Minister of Education v H Construction North Island Ltd
[2017] NZHC 3228
•19 December 2017
IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY
I TE KŌTI MATUA O AOTEAROA TĀMAKI MAKAURAU ROHE
CIV-2013-404-1504 [2017] NZHC 3228
IN THE MATTER OF BOTANY DOWNS SECONDARY
SCHOOL
BETWEEN
MINISTER OF EDUCATION First Plaintiff
SECRETARY FOR EDUCATION Second Plaintiff
BOARD OF TRUSTEES OF THE BOTANY DOWNS SECONDARY SCHOOL
Third Plaintiff
AND
H CONSTRUCTION NORTH ISLAND LIMITED (FORMERLY KNOWN AS HAWKINS CONSTRUCTION NORTH ISLAND LIMITED)
Defendant
Hearing: On the papers Counsel:
M Davies and J S McTavish-Butler for the Plaintiffs
A Skelton and B Cash for the DefendantJudgment:
19 December 2017
JUDGMENT OF WHATA J
This judgment was delivered by me on 19 December 2017 at 4.30 pm, pursuant to Rule 11.5 of the High Court Rules.
Registrar/Deputy Registrar
Date: ………………………….
Solicitors: Meredith Connell, Auckland
MINISTER OF EDUCATION v H CONSTRUCTION NORTH ISLAND LIMITED [2017] NZHC 3228 [19
December 2017]
Kensington Swan, Auckland
[1] This judgment concerns two recent applications1 by the defendant to:
(a) adjourn the trial set down for a four week fixture starting 12 February
2018; and
(b) review the decision of Associate Judge Bell as to particulars.
[2] This proceeding was commenced in 2013. After lengthy stay, the first trial date was fixed for 1 May 2017 on 31 August 2016. The second trial date was set down on
11 October 2016 to commence on 12 February 2018, with a close of pleadings date of
31 October 2017. The defendants are due to exchange their evidence today. An urgent judgment is needed with, regrettably, corresponding prolixity.2
Background
[3] I adopt the background of Associate Judge Bell from his decision of 25 October
2017, supplemented by the evidence filed by the parties in relation to the adjournment application. A complete chronology, from the filing of the statement of claim, is attached as Appendix A.
[4] The plaintiffs own and manage Botany Downs Secondary College (the School). The defendant, previously called Hawkins Construction Ltd and Hawkins Construction North Island Limited, is a construction company.
[5] Under a build-only contract, in 2003-2004 the defendant built a gym and performing arts block, administration block, library, and blocks referred to as Whanau
1, Whanau 2 and Whanau 3. That was Stage 1. For that work the Ministry of
Education engaged an architect. Stage 2, carried out in 2005-2006, involved the construction of buildings Whanau 4, 5 and 6. The defendant engaged the architect
1 The application to review was filed on 31 October 2017 but deferred pending exchange of evidence by the plaintiff. The application for adjournment was filed on 28 November 2017, with the plaintiff filing its notice of opposition on 6 December 2017. Supporting affidavits were filed by 8 December 2017. Submissions were exchanged on 11 and 13 December 2017.
2 Given the lateness of the applications, there was no fixture time to hear the applications, and I have resolved the applications on the papers. There have however been a number of conferences on the issues raised in the applications.
who had worked for the Ministry for Stage 1. Stage 3 involved the building of the library extension in 2008.
[6] The plaintiffs sue the defendant in negligence under three causes of action, one for each stage. They say that defects in the buildings are attributable to breaches of duty of care by the defendant, that those defects in the school buildings have caused damage. The cost of remedial works claimed in the latest statement of claim is
$18,270,886 plus GST. There is also a claim for additional costs for the disruption caused by carrying out the remedial works. The evidence now filed by the plaintiffs suggests that the total loss is closer to $25,000,000. The plaintiffs have not carried out any remedial work yet. The defendant denies any duty of care, breaches of any duty, liability generally and, by way of affirmative defences, pleads the 10-year limitation under s 91 of the Building Act 1991, s 393 of the Building Act 2004, and s 4 of the Limitation Act 1950, contributory negligence, failure to mitigate and betterment. By way of counterclaim and set-off, it also seeks contractual indemnity.
[7] The proceeding started in March 2013. The plaintiffs filed an amended statement of claim on 26 September 2013 but that aside, little happened in court. For the first two years, the defendant did not have legal representation. Directions were given to allow the parties to explore settlement.
[8] In March 2015, the plaintiffs filed a second amended statement of claim. The defendant instructed lawyers who filed a statement of defence on 15 May 2015. The plaintiffs filed their affidavit of documents in December 2015 and the defendant in April 2016. In August 2016, Associate Judge Bell gave trial directions for a hearing for four weeks beginning 1 May 2017. The close of pleadings date was 2 December
2016.
[9] At the parties’ request, the fixture was vacated to give them the opportunity to take part in mediation. The mediation was unsuccessful. On 3 November 2016
Fogarty J gave amended timetable directions, leading to a hearing for four weeks beginning 12 February 2018. By consent, he made amended directions on 3 February
2017.
[10] Under these directions, the plaintiffs were to file and serve an amended statement of claim by 8 February 2017, the defendant a statement of defence by
8 March, and the plaintiffs any reply by 15 March. The close of pleadings date was
31 October 2017. The plaintiffs were to serve their evidence by 3 November 2017 and the defendant its evidence by 15 December 2017. There were related directions towards the hearing to begin on 12 February 2018. Neither side signalled any need for interlocutory applications.
[11] The plaintiffs filed a third amended statement of claim on 8 February 2017. The defendant filed a statement of defence on 25 August 2017. Amongst other things, the statement of defence said that insufficient particulars of defects had been given, but the defendant did not apply for further particulars.
[12] In September 2017, the defendant instructed new lawyers, Kensington Swan. In a telephone conference on 21 September 2017, Associate Judge Bell directed a face-
to-face conference on 29 September. On 27 September 2017, the defendant’s new lawyers wrote to the plaintiffs’ lawyers, Meredith Connell, requesting particulars of the third amended statement of claim. On 29 September 2017 Associate Judge Bell directed the plaintiffs to file and serve a new statement of claim by 6 October 2017, the defendant to file and serve a new statement of defence by 13 October 2017, and any reply by the plaintiffs by 20 October. Associate Judge Bell also made directions for a conference on 19 October 2017 to deal with any outstanding pleadings questions. He also gave amended timetabling directions through to trial, which maintained the fixture for 12 February 2018. Finally, he encouraged information-sharing and directed the parties to visit the school with experts.
[13] The plaintiffs filed a fourth amended statement of claim on 6 October 2017, but the defendant says one schedule was served late. The defendant served a statement of defence on 16 October 2017. The parties, their lawyers and experts visited the school for four hours on 12 October 2017.
[14] In the telephone conference on 21 September 2017, counsel for the defendant was not able to name any experts instructed for the defendant. By the time of the visit on 12 October 2017, it had two experts in attendance.
[15] In his 8th Case Management Conference Minute of 25 October 2017, Associate Judge Bell addressed the defendant’s request for further particulars. In doing so, he observed it had not sought an adjournment of the 12 February 2018 fixture, and dealt with the request for a more explicit pleading on the basis the case would go ahead on that date. He advised the defendant to file and serve a formal application and seek a prompt hearing if it wished to seek an adjournment. Overall, he was of the view the defendant had made “its pitch too late”, and that it was not at any significant disadvantage without further particulars being ordered.3
[16] The only further development of note is on 5 November 2017, Thomas Wutzler, who was engaged by the defendant on 29 September 2017 to act as an expert witness, withdrew on the basis of a possible conflict of interest.
Application for adjournment
[17] With the benefit of submissions, the main grounds for the adjournment application are:4
(a) There was no undue delay in making the application.
(b)The plaintiffs significantly expanded the scope and quantum of their claim only three weeks prior to the close of pleadings date, in the Fourth Amended Statement of Claim.
(c) The plaintiffs’ evidence includes significant new allegations and a considerable expansion in the scope of the defects and damage alleged in loss claims.
(d)The new allegations and expansion of scope means there is considerable additional expert evidence required and the need for
further extensive inspections (including destructive testing).
3 At [34]-[35].
4 An issue of late discovery was also raised by the defendant, but it is not clear how matters raised in discovery affect the defendant, beyond in the manner I address below.
(e) The plaintiffs have frustrated the defendant’s access to the School. The plaintiffs have allowed their experts access without informing or inviting the defendant to participate, contrary to a commitment made by the plaintiffs.
(f) The plaintiffs challenged the defendant’s lead expert, Mr Wutzler, on the basis he had a conflict of interest, which ultimately forced him to withdraw in early November.
(g)The plaintiffs will not be prejudiced by delay in the trial, and the trial could be moved to 16 July 2018 (when another proceeding between the parties is to be heard). Further, the plaintiffs’ evidence discloses that the plaintiffs have no immediate or even long-term plans to remediate the school.
Legal principles
[18] The parties are largely agreed as to the applicable legal principles. Rule 10.2 of the High Court Rules 2016 provides for adjournment in the interests of justice, as follows:
10.2 Adjournment of trial
The court may, before or at the trial, if it is in the interests of justice, postpone or adjourn the trial for any time, to any place, and upon any terms it thinks just.
[19] As stated in McGechan on Procedure, in assessing whether the interests of justice favour postponing or adjourning the trial, the court must consider and weigh, not only the interests of the immediate parties, but also those of parties waiting in the queue for hearing and the public interest in the efficient use of court resources.5
Significant weight may also be afforded to one party’s wish that a trial not be
adjourned.6 Whether the parties and those representing them have done everything
5 McGechan on Procedure (looseleaf ed, Thomson Reuters) at [HR10.2.02].
6 Cygnet Farms Ltd v ANZ Bank New Zealand Ltd [2016] NZHC 1945.
reasonably practicable to avoid having to see an adjournment is another relevant consideration.7
[20] I turn to address each of the grounds for the adjournment.
(a) No delay in bringing application
[21] The central thrust of the defendant’s submission is it reserved its position on
21 September 2017 as to the requirement for adjournment, and raised the issue of a potential adjournment at numerous subsequent conferences. It says the decision to seek adjournment followed several events (including the loss of its lead expert, and following the exchange of evidence which revealed substantial changes in scope of the proceedings) which then made it necessary to seek the adjournment.
Assessment
[22] I consider the defendant should have “bitten the bullet” and sought an adjournment when it became clear it was not going to be ready to exchange evidence in accordance with the established timetable. Based on the evidence before me, the defence case was in a very poor state of unreadiness when new counsel was appointed, which then escalated to parlous when its purportedly lead expert, Mr Wutzler, withdrew. It should have been obvious to counsel at this point that an adjournment may have been necessary.
[23] Balanced against this, the relatively last minute rash of steps required to get these proceedings ready for trial, against a backdrop of a lengthy period of inactivity,
is a mitigating factor. The challenge to Mr Wutzler, while not without merit, was a factor the defendant could not be expected in the circumstances to have anticipated. I return to this issue below at [45].
[24] Overall, in my view, the application was late, though partly explicable by events beyond the control of the defendant.
7 ANZ Banking Group (NZ) Ltd v Couchman (1992) 6 PRNZ 34.
(b) Expanded scope, nature of claim and quantum
(c) New allegations and evidence
(d) New defects not apparent from the statement of claim or without prejudice material
[25] These three grounds can be dealt with together.
[26] The defendant submits the Fourth Amended Statement of Claim served on
6 October 2017 substantially expanded the scope of the claim, increasing the quantum of the claim from $17,200,000 (in the Third Amended Statement of Claim) to
$20,000,000. It also notes the plaintiffs’ evidence has substantially expanded the allegations and the scope of the defects, with the result that the claim now sits at approximately $25,000,000. The significance of this issue is explained by Trina Lincoln, an employee of the defendant. She notes:
41… one of the issues in relation to this claim and its resolution has been the plaintiffs’ periodic revisions to their claim to feature more allegations of defective work, and increases to their quantum by multiples of what was initially claimed. This has occurred yet again when the plaintiffs have served their evidence, with new and different allegations and yet further increases in the scope of work and the quantum from that claimed in the latest statement of claim (and from the without-prejudice material previously provided). This point is addressed in more detail in the other affidavits being filed in support of this application, which I have reviewed. At the same time, H Construction has not yet been able to clearly understand from the claim and other material provided the true nature and extent of the issues claimed against it, the actual damage it has allegedly caused, whether the alleged defects are a design and construction defect or construction only, and the cost of dealing with each defect. It also took the plaintiffs several years to accept that the Stage 1 construction (which constitutes most of the school) was a construction-only contract under the guidance of the plaintiffs’ architect, rather than being a design and build contract.
[27] More specifically, the defendant claims four new allegations emerge from the evidence, namely failing to:
(a) request information from the architect;
(b) provide a maintenance manual (or maintenance programme);
(c) warn the plaintiffs about design issues; and
(d) follow specific architect’s drawings and instructions.
[28] In addition, Mr Bray, an expert retained by the defendant, identifies several new defect claims. He states:
10The Crown’s expert evidence includes several new defects which were not apparent from the statement of claim or the without prejudice materials we reviewed. These include:
(a) At paragraph 8.20 of Mr Goodwin’s brief the description in relation to the inadequate ground clearance (defect 5) appears to now include the lack of adequate distance between the timber framing and the adjacent ground which is different from the pleaded defect in the Fourth Amended Statement of Claim.
(b) At paragraph 8.24 of Mr Goodwin’s brief there is another new description of the alleged inadequate clearance issue in relation to the alleged lack of offset to the bottom plate for all buildings. Again, this has not been described previously within the defects in schedule 1 of the Fourth Amended Statement of Claim (although some without prejudice material indicated it might be raised for a few (but not all) of the buildings).
(c) Paragraphs 8.27 to 8.30 of Mr Goodwin[’s brief] also refer to the concrete nib in an area on whanau 1 being formed with timber, that this will decay and that photos show that water has entered and severely decayed the timber. This is an entirely new issue (although it appears to be a one off).
(d) At paragraph 7.6 of the brief of evidence of Mr O’Sullivan the description of the Stage 2 nib defect appears to have changed to now include a description of “The stage 2 nibs also need to be replaced as they are not high enough”. This is a description of the defect I have not previously seen.
(e) At paragraph 8.2(c) of Mr O’Sullivan’s brief there appears to be a description of the failure to achieve the required step in the roof. I have not previously noted any reference to an inadequate step within, for example, the Fourth Amended Statement of Claim in relation to defect 1.
11 I consider the above matters to be clearly new defects or sub-defects (or as the plaintiffs’ witnesses characterise them “causes”) not identified in the materials previously provided.
12Further, as I have noted above, given the quite vague description of the defects in the Fourth Amended Statement of Claim it was simply
unclear to me as to the exact nature and extent of the defects. By way of example in relation to the roofs:
(a) Paragraphs 9.26 to 9.27 of the brief of Mr Rawlinson identifies two separates location on the gym/PAC building and the library at Botany Downs where roof sheets are allegedly double layered and corrosion has occurred. There was no reference to this within the Fourth Amended Statement of Claim. There was some material (e.g. without prejudice photographs of one of these two locations but not the other) that indicated this might be an issue but it was not clear to me exactly what was alleged. This could be seen as a new defect or an expansion or clarification of the roof edge defect or cause (part of defect 1) but either which way it was an issue where the exact allegation and its nature and extent was not previously apparent from the materials provided by the Crown.
(b) Paragraphs 9.28 – 9.33 of the brief of Mr Rawlinson raises issues about the roof underlay being short of the edge and the use of expanding foam instead of specified Ecofoam and says this is contrary to ASC detail 44 drawing 91 and detail 79 drawing 652. Again, this is not set out in the Fourth Amended Statement of Claim – it simply says (under defect 1) poorly formed roof edges. The way this defect was pleaded in the Second Amended Statement of Claim which schedule 1 to the Fourth Amended Statement of Claim refers back to (poor turn down or lack of turn down at roof edges) gave no indication
that the alleged roof edge defect included issues such as these. Again, there was some material (provided on a without prejudice basis, such as photos) which potentially showed this issue but it was an issue where the exact allegation and its nature and extent was not clear and it has only now been clarified in the evidence.
[29] Mr O’Sullivan, an expert for the plaintiff,8 however responds to Mr Bray’s claims. His key evidence is as follows:
12While I cannot speak to what was clear or not to Mr Bray, Hawkins had Schedule 1 to the fourth amended statement of claim (4ASOC) and the schedules to the prior statements of claim well before receiving the evidence. The schedules to the claim clearly define the defects, the matters behind the defects (being the cause/particulars), the nature of the damage and the locations, any building code issues and general directions as to technical literature and a description of the remedial works. The 4ASOC includes Schedule 2 which provides detailed location information for each defect.
8 Mr Sullivan has considerable experience in litigation of the present kind, having appeared in several high profile leaky building proceedings including ones involving the Victopia Apartments and The Nautilus.
13 The form of Schedule 1 is routinely used in these types of claims.
Based on my experience Schedule 1 to the 4ASOC provides a comparatively detailed explanation of the defects. Schedule 1 is not
meant to be an absolute statement of all matters relating to the defects;
that level of detail comes with the filing of the evidence. Again, in my experience that is the usual approach.
…
14In paragraphs 9 to 14 of his affidavit, Mr Bray suggests the plaintiffs’ expert evidence differs in several significant ways from the statements of claim and the without prejudice material previously provided and that there are several new defects.
15There are no “new defects” from the 4ASOC described in the plaintiffs’ briefs of evidence. Schedule 1 to the 4ASOC lists seven defects. The plaintiffs’ expert evidence is broken up by headings for each of those seven defects. The briefs of evidence include detailed information on the underlying nature of those defects or in simple terms, what goes to make up the defect.
16Mr Bray has given examples of what he says the “new defects” are at paragraphs 10(a) to 10(e) of his affidavit. I respond to these comments below:
(a) Paragraph 10(a) – The lack of adequate distance between the timber framing and ground described in Mr Goodwin’s brief is not a new defect. It is part of Defect 5 – the ground clearance issues with the cladding. The inadequate clearance to cladding encompasses the industry requirements and the James Hardie Technical details which refer to ground clearance for the framing. It is the same inadequate ground clearance issue and that issue is well known.
(b) Paragraph 10(b) – as with my comments above, the lack of offset to the bottom plate is not a new defect. It is simply part of the clearance issues with the cladding (Defect 5). The requirement for an offset to the bottom plate forms part of the James Hardie technical requirements.
(c) Paragraph 10(c) – the formation of the concrete nib with timber is part of Defect 5. Although it is not explicitly noted in the particulars it is de [minimis] and makes no difference to the nature of the work to rectify Defect 5, as new concrete nibs have to be constructed in any event.
(d) Paragraph 10(d) – the height of nibs is part of Defect 5.
Failure to comply with requirements of the James Hardie technical literature and thus avoid capillary action is a standard requirement for all cladding types and that includes framing. Again, this is self evident within the construction industry.
(e) Paragprah 10(e) – the failure to achieve the required step down comes within Defect 2 – poorly formed internal gutters
and outlets. It is part of the particular described as “incorrect formation of the gutter membrane at junctions and at outlets”.
And further:
20 Dealing with the specific examples given by Mr Bray:
(a) Paragraph 12(a) – Mr Bray refers to paragraphs 9.26 and 9.27 of Mr Rawlinson’s brief of evidence. He says the references in those paragraphs to double layered roof sheets is not referred to in the 4ASOC. The double layering of roof sheets is covered by the particular to Defect 1 ‘poorly formed roof edges’. As noted by Mr Bray, he has seen photos of two locations of the double layering and corrosion.
(b) Paragraph 12(b) – Mr Bray refers to paragraphs 9.28 and 9.33 of Mr Rawlinson’s brief of evidence. He says that the references in those paragraphs to roof underlay being short is not referred to in the 4ASOC. Again, the underlay being short is also covered by the particular to Defect 1 ‘poorly formed roof edges’. As above, Mr Bray accepts that he [h]as seen photos of this issue. Again, it is important to distinguish between a defect and its cause.
[30] In my view:
(a) The allegedly new allegations (a) and (b), noted at [27], form only a small part the plaintiffs’ claim and appear insignificant.
(b)Items (c) (dealing with a duty to warn) and (d) (dealing with failure to follow architectural design) may require leave to amend. But I foresee the prejudice attaching to item (c) to be small – the facts and corresponding evidence attached to such an allegation are relatively confined. In relation to item (d), the schedule sets out in reasonably clear detail the types of defects claimed, many of which raise by necessary implication issues of flawed design or failure to adhere to design specifications. In the result, these claims are readily capable of being carved out by the trial judge if that proves necessary.
(c) Mr Sullivan appears generally correct – the schedules to the Fourth Amended Statement of Claim adequately define the defects, and matters raised by Mr Bray appear to be of detail, to be expected in
evidence rather than pleading. I however accept that one of the examples noted by Mr Bray at [12](b) of his evidence (dealing with the alleged inconsistency with design drawings) appears to raise a partially new issue not expressly covered by Schedule 1. But, without foreclosing a successful challenge at trial, the failure to comply with product specifications is clearly pleaded and the related allegation of inconsistency with design drawings is implicit in such a pleading.
[31] Overall, I am not satisfied the defendant has established it is unduly prejudiced by the allegedly expanded scope of the pleadings and evidence. The plaintiffs pleaded in a reasonably clear and comprehensive way the alleged negligence and the nature and type of defects allegedly arising from that negligence. To the extent that there may be material new allegations or new defects, I am satisfied the trial judge will have little problem excluding them from consideration if that proves necessary in the interests of justice.
(e) New areas or aspects of alleged damage, and undiscovered evidence
(f) Expansion and changes to scope of alleged remedial work
(g) Increase in quantum
(h) Access
[32] I will also deal with these grounds together.
[33] Mr Bray sets out the genesis of the defendant’s complaint as follows:
13I otherwise note that the Crown’s allegations as regards the defects and their extent have changed in their expert evidence when compared with what was set out in the Fourth Amended Statement of Claim. Attached are two schedules describing the changes in the location and extent of the defects in the Crown’s expert evidence as compared with what was shown in the Fourth Amended Statement of Claim. Some of these are reductions in the locations/extent of the alleged defect. However, concerningly, new areas are now also alleged.
14 There also appear to be new areas or aspects of the alleged damage.
For example, at paragraph 7.27 of his brief Mr Goodwin describes that a total of 25 new timber samples were taken during investigations (20
in September 2016 and 5 [in] October 2017). In addition, at paragraph
7.29 Mr Goodwin makes reference to 13 new building underlay samples being analysed and a further 2 samples of particleboard and carpet being analysed by Biodet Services Ltd. There were samples also taken during the same investigations in September/October 2016 and October/November 2017. While reports of Biodet and Beagle on samples taken by ACL formed part of the without prejudice ACL reports previously provided to Hawkins, Hawkins had not been provided with reports on the samples taken by Prendos.
15I could understand, based on the testing and analysis results of the ACL samples, why Hawkins may have decided that it did not need to take any steps to take and test any samples at Botany Downs. However, now a total of 40 additional/new timber and other material samples have been taken and analysed and those samples and the analysis is now relied on in the Crown’s evidence and has some significance placed on it (e.g. see for example paragraph 8.41 of
Mr Goodwin’s brief which refers to the new test results to support a claim of water ingress and damage in relation to defect 5 or paragraphs
5.15 to 5.20 of Mr Wakeling’s evidence as regards the alleged
significance of the new results).
16None of the above was specifically detailed in the Fourth Amended Statement of Claim as regards the alleged damage or provided on a without prejudice basis, which is what I would normally expect. In particular, the October 2016 samples (which make up 31 of the 40 additional samples) had been analysed and a report made available to the Crown by October 2016 and could have been provided in some form well over a year ago to help inform Hawkins of the nature of the claim.
17In addition, there are numerous references by the Crown’s expert witnesses to photographs which appears to have been taken throughout 2016 and 2017 and which had not previously been provided (either on an open or without prejudice basis). If the other materials provided (e.g. the statement of claim and/or other without prejudice material) had clearly laid out the nature of the defects and their [extent] and the alleged damage, this omission would be less significant. However, when combined with the lack of clarity in other materials, it is yet another factor that contributes to us being taken by surprise as regards the specifics of the Crown’s case.
[34] Ms Lincoln also expands:
52As canvassed above, the plaintiffs’ pleadings substantially changed throughout the course of the proceedings. The amendments have made it difficult for H Construction to understand the allegations against it and respond accordingly.
53This issue was compounded as a result of without-prejudice exchanges between the parties. H Construction was provided with various reports of Alexander & Co Ltd (ACL) on a without-prejudice basis. I understand that ACL had been engaged as the experts for the plaintiffs but was later replaced by Prendos. Ostensibly the purpose of providing these reports was to aid H Construction in understanding
what the plaintiffs alleged to be defective and assist the parties to establish common ground and reach a sensible solution.
54Having had the benefit of reviewing the plaintiffs’ evidence it is now apparent that the plaintiffs’ pleadings and indications made in the without-prejudice reports did not provide H Construction with adequate information to understand the claims made against it, appropriately respond in defences made to the claims and prepare evidence to test the claims.
55By way of example, the ACL reports included reports analysing timber and other samples taken at the school by ACL. Those reports have now been discovered on an open basis and are relied on in the plaintiffs’ evidence. Those reports did not indicate any significant damage to the school. Given this, H Construction did not believe it was necessary to undertake any testing of its own at the school. Essentially, nothing found in the ACL samples and the analysis of them was of concern.
56However, as explained above, unbeknownst to H Construction, additional testing was being done by the plaintiffs’ new experts. H Construction was not given an opportunity to attend and not given the analysis of the new samples taken in 2016. This evidence is now relied on by the plaintiffs’ witnesses as showing damage from alleged defects (again, the details of this is addressed in the affidavits of others filed in support of this application). Had H Construction been involved in these inspections and/or had the claim either been clear about the damage alleged and/or the new analysis shared with H Construction, different decisions would likely then have been made about the conduct of H Construction’s defence, including whether to undertake further inspections of the school and undertake its own testing.
57Overall, the plaintiffs’ position conveyed both by way of the claims and the supplementary material provided on a without-prejudice basis has not given H Construction a true or clear picture of the plaintiffs’ case. The plaintiffs’ evidence has then materially changed the character of the plaintiffs’ claim again (on top of the substantial changes that the claim went through throughout the proceedings), with the evidence differing materially from the fourth amended statement of claim filed only a month before the evidence was served.
[35] There appear to be three main problems arising from this for the defendant:
(a) there was inadequate information to understand the claims; and
(b)it did not understand that it needed to undertake its own testing given the limited information provided by the plaintiffs; and
(c) the plaintiffs were not transparent about their testing.
[36] The prejudice to the defendant is noted by Mr Bray in the following terms:
19The cost or loss claimed by the Crown has then also increased significantly from what was in the Third or Fourth Amended Statement of Claim. The remedial work cost estimate is now
$22,208,549.48 plus GST (refer, for example, to paragraph 7.1 of the brief of evidence of Heidi Van Eeden) or an increase of $3,937,669 over and above the $18,270,880 claimed in the Fourth Amended Statement of Claim. While I am not a quantity surveyor, this increase seems to reflect both changes to the scope and changes in quantities and rates.
20The cost of additional or temporary accommodation has also increased. Ms Eeden (paragraphs 8.14 to 8.18) outlines the cost of hiring or buying temporary buildings and settles on a claim for buying and reselling temporary buildings at a cost of $2,742,726. In the Fourth Amended Statement of Claim, the cost claimed was
$1,697,595.92. This is an increase in this aspect of the claim of
$1,045,131.
21Overall, the claim, which was almost $20 million in the Fourth Amended Statement of Claim, is now almost $25 million – an increase of approximately 25%.
22The cumulative impact of all of these matters is that Hawkins and its expert are having to now respond in quite a short time period to a claim that differs in material respects from that foreshowed in the claims or the without prejudice material previously provided by the Crown. In short, the claim is different in a number of respects to what was expected or foreshadowed and this has an impact on the work that experts for Hawkins would wish to do to meet the claim.
23In particular, based on the further evidence provided and referenced within the Briefs of Evidence of Hawkins’ experts consider it necessary to investigate the newly described defects, the extent of defects and new examples of damage to confirm their existence or otherwise.
24This will require further site visits (encompassing at least several days on site) including visual investigations, invasive investigations (i.e. destructive testing), testing and sample analysis, including:
(a) Investigations of the pop-up roofs (of which new evidence has been provided within the Crown’s experts briefs of evidence);
(b) New areas of fibre cement newly identified within the briefs of evidence of both Mr Goodwin and Mr Rawlinson;
(c) Other areas of the school where new evidence of alleged damage has been claimed.
25Also, we now need to do further analysis of additional trade literature, product literature and design documentation to verify new concerns in relation to building elements and alleged departures from the design.
[37] Mr O’Sullivan responds for the plaintiffs, noting in particular:
21At paragraph 13, Mr Bray refers to two schedules which outline what he says are changes to the locations of certain defects. It is correct that some locations for Defects 1 and 6 have been clarified in greater detail in the evidence but the Defects have not changed. For Defect 1, the locations of the thermal movement aspect have in fact been reduced. Locations for raking edges have been included. Again, the raking edges were always part of Defect 1. For Defect 6 the affected cladding areas have been updated to reflect the most up to date findings. As before, this is by way of additional clarification for all involved in the trial and is entirely usual in my experience.
22At paragraph 14 of his affidavit Mr Bray talks about testing from samples taken in 2016 and 2017. The timber samples were requested to demonstrate the natural progression of damage with H3.1 timber.
23Mr Bray then goes on to comment in paragraph 15 that based on the initial testing of the ACL samples, he could understand why Hawkins did not take any steps to test new samples. I cannot comment on why Hawkins did not take any steps to test new samples. I cannot comment on why Hawkins did or did not decide to take any actions. I simply comment that it is a matter of common knowledge to experts that damage from water ingress increases over time. In keeping with this, and predictably, as time has progressed more damage has become evident. That is common and [in] line with normal expectations for H3.1 timber.
24Mr Bray talks at paragraph 16 about the testing not being detailed in Schedule 1 of the 4ASOC. Schedule 1 describes the damage for each defect. Testing results are not detailed in Schedule 1 because they form part of the evidence rather than part of the pleadings.
[38] And further:
26At paragraphs 19-21, Mr Bray comments on the increase to the quantum of the claim. I note that the 4ASOC expresses the Costs of Remedial Work as being “currently estimated to be not less than”. Again, it is entirely standard for final updates on costings to be provided in the evidence.
[39] Mr O’Sullivan addresses a further concern raised by Mr Bray in relation to the availability of a bio-deterioration expert. He notes one based in the Waikato is available.
[40] Tania Halpin, project manager for the Ministry of Education, also provides evidence as to the background and the defendant’s involvement in the four or so years since the proceedings commenced. She notes:
9Meredith Connell regularly provided information to ensure that Hawkins was kept updated on a without prejudice basis (the Ministry does not in any way waive privilege by virtue of my reference to these matters in my affidavit). This included providing information about the increasing estimated remediation costs, copies of destructive testing reports, health and safety audit results that the Ministry had commissioned and defect causation schedules prepared by the Ministry’s experts. None of these things have been referred to in paragraphs 8 to 22 or 52 to 57 of Ms Lincoln’s affidavit.
[41] She also observes:
(a) The increase in the estimated cost of remedial works and the provision of temporary accommodation between the Second Amended Statement of Claim (September 2015) and the Third Amended Statement of Claim (February 2017) was $3,000,000, and was largely because of the associated increases in professional fees, building costs and material over that period.
(b)The defendant engaged Brian Duffy as an expert in 2014. He met with the plaintiffs’ experts in December 2014 and June 2015, attended a pre- mediation experts’ meeting with Prendos on 9 May 2017, and the mediation on 18 May 2017. He also attended the School for a third time on 12 October 2017 and was scheduled to attend a further destructive testing site visit on 9 and 10 December 2017.
(c) Prendos reports were provided to the defendant on a without prejudice basis in May 2015.
(d)The defendant was given ample site access. Ms Halpin produced a detailed chronology of sites visits, which I have reproduced in part in Appendix A.
Assessment
[42] In my view:
(a) The defendant has had ample notice that the claims against it were likely to be very substantial and would increase over time, given the fact water damage caused by unremediated defects generally increases with time.
(b)Increases in the quantum claimed, while significant, should have been anticipated by the defendant given the scale of the building works.
(c) The defendant did not appear (based on the evidence before me) to engage in any testing of its own on the spurious basis that initial testing by the plaintiffs did not reveal significant damage. But I also note Mr Duffy has been actively involved in preparation for the hearing and it has not been suggested that he is no longer available to assist.9
(d)While part of the reason for the defendant’s inactivity can be explained by the attempts at mediation, it should have taken undertaken its own testing.
(e) The defendant’s representatives were wrong to assume (if they did) that plaintiffs in a very substantial leaky building case were not going to repeat or expand testing for water damage as part of the evidence preparation process.
(f) I agree with Mr Davies that the plaintiffs were under no obligation to disclose their full testing programme to the extent that it formed part of their preparation of evidence. Having said that, plaintiffs who keep their cards close to their chest run the risk that applications for adjournment
might be made when testing done in secret is produced in evidence.
9 Mr Cash noted in a conference on this matter that Mr Duffy had relatively limited involvement and could not add substantively to the information supplied by Ms Lincoln. I am prepared to proceed on the basis that he cannot add to Ms Lincoln’s evidence as to the process followed and the information exchanged. Nevertheless, the defendant has had the benefit of a building expert for some time and should have taken more active steps to ascertain the extent of its potential liability (if any) and in any event, an expert who should be reasonably placed to assist the defendant in preparing evidence.
[43] Assessed in the round, the defendant’s grounds under this heading are not strong. It was in control of its preparation for trial. The defendant sat on its hands for too long. It cannot reasonably sheet responsibility for this to the plaintiffs. I am mindful, however, that the plaintiffs’ “secret” testing is a relevant factor. The production of this testing in 2016 may have stimulated the defendant into action, and among other things avoided the need for the defendant to seek an adjournment now. Nevertheless, the approach taken by the plaintiffs does not raise interests of justice considerations. As noted, the defendant was well able, and had the opportunity, to undertake its own testing.
(i) Inconsistencies must be addressed now
[44] The defendant says it is not appropriate to address the apparent inconsistencies between the pleadings and the evidence at trial and that they must be considered now. However, as foreshadowed above, I am satisfied having reviewed the pleadings and the alleged inconsistencies that the degree of difference appears, at least on its face, to be discrete and capable of management at trial if necessary. I return to this aspect below at [101].
(j) Removal of the lead expert
[45] As noted Mr Wutzler withdrew as an expert for the defendant on 5 November
2017. Mr Wutzler has provided an affidavit addressing his expertise, the circumstances of engagement by the defendant, and his subsequent withdrawal. It is necessary to set it out because it reveals that the decision to withdraw cannot be attributed to the defendant. On the contrary, while not unreasonable, the plaintiffs forced Mr Wutzler’s hand.
[46] Mr Wutzler is a very experienced building surveyor, having provided advice for approximately 150 matters in leaky home or building proceedings. He was contacted by the defendant on 29 September 2017 to act as an expert witness in relation to claims in respect of four schools. He identified the schools subject to litigation and confirmed he had no conflict. He is, however, currently engaged by the Ministry in the Carter Holt Harvey Ltd “Shadowclad” proceedings, which involves a product
liability claim. On 4 October 2017, he received advice from Meredith Connell that he was conflicted. He was not persuaded and referred them to Kensington Swan.
[47] Mr Wutzler continued to act, and made site visits on 12 and 27 October 2017. He was then shown correspondence from Meredith Connell suggesting he was in possession of confidential information. He did not think that information had any relevance to the present proceeding.
[48] Mr Wutzler explains that there was then an application to the Court for an order barring the defendant from calling him. The plaintiffs claimed he was a trusted professional adviser to the Ministry. At this point he sought independent legal advice. Having explained his position to counsel, further information was sought from Meredith Connell. It transpires that, while not engaged to act by the Ministry, the fresh information showed he had been present at a meeting where the present proceeding was discussed. In addition, further information revealed his company, Helfen Ltd, had a number of years ago reviewed documents relevant to the present proceeding. He could not recall the content of this material, but concluded he had to withdraw.
[49] Mr Hazlehurst has since been retained, I understand, to replace Mr Wutzler. He is also very experienced. He says he has only visited the school once. He also notes the plaintiffs’ claim is substantial, involving briefs of evidence of 190 pages in total. He then says:
22To properly complete my investigations, I need to undertake further extensive inspections at the school over several days, including destructive testing and the taking of material and wood samples for review and analysis. There is a significant amount of information generated by others working on the case, both from the plaintiffs’ and the defendant’s sides. Add to that the material I and my two support surveyors are generating. Consequently, there is and there will be a large body of information to manage, collate and shape into reports and briefs of evidence, including photographic records, drawings and sketches, costs analysis and industry references. However, given I have only just recently been engaged and therefore been able to begin my work only some 5 or so weeks before Hawkins’ evidence is due, I cannot see how I can properly complete my investigations and prepare a brief of evidence by the due date for Hawkins’ evidence (I understand the current deadline is 19 December). This is especially the case when a significant part of my on-site investigation is, due to exams, unable to proceed until 4 December 2017 or potentially even later.
[50] And further:
24I can see how it might be possible to complete the full investigations required by the trial date but I understand the experts are supposed to have conferred and produced a report for the Court as to the points of agreement/disagreement by 2 February 2018. That is clearly premised on the respective experts having had an opportunity to properly consider each other’s evidence, so they can engage meaningfully in discussions aimed at identifying what the experts agree on and what they don’t agree on, so as to establish the differences, or narrow the trial’s focus down to those fundamental issues of significance.
Assessment
[51] I accept the defendant’s basic contention that losing an expert of Mr Wutzler’s experience at such a late stage was a heavy blow to their preparation. While he was retained only recently, an expert of his significant experience can assimilate information and prepare evidence quickly and efficiently, as well as assist in the identification of key matters to be addressed in associated evidence. This is particularly important in the context of a claim involving seven primary defects (and
24 “sub-defects”) across multiple buildings.
[52] The plaintiffs do not accept Mr Wutzler’s late withdrawal is a problem. They refer to the fact:
(a) he was retained in late September and after the date for caucusing;
(b) he was notified of the conflict immediately; and
(c) Mr Duffy, who has not given evidence in support of the present claim, has been engaged since 2014 and it has not been explained why he cannot provide lead expert evidence.
[53] I nevertheless consider this to be a strong factor favouring either an adjournment of the hearing, or as a minimum an extension of time to exchange evidence. I have come to the view that a further month to exchange evidence should suffice, with a truncated period for expert caucusing. I reach this view because with an extra month, Mr Hazlehurst will then effectively be in the same position as Mr Wutzler in terms of timing for the evidence. I appreciate that the Christmas break
complicates matters. But this is a necessary consequence of the defendant’s poor preparation to date.
Prejudice
[54] Given where I have got to, I do not consider the proceedings should be adjourned. I am fortified in this view because the defendant’s difficulties are largely of its own making. The failure to undertake even basic testing over a four-year period is not explained by the initial exchange of apparently innocuous test results. The unexplained decision to appoint new counsel and very late retention of a key expert were matters within the defendant’s control. Any prejudice to the defendant caused by the haste with which it must now prepare for the hearing is therefore largely self- induced (though as noted Mr Wutzler’s conflict issue was not something it could control).
[55] By contrast, the plaintiffs will be substantially prejudiced by any delay. They have expended considerable resource to comply with the Court’s timetabling orders. This will have dictated the level and timing of deployment of scarce resources. Decisions will have been made in terms of the scale and type of evidence preparation accordingly. In the absence of good clear reasons to adjourn, it is not fair to them to extend more time to the defendant to prepare, with the benefit of the plaintiffs’ evidence. While this is not a game of rugby, the credibility of our civil justice system likewise depends on the even-handed enforcement of rules, in this case timetabling orders which secure procedural fairness for the parties.
[56] There is also prejudice to the court, other litigants and the general public to consider. Large scale matters of this kind consume considerable judicial and court resources. Other litigants are affected in terms of the capacity of the courts to hear their matters. The adjournment will have a knock-on effect: other litigation may have to be brought on at short notice, or conversely precious time lost to the disposal of proceedings.
[57] I have considered whether I should simply adjourn to the 16 July 2018 date as suggested by the defendant. But this will cause material prejudice to the parties in that proceeding. The parties include a different Board of Trustees and a further defendant,
not party to this proceeding, who do not consent to the adjournment. They ought not to lose their fixture because of the defendant’s clear failure to be ready for this trial. Finally, I am satisfied an extension of one month, including the Christmas break, should be sufficient for evidence exchange purposes.
Outcome
[58] The application for an adjournment is declined. However, I propose extend the period for exchange by the defendant to 15 January 2018. The experts are to confer no later than ten working days later, by 29 January 2018. A joint expert report is to be produced as soon as possible thereafter. Evidence in reply to be filed no later than 5
February 2018. The defendants are to make their briefs of evidence available as they are completed (though that this may be when other related briefs are complete). The parties are to file memoranda as soon as possible if this timetable cannot be met.
Application to review
[59] The application to review the decision of Associate Judge Bell alleges the following errors:
(a) Associate Judge Bell erred in finding that the particulars relating to health and safety of the staff and students, or interference with the provision of education, were not required because they were self- evident, a standard issue in leaky building proceedings and uncontroversial once defects and damage are established. This ground is no longer pursued.
(b) Associate Judge Bell was wrong to conclude:
(i)it is not disputed that Stages 2 and 3 were subject to design and build contracts; and
(ii)it is sufficient for the plaintiffs to plead that there was a contract but that more is not required.
(c) Associate Judge Bell was wrong to refuse particulars relating to alleged defects, damage, remediation work and loss, and in respect of
Schedules 1, 2 and 3 of the pleadings on the basis that:
(i) ordering such particulars would severely disrupt the plaintiffs’
preparation for trial; and
(ii)the defendant’s alleged delay in applying justified a refusal to order particulars that are otherwise required, and in relying on the decision in Astrovlanis SA v Linard.10
(d)Associate Judge Bell wrongly found the defendant is not at any significant disadvantage if the further particulars are not ordered.
The pleadings
[60] Because the application for review concerns the Fourth Amended Statement of Claim, it is necessary to the pleadings in some detail. This involves some unavoidable repetition from the background outlined above at [3]-[16].
[61] The present claim involves three stages of building work. The first state of building work involved the construction of the following blocks:
(a) Gymnasium and Performing Arts Centre (Block E); (b) Whanau One (Block B);
(c) Whanau Two (Block C); (d) Whanau Three (Block D); (e) Library (Block F); and
(f) Administrative Building (Block A).
10 Astrovlanis SA v Linard [1972] 2 QB 611 (CA).
(collectively, the Stage 1 building work)
[62] In or around December 2002, the plaintiffs appointed the defendant to construct the Stage 1 building work. A building work report confirmed the Stage 1 building work contract. It confirmed, among other things:
(a) the defendant had submitted control documents, including for health and safety, programme and cost for construction of the Stage 1 building work;
(b) construction documents had been issued to the defendant;
(c) the site had been handed over to the defendant on 6 January 2003; (d) the defendant was the main contractor;
(e) the defendant was responsible for quality control;
(f) the defendant confirmed that it was established on site; and
(g)Maltby & Partners Ltd (the quantity surveyor for the Stage 1 work) confirmed the project had been awarded to the defendant for the sum of $14,392,155.36.
[63] The Stage 1 building contract was then executed on 6 October 2003. A copy of this contract has not been retained by the plaintiffs or the defendant.
[64] The defendant constructed the Stage 1 building work between about March
2003 and early-mid 2004, and certificates of compliance were obtained. In December
2003, the defendant issued a producer statement certifying it had carried out and completed the construction of the Stage 1 building work in accordance with plan specifications and the Stage 1 contract. Corresponding certificates of code compliance were also issued.
[65] Stage 2 of the building work comprised construction of the following blocks:
(a) Whanau Four (Block I);
(b) Whanau Five (Block H); and (c) Whanau Six (Block J). (collectively, the Stage 2 building work)
[66] The Ministry on behalf of the second plaintiff accepted the defendant’s tender on the Stage 2 building work. In late 2004, the plaintiffs entered into a design and build contract with the defendant in respect of Stage 2 building work. The contract was a fixed price design and build contract, based on NZS 3910:2003. It included a number of ancillary documents to the contract. In 2005, the defendant engaged Andrews Scott Cotton Architects Ltd (ASC) and instructed it to prepare plans and specifications for the design of the Stage 2 building work. Drawings were ultimately issued and, between May 2005 and April 2006, the defendant constructed the Stage 2 building work. The building work was carried out pursuant to separate building consents.
[67] The Stage 3 building work involved an extension to the library. The plaintiffs entered into a design and build contract with the defendant for this purpose. Building consent was issued in May and October 2008. Between May 2008 and November
2008, Hawkins constructed the Stage 3 building work.
[68] Between 2004 and 2009, the defendant was required to fulfil its contractual obligations and complete outstanding remedial issues left over from the defects liability periods under the Stage 1, 2 and 3 building works. In October 2003, it issued a list of outstanding remedial items for the Stage 1 work. In August 2004, the project manager (Bovis Lend Lease) wrote to the third plaintiff confirming that, other than three or four minor defects, the defendant had actioned the outstanding remedial works required for Stage 1 building works.
Leaks appear
[69] Between May 2010 and August 2011, the School reported serious recurring leaks in various school buildings. Around 2012, the plaintiffs engaged expert building surveyors to inspect and investigate the Stage 1, 2 and 3 building work. The inspections and investigations identified defects in the construction of the works. The defects are set out in Schedule 1 to the Fourth Amended Statement of Claim, which is attached as Appendix B to this judgment.
[70] The plaintiffs say that as a result of the defects, the building works are not weathertight, watertight, durable, are at risk of not being safe and sanitary, and have suffered damage. Particulars of the damage are also set out in Appendix B. The plaintiffs say that as a result of the defects and the damage, the works do not comply with applicable building standards, including:
(a) the functional and/or performance requirements of cls B2 and E2 of the
New Zealand Building Code; and/or
(b) the Building Act 1991/2004; and/or
(c) the relevant and/or specified product specifications; and/or
(d) good trade practice, including reasonable standard of skill and care. (together, the building standards)
[71] The plaintiffs say that as a result of the defects and damage, remedial work is needed. The scope of remedial work is set out in Schedule 3 to the Fourth Amended Statement of Claim. The plaintiffs also refer to the cost of investigation, together with additional losses, including the cost of temporary rooms and facilities to accommodate staff and students. It is noted that the cost of renting temporary rooms and facilities is currently estimated to be $1,697,595.92 (plus GST). In terms of the cost of remedial works, the plaintiffs say it is “currently estimated to be not less than $18,270,886.01
(plus GST)”.11 The particulars of the remedial works they say is needed are also set out in Schedule 3.
[72] The pleadings also contain the currently estimated costs per block as follows:
Stage 1 and 3 Building Work Remedial Costs
Block Cost (plus GST) (i) Whanau One $1,855,542.84 (ii) Whanau Two $1,818,745.45 (iii) Whanau Three $1,991,108.93 (iv) Administration Building $1,781,608.98 (v) Gymnasium & Performing Arts $4,944,564.19 (vi) Library & Library Extension Stage 3
Building Work
$1,754,042.95
[97] Second, the defendant complains the plaintiffs have not pleaded the remedial work and costs in respect of each individual defect to satisfy the requirement for a proper nexus to be pleaded between each individual defect and consequences of that defect. However, as the defendant concedes, the evidence of Heidi van Eeden provides a breakdown of the remedial work costs in respect of each of the defects. In that evidence, she apportions the remediation cost to each of the seven alleged defects. In my view that is adequate to sufficiently inform the defendant of the nexus between the alleged defect and the cost of rectification.
[98] In this regard, the defendant refers to Body Corporate 351522 v Queenstown Lakes District Council as authority for the proposition that a sufficient nexus must be pleaded.21 In that case, however, the issue was simply whether the cost of remediation arose from one or more of the three pleaded problems. The plaintiffs have already provided the type of breakdown required in that case.
[99] Third, the defendant’s complaint about lack of identification of locations of defects and standards not met is not reconcilable with the schedules which clearly state
21 Body Corporate 351522 v Queenstown Lakes District Council [2013] NZHC 559.
these matters, or allow them to be inferred – for example in terms of water ingress. Apparent inconsistencies with the evidence go to issues of proof not pleading.
[100] The upshot of this is that I am satisfied:22
(a) Sufficient information has been provided to inform the defendant of the case it must meet on the defects and to enable it to take steps to respond.
(b)There is no real risk the defendant may face at trial an ambush if further particulars are not provided.
(c) The request by the defendant is not oppressive, but it is unreasonable in the circumstances.
[101] Finally, I note the defendant relies on the evidence exchanged to claim an ongoing lack of clarity as to matters listed above at [90]. I agree with the defendant that by the time of trial there should be no ambiguity about those matters. As Turner J stated in Notter v McInnes, particulars assist not only the defendant in their preparation for trial, but “the Court itself will be assisted by the clarity which furnishing of particulars must help to impart to the actual Court proceedings”.23 As it currently stands, there is no substantial prejudice to the defendant because the Fourth Amended Statement of Claim, for reasons stated, sufficiently signals the claims it must respond to. But there should be no lingering ambiguity about these matters at trial.
[102] To address this concern, I propose the following course. The experts must caucus on the matters raised by the defendant at [90] with a view to reaching agreement as to those particulars. Areas of agreement and disagreement will need to be recorded, as should any necessary concessions. With the benefit of the joint expert caucusing on these matters, the plaintiff should address the matters raised by the defendant to the extent necessary, within its opening submissions. From that point, it will be a matter for the trial judge as to whether the pleadings and evidence provide
sufficient clarify on these matters in order to sustain the plaintiffs’ claims. This will
22 I have here answered the three questions posited in Body Corporate 74246 v QBE Insurance
(International) Ltd [2015] NZHC 1360 at [18](h).
23 Notter v McInnes [1961] NZLR 793 at 794 (SC).
then enable the defendant to mount a challenge based on lack of particulars at trial, if that proves necessary.
[103] Overall, while further elaboration and clarification of aspects of the pleadings may be useful, I am satisfied the pleadings have served their proper purpose, and given the defendant sufficient notice of the plaintiffs’ claims. In this context, I endorse Associate Judge Bell’s observation that given the proximity to trial, it is too late and would be unfair to the plaintiffs to require further particularisation now. The additional directions as to expert caucusing should address any residual concerns.
Outcome
[104] The application to adjourn the trial is declined, subject to the timetabling orders set out at [106] below.
[105] The application to review the decision of Associate Judge Bell is declined, subject to the following directions:
(a) The joint expert conference must address the matters raised by the defendant at [2](d)(i) of the application for review.
(b)The plaintiff must provide the particulars sought in respect of the matters raised by the defendant at [2](d)(i) of the review application, to the extent it remains necessary following expert caucusing, in its opening submissions.
[106] I order the following amendments to the timetable:
(a) The defendant shall exchange its evidence on 15 January 2018, but on the condition the defendant is to make its briefs of evidence available as soon as they are completed.
(b)The experts are to informally confer with each other in their corresponding fields for the purposes of identifying areas of agreement and disagreement, and in preparation for a formal expert conference,
which is to take place no later than 29 January 2018. A joint expert report is to be produced as soon as possible thereafter.
(c) Evidence in reply is to be filed no later than 5 February 2018, in anticipation that the expert conferral process will narrow the issues between the experts.
(d)Leave is granted to the parties to seek amendments to the timetable if necessary.
[107] Given the proximity to trial, costs are reserved.
Addendum
[108] I issued my rulings in advance of this judgment so that the parties knew where they stood. Since then the plaintiffs have sought an adjustment to the timetabling to reinsert the time for joint expert caucusing because of witness availability issues. Other knock on timetabling adjustments are also sought. The adjustments seem sensible. I make those adjustments accordingly, together with an order granting leave to come back to the Court if necessary.
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