that the McKenzies’s telephone records are not relevant. Mr McKenzie is to be called as a witness. His evidence relates, in part, to the cause of the fire. He refers to the time he received the

call from Mrs McKenzie and what he observed after that. Clearly the telephone records are relevant to his evidence. Orion should be allowed  to  see  those telephone records.

[24]   The plaintiffs argue that the application is “fishing” and that the real purpose of it is to obtain information to implicate Mr McKenzie in the setting of the fire.    Mr Stevens argued this can be inferred from the change in Orion’s focus over time. He referred to Orion’s lawyer’s letter of 2 December 2019 requesting the telephone records, where they state that the records are required to corroborate and track the timing and movements of the witnesses to the fire. In the application, the records are said to be relevant to the cause of the fire. In its submissions, Orion also argues that the records are relevant to the timing of the fire. Mr Stevens highlighted the evolution of the relevance of the records from tracking; to cause; to timing.

[25]   The plaintiffs’ submission overlooks the fundamental point that the timing and cause  of  the  fire  are  insolubly  connected.  Orion  wishes  to  accurately  track   Mr McKenzie’s  movements  only  because  when  he  received   the   call   from  Mrs McKenzie, where he went after the call and what he observed may assist the court to determine both the time the fire started and its cause. Orion is not engaged in fishing because the telephone records are relevant to its pleaded defence.

[26]   The plaintiffs argue that if Orion wishes to assert that Mr McKenzie was involved in setting the fire it should plead that. There is no such pleading because Orion is making no such allegation.

[27]   The plaintiffs then argue that the timing provided by Mr McKenzie is entirely plausible. This overlooks the difficulty reconciling his statements with other available evidence. Orion is not required to accept Mr McKenzie’s evidence without challenge, just because it might, under some circumstances, be considered plausible.

[28]   I am satisfied that the McKenzies’s telephone records are relevant to matters put in issue by the pleadings.

Do the documents exist?

[29]   In Assa Abloy, Asher J considered that an application for further discovery must show that there is some credible evidence, objectively assessed, that indicates the documents sought  exist.6  There is  reference  in Mr McKenzie’s statement to   Mr Donnellan to a call history and I consider I am able to take judicial notice that telephone service providers maintain records of calls made by their customers.7 There is a submission that the plaintiffs’ solicitors have made inquiries and the McKenzies do not hold the telephone records, but no evidence that a request has been made of the telephone service providers for the records or that the records do not exist. I am satisfied that the records of the McKenzies’s calls are likely held by their telephone service providers and are obtainable by them upon request.

Proportionality

[30]   The documents that are being sought are few in number. They are not, as the plaintiffs submit, being sought for an improbable or ulterior purpose. There will not be a considerable amount of work, nor any undue expense in obtaining the documents. The discovery process will not delay the fixture. It is entirely proportionate they be disclosed.

Balancing test

[31]   Under this heading the McKenzies raised two matters. First, that it is not credible  that  a  doubtless  distressed  telephone  call   from   Mrs  McKenzie  to   Mr McKenzie can shed any light on when the fire started. The relevance of the call arises from the time that it was made not the emotions that accompanied it. For reasons given above, I do not discount the possibility that the time of the call may assist the court to determine the cause of the fire.

[32]   Second, counsel argue that there were a number of witnesses in the area of the fire and particular discovery has not been sought from them. This is whataboutism; an illogical basis for argument. In any event, I accept that further discovery is sought

6      Assa Abloy New Zealand Ltd v Allegion (New Zealand) Ltd, above n 1, at [12].

7      Evidence Act 2006, s 128.

from the McKenzies because of the difficulties Orion has had reconciling their statements with other factual evidence.

[33]   I note that the argument that requiring discovery of the telephone records would be a breach of the McKenzies’s privacy, was not pursued.

Result

[34]   Orion’s application is successful. Mr and Mrs McKenzie are to file and serve a supplementary affidavit of documents within 21 days of the release of this judgment listing all documents in their power, possession or control as follows:

All landline and mobile phone records for calls made and received by Mr and Mrs McKenzie on 13 February 2017.

[35]   I appreciate immediately that the McKenzies may not be able to comply with this order by the date stated due to the COVID-19 pandemic. If this is so, counsel may confer and simply email the Registrar and apply for an extension to a suitable date for compliance.

[36]   Counsel made brief submissions on costs. Orion is the successful party and is entitled to its costs on a 2B basis.

O G Paulsen

Associate Judge

Solicitors:

DLA Piper, Auckland Kennedys, Auckland

Chapman Tripp, Christchurch