Ritchie v Earthquake Commission
[2017] NZHC 1242
•8 June 2017
IN THE HIGH COURT OF NEW ZEALAND CHRISTCHURCH REGISTRY
CIV-2016-409-000831 [2017] NZHC 1242
BETWEEN JAMES MATTHEW RITCHIE AND
SANDRA JANE BUSHNELL Plaintiffs
AND
EARTHQUAKE COMMISSION First Defendant
AND
LUMLEY GENERAL (NZ) LIMITED Second Defendant
Hearing: 29 May 2017 Appearances:
N S Wood and K S Rouch for Applicant (First Defendant) J E Bayley and R C Harris for Respondents (Plaintiffs)
B J Read for Second Defendant (Supporting the applications)
Judgment:
8 June 2017
JUDGMENT OF ASSOCIATE JUDGE OSBORNE [on interlocutory applications]
Summary of outcome and the significance
[1] By this judgment the Court dismisses the first defendant’s interlocutory applications for orders striking out the plaintiffs’ claim or, alternatively, requiring the plaintiffs to file a more explicit pleading.
[2] The plaintiffs, as insured houseowners of an earthquake-damaged house, have encountered a difficulty not uncommon in cases on this Court’s Earthquake List. They know their house was damaged by more than one earthquake; the first defendant (EQC) has determined an apportionment of damage between two earthquakes, with the damage from one earthquake over cap,1 and EQC has paid the
plaintiffs accordingly; the plaintiffs have not resolved with their private insurer, the
1 For the “cap” see [6] below.
RITCHIE V EARTHQUAKE COMMISSION [2017] NZHC 1242 [8 June 2017]
second defendant (Lumley), their claim for the balance of the damage; the plaintiffs would accept the EQC apportionment as the basis of calculating the balance due from Lumley, but Lumley have put EQC’s apportionment in issue.
[3] The plaintiffs are therefore in doubt as to the party from whom they are entitled to relief. They sue. They join both EQC and Lumley as defendants. They plead the facts known to them. They plead their uncertainty as to which defendant is liable and expressly invoke r 4.3(4) High Court Rules. They seek declarations as to apportionment of damage and their entitlement, and they seek an inquiry.
[4] EQC takes issue with the plaintiffs’ pleadings, asserting that the pleadings should either be struck out or further particularised. This Court refuses EQC’s applications. The plaintiffs’ pleadings are appropriate to the situation in which the plaintiffs’ doubt as to the correct defendant persists by reason of the pleaded position of Lumley as the second defendant.
Background
[5] The plaintiffs’ house was damaged in the Canterbury earthquake sequence. It is common ground that it was damaged by both the 4 September 2010 and the 22
February 2011 earthquakes. The house was insured under Lumley policies at the time of each earthquake. Where the insured chooses to repair or rebuild their house, Lumley’s commitment under the policies is to pay costs actually incurred (on a specified basis).
[6] EQC is a Crown entity established under the Earthquake Commission Act
1993. It is required, to a limit of $100,000 plus GST per event (the cap), to reinstate the house to substantially the same (but not better or more extensive than) its condition when new.2
[7] After the September 2010 earthquake (and before the February 2011 earthquake), the earthquake damage to the house was inspected. EQC made a
2 Earthquake Commission Act 1993, ss 2 & 18.
payment of $4,421.85 for the September 2010 earthquake. The plaintiffs recognise that EQC, by that payment, may have discharged its liability in relation to that event.
[8] In early 2016, EQC eventually decided that it would make a cap payment in relation to the February 2011 earthquake. EQC made its payment to the plaintiffs’ mortgagee.
[9] There loomed on 4 September 2016 a potential limitation issue for the claimants, by reason of its being the 6th anniversary of the September 2010 earthquake.
[10] The plaintiffs issued this proceeding on 1 September 2016 against both defendants. The plaintiffs’ pleadings are now in the form of a first amended statement of claim (the Claim). In the Claim, the plaintiffs record that they are in doubt, within the meaning of r 4.3(4) High Court Rules (“the uncertainty rule”), as to which of EQC and Lumley is liable for the damage to the house and as to the extent of liability.
Pleadings
Statement of claim
[11] The Claim identifies in a standard way the parties, the insured property, Lumley’s obligation under the insurance policies and EQC’s obligation under the Earthquake Commission Act. The Claim pleads that the house suffered damage in the Canterbury earthquake sequence commencing 4 September 2010, with seven particulars of physical damage provided. There is then a pleading as to the following matters:
· The plaintiffs lodged claims with EQC for damage caused by the
September 2010 and February 2011 earthquakes;
· The plaintiffs are covered under the Act and the policies for the damage;
· The plaintiffs plead the required standard of repair and identify the scope
of works on which they rely (Scope of Works);
· Lumley has breached its obligations under the policies and, in particular:
–Lumley has failed to acknowledge that repairs in accordance with the Scope of Works are necessary to repair the earthquake damage to the house to the standard required under the policies.
–Lumley has failed to make full payment for claims costs and the cost of repairs which are necessary to repair the earthquake damage to the standard required under the policies.
[12] As to apportionment of liability between EQC and Lumley, the plaintiffs plead:
15.EQC has made a payment of $4,421.85 for the 4 September 2010 event and a “cap” payment for the 22 February 2011 event (the Apportionment).
16.EQC and Lumley have not agreed between themselves that the Apportionment accurately reflects the allocation of damage to the House across the events in the Canterbury earthquake sequence.
17. EQC and Lumley have not agreed the allocation of damage to the
House across the events in the Canterbury earthquake sequence.
18.Lumley, despite requests from the plaintiffs, has failed to acknowledge that the payments made by EQC under the Apportionment are sufficient to discharge all of EQC’s liability for the damage to the House.
19.The plaintiffs, whilst aware of the total damage to the House, are uncertain as to the allocation of damage to the House across the events in the Canterbury earthquake sequence and, consequently, whether EQC has discharged all of its liability for the damage to the House.
20.In the circumstances described in paras 15 to 19 above, the plaintiffs are in doubt, within the meaning of r 4.3(4) of the High Court Rules, as to which of EQC and Lumley is liable and the extent to which EQC and Lumley is liable.
[13] Finally, in the claim, the plaintiffs set out the primary relief they seek, being declarations and an inquiry (together with the claim for interest and costs):
AA declaration that the work required to repair the earthquake damage to the House to the standard required under the Act and the Policy is that specified within the Scope of Works (which may be subject to further refinement before trial);
BA declaration as to the apportionment of Damage to the House across the events in the Canterbury earthquake sequence;
CA consequent inquiry into the amounts still owing by the first defendant under the Act (if any) and the amounts owing by the second defendant under the policy.
Statements of defence
[14] EQC filed a statement of defence of the plaintiffs’ original statement of claim, but not to the amended statement of claim which contains the plaintiffs’ pleading of doubt and reliance upon the uncertainty rule. Because EQC has made this strike-out application, it has not to date filed a defence to the amended claim.
[15] Lumley has filed a defence to the amended claim. Lumley sets out its response to the plaintiffs’ pleadings as to apportionment of liability between EQC and Lumley:
15.It admits EQC has made payments to Mr Ritchie but otherwise denies paragraph 15.
16.It does not know whether the apportionment accurately reflects the allocation of damage to the house across the events in the Canterbury earthquake sequence, and therefore denies paragraph 16.
17.It does not know the allocation of damage to the house across the events in the Canterbury earthquake sequence and therefore denies paragraph 17.
18.It does know whether the payments made by EQC under the apportionment are sufficient to discharge all of EQC’s liability for the damage to the house, and therefore denies paragraph 18.
19.It apprehends it is not required to plead to paragraph 19. However, it says that the plaintiffs are the party in the best position to be aware of the damage to the house caused by each earthquake event. It further says that the plaintiffs have been asked to advise if there are any grounds on which they consider the EQC assessment, scope and costings for the 4 September 2010 earthquake are incorrect, and they have not done so.
20. It apprehends it is not required to plead to paragraph 20.
Plaintiffs’ further particulars
[16] The plaintiffs in the Claim plead damage caused in the Canterbury earthquake sequence as a whole (unrelated to particular earthquakes) (see [11] above). EQC sought further and better particulars of the damage alleged to have occurred specifically as a result of the 4 September 2010 earthquake.
[17] In their statement of further particulars the plaintiffs plead:
1 The plaintiffs observed the following damage after the 4 September
2010 event:
(a) cracking in ceiling and wall gib-board; and
(b) foundation cracks.
The plaintiffs refrain from giving further particulars as to the extent of the damage or whether other elements were damaged because:
(a) the plaintiffs did not undertake measurements (including for example, measurements of house levels) prior to the next earthquake event; and
(b) the plaintiffs did not inspect the underfloor areas (including the piles) prior to the next earthquake event.
EQC’s interlocutory applications
[18] EQC’s strike out application proceeds on two grounds.
[19] First, EQC asserts that the plaintiffs have not pleaded material facts which would make out a cause of action against EQC. This ground raises important considerations as to the right which the plaintiffs invoke, under the uncertainty rule, to join two defendants. It raises considerations as to the responsibilities of private insurers and EQC respectively in the context of litigation over earthquake insurance.
[20] EQC’s second strike out ground is that none of the primary relief sought by the plaintiffs (declarations and an enquiry) is appropriate. EQC asserts on that ground also that the claim against EQC should be struck out.
[21] EQC’s particulars application will call for consideration of the relationship between the particular needs of litigation arising from the Canterbury earthquake
sequence and the general power of the Court to require defective pleadings to be more explicitly stated.
First ground of application – failure to plead material facts
EQC’s ground of application
[22] EQC first asserts that the plaintiffs’ pleading involves a failure to plead necessary, material facts. This requires in turn a consideration of the plaintiffs’ entitlements of joinder and pleading when there is doubt as to the persons from whom the plaintiffs might obtain relief.
Joinder of defendants in cases of doubt – the Court’s jurisdiction
[23] The most convenient starting point for such a plaintiff lies in the express provision contained in the uncertainty rule (r 4.3(4)).
[24] Beyond such specific rules, the courts also possess inherent powers to enable them to act effectively within their jurisdiction.3 In appropriate circumstances, a Court may, within its inherent powers, uphold or permit the joinder of multiple defendants in cases of uncertainty which do not fall squarely within a rule. Such inherent power was recognised by Goddard CJ in Managh v Wallington.4 Mrs Wallington, uncertain as to the identity of her employer, sued both Mr Managh and the company in which he was involved. Of this form of claim, his Honour observed:5
It was a perfectly proper way for her to proceed: compare the explicit (but not entirely necessary) provision for such a course in r 74(3) of the High Court Rules.
(emphasis added by italics)
[25] As recognised by Goddard CJ, independently of express provision under the
Rules, the Court would be acting within its (inherent) powers to permit a plaintiff in such circumstances to name as defendants the potentially liable parties.
3 R v Connelly [1964] AC 1254 at 1301; see also, Rosara Joseph Inherent Jurisdiction and
Inherent Powers in New Zealand (2005) Canterbury Law Review 220 at 232 – 237.
4 Managh v Wallington EmpC Wellington, WEC 61/96, 1 October 1996.
5 At 3 – 4.
[26] Express entitlement is given to a plaintiff to join potentially liable parties under r 4.3(4) High Court Rules which provides:
4.3 Defendants
…
(4) A plaintiff who is in doubt as to the person or persons against whom the plaintiff is entitled to relief may join 2 or more persons as defendants with a view to the proceeding determining—
(a) which (if any) of the defendants is liable; and
(b) to what extent.
The need for the uncertainty rule – illustration
[27] The need for an uncertainty rule was illustrated in the English decision of Hummerstone v Leary.6 The events in that case show how an injustice may occur without the correct application of a r 4.3(4)-type provision.
[28] The plaintiffs had been passengers in a lorry in broad daylight. There was a collision between the lorry and a motor-car. The plaintiffs suffered personal injuries through the collision. They sued the drivers of both vehicles in the County Court, invoking Order III, r 5, County Court Rules.7 (The Rule is set out in the Divisional Court judgment – below at [34]).
[29] At trial, the plaintiffs’ evidence appeared to make it probable that the car- driver was to blame but the plaintiffs could do no more than state what they observed just before the lorry was upset. They did not affirmatively or conclusively prove that the lorry-driver was not liable.
[30] At the close of the plaintiffs’ case, counsel for the lorry-driver applied for and obtained judgment against the plaintiff. When the case then proceeded in relation to the car-driver, the evidence of passengers in the car threw all the blame on the lorry-
driver. The County Court Judge found that the car-driver was not negligent and
6 Hummerstone v Leary [1921] 2 KB 664.
7 Order III, r 5, County Court Rules was substantially a reproduction of Rules of the Supreme
Court Order XVI, r 7.
entered judgment for the car-owner. On appeal, the Divisional Court set aside the judgment in favour of each defendant and ordered a new trial. But for the appeal, the plaintiffs would have been left without a remedy and liable for costs.
The purpose of the uncertainty rule
[31] The wording of the New Zealand uncertainty rule is very closely modelled on the (former) Rules of the Supreme Court.
[32] Early discussion of the uncertainty rule, of persuasive authority in New
Zealand, is found in English cases.
[33] In Lipman v Fox & London General Omnibus Co, Lord Alverstone CJ (in circumstances similar to Hummerstone v Leary) refused to dismiss one defendant from an action.8 His Lordship ruled that the defendant had to remain a party in order that it might be seen whether the evidence called for the other defendant would fix him with liability.
[34] That authority was followed in 1921 by the Divisional Court in Hummerstone v Leary. Bray J, delivering the judgment of the Court, set out the facts and then explained why the County Court Judge’s decision to enter judgment in favour of the “first” defendant was wrong:9
In our opinion the learned judge took an entirely wrong course in allowing Leary to be dismissed from the action. Instead of trying the case as one entire case, which it was, and hearing all the evidence before arriving at a conclusion, he divided it into what we may call compartments and tried each separately, the result of which was that it was never really tried at all. He treated it as a claim against Leary alone and a claim against Foster alone, overlooking the fact that the plaintiffs, as they were entitled to do under the Rules, were alleging that either Leary or Foster or both were responsible for the accident. When once a state of facts was proved, as it was, from which the reasonable inference to be drawn was that prima facie one if not both drivers had been negligent, the plaintiffs were entitled to call on the defendants for an answer, and the proper time at which to decide whether on the evidence one defendant or the other defendant or both the defendants were liable was at the close of the whole case. That the plaintiffs did prove such a state of facts is clear. The collision took place in broad daylight, there was no other traffic in the road, and there was nothing to indicate inevitable
8 Lipman v Fox & London General Omnibus Co (1911) (unreported), noted in Annual Practice,
1921, Vol I, at 229; noted in Law Journal, 2 December 1911.
9 Hummerstone v Leary, above n 6, at 666 – 668.
accident. If the learned judge was right, then if all that the plaintiffs could have proved was the collision itself, which under such circumstances as these would raise a presumption of carelessness on the part of one or both drivers, each defendant would be entitled to judgment because the plaintiffs would have failed to prove which driver was to blame. The learned judge did not give effect to Order III., r. 5, of the County Court Rules, which is substantially a reproduction of R.S.C. Order XVI., r. 7. Order III., r. 5, which enables a plaintiff to join several defendants when he is in doubt which is liable, provides that “where the plaintiff is in doubt as to the person from whom he is entitled to redress, he may join two or more defendants, to the intent that the question as to which, if any, of the defendants is liable, and to what extent, may be determined as between all parties.” The language of that rule contemplates that the case shall be tried out between all the parties, and, apart from the special language of the rule, it is in our opinion clear that when the difficulty of procedure is got over and a plaintiff can present his case against two defendants in the alternative he is just as much entitled to have the case tried out where he has made a prima facie case in support of his cause of action as a plaintiff is who proceeds against one defendant alone.
It must not be supposed from our judgment that if a plaintiff fails to make a prima facie case at all he is entitled to call on two defendants under such circumstances as these to give evidence and ask for judgment if no such evidence is given. He must of course prove facts from which in the absence of an explanation liability could properly be inferred. It might perhaps happen that a plaintiff suing two defendants in the alternative proved affirmatively that as regards one of them it is impossible to impute blame to him, and in that case, if such a case should occur, the judge would no doubt be entitled to dismiss him from the action. But it is not enough to show that on the plaintiff's view of the matter from what he was able to see of the accident it seems probable that one defendant was to blame. It seemed probable here on the plaintiffs’ evidence that Foster’s driver was to blame. As the ultimate result showed, they did not conclusively prove it.
[35] The application of the uncertainty provision then arose in a New Zealand case in 1927, under the equivalent rule.10 In Captain and Owners of SS “City of Naples” v Gollin and Co Ltd (“City of Naples”), the plaintiffs had sued two defendants for lost cargo pursuant to the uncertainty rule.11 At the conclusion of the plaintiff’s case, the first defendant purported to close its case without calling evidence. The Magistrate then heard evidence from the second defendant and gave judgment for that defendant. The Magistrate entered judgment against the first defendant. The Magistrate relied in part on the evidence of the successful (second)
defendant. The first defendant appealed.
10 Section 50 Magistrates’ Courts Act 1908 (in terms identical with r 64 Code of Civil Procedure).
11 Captain and Owners of SS “City of Naples” v Gollin and Co Ltd [1927] NZLR 297.
[36] The first ground of appeal was that the Magistrate was not entitled to consider the second defendant’s evidence, the first defendant having closed its case.12 Alpers J, in dismissing the appeal, held:13
The first of these two grounds of appeal is clearly not maintainable. The
Magistrates’ Courts Act, 1908, s.50, provides, in terms identical with Rule
64 of the Code of Civil Procedure in this Court, that where a plaintiff is in doubt as to the person from whom he is entitled to redress he may join two
or more defendants, to the intent that in such action the question as to which,
if any, of such defendants is liable may be determined as between all parties.
The very basis of this procedure assumes that the plaintiff is unable to prove conclusively by his own evidence his claim against any one of the defendants. He informs the Court of all he or his own witnesses know of the wrong he has suffered or the damage he has sustained; he makes out a prima facie claim against one or the other, or both, of the defendants, and leaves them to clear the matter up. If one defendant could entitle himself to judgment by merely refusing to lead evidence and declaring that he “closed his case” at the conclusion of the evidence called on behalf of the plaintiff, the special procedure provided by the rule would be rendered nugatory; a fortiori if the other defendant adopted the same course. This seems to be clear on principle, and the language of the rule itself contemplates that the issue shall be tried out between all parties.
But, apart from principle, the question is settled by authority. The same procedure obtains, and has for many years obtained, in England under rules identical in language with ours, though it was not till quite recently that the question came up for decision: Hummerstone v. Leary…
(footnotes omitted).
[37] Another New Zealand authority, NZI Insurance Ltd v Hinton Hill & Coles Ltd [Joinder], is relevant particularly to a plaintiff’s pleading.14 In that case, Barker J referred to a passage in the judgment in “City of Naples”. There Alpers J had stated that the plaintiff must inform the Court of all the plaintiffs and his own witnesses know of the wrong he has suffered or the damage he has sustained. Barker J directed:15
If resort is to be had to r 74(3), the pleading should say as much.
Barker J found the plaintiffs were entitled to rely on the uncertainty rule so as to allege that representations made to them in relation to insurance cover were made by
12 There was a second ground of appeal which is irrelevant here.
13 At 299 – 300.
14 NZI Insurance Ltd v Hinton Hill & Coles Ltd [Joinder] (1996) 9 PRNZ 615.
15 At 620.
or on behalf of a number of defendants or any one or more than one of them.
[38] The Courts in the Australian jurisdictions apply a similar procedure to that in New Zealand and England.16 They have in this area developed their practice in direct line with Hummerstone v Leary.17 The practice of the Australian courts is captured in the judgment of Clarke JA, delivering the judgment of the New South Wales Court of Appeal Court in Broken Hill Proprietary Co Ltd v Waugh (BHP v Waugh). His Honour there said:18
According to well recognised principles where a plaintiff, who has sued multiple defendants one or more of whom may be liable, shows prima facie that at least one defendant may be responsible, the court is bound to hear the whole of the evidence before entertaining submissions by any other defendant that no case has been established against him. This is so even if the plaintiff has not called any evidence demonstrating the fault of the particular defendant.
The rationale of the rule, as explained in Menzies v Australian Iron & Steel (1952) 52 SR (NSW) 62; 69 WN (NSW) 68, is that if the rule were otherwise the defendant against whom a prima facie case was shown might escape liability by addressing evidence to the effect that the defendant against whom the case had been dismissed was the party who was actually at fault. Indeed that is what occurred in Hummerstone v Leary [1921] 2 KB
664, the case cited in Menzies. Obviously that result would be inimical to the interests of justice.
[39] Finally, I refer to the judgment of Paterson J in Wake v Milne Ireland Walker.19 In that case, the plaintiff sued lawyers who had acted for him in proceedings for wrongful dismissal. The plaintiff obtained an award of damages, most of which he was unable to recover because the judgment debtor was put into liquidation. By reference to the then r 74(3) High Court Rules, the Court found that the plaintiff’s lawyer had been in breach of his duty of care to the plaintiff in two ways, one of which lay:20
… in not advising Mr Wake that Modulock and Lockwood Management Services should be joined so that the Court at the hearing could determine the appropriate employer.
16 B C Cairns Australian Civil Procedure (11th ed, LawBookCo Pyrmont, 2016) at 390.
17 Australia does not appear to have an express rule on this matter, unlike England and New
Zealand.
18 Broken Hill Proprietary Co Ltd v Waugh (1988) 14 NSWLR 360 at 372; See also, Briggs v
James Hardie & Co Pty Ltd, (1989) 16 NSWLR 549 (NSWCA) per Rogers A-JA at 563.
19 Wake v Milne Ireland Walker HC Auckland CP 253/95, 26 June 1997.
20 At 17.
Costs flowing from joinder – a related issue
[40] I now refer to authority which directly addresses the consequential costs issues which arise when the plaintiff’s claims against multiple defendants succeed in relation to one but fail in relation to another or others. This is the territory of Sanderson orders and Bullock orders.21
[41] The availability of costs orders as between a successful and an unsuccessful defendant (through either Sanderson or Bullock orders) enables a court to achieve overall justice as between all parties when the plaintiff has exercised its right of multiple joinder under the uncertainty rule. The Court of Appeal in Lane Group Ltd v DI & L Paterson Ltd affirmed that there was no absolute or presumptive rule governing the award of costs following trial in cases involving both successful and
unsuccessful defendants.22 Tipping J identified the correct approach to costs in such
cases:23
… Obviously a reasonable and proper joinder of the successful defendant will be a relevant and sometimes a decisive consideration in the plaintiff's favour. But against an originally reasonable and proper joinder must be set any relevant factors in favour of the unsuccessful defendant. … these can include a change in the position since original joinder, how much was recovered as against the amount claimed, whether the unsuccessful defendant caused or contributed to the original joinder, and in the end the overall justice of the matter as between the three parties concerned.
Defendants’ entitlement to reserve its position
[42] Just as a plaintiff may have uncertainty as to the correct defendant when commencing litigation, so too may one or more of the defendants who are joined under the uncertainty rule. In this case, Lumley has, through its statement of defence (at paragraphs 16 – 18), exercised its right to plead that it does not know whether the
EQC apportionment was correct and to therefore deny its correctness.
21 Titled respectively after Sanderson v Blyth Theatre Co [1903] 2 KB 533 and Bullock v London General Omnibus [1907] 1 KB 264; see Sim's Court Practice (online looseleaf ed, LexisNexis), at [HCR 14.1.6(a)].
22 Lane Group Ltd v DI & L Paterson Ltd (1999) 13 PRNZ 509, per Henry J at [3], per Tipping J at
[83].
23 At [90].
[43] In the consideration of EQC’s strike out application based on the current pleadings, nothing in the Court’s consideration is to be taken as criticism of Lumley’s pleaded position. The approach to costs taken by the Court of Appeal in Lane Group Ltd v DI & L Paterson Ltd recognises that the information necessary to determine matters of liability may develop during the course of the litigation, thereby enabling the parties to more reliably appreciate the liability position in a way that was not possible at the start of the litigation. A defendant’s sense that it has been unnecessarily involved from the outset falls to be addressed subsequently (so long as the plaintiff had at the outset a genuine doubt when joining both defendants). It is in the costs context that the Court is able, with the benefit of hindsight, to assess all matters, including whether the joinder was reasonable and proper.
Plaintiffs’ submissions
[44] For the plaintiffs, Mr Bayley accepted that the uncertainty rule requires a plaintiff (as observed by Alpers J in “City of Naples”) to make out a prima facie claim against one or the other, or both, of the defendants, leaving them to clear the matter up. Mr Bayley submits that the plaintiffs have met their obligation in this case in that they have pleaded, to the extent it is within their knowledge, the damage caused by the September 2010 earthquake, the “cumulative” damage and the basis upon which one or other (or both) of the defendants are liable for that damage. Mr Bayley submits that the apportionment of liability is now a matter for the defendants to clear up.
Submissions for EQC
[45] For EQC, Mr Wood set out in a single paragraph in his written synopsis the basis upon which he asserts the plaintiffs are unable to rely on r 4.3(4):
24The plaintiffs’ reliance on HCR4.3(4) to keep EQC in this proceeding is misplaced. That provision does not relieve plaintiffs of their obligation to plead (and prove) a case against someone. It simply allows a plaintiff to proceed against two or more defendants where the plaintiff can make out a prima facie case against one or other (or both) defendants, and the defendants are then left to clear
up who is responsible.24 The plaintiff’s uncertainty must be as to
who is liable not whether anybody is liable.
[46] Speaking to his synopsis, Mr Wood made submissions which can be grouped under two heads. First, in relation to pleadings, Mr Wood submitted that the provisions of the uncertainty rule do not absolve a plaintiff from the requirement to plead both damage and quantum. Secondly, Mr Wood submitted that the plaintiffs here should not be able to rely on the uncertainty rule because “the fault element is missing here”, with neither insurer “at fault”. Mr Wood submitted that r 4.3(4) is not available unless one or both defendants have peculiar knowledge of the circumstances which create the uncertainty.
[47] The first point raised by Mr Wood does not affect the plaintiffs’ right to invoke r 4.3(4). It is a matter appropriately considered in relation to further particulars.
[48] Mr Wood’s submissions as to the unavailability of the uncertainty rule proceeds on an assumption. His assumption is that the rule was intended to operate specifically in cases in which plaintiffs allege fault on the part of the multiple defendants and where the facts on which fault would be assessed are within the peculiar knowledge of one or more defendants (and not within the plaintiffs’ knowledge).
[49] Mr Wood would distinguish Hummerstone v Leary on the basis that it was a case in which the issue was as to which defendant had caused the accident. Similarly, Mr Wood sought to distinguish “City of Naples” as a case in which the plaintiff did not know which defendant caused some of the plaintiff’s cargo to be missing.
Discussion of submissions
[50] Through his submissions, Mr Wood sought to have the Court adopt a restrictive interpretation of the uncertainty rule. Neither the wording nor the
24 For this proposition, Mr Wood cited both City of Naples, above n 11, and Hummerstone v Leary,
above n 6.
structure of the rule suggests that it is to be read or applied restrictively. The rule is to be read purposively25 – that is, to allow the plaintiff to join defendants when the plaintiff is uncertain as to the correct defendant. The purpose is to have the Court determine the issue. At the point the plaintiff is pleading its case, the express requirement of the rule is that the plaintiff be “in doubt” as to the person or persons against whom it is entitled to relief. That implicitly involves a requirement that the
plaintiff genuinely have the doubt, as reflected in the commentary in McGechan on
Procedure where the authors record:26
Rule 4.3(4) allows a plaintiff to join multiple defendants where the plaintiff is in genuine doubt as to the number of potential defendants that may be liable.
[51] There is no requirement within the uncertainty rule that the case involve a pleading of fault in a tortious or other sense. Given the frequency of accidents involving breach of a tortious duty, it is unsurprising that the case law often involves discussion as to proof of “who is at fault” in causing a physical accident. Nor is it surprising that in such cases the courts speak of “leaving the defendants to clear the matter up” or similar.27
[52] A plaintiff ’s case, however, may involve questions of entitlement under contract, statute or otherwise which may not involve assessments of misconduct or fault. So, for instance, in Managh v Wallington, an employment law case, the doubt was as to which defendant was the employer rather than as to which defendant was at fault.28 Similarly, cases will arise where an insured plaintiff may be in doubt as to which of two private insurance policies (of separate insurers) covers the plaintiff’s loss.
[53] Cases involving uncertainty as to which of two defendants was at fault are merely example of circumstances which may cause a plaintiff to have the doubt
required under r 4.3(4).
25 Interpretation Act 1999, s 5(1).
26 McGechan on Procedure (online looseleaf ed, Thomson Reuters) at [HR 4.3.05].
27 As in City of Naples, above n 11.
28 Managh v Wallington, above n 4. See, similarly, Wake v Milne Ireland Walker, above n 19; Dunedin Airport Ltd v The Mount Cook Group Ltd HC Dunedin CP 34/96, 10 October 1996, in which a doubt arose as to which corporate entity was the party responsible under the Airport Authorities Act 1966 for airport landing fees.
[54] A further proposition within Mr Wood’s submissions was that cases properly falling within the uncertainty rule involve situations where the defendants have peculiar knowledge which will enable resolution of the doubt as to which defendant is liable. Again, that is not an express requirement of the rule and it would impose an unnecessary restriction on the operation of the rule. A plaintiff ’s uncertainty may arise for reasons not covered by a defendant’s peculiar knowledge. In earthquake insurance litigation, it may be that all parties need the benefit of independent expert evidence from a range of disciplines before a reliable assessment of liability can be made. There will also be cases where the uncertainty is as to what the Court will decide on already identified facts. That may be because there are legal arguments which require determination by the Court, there are matters of evidence from which different inferences may be drawn, or otherwise. As the express words of r 4.3(4) indicate, the “view” or intention of a r 4.3(4) joinder is to have the proceeding determine the matter in doubt. What is required under the uncertainty rule is that the plaintiff has a genuine doubt as to the persons against whom it may be entitled to relief. In some cases, the Court may need to choose between two compelling arguments.
The interests of efficiency
[55] The objective of the High Court Rules is to secure just and efficient determination of all litigation.29 The uncertainty rule promotes efficiency for both the Court’s resources and for parties. It reduces the risk of consecutive separate proceedings. Through avoiding that prospect, the rule serves to minimise the risk of irreconcilable determinations such as occurred at first instance in Hummerstone v Leary – a result, as observed by Clarke JA in BHP v Waugh (above at [38]), which was “inimical to the interests of justice”. Where limitation periods may be expiring (as was feared in the present case), the uncertainty rule allows a plaintiff who
remains uncertain as to the correct defendant to commence the proceedings within
time against the potentially appropriate defendants.
29 High Court Rules, r 1.2.
The burden of proof
[56] The Court is here concerned with a strike out application, not with burden of proof issues which arise at trial.
[57] Decisions, such as “City of Naples” and Hummerstone v Leary, which speak in terms of the plaintiff “making out a prima facie claim against one or the other, or both, of the defendants” are addressing the trial situation, not the issue which arises on a strike out application based on the pleadings.
Summary – the operation of the uncertainty rule
[58] I conclude that the regime of r 4.3(4) High Court Rules has the following features:
(a) A plaintiff may join multiple defendants where the plaintiff is in genuine doubt as to the person from whom relief may be obtained;
(b)The rule encompasses doubt as to all sources of legal liability whether based in tort, contract, statutory duty or otherwise – its application is not limited to cases in which defendants blame one another as being at fault;
(c) A plaintiff, when intending to invoke r 4.3(4), should identify in its statement of claim that the rule is being relied upon and the matter on which the plaintiff has doubt;
(d)The rule contemplates that the issues of liability will be tried as an entire case between all parties and determined after all the parties’ evidence is called;
(e) At trial, it is for the plaintiff to make out a prima facie claim against at least one of the defendants – the plaintiff need not be able to prove conclusively by its own evidence the claim against any one of the defendants;
(f) At the conclusion of the trial, the Court may make such costs orders as justly reflect the conduct of the several parties’ cases and the other considerations which appropriately inform the costs jurisdiction; and
(g)The enabling provisions of r 4.3(4) are not exhaustive – the Court pursuant to its inherent power, even in cases which fall outside the provisions of the rule, may if joinder will serve the ends of justice countenance a joinder of multiple defendants to meet a situation of uncertainty as to the liable defendant.
Strike out application – is the uncertainty rule available?
The evidence – uncertainty existed
[59] EQC and the plaintiffs filed evidence in relation to EQC’s applications. The
evidence includes correspondence between the various lawyers from 2016 to 2017.
[60] After the plaintiffs commenced the proceeding, EQC requested that the plaintiffs discontinue the claim against EQC upon the basis that EQC had discharged its statutory liability in relation to both the September 2010 and the February 2011 earthquakes. In response, the plaintiffs’ solicitors recorded that (before any discontinuance) they required written acknowledgement from Lumley that EQC had discharged all of its statutory liability. In other words the plaintiffs sought an acknowledgement that EQC’s apportionment of damage between the September
2010 and February 2011 earthquakes was accepted as correct.
[61] The issue was not resolved between the parties before the plaintiffs filed their amended statement of claim in February 2017.
[62] The latest exhibited correspondence from Lumley’s solicitors is dated 27
February 2017. In that letter reference is made to the plaintiffs’ concern that EQC and Lumley have not agreed the apportionment for the September 2010 and February 2011 earthquakes. The letter continues:
Based on the information currently available Lumley will agree to the EQC
payment of $4621.85 for the September EQC building claim. However if
information comes to light in the future that the September assessment and costings are incorrect and the EQC payment for September should be higher, then Lumley will not be liable to cover the difference between the new EQC figure, and the current EQC payment for September.
[63] Matthew Bushnell, the husband of the second-named plaintiff, gave the plaintiffs’ evidence in opposition. He explained the importance to the plaintiffs of having Lumley accept the EQC apportionment before the plaintiffs’ claim against EQC is discontinued. Mr Bushnell concluded his evidence:
We observed damage after the 4 September 2010 earthquake but are uncertain as to the extent of the damage and whether other building elements were damaged…[W]e are uncertain as to whether EQC has discharged its statutory liability … and whether Lumley is now the only party liable for the damage to the dwelling…
[64] In the event, Lumley did not unreservedly confirm its acceptance of the EQC
apportionment. The plaintiffs filed their amended statement of claim in February
2017.
Uncertainty remains
[65] The plaintiffs have established that they are in genuine doubt as to the persons against whom they may be entitled to relief. Lumley’s pleading (especially paragraphs 16–18, above at [12]), and Lumley’s correspondence of 27 February
2017 identified Lumley’s own doubt as to whether EQC’s apportionment between the September and February earthquakes was correct. Lumley’s pleading reserved Lumley’s right to contend for a different apportionment (by inference as Lumley proceeds through the discovery process and the briefing of any evidence).
[66] If this claim proceeds to trial on the present pleadings, the plaintiffs face the prospect that the evidence may establish that EQC apportioned too little damage and repair costs to the September earthquake, thereby leaving Lumley “not liable to cover the difference between the new EQC figure and the current EQC payment for September”, as asserted in the 27 February 2017 solicitor’s letter.
[67] In these circumstances, and having regard to the “as incurred” nature of the
Lumley policy provisions for repair costs, the plaintiffs’ seeking of declarations is
appropriate, including (importantly in relation to the plaintiffs’ area of doubt) a
declaration as to the apportionment of damage between the earthquakes.
Inadmissible evidence
[68] EQC had indicated through Ms Read that it did not intend to make submissions on this application. I nevertheless offered Ms Read the opportunity, at the conclusion of the submissions of Mr Wood and Mr Bayley, to address any matters which had arisen. I did so particularly because Mr Bayley had necessarily in the course of his submissions identified that Lumley was, if it chose to do so, in a position to clear the way for EQC to be removed as a party from the proceeding, by pleading an acceptance of the other parties’ apportionment figures.
[69] Ms Read addressed the Court briefly. Nothing in her submissions served to remove the continuing doubt as to liability which remains for the plaintiffs under r
4.3(4). At one point of her submissions, Ms Read noted that Lumley has not yet completed the evidence process and has no grounds (at present) to challenge the proceedings.
[70] Ms Read then advised me from the bar that there had been continuing discussions between counsel in which (she stated) “it has been made clear that Lumley will accept EQC’s assessment of the September claim”. As I understood her to then add, however, it is a requirement of Lumley that the plaintiffs execute a Deed of Assignment of any claims they may have against EQC. I indicated to Ms Read that those were matters of evidence on which I do not have admissible evidence. They therefore do not form part of the material I take into account in this judgment. Had such information come in, as admissible evidence, it might be suggested that it would heighten rather than lessen the existing doubt as to the identity of the liable party. It would seem a waste of time and resource for Lumley to prepare and have executed an assignment of claims against EQC if it considered there was no prospect of recovery from EQC.
[71] The Court is left to deal with Lumley’s position as it is pleaded, namely with a reservation of the right to argue at trial for an apportionment which differs from that adopted by EQC.
Conclusion on strike out application
[72] It would be an unusual case in which it was appropriate for the Court to strike out a plaintiff’s claim against one of the defendants pursued by a plaintiff who has established genuine doubt under the uncertainty rule. By the nature of the uncertainty rule, the plaintiff recognises at the outset (and the High Court Rules endorse) that the plaintiff may be joining a further defendant simply on a chance that evidence or Court judgment will determine that the further defendant had a degree of liability for the relief sought by the plaintiff. The threshold on a strike out application is unlikely to be met when the permitted joinder (under the uncertainty rule) flows, in a case when there is prima facie evidence that at least one defendant is liable, from the existence of a chance that the joint defendant might be liable.
[73] Here the plaintiffs have established their genuine doubt as to the persons against whom they are entitled to relief. Beyond that, the position taken and pleaded by Lumley indicates the reasonableness of the plaintiffs’ doubt and consequential joinder of EQC.
Second ground of application – unavailability of the relief sought
EQC’s ground of application
[74] As a further ground of its application for an order striking out the proceeding, EQC submits that the proceeding should be struck out because it would be inappropriate for the Court to grant any of the relief (declarations and enquiry) sought by the plaintiffs.
The plaintiffs’ reason for seeking declaratory relief
[75] As noted at [5] above, Lumley’s commitment where the insured chooses to
repair or rebuild their house is to pay costs actually incurred.
[76] The plaintiffs, having not incurred repair or rebuild costs to date, have no entitlement to sue for judgment for a specific sum. Thus, as Mr Bayley explained, they have sought as relief the declarations and enquiry set out at [13] above.
Discussion
[77] This aspect of EQC’s application fails for essentially the same reasons as the earlier ground of strike out. In an exercise of parallel reasoning, EQC submits that just as the statement of claim should be struck out for lack of a particularisation of liability on the part of EQC, it should also be struck out because the three primary forms of relief sought could not be granted by reason of the plaintiffs’ failure to plead and particularise material facts.
[78] The second form of declaration sought by the plaintiffs (a declaration as to the apportionment of damage to the house across the events in the Canterbury earthquake sequence) is, in the circumstances of the plaintiffs’ doubt as to who is liable, an eminently justifiable request. Neither the plaintiffs nor EQC know at this point whether Lumley will contend that the Court should apportion to the September
2010 earthquake more damage than assessed by EQC. The time will come, by the close of pleadings, that Lumley, if its evidence supports a different apportionment to EQC’s, will be required to plead its allegation of apportionment. Until that point is reached, the plaintiffs’ present proposed wording of that declaration is apt.
[79] By reason of the plaintiffs’ entitlement to invoke and plead the uncertainty rule (as discussed above) and by reason of the adequacy of the plaintiffs’ pleading (which I come to below), it is not possible to conclude that any of the primary relief sought by the plaintiffs will be found at trial to be unavailable. To the extent the strike out application is based on the unavailability of any of the relief sought, it also fails.
Application for an order requiring a more explicit pleading
The application for answers to three questions
[80] EQC seeks an order that the plaintiffs file a more explicit pleading by answering three questions:
(a) What physical loss or damage do the plaintiffs allege occurred to their house as the direct result of the earthquake of 4 September 2010,
including the particular building elements that the plaintiffs allege were damaged and the nature and extent of that alleged damage?
(b)What repair strategy do the plaintiffs allege is necessary to repair the physical loss or damage to their house, particularised in their answer to the first question, to the standard required under the Earthquake Commission Act?
(c) What is the alleged (and itemised) cost of carrying out the repair strategy particularised in the answer to the second question?
The plaintiffs’ particulars
[81] Following the EQC application, the plaintiffs filed their further particulars (above at [17]) with direct reference to the three questions posed in the EQC application.
Submissions
[82] For EQC, Mr Wood set out in his synopsis a summary of the general principles governing pleadings and particulars:
16Pleadings have their purpose: they supply an outline of the case advanced, sufficient to enable a reasonable degree of pre-trial briefing and preparation. Particulars inform a defendant of the case it has to meet and limit the scope of matters that may be put in issue at trial (or in pre-trial settlement discussion).
17The statement of claim must (among other things) show the general nature of the plaintiff’s claim to the relief sought and give sufficient particulars of time, amounts and other circumstances to inform the Court and the parties against whom relief is sought of the plaintiff’s cause of action. A cause of action is every fact necessary for the plaintiff to prove, if traversed, to support the plaintiff’s right to judgment. Distinct causes of action founded on separate and distinct facts must if possible be stated separately and clearly. A statement of claim seeking recovery of a sum of money must state the amount as precisely as possible.
(footnotes omitted).
[83] Mr Wood then turned to the plaintiffs’ particulars, beginning with the answers
to EQC’s first question concerning the damage resulting from the September 2010
earthquake. The plaintiffs’ answer (above at [17]) identified what they had “observed” following the September 2010 earthquake (cracking in ceiling and wall gib-board and foundation cracks). The plaintiffs expressly recorded that they were not giving further particulars as to the extent of damage because they had not undertaken measurements prior to the next earthquake event and had not inspected the underfloor areas (including the piles) prior to the next event.
[84] Mr Wood submitted that the plaintiffs’ response was not “particulars” at all, being a statement of evidence (what the plaintiffs observed) rather than “fair notice of the claim being advanced”.
[85] Mr Wood also criticised the plaintiffs’ answers to the second question, which required the plaintiffs to identify the repair strategy necessary to repair the damage as a result of the September 2010 earthquake. The plaintiffs had declined to answer the second question because of the uncertainty they had noted. Mr Wood submitted that the plaintiffs still had to particularise the damage caused and repairs required as a result of a particular event. Mr Wood noted that the plaintiffs’ uncertainty under r
4.3(4) must be as to who is liable and not whether anybody is liable. Mr Wood invited the Court to reject the suggestion contained in the plaintiffs’ answer to question 2 that it was for the defendants to resolve the repair strategy between themselves.
[86] For the plaintiffs, Mr Bayley submitted that the extent of particulars sought by EQC (including pleadings on the repair work required and the cost to repair per event) went beyond what is required to inform EQC and Lumley of the case they have to meet. The plaintiffs’ case is that all of the damage suffered in the September
2010 and February 2011 earthquakes is to be met by one or both the defendants (and, if both, in an appropriately apportioned manner). It is not the plaintiffs’ case that EQC is liable. The plaintiffs frankly concede that they do not know if EQC is liable. Lumley’s pleading also raises EQC’s liability as possible. The plaintiffs have pleaded their position and have recorded that they are invoking the uncertainty rule. They do not put forward positively a need for a repair strategy for each earthquake other than that which EQC had adopted. The plaintiffs invoking of the uncertainty rule and their joinder of EQC nevertheless recognises that Lumley’s position and
subsequent pleadings give rise to the possibility that another view of the causation of damage and of the appropriate repair strategy may be put forward and could conceivably be accepted by the Court.
Discussion
[87] The Court’s consideration of this aspect of EQC’s application takes place
against two backgrounds.
[88] First, there are settled principles regarding the particulars of pleadings. A convenient summary of principles applied by the Court is to be found in McGechan on Procedure where the discussion includes this commentary, which I adopt:30
In Platt v Porirua City Council31 the Court noted that particulars of pleadings are important to:
(a) inform a defendant as to the case it has to meet;
(b) limit the scope of matters the plaintiff may put in issue at trial (or in pre-trial settlement discussion);
(c) enable a defendant to know what witnesses it will need to retain and enable it to start preparing evidence ahead of the formal exchange of evidence; and
(d) provide an opportunity for a defendant to seek summary determination on the basis that the claim as pleaded is untenable.
…
The temptation to insist upon excessively refined pleadings is to be resisted as unnecessary and wasteful of costs and court time. That is particularly so in complex cases, where over-pleading can obscure rather than clarify the issues: BNZ Investments Ltd v Commissioner of Inland Revenue.32 Pleading is not an area for mechanical approaches or pedantry: Price Waterhouse v Fortex Group.33
In Malley & Co v Burgess,34 the Court emphasised that even if it finds a pleading to be defective, it may decline to make an order if not doing so is more consistent with the objectives of the Rules. Three questions the Court could usefully ask were outlined in Body Corporate 74246 v QBE Insurance (International) Ltd:35
30 McGechan on Procedure (online looseleaf ed, Thomson Reuters) at [HR 5.21.01].
31 Platt v Porirua City Council [2012] NZHC 2445 at [19].
32 BNZ Investments Ltd v Commissioner of Inland Revenue (2008) 23 NZTC 21,821 at [45].
33 Price Waterhouse v Fortex Group CA179/98, 30 November 1998 at 19.
34 Malley & Co v Burgess [2015] NZHC 841 at [25].
35 Body Corporate 74246 v QBE Insurance (International) Ltd [2015] NZHC 1360 at [18(h)].
•Has sufficient information been provided to inform the other party of the case they have to meet and to enable them to take steps to respond?
•Is there a real risk that the other party may face a trial by ambush if further particulars are not provided?
•Is the request oppressive or an unreasonable burden upon the party concerned?
[89] The second background against which I consider EQC’s application is the bi- fold nature of insurance cover for earthquake damage. Since the events of the Canterbury earthquake sequence and in the course of the case management of proceedings in the Earthquake List, this Court has on numerous occasions come across developments parallel to that confronting the plaintiffs in this case. After some years of apparent uncertainty as to an appropriate apportionment of damage on the part of EQC and/or the private insurer, EQC has reached a determination which would be acceptable to the houseowner, has paid out and sought a discontinuance of the claim against EQC. At that point, the houseowner (as did the plaintiffs here) may seek confirmation from the private insurer that EQC’s apportionment is accepted. If it is not, the plaintiff is entitled to invoke the uncertainty rule by joining EQC. The possibility of an apportionment other than determined by EQC exists but is not the outcome which the plaintiff wishes to pursue. The plaintiff accordingly pleads (as here) the uncertainty and identifies the matter to which the uncertainty relates.
[90] In the context of such litigation, I am satisfied that the pleadings have fully informed the defendants of the case they need to meet as between plaintiffs and defendants. If and when Lumley chooses to affirmatively plead a particular apportionment which differs from that determined by EQC, then at that point both EQC and the plaintiffs will become informed as to any different case which has to be met in relation to apportionment.
[91] There is a complexity to litigation in the Earthquake List. The complexity is reflected in the fact that there are often as many as four layers of expert evidence including professionals with geotechnical, surveying, structural engineering and quantity surveying expertise. There is not a real risk in this case that either defendant will face a trial by ambush conducted on the part of the plaintiffs. On the contrary, the plaintiffs, by pleading the uncertainty rule, set in motion a process by
which there can be assurance that EQC and the plaintiffs will not face a trial by ambush through a poorly-signalled apportionment argument on the part of Lumley. The pleading of the uncertainty rule, with joinder of multiple defendants, encourages the parties to move through discovery and the obtaining of expert evidence so as to inform the parties of the matters which will determine who is liable.
[92] I am satisfied that this application for particulars to be provided by the plaintiffs is oppressive and that pleading of the nature sought would be an unreasonable burden. The plaintiffs have clearly signalled their position. It is readily capable of understanding by all involved.
Outcome – the three questions
[93] EQC has not made out a case for ordering the plaintiffs to file a more explicit pleading in relation to any of EQC’s three questions ([80] above).
Costs
[94] EQC’s applications have failed. It follows that EQC should pay the plaintiffs the costs and disbursements associated with the application, and I will so order.
[95] Although I have found it appropriate in this judgment (by reason of the modest amount of authority on the uncertainty rule) to examine the uncertainty rule in some detail, the outcome of these interlocutory applications flowed inevitably from the plaintiffs’ proper invoking of the uncertainty rule. Given Lumley’s pleaded position, the plaintiffs’ invoking of the uncertainty rule was entirely justified and the sensible course. The plaintiffs may take the view, in relation to costs, that EQC has embarked on a pursuit of “excessively refined pleadings” of a kind frowned upon in the cases referred to in the McGechan on Procedure commentary which I have cited (above at [88]). It may be open to the plaintiffs to seek increased costs under r
14.6(3)(b) High Court Rules. In these circumstances, I will be reserving the amount of costs payable by EQC to the plaintiffs. In the event that those parties cannot reach agreement on the amount of costs, the Court will resolve the amount of costs on the papers, with the plaintiffs’ memorandum (four page limit) to be filed first and the first defendant’s memorandum to be filed within three working days thereafter.
[96] Although Lumley did not formally support the application, it signalled its support and had counsel appear for the hearing. When Ms Read was offered the opportunity to make submissions, her submissions were in support of the application. In the circumstances, I will be reserving issues of costs and disbursements as between the plaintiffs and Lumley. I note that any issue in that regard may be academic as between the plaintiffs and EQC, given EQC’s ability to meet the costs and disbursements order which will now be made.
Orders
[97] I order:
(a) The first defendant’s interlocutory applications dated 28 February
2017 are dismissed;
(b)The first defendant is to pay to the plaintiffs the costs of the interlocutory applications together with disbursements to be fixed by the Registrar, but with the amount of costs reserved;
(c) Costs and disbursements as between the plaintiffs and the second defendant are reserved;
(d)The first defendant is to file its defence to the first amended statement of claim within 10 working days;
(e) The proceeding is adjourned to a case management conference at 2.15 pm, 12 July 2017 (Associate Judge Osborne), with counsel to file a
joint memorandum as to a proposed timetable by 5 July 2017.
Solicitors:
Rhodes & Co, Christchurch
Chapman Tripp, Wellington
Young Hunter, Christchurch
Associate Judge Osborne
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