Robin v IAG New Zealand Ltd - [2018] NZHC 1464

IN THE HIGH COURT OF NEW ZEALAND CHRISTCHURCH REGISTRY

I TE KŌTI MATUA O AOTEAROA ŌTAUTAHI ROHE

CIV-2016-409-001182

[2018] NZHC 1464

BETWEEN
SUZANNE ROBIN

Plaintiff

AND

IAG NEW ZEALAND LIMITED

First Defendant

CANTERBURY RECONSTRUCTION

LIMITED (now in liquidation) Second Defendant

ORANGE H MANAGEMENT LIMITED (FORMERLY HAWKINS MANAGEMENT LIMITED)

First Third Party

ORANGE H GROUP LIMITED (FORMERLY HAWKINS GROUP LIMITED)

Second Third Party

Hearing: 23 May 2018

Appearances:

KJM Robinson and N R Musesengwa-Gwaze for Plaintiff N S Gedye QC and E A Boshier for First Defendant

No Appearance for Second Defendant, First Third Party or Second Third Party

Judgment:

19 June 2018

JUDGMENT OF GENDALL J

[1] On 21 February 2018, Associate Judge Matthews dismissed an application by the first defendant, IAG New Zealand Ltd (IAG), to add four parties as defendants to

ROBIN v IAG NEW ZEALAND LIMITED [2018] NZHC 1464 [19 June 2018]

this proceeding under r 4.56 High Court Rules 2016.1 IAG has applied to have this decision reviewed under r 2.3.

Background facts

[2] The plaintiff (Ms Robin), purchased a residential property at 214 Fitzgerald Avenue, Christchurch (the house), in December 2014. The previous owners, Creole Investments Ltd (Creole), owned the property at the time of the Christchurch earthquakes in late 2010 and early 2011. Creole had an insurance policy with (IAG). Creole assigned its rights under that policy to Ms Robin when she purchased the property.

[3] After the earthquakes, Creole made a claim under the policy. Creole elected to repair the house, thus obligating IAG to pay “the cost of restoring it to a condition as nearly as possible equal to its condition when new”. IAG appointed Hawkins Management Ltd (Hawkins) as it then was to act on its behalf in assessing the scope of works required to effect repairs and to monitor the repair work undertaken. Hawkins appointed the second defendant, Canterbury Reconstruction Ltd (CRL), to carry out repairs to the house. Creole and CRL signed a contract to govern the repairs to the property.

[4] Ms Robin argues that the repairs to the house have not been carried out to the standard required by the IAG policy. She seeks an order that IAG specifically perform its duties pursuant to the policy by paying the costs to remediate the defective repairs, or, alternatively, pay damages in the amount required to repair the house to a good standard of workmanship with all earthquake damage properly repaired.

[5] Ms Robin also sues CRL (being the party appointed by Hawkins to carry out and manage the house repairs) in the tort of negligence, contending that CRL breached the duty of care it owed to her to ensure that those repairs were carried out to a good standard of workmanship with all earthquake damage properly repaired.

1 Robin v IAG New Zealand Ltd [2018] NZHC 204.

[6] IAG joined Hawkins, now known as Orange H Management Ltd (OHML), as first third party, pleading that, if Ms Robin’s contentions are established, OHML failed in certain duties to…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

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Details

Case: [2018] NZHC 1464
Decision Date: 19 June 2018

CaseChat Overview and Summary

Suzanne Robin purchased a residential property in Christchurch in December 2014. The previous owners, Creole Investments Ltd, had owned the property at the time of the Christchurch earthquakes in late 2010 and early 2011. Creole had an insurance policy with IAG New Zealand Ltd (IAG). Creole assigned its rights under that policy to Ms Robin when she purchased the property. Creole made a claim under the policy. Creole elected to repair the house, thus obligating IAG to pay “the cost of restoring it to a condition as nearly as possible equal to its condition when new”. IAG appointed Hawkins Management Ltd (Hawkins) to assess the scope of works required to effect repairs and to monitor the repair work undertaken. Hawkins appointed Canterbury Reconstruction Ltd (CRL) to carry out repairs to the house. Ms Robin argues that the repairs to the house have not been carried out to the standard required by the IAG policy. She seeks an order that IAG specifically perform its duties pursuant to the policy by paying the costs to remediate the defective repairs, or, alternatively, pay damages in the amount required to repair the house to a good standard of workmanship with all earthquake damage properly repaired. Ms Robin also sues CRL in the tort of negligence, contending that CRL breached the duty of care it owed to her to ensure that those repairs were carried out to a good standard of workmanship with all earthquake damage properly repaired. IAG joined Hawkins, now known as Orange H Management Ltd (OHML), as first third party, pleading that, if Ms Robin’s contentions are established, OHML failed in certain duties to IAG under the written contract that existed between them. IAG also joined Orange H Group Ltd (OHGL), formerly Hawkins Group Ltd, as second third party in respect of certain duties OHGL owes under that contract. IAG applied for an order that, four new parties be added to this proceeding as defendants. The first party was OHML. The second and third parties carried out work on the house under subcontracts with CRL. One of these is Houselifters Ltd (Houselifters) which carried out the foundation work. The other is Max Contracts Ltd (Max) which carried out other building work. The last of the four parties is the Christchurch City Council (the Council). It issued a code compliance certificate certifying that work on the house complied with the relevant building consent. Ms Robin opposed this application. She argued that the presence of the parties remaining, Houselifters, Max and the Council (the proposed defendants) as defendants is not necessary to adjudicate upon or settle any of the questions raised in her case. Associate Judge Matthews dismissed IAG’s application. IAG has applied for a review of that decision. The court found that the Associate Judge erred in making findings on the merits of Ms Robin’s claim, which he then used to determine the application. He needed only to assume that her case was provable. The Associate Judge also erred by taking an irrelevant factor into his consideration of the question whether the proposed defendants should be joined. The Associate Judge wrongly assumed that joinder of the proposed defendants as third parties by CRL would resolve the issues in the application. It was not in the interests of justice for Ms Robin to claim against the building contractors, who actually did the work, and the Council. The impossibility of the proposed defendants being joined by CRL, however, is a material change in circumstances here. The Associate Judge’s decision, therefore, does not ensure justice by having all relevant parties before the Court. With respect, it must, therefore, be seen as plainly wrong. The decision to refuse IAG’s application to join the proposed defendants as further defendants was plainly wrong in light of the likely impossibility of them being joined by other means. The present application, therefore, succeeds. Houselifters Ltd, Max Contracts Ltd and the Christchurch City Council be joined as defendants.

Orders