Harris v Porirua City Council

[2013] NZHC 1973

IN THE HIGH COURT OF NEW ZEALAND WELLINGTON REGISTRY

CIV 2012-485-219 [2013] NZHC 1973

BETWEEN  S J HARRIS and GIBSON SHEAT TRUSTEES LIMITED as trustees of the Amber Trust and S E WILSON and GIBSON SHEAT TRUSTEES LIMITED as trustees of the Maslow Trust

Plaintiffs

ANDPORIRUA CITY COUNCIL First Defendant

ANDP M BURGE Second Defendant

ANDC R PROUSE Third Defendant

ANDINTERACT ARCHITECTS & DESIGNERS LIMITED

First Third Party

ANDA J WATSON Second Third Party

ANDT F G TAYLOR Third Third Party

ANDB M SCOTT LIMITED Fourth Third Party

Hearing:                   5 August 2013 (teleconference)

Counsel:                  S Baldwin and M Josephson for Plaintiffs

P Roberston for First Defendant
A Hazelton for First and Second Third Parties
M Dalmer for Third Third Party

Judgment:                7 August 2013

JUDGMENT OF RONALD YOUNG J

HARRIS & ORS v PORIRUA CITY COUNCIL [2013] NZHC 1973 [7 August 2013]

[1]      This is a leaky building claim.  The first defendant has made an application for leave to file an amended statement of defence.  The trial of this case commenced

12 August 2013.  Given the lateness of the application, leave is required.  A copy of the  proposed  statement  of  defence  accompanied  the  application.    On  Monday,

5 August 2013, I heard argument by the plaintiffs who oppose the application and the first defendant in support of the application.  The plaintiffs were given time to file, later on Monday, 5 August, a memorandum relevant to the application.   That has now been done.

[2]      The  application  for  leave  to  amend  the  statement  of  defence  involves  a request to add:

(a)       an affirmative defence of contributory negligence; and

(b)      an affirmative defence of causation.

[3]      The contributory negligence defence alleges that if the plaintiffs suffered losses as a result of the negligence of the City Council, then the losses were contributed to by the plaintiffs in ways specified in para 35(a) to (j) of the proposed new pleading.

[4]      The second alternative defence is based on causation.  It is alleged that the plaintiffs placed no reasonable reliance on the Porirua City Council when purchasing the property.

[5]      I am satisfied that the first defendants should not be allowed to raise the affirmative   defences   in   para 35(a)   and   para 35(j)   but   that   save   for   those subparagraphs they should be allowed to raise the remaining contributory negligence particulars and the causation affirmative defence allegation.

[6]      I give my reasons only briefly.  I consider two issues, first, the cause of the delay and secondly, prejudice to the plaintiffs and any other parties.

Delay

[7]      The first defendants point to the minute of Kós J of 16 April 2013 where in a schedule  to  his  minute  he  identified  relevant  trial  issues.    One  of  those  issues (at [19]) was whether the plaintiffs had caused or contributed to their losses.

[8]      The  first  defendants  accept  that  they overlooked  the  need  to  amend  the pleadings to reflect this identified trial issue.   They also raised the contributory negligence and causation issues with the plaintiffs some eight weeks ago enquiring as to whether they would consent to an amendment to the pleadings.

[9]      In summary, therefore, the first defendants accept that by counsel’s error they failed to include causation and contributory negligence in their pleadings before they could amend as of right.  They say, however, that the plaintiff has been aware of the allegations of contributory negligence and causation for some time, certainly since April 2013.

Prejudice

[10]     This leads me to the question of prejudice.  The only prejudice identified by the plaintiffs related to the proposition that if the allegations of contributory negligence in para 35(a) and (j) of the proposed amended statement of defence were permitted,  then  the  plaintiffs  would  be  unable  to  seek  a  contribution  for  their negligent failure from their solicitors at the time of purchase.

[11]     Paragraph 35(a) is an allegation that the plaintiffs failed to instruct an expert in construction and weathertightness issues prior to the purchase of the property; and (j) is an allegation that the plaintiffs failed to obtain a land information memorandum prior to the purchase of the property.

[12]     The plaintiffs’ response is that it relied upon the professional advice of a firm of solicitors.  Thus, if the plaintiffs contributed by their negligence to the loss they suffered, then that loss was in turn caused or contributed to by the solicitors.

[13]     The defendants’ case is that the plaintiffs would have no right of contribution from the solicitors because; the solicitors were not acting for the plaintiffs at the relevant time; the Limitation Act in any event may apply; and if the plaintiffs thought they had a cause of action against their previous solicitors, they had had the opportunity to bring those proceedings.

[14]     I am satisfied that if I allow the first defendants statement of defence to be amended with respect to the proposed para 35(a) and (j), then there is a reasonable argument that the plaintiffs suffer prejudice.  They could not now bring a claim for contribution against their previous solicitors.  I am satisfied they have an arguable case for such contribution.  In those circumstances I am not prepared to allow this proposed late amendment of the statement of defence with respect to para 35(a) and (j).   I refuse the application rather than consider an adjournment of the trial after canvassing the views of both the plaintiffs and first defendant.

[15]     No prejudice can be shown by either the plaintiffs or the other litigants in the other proposed allegations in para 35(b) to (i) inclusive and para 36.   I allow the application to amend the pleadings with respect to those paragraphs.

[16]     Costs will be reserved until after trial.

Ronald Young J

Solicitors:

Grimshaw & Co, Wellington

Heaney & Partners, Auckland