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Ross v Southern Response Earthquake Services Ltd

Ross v Southern Response Earthquake Services Ltd

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Case Copied 23 February 2021 70 min read

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IN THE HIGH COURT OF NEW ZEALAND CHRISTCHURCH REGISTRY

I TE KŌTI MATUA O AOTEAROA ŌTAUTAHI ROHE

CIV-2018-409-000361

[2021] NZHC 2451

BETWEEN
BRENDAN MILES ROSS and COLLEEN ANNE ROSS

Plaintiffs

AND

SOUTHERN RESPONSE EARTHQUAKE SERVICES LIMITED

Defendant

Hearing: 15 February 2021

Appearances:

P G Skelton QC and C B Pearce for Plaintiffs (Respondents) T C Weston QC, K M Paterson and E D Peers for Defendant (Applicant)

Judgment:

23 February 2021

Reasons:

20 September 2021

JUDGMENT OF OSBORNE J

(on defendant’s communications) [Reasons]

This judgment was delivered by me on 20 September 2021 at 4.00 pm pursuant to Rule 11.5 of the High Court Rules

Registrar/Deputy Registrar Date:

ROSS v SOUTHERN RESPONSE EARTHQUAKE SERVICES LIMITED [2021] NZHC 2451 [23 February 2021]

TABLE OF CONTENTS

Introduction [1]

Mr and Mrs Ross’s substantive claim [5]

The litigation to date [6]

Progress of other litigation and claims [11]

Southern Response’s application for directions [16]

The opposition of Mr and Mrs Ross [19]

Southern Response’s intended approach [20]

Development of the Package through the Dodds litigation [20]

Package principles [25]

The Rosses’ opposition to Southern Response’s communication with policyholders [30]

Submissions for Southern Response [34]

Introduction [34]

Entitlement to deal directly with those separately represented or self-represented [37] Relationship between the plaintiffs, the plaintiffs’ lawyers and the class members [41] Communication as affected by r 10.4 of the Conduct and Client Care Rules  [44] Analogy between “certification” and leave under r 4.24?  [49]
The Australian regimes  [55]
Rule 13.2 of the Conduct and Client Care Rules  [57]
Southern Response’s ability to offer individual settlements  [61]
Australia  [63]
Canada  [67]
United States  [70]
Does Southern Response require Court approval of the Package?  [79]
Approval of the substance of the Package?  [82]
The best interests of class members  [83]

Submissions for Mr and Mrs Ross [84]

Introduction [84]

The concerns of Mr and Mrs Ross as to the Package [87]

The litigation to date [88]

Purpose of the supervisory jurisdiction [93]

Is Southern Response settling the representative proceeding? [98]

An analogy with North American certification? [100]

An analogy with the North American “class counsel” [108]

Ethical standards for Southern Response’s lawyers  [111]
The Rosses disavow any monopoly rights  [121]
Mr Skelton’s problem 1: Evading the Court’s supervision  [122]
Mr Skelton’s problem 2: Prejudice to class members  [131]
Mr Skelton’s problem 3: Unfairness between class members  [138]
Concluding submissions  [143]

Analysis  [144]
The Court’s supervisory jurisdiction in representative proceedings  [144] A defendant’s communications with class members — the competing positions  [148] Ethical obligations of Southern Response’s legal advisors  [150] The Court’s supervisory jurisdiction — applied to the defendant and its lawyers [160] Comparative law summarised  [169]
The appropriateness of supervisory intervention in this case  [172]

Introduction

[1] In this proceeding Brendan and Colleen Ross,1 bring (by leave under r 4.24 High Court Rules 2016) a representative claim against Southern Response Earthquake Services Ltd (Southern Response).2 An issue arose as to communications which Southern Response proposed to initiate with individual potential members of the class represented by the…

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: [2021] NZHC 2451
Decision Date: 23 February 2021

CaseChat Overview and Summary

In Ross v Southern Response Earthquake Services Ltd, the High Court of New Zealand was asked to decide whether Southern Response Earthquake Services Ltd (Southern Response) could directly communicate with individual potential class members in relation to a settlement offer, without the involvement of the plaintiffs, Mr and Mrs Ross. The Rosses brought a representative claim against Southern Response, alleging that they had settled their insurance claim for earthquake damage on a less favourable basis due to incomplete or misrepresented information provided by Southern Response. The case was brought on an opt-out basis. Southern Response sought directions to allow it to communicate directly with individual potential class members about a settlement offer, known as the Package. The Rosses opposed the application, arguing that Southern Response's direct communications would circumvent the Court's supervisory role, risk unfairness to individual class members, and create inequity between different groups of class members. The Court found that Southern Response was not entitled to communicate directly with individual potential class members, as the timing of the proposed communications coincided with the Rosses' application for notification orders. The Court held that the potential for confusion and misunderstanding among class members warranted its supervisory intervention. The directions sought by Southern Response were refused.

Orders