STEVEN JOHN FINLAY AND SUSAN JEAN BEAUMONT FINLAY s AND FLOORMAN LIMITED BRETT IRVING KAPITI FLOORWORKS LIMITED Party HAZMAT WELLINGTON LIMITED Party
[2024] NZHC 3487
•20 November 2024
IN THE HIGH COURT OF NEW ZEALAND WELLINGTON REGISTRY
I TE KŌTI MATUA O AOTEAROA TE WHANGANUI-A-TARA ROHE
CIV-2023-485-368
[2024] NZHC 3487
BETWEEN STEVEN JOHN FINLAY AND SUSAN JEAN BEAUMONT FINLAY
Plaintiffs
AND
FLOORMAN LIMITED
First Defendant
BRETT IRVING
Second DefendantKAPITI FLOORWORKS LIMITED
First Third PartyHAZMAT WELLINGTON LIMITED
Second Third Party
Hearing: On the Papers Counsel:
F E Geiringer for Plaintiffs
H E Cameron for First Defendant
M R G van Alphen Fyfe for Second Defendant and First Third Party
T J Kim for Second Third PartyJudgment:
20 November 2024
JUDGMENT OF McQUEEN J
[Confidentiality orders]
[1] In this proceeding, the plaintiffs claim damages for breach of contract and negligence following the installation of new flooring at their house, as a result of which it is said that the house became contaminated with asbestos. The damages sought include damages for emotional harm.
FINLAY AND FINLAY v FLOORMAN LIMITED [2024] NZHC 3487 [20 November 2024]
[2] The proceeding is set down for a judicial settlement conference (JSC) in February 2025. Timetable directions have been made to provide for the filing of “will say” statements for use in the JSC.
[3]The plaintiffs seek orders that:
(a)when filing their evidence for the JSC the plaintiffs are to provide defendants’ counsel with redacted and unredacted versions of that evidence with redactions made only to passages that relate to the mental health symptoms and treatment experienced by the plaintiffs or the plaintiffs’ daughters;
(b)the defendants’ counsel may only share the unredacted versions with other legal representatives for the defendants and instructed mental health experts; and
(c)leave is granted for any party to challenge any such redaction on the basis that the material marked as confidential does not relate to the mental health symptoms and treatment experienced by the plaintiffs or the plaintiffs’ daughters.
[4] The defendants and third parties oppose the orders sought. As directed, counsel have filed memoranda on the issue which is now to be determined on the papers by consent. Although the orders sought refer only to the defendants and not the third parties, I understand that the orders are in fact sought in relation to both the defendants and the third parties (and this is confirmed by the opposition indicated from both the defendants and the third parties). I proceed on that basis.
The plaintiffs’ position
[5] The plaintiffs say that the defendants’ negligence and/or breach of contact has caused them emotional harm by:
(a)leading to the loss of irreplaceable possessions of deep personal significance;
(b)depriving them of their residence for 532 days;
(c)exposing them to asbestos dust and putting their physical health in jeopardy;
(d)making them witness the similar suffering caused to their daughters;
(e)placing their finances in jeopardy; and
(f)damaging their relationship with one another.
[6] The plaintiffs say that this emotional harm has left them with ongoing psychological symptoms.
[7] Counsel for the plaintiffs, Mr Geiringer, emphasises that the plaintiffs do not seek to redact any description of the facts of the case that are said to have caused the mental health symptoms experienced by them or their daughters. Rather, they seek to redact passages in their “will say” statements that recount the symptoms they have experienced from the emotional harm they say they have suffered and the treatment they have received as a consequence. Mr Geiringer says the plaintiffs are distressed by the prospect of revealing deeply personal mental health information.
[8] Mr Geiringer submits that, while it will always turn on the specific information in question, the legal system acknowledges that mental health information can be private information of the highest order and that merely revealing mental health information can itself be the cause of emotional harm.1
[9] Mr Geiringer submits that the plaintiffs live in a small community, and they are already aware that information set out in court documents has become known in the community. It is not alleged that the other parties have done anything improper in this regard, rather it is accepted that they will likely discuss the case with family and
1 Gulati v MGN Ltd [2015] EWHC 1482 (Ch); and upheld on appeal Gulati v MGN Ltd
[2015] EWCA Civ 1291.
friends. Mr Geiringer emphasises that this “is all it takes for information of this nature to be spread in a way that causes damage to the plaintiffs”.
[10] Mr Geiringer submits that no prejudice is caused to the other parties by the orders sought, as the facts sought to be redacted cannot be within the knowledge of any of the parties (so they would not be able to respond to such facts in their own “will say” statements) and the other parties’ lawyers are able to share the unredacted evidence with any experts instructed.
[11] If the orders sought are not made, the plaintiffs say that they will not divulge information about their symptoms and treatment in their “will say” statements for the JSC. Mr Geiringer submits the orders sought are therefore in the interests of justice as the plaintiffs will be able to outline the whole of their case and this will permit the other parties’ lawyers to assess the evidence, consider obtaining expert evidence in relation to it and advise their clients on the relevance of the evidence to questions of causation and damage, should the matter come to trial. He says further that there is no unfairness as the matter is only at the JSC stage and there is no reliance on the redacted evidence for a judicial decision.
The position of defendants and third parties
[12] The defendants and the third parties take a common position in opposition to the application for confidentiality orders. They submit the orders are: 2
(a)unnecessary, given the ordinary obligations imposed on parties regarding documents disclosed in a proceeding and not yet read in open court;
(b)likely to prejudice the defendants and the third parties because the claim is against them, and decisions in relation to the claim (including receiving legal advice, giving instructions and potential settlement at the JSC) should be made by them with full information; and
2 In support, counsel refer to Aivita Healthy New Zealand Ltd v Unipharm Healthy Manufacturing Co Ltd [2021] NZHC 1401; Mobil Oil New Zealand Ltd v Ellison (1999) 13 PRNZ 177; and Port Nelson Ltd v Commerce Commission (1994) 7 PRNZ 344.
(c)not in the interests of justice as it is within the plaintiffs’ control as to whether they present their whole case without such orders, especially where the evidence in question will need to be given at trial and so settlement at the JSC is likely to be impeded while postponing inevitable disclosure.
Discussion
[13] I start by observing that the effect of r 7.79 of the High Court Rules 2016 (the Rules) and s 57(1) and (2) of the Evidence Act 2006 is that any statement made during a JSC may not be disclosed in court or otherwise. Thus, any “will say” statements provided by the plaintiffs will be protected both by the rules of court and the privilege attached to confidential settlement discussions under the Evidence Act (subject only to limited exceptions).
[14] I accept that the plaintiffs are concerned this is not adequate protection for the highly personal information they anticipate disclosing. However, it is well-recognised that parties are generally entitled to be fully informed of the nature of the case against them. In Aivita Healthy New Zealand Ltd v Unipharm Healthy Manufacturing Co Ltd,
Associate Judge Bell stated:3
[32] I accept Aivita's submission that Sabrina must be able to receive the valuer's report so that its professional advisers can advise her properly and she can give them informed instructions. The text Disclosure states:4
In modern times however, it is rare that the claimant himself (or, where the claimant is a corporate body, a named officer) is excluded from knowledge, because decisions whether to continue or abandon the action, for example, should be made by the claimant, and not by his advisers.
[15] There are exceptions to this usual position of disclosure. The learned authors of the Disclosure text explain:5
The court’s discretion to order inspection is not exercisable merely in an “all or nothing” fashion, but includes power to order such inspection subject to
3 Aivita Healthy New Zealand Ltd v Unipharm Healthy Manufacturing Co Ltd, above n 2.
4 Paul Matthews and Hodge M Malek Disclosure (5th ed, Sweet and Maxwell, London, 2017) at 15.28.
5 Paul Matthews and Hodge M Malek Disclosure (6th ed, Sweet and Maxwell, London, 2024) at
15.26 (footnotes omitted).
conditions or restrictions. These might include specific undertakings to be given in relation to the documents produced, or restrictions on where any copy documents may be kept or read, on who in the other party’s camp may inspect them, and on the making of further copies or extracts. The court will not order such additional protection lightly, but only where the risk of damage or loss to the producing party (or, exceptionally, to others) is so significant that some additional restriction on the usual position can be justified. Such cases are usually cases of trade secrets which, if disclosed at all, may be irretrievably lost and they usually arise in intellectual property litigation.
[16] In deciding whether there is a need to depart from the usual position, the learned authors of Disclosure go on to state:6
The question is always how to strike a balance between the need for a party to participate meaningfully in the proceedings (including the trial) and the need to protect another party’s confidential information.
[17] In Aivita Healthy New Zealand Ltd, the Associate Judge outlined undertakings that would adequately keep Unipharm’s interest in the confidentiality of its information protected against unauthorised disclosure.7 On the basis that such undertakings were given, the Associate Judge granted the discovery application in that case. The parties in that case had considered conditions for the provision of documents but could not reach agreement, therefore seeking the Court’s assistance. In the present case, although consent to the confidentiality orders was sought by the plaintiffs from the other parties, it is not apparent to the Court that any conditions were proposed or considered.
[18] These discussions relate to the provision of documents subject to discovery obligations, but the principles are apposite, and counsel did not support their submissions with reference to any caselaw that relates specifically to the redaction of evidence as proposed here.
[19] The plaintiffs rely on Gulati v MGN Ltd to argue that the order is necessary to protect their privacy; they submit that merely revealing health information of this kind can itself be the cause of emotional harm.8 However, I do not find Gulati to be of much assistance in the question before me. There, where the Court was discussing the level
6 Matthews and Malek Disclosure (6th ed), above n 5, at 15.29 (footnote omitted).
7 At [33].
8 Gulati v MGN Ltd, above n 1.
of compensation to grant for privacy claims, it considered that medical information is more likely to be high in the ranks of information which is expected to be private, so its interception and disclosure is likely to attract a higher, rather than a lower, figure.
[20] I do not accept the plaintiffs’ argument that there is no prejudice to the defendants and third parties by the proposed redactions to the “will say” statements. Without the evidence sought to be withheld, they are being asked to make decisions on how to respond to the claim (including its possible settlement) with incomplete information. It is not apparent to me that their legal advisers or expert advisers will necessarily be able to advise on the impact of the redacted information in a way that adequately assists the parties. If the plaintiffs are not prepared to provide certain evidence without the confidentiality orders sought, it remains the position that they can still advance their claim at the JSC (and Mr Geiringer has noted their intention to do so). It does seem to me that at the JSC, the plaintiffs and their counsel are likely in any event to be able to convey, in a high-level and careful manner, the nature of the mental health symptoms and treatment experienced by them and their daughters.
[21] Mr Geiringer also acknowledges the proposed redacted material would need to be provided in evidence at any trial. This is consistent with the right to a public trial which carries with it certain risks, amounting in many cases to the near certainty that documents, by being produced and read in the course of a trial, will become public property and public knowledge.9 It is unnecessary at this stage to speculate about what evidence may be brought at trial about the plaintiffs’ mental health symptoms and treatment, and whether any orders to protect the plaintiffs’ privacy, such as through suppression of publication in evidence, will be sought or granted.10
[22] Accordingly, I conclude that the interests of justice favour dismissing the plaintiffs’ application.
[23] I nonetheless consider it appropriate in the circumstances to direct the defendants and third parties to provide undertakings confirming that they understand the legal obligation not to disclose any statement made for or during a JSC.
9 Mobil Oil New Zealand Ltd v Ellison, above n 2, at 179.
10 See discussion in Peters v Birnie HC Auckland CIV-2009-404-8119, 19 March 2010.
[24] I have reached this view despite being confident that counsel for the defendants and third parties will have explained to their clients the obligations that arise in relation to use of material provided in a proceeding, and especially a JSC, and, as acknowledged by Mr Geiringer, recognising there is no suggestion that any of the defendants or third parties have made any improper use of material provided in the proceeding.
[25] Such express undertakings may provide reassurance to the plaintiffs such that they decide to include material relating to their mental health symptoms and treatment in their “will say” statements that they otherwise might not include—and this may be to the benefit of all parties at the JSC.
Result
[26]The plaintiffs’ application for confidentiality orders is dismissed.
[27] I direct each of the defendants and the third parties to file and serve within five working days an undertaking that they understand that any statement made for or during a JSC may not be disclosed in Court or otherwise, pursuant to r 7.79(6) and (7) of the Rules.
Costs
[28] Costs are sought by the defendants and third parties on the application.11 Costs should follow the event, and in the case of an interlocutory application, are usually to be fixed and payable when the application is determined.12 I encourage the parties to agree costs.
[29] If such agreement cannot be reached, the defendants and third parties may each file a brief memorandum within five working days of the date of this judgment with
11 The second third party specifies that they seek costs on a 2B scale basis for item 24 of sch 3 of the High Court Rules 2016.
12 High Court Rules 2016, rr 14.2(1)(a) and 14.8.
any response from the plaintiffs within a further five working days. Costs will then be determined on the papers.
McQueen J
Solicitors:
BMC Lawyers, Paraparaumu for Plaintiffs
Cameron Lawyers, Wellington for First Defendant
Duncan Cotterill, Auckland for Second Defendant and Second Third Party
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