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ISP Consulting Engineers Ltd v Body Corporate 89408

ISP Consulting Engineers Ltd v Body Corporate 89408

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IN THE COURT OF APPEAL OF NEW ZEALAND

CA235/2016
[2017] NZCA 160

BETWEEN	ISP CONSULTING ENGINEERS LIMITED Appellant
AND	BODY CORPORATE 89408 AND ORS Respondents

Hearing:	16 March 2017
Court:	Asher, Brown and J Williams JJ
Counsel:	M G Ring QC and R C Woods for Appellant A K Hough for Respondents
Judgment:	5 May 2017 at 10am

JUDGMENT OF THE COURT

AThe appeal is dismissed.
BThe appellant must pay the respondents costs for a standard appeal on a band A basis and usual disbursements.

___________________________________________________________________

REASONS OF THE COURT

(Given by Asher J)

Introduction

This appeal concerns the amendment of a statement of claim issued by the respondent owners of an apartment building against ISP Consulting Engineers Ltd (ISP) and others. The question to be determined is whether the pleading added a new cause of action that was time-barred, or did no more than particularise the already pleaded and in-time cause of action. In a hearing that took the form of an amendment application under r 1.9 of the High Court Rules, Clifford J concluded that no new cause of action had been added.[1] That is the decision that is the subject of this appeal.

Background

[1]Body Corporate 89408 v MacRitchie [2016] NZHC 844.

It is unnecessary to trace the factual history of the claim in detail. Body Corporate 89408 represents the owners of an apartment building (the Owners). ISP is an engineering firm that was responsible for the engineering work when the apartments were developed, and is alleged to have carried out work between May 1999 and December 2004.
In 2005 individual owners of the apartments began lodging claims under the Weathertight Homes Resolution Services Act 2002 (WHRS Act). A multi-unit claim was registered in 2007. The claims were made against the Wellington Council. ISP was not a party to any of those claims.
As was required under the WHRS Act, the Owners undertook the necessary work to make the apartments weathertight before seeking adjudication. That work revealed structural defects. Structural defects are beyond the jurisdiction of the WHRS Tribunal.
So, in 2010, the Owners filed a separate claim for structural damage in the High Court against the Council, ISP and various other parties (the 2010 Structural Proceedings). An amended statement of claim was filed in those proceedings in December 2012 (the 2012 Structural ASOC).
The Owners then considered it advantageous to file a fresh claim under the WHRS Act in February 2014 (the Second WHRS Weathertightness Proceeding). ISP was named as a defendant in the fresh claim. ISP successfully sought to be removed as a defendant from that proceeding on the basis that it was essentially a duplication of the 2010 Structural Proceedings against ISP in the High Court.[2] The Second WHRS Weathertightness Proceeding was removed to the High Court. It was then consolidated with the existing 2010 Structural Proceedings. A consolidated statement of claim was filed on 1 October 2015 (First CSC).
[2]ISP Consulting Engineers Ltd v The Weathertight Homes Tribunal [2015] NZHC…

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: [2017] NZCA 160
Decision Date: 5 May 2017 at 10am

CaseChat Overview and Summary

The appeal is between ISP Consulting Engineers Limited, the appellant, and Body Corporate 89408 and others, the respondents. The central issue before the Court of Appeal was whether an amended statement of claim introduced a new cause of action that was time-barred, or if it merely particularised an already pleaded and in-time cause of action. This appeal followed a decision by Clifford J that no new cause of action had been added, a conclusion that ISP contested.

The Court examined the relevant rules governing the amendment of pleadings in the High Court Rules, particularly rules 1.9 and 7.77. Rule 1.9 provides a general discretionary power for the court to amend pleadings at any stage, while rule 7.77 is more prescriptive, governing amendments before trial and subject to rule 7.7, which prohibits steps after the close of the pleadings date without leave. The Court noted that while there was no New Zealand case where a court had permitted an amendment introducing a fresh time-barred cause of action, it was not necessary to definitively address whether such an amendment could be allowed under rule 1.9, given the Court's findings.

Clifford J had concluded that the amendment in question did not introduce a new cause of action, and thus, the limitation argument was not available to ISP. The Court of Appeal agreed, finding that the amendments in the Second Consolidated Statement of Claim did not amount to the pleading of a new cause of action, but rather provided further particulars in respect of the originally pleaded cause of action in negligence. The legal basis and the essential area of factual enquiry remained the same, and the claim was part of the originally pleaded claim, which was lodged within the limitation period.

The Court of Appeal dismissed the appeal and upheld the decision of Clifford J. The appellant was ordered to pay the respondents' costs for the appeal on a band A basis and usual disbursements.

Orders