Walcroft v P3 Research Limited
[2025] NZHC 2251
•11 August 2025
IN THE HIGH COURT OF NEW ZEALAND
WELLINGTON REGISTRY
I TE KŌTI MATUA O AOTEAROA TE WHANGANUI-A-TARA ROHE
CIV-2025-485-209
[2025] NZHC 2251
UNDER the Declaratory Judgments Act 1908 BETWEEN
JILLIAN LEE WALCROFT
Plaintiff
PETER GEOFFREY WOODS
Second PlaintiffAND
P3 RESEARCH LIMITED
First DefendantMERCK SHARP & DOHME (NEW ZEALAND) LIMITED
Second Defendant
Hearing: 7 August 2025 Counsel:
P W Michalik and G Phipps for First Plaintiff S Baigent for Second Plaintiff
A H Waalkens KC and M K Henaghan for Second Defendant (via VMR)
P J Gunn for Attorney-General and Accident Compensation CorporationJudgment:
11 August 2025
REASONS JUDGMENT OF McQUEEN J
[1] The plaintiff, Ms Walcoft, seeks declaratory relief in relation to the ability for participants in commercial clinical trials who suffer personal injury or death as a result of their participation in such trials to sue for damages. Ms Walcoft is the widower of Mr Adrian Walcroft. Mr Walcroft had been suffering from melanoma. After successful surgery he took part in the clinical trial of an experimental combination drug treatment
WALCROFT v P3 RESEARCH LIMITED [2025] NZHC 2251 [11 August 2025]
offered by the defendants. He died from myocarditis shortly after receiving his fifth dose.
[2] With the consent of the defendants, I made the declarations sought in this proceeding in an oral results decision at the hearing of this matter on 7 August 2025.1 In that decision I also directed a timetable for the determination of costs and said that I would issue a judgment with my reasons. This is that judgment.
Background
The claim and defence
[3]The proceeding was commenced in April 2025.
[4] The statement of claim initially included a second plaintiff, Mr Woods, whose claim was recently discontinued with no issue as to costs. The second defendant (MSD) filed a statement of defence. The first defendant (P3) filed a notice of appearance in the proceeding, indicating it would abide the decision of the Court in relation to the claims by Ms Walcroft and Mr Woods, and that MSD would assume the conduct of the defendants’ defence under contractual indemnity.
[5] Significant factual matters are not in dispute between Ms Walcroft and MSD. This includes that MSD was conducting a world-wide clinical trial known as the “KeyVibe-010 trial”, the purpose of which was to compare the efficacy in preventing the recurrence of melanoma between Pembrolizumab (marketed as Keytruda) and Pembrolizumab in combination with MSD’s new drug MK 7684A (Vibostolimab). P3 ran one of the KeyVibe-010 trial sites in New Zealand. Nor is it in dispute that Mr Walcroft consented to join the trial (signing a consent document) and was accepted as a trial participant.
[6] The parties agree that under s 32(6) of the Accident Compensation Act 2001, injuries suffered by participants in clinical medical trials undertaken principally for the benefit of the manufacturer or distributor of the medicine or item being trialled (commercial medical trials) are not treatment injuries, and injured participants in such
1 Walcroft v P3 Research Ltd [2025] NZHC 2221.
trials cannot claim ACC benefits. They also agree that the consent document signed by Mr Walcroft notified him of this fact.
[7] It is also accepted that, for the benefit of the trial participants, MSD entered into an Indemnity and Compensation Agreement for Clinical Trial with P3, under which MSD promised to indemnify P3 against any compensation payable to any injured participant in the KeyVibe-010 trial (the Indemnity and Compensation Agreement). One of the terms of the Indemnity and Compensation Agreement is that MSD agreed to follow the principles of and to provide compensation to participants in accordance with the Medicines New Zealand Guidelines on Clinical Trials Compensation for Injury Resulting from Participation in an Industry-Sponsored Clinical Trial (the Guidelines). The Indemnity and Compensation Agreement also contains provisions that confer a benefit on and are intended to be enforceable by participants in the KeyVibe-010 trial.
[8]Amongst other things, the Guidelines provide:
(a)As Basic Principle 1.1 that: having cognisance of the “no fault” nature of the New Zealand Accident Compensation Act, MSD as sponsor should pay compensation to patient volunteers suffering bodily injury (including death) in accordance with the Guidelines.
(b)As Basic Principle 1.6 that: neither the fact that the adverse reaction causing the injury was foreseeable or predictable, nor the fact that the patient has freely consented (whether in writing or otherwise) to participate in the trial should exclude a patient from consideration from compensation under the Guidelines.
(c)As Basic Principle 1.7 that: compensation should be paid regardless of whether the patient is able to prove that the company has been negligent in relation to research or development of the medicinal product under trial or that the product is defective and therefore, as producer, the company is subject to strict liability in respect of injuries caused by the product.
(d)As cl 4.1 under the heading “Assessment of Compensation”: the amount of compensation paid should be appropriate to the nature, severity and persistence of the injury and should be no less than would be awarded for similar injuries by New Zealand’s accident compensation scheme.
(e)As cl 5.3 under the heading “Miscellaneous”: the fact that a company has agreed to abide by the Guidelines in respect of a trial does not affect the right of a patient to pursue a legal remedy in respect of injury alleged to have been suffered as a result of participation. Nevertheless, patients will normally be asked to accept that any payment made under the Guidelines will be in full settlement of their claims.
[9] It is accepted that Ms Walcroft wrote to the defendants setting out her claims (as executor of Mr Walcroft’s estate) on behalf of Mr Walcroft as a trial participant who suffered bodily injury (that is, death) from his participation in the KeyVibe-010 trial. Ms Walcroft claims that she has a right to claim compensation for the wrongful death of Mr Walcroft in the KeyVibe-010 trial under a combination of the Deaths by Accident Compensation Act 1952 (the DAC Act), the Indemnity and Compensation Agreement and the Guidelines. Ms Walcroft says that compensation payable is not limited to the amount that would be available under the accident compensation scheme but extends to the full compensation for wrongful death assessed under the principles applicable to claims in tort and under the DAC Act.
[10] MSD pleads that Mr Walcroft’s death was not caused by any wrongful act, neglect or default. MSD also pleads affirmative defences of limitation of compensation and voluntary assumption of risk/consent. This includes that the maximum amount of compensation the defendants are legally obligated to pay for any injuries or death caused by study medication is the equivalent entitlement under the Accident Compensation Act. MSD relies on the terms of Mr Walcroft’s consent document, the terms of the Clinical Trial Research Agreement between MSD and P3 and the Guidelines. MSD seeks declarations in relation to the affirmative defences raised.
[11] In her statement of claim, Ms Walcroft seeks the following declarations by way of relief:
(a)the bar on proceedings for personal injury or death established by the Accident Compensation Act 2001 does not apply to injuries suffered by participants in commercial clinical trials;
(b)participants in commercial clinical trials who suffer personal injury or death as a result of their participation in such trials are entitled to bring proceedings in court to claim compensation in tort or under any statute applicable to the circumstances; and
(c)in the case of tortious or statutory claims brought by or on behalf of injured participants in commercial clinical trials, the benefits that would have been available under the Accident Compensation Act 2001, if that Act had been applicable, do not limit the amount of compensation the injured party is entitled to recover.
Procedural history
[12] Because Mr Woods is critically ill, the parties agreed it was appropriate for the case to have an accelerated timetable to hearing.
[13] Timetable orders were made, and the Court directed that the proceeding be served on the Attorney-General and granted leave to the Attorney-General and the Accident Compensation Corporation to intervene if they chose to do so.2 No steps in the proceeding were taken by the Attorney-General or the Accident Compensation Corporation at that time. On 17 June 2025, a one-day hearing was allocated for 7 August 2025. MSD did not file any evidence by 30 June 2025, as was due under the timetable.
[14] There were developments between the parties in July 2025, reflected in communications between counsel, some of which are before the Court. In an open
2 Walcroft v P3 Research Ltd HC Wellington CIV-2025-485-209, 11 June 2025 (Minute of Boldt J).
letter dated 18 July 2025 (the July letter), MSD indicated its view that there was no point in proceeding any further with the declaratory judgment proceeding given:
(a)matters with Mr Woods had been settled;
(b)MSD has paid Ms Walcoft the sum representing her equivalent ACC entitlement (being $216,148.36); and
(c)no issue is taken with the relief that Ms Walcoft seeks in the proceeding and the defendants will not seek any relief in it.
[15] MSD also indicated that while the ACC benefits do not cap the compensation entitled to be sought, any amount paid (in this case being the $216,148.36) must be factored into any relief that a court might order if it were found that Ms Walcroft had a proper cause of action (which is denied). MSD sought either that Ms Walcroft confirmed by letter that she accepted this position or that a proviso recognising this be added to the declarations sought.
[16] MSD prepared a draft memorandum proposing consent orders and that the hearing scheduled for 7 August 2025 be vacated. The memorandum consented to the declarations sought by the plaintiffs in the statement of claim but added in a proviso as had been raised in the July letter. The memorandum also sought a timetable for the filing of memoranda in relation to costs if agreement on costs is not able to be reached.
[17] Ms Walcroft expressed her view that the proviso is not required, as there has been no issue between the parties in that regard. It has never been suggested that money paid by MSD would not be taken into account when considering if MSD had discharged its obligation to compensate or indemnify as might be established by trial in an action for compensation, and no declaration to that effect has been sought or is necessary. Ms Walcroft also proposed that rather than vacating the hearing, it should be used to determine her application for indemnity costs.
[18] MSD indicated that it would be asking the Court to formally include the proviso in any declaration made. MSD also opposed the hearing on 7 August 2025
becoming a costs hearing. MSD considered the application for indemnity costs made by Ms Walcroft to be ill-conceived and said it has not had sufficient time to consider costs, including because Ms Walcroft has not provided adequate information (particularly time records and copies of fee invoices rendered to date).
[19] Memoranda were filed in the Court for each of Ms Walcroft and MSD. Ms Walcroft sought that judgment be entered on the basis of the admissions by MSD as recorded in the July letter and that the hearing be used to determine her claim for indemnity costs (a further memorandum and affidavit in support having been filed in relation to costs). MSD sought that the hearing on 7 August 2025 be vacated “as the substantive issues between all parties [has] (largely) been resolved by consent. The only remaining issue is the proviso”. MSD also proposed timetable directions in relation to costs, impliedly seeking those costs be determined on the papers.
[20] I issued a Minute on 5 August 2025. I dismissed MSD’s application to vacate the hearing. I directed Ms Walcroft to file a memorandum setting out the basis on which she says the declarations sought may be made and confirming that service on the Attorney-General had been completed. I also directed MSD to file any memorandum in reply. I indicated that I would not hear argument as to costs but would make any timetable directions necessary for their determination. Further memoranda were duly filed by the parties.
[21] Just before the hearing on 7 August 2025, a memorandum was filed by counsel for the Attorney-General. It transpires that although the proceeding was sent to a Crown Law email address on 12 June 2025, service of the proceeding was not formally accepted, and the proceeding was also electronically misfiled. This meant the proceeding was not directed to counsel for the Attorney-General until 5 August 2025. On 6 August 2025, counsel for the Attorney-General forwarded the proceeding to the Accident Compensation Corporation.
Parties’ positions at the hearing
[22] I granted Ms Baigent, counsel for Mr Wood, leave to appear at the hearing. As already noted, Mr Wood has discontinued his claim but sought that Ms Baigent appear in an observer capacity so that she could update him in relation to the proceeding.
[23] Mr Gunn appeared for both the Attorney-General and the Accident Compensation Corporation and advised the Court that neither party wished to take an active role in the proceeding. On that basis, I excused Mr Gunn for the remainder of the hearing.
[24] On behalf of P3, Mr Waalkens KC reiterated its position that it abides the decision of the Court.
[25] This left the issues before the Court as relating to the declarations sought by Ms Walcroft (including whether the proviso requested by MSD should be included) and the question of costs in the proceeding between Ms Walcroft and the defendants. Each are addressed in turn.
Declarations
[26] Counsel for Ms Walcroft, Mr Michalik and Ms Phipps, submit that there are two bases on which the declarations sought in the statement of claim may be made:
(a)the cover established under the ACC scheme is irrelevant to her claims for compensation, which are not within the ACC bar and are not limited by the cover available under that scheme; and
(b)her entitlement to the declarations is acknowledged by MSD.
[27] Under s 32(4)–(6) of the Accident Compensation Act, injuries suffered by participants in clinical medical trials undertaken principally for the benefit of the manufacturer or distributor of the medicine or item being trialled are not included in the definition of “treatment injury” for the purposes of the Act, with the effect that:
(a)any injury the participant may suffer is outside the cover provided for treatment injury by s 20(1) and (2)(b) of the Act for “treatment injury”, and
(b)the bar on proceedings for damages arising out of personal injury covered by the accident compensation scheme under s 317(1) of
the Act does not apply; and
(c)the benefits that might have been available to Ms Walcroft if there had been cover under the Act are not relevant to limit her entitlement to compensation, which must arise, if it exists, from other sources.
[28] No part of the Accident Compensation Act makes the cover available to any person under that Act the applicable measure of damages, or an applicable maximum amount of damages, for claims that may exist outside the no-fault compensation regime established by the Act.
[29] Counsel for Ms Walcroft further submit that Ms Walcroft has an entitlement to compensation under the DAC Act, in reliance on Pou v British American Tobacco (New Zealand) Ltd.3 Accordingly, counsel say her claim is not limited by the Accident Compensation Act, but is assessed in accordance with the law as it applied to wrongful death claims before the ACC regime was put in place. The tortious measure of damages for wrongful death is applied, and the ACC regime is simply not relevant.
[30] Ms Walcroft seeks three declarations. The first declaration sought is that the bar on proceedings for personal injury or death established by the Accident Compensation Act does not apply to injuries suffered by participants in commercial medical trials.
[31] The status of the relevant trial as a commercial medical trial, and therefore outside ACC cover, is accepted by the defendants. Ms Walcroft says she is entitled to this declaration because:
(a)Mr Walcroft’s death resulted from his participation in a commercial medical trial, being the defendants’ KeyVibe-010 trial;
(b)commercial medical trials are excluded from cover under ACC by s 32(4)–(6) of the Accident Compensation Act; and
3 Pou v British American Tobacco (New Zealand) Limited [2006] 1 NZLR 661 (CA).
(c)the ACC bar in s 317(1) applies to bar proceedings only where these arise from personal injury covered by the Accident Compensation Act or a former Act.
[32] The second declaration sought by Ms Walcroft is that participants in commercial medical trials who suffer personal injury or death as a result of their participation in such trials are entitled to bring proceedings in court to claim compensation in tort or under any applicable statute.
[33] Counsel for Ms Walcroft characterise this declaration as a positive restatement of the first declaration in terms of the rights of persons injured by their participation in commercial medical trials, in reliance on the same grounds outlined above. They say that Ms Walcroft is therefore also entitled to this declaration.
[34] The third declaration sought by Ms Walcroft is that in the case of tortious or statutory claims brought by or on behalf of injured participants in commercial medical trials, the benefits that would have been available under the Accident Compensation Act, if that Act had been applicable, do not limit the amount of compensation the injured party is entitled to recover.
[35]Ms Walcroft says that she is entitled to this declaration because:
(a)no part of the Accident Compensation Act makes the cover available to any person under that Act the applicable measure of damages, or an applicable maximum amount of damages, for claims that may exist outside the no-fault compensation regime established by the Act; and
(b)there is no wider principle of New Zealand law and no other statutory provision that has made or could make the cover available to any person under the Accident Compensation Act the applicable measure of damages, or an applicable maximum amount of damages, for claims that may exist outside the no-fault compensation regime established by the Act; and
(c)no part of the contract or agreement between the parties makes the cover available to any person under the Accident Compensation Act the applicable measure of damages, or an applicable maximum amount of damages.
[36] For MSD, Mr Waalkens submits that the assertions by Ms Walcroft as to an entitlement to compensation are a matter to be traversed only if Ms Walcroft issues such a claim and are not relevant to the declarations presently sought. It appears that MSD’s position is that any future claim made by Ms Walcroft will be rigorously defended on the grounds there is no basis for a further claim, at law or as a fact, including because the amount that has already been paid (representing the equivalent ACC entitlement) is, in all the circumstances, sufficient compensation.
[37] Following discussion with Mr Michalik and Mr Waalkens, it was apparent that whether the proviso was necessary to the declarations could be readily resolved. MSD is content with confirmation from Ms Walcroft that the amount already paid to her (being the $216,148.36 mentioned earlier) would be acknowledged in any claim for compensation to be made. Mr Michalik gave that confirmation, noting that in fact any claim by Ms Walcroft would likely plead the payment made by MSD in relation to admission of liability.
[38] I accept that the declarations as sought by Ms Walcroft may properly be made. The proviso, to my mind, is unnecessary because its absence from the declarations would not prevent a pleading of the fact of payment. In any event, this issue was overtaken by the confirmation provided by Mr Michalik as noted above. It remains for another day as to whether Ms Walcroft pursues a claim of compensation against the defendants and how such a claim is resolved.
Costs
[39] Ms Walcroft seeks indemnity costs. The basis for seeking indemnity costs is set out in a memorandum filed by counsel for Ms Walcroft dated 1 August 2025. MSD seeks further information from counsel for Ms Walcoft, being corroborating details of time and attendances, and further time to file a response as to costs.
[40] As I set out in my Minute dated 5 August 2025, I did not consider it necessary to have a hearing about costs, rather they can be dealt with on the papers in the usual way following a timetable for exchange of memoranda.
[41] I encouraged counsel to confer in relation to the information needed to allow determination of the application for indemnity costs. Ms Phipps has provided a schedule of time and attendances, explaining rates used and that no invoices have yet been issued to Ms Walcoft, given the circumstances. Ms Phipps says this is sufficient information, noting that material sought by MSD is likely privileged, given that Ms Walcroft is still to advance her substantive claim for compensation.
[42] While it remains open to MSD to argue that, as a matter of law, insufficient information has been provided to support the application for indemnity costs, it is likely more efficient for the determination of costs if counsel are able to agree as to the information required. To allow time for counsel to discuss the question of information further, I made certain timetable directions, which, for convenience, I repeat here:
(a)the second defendant is to file and serve a memorandum as to costs by 21 August 2025; and
(b)the first plaintiff is to file any memorandum in reply by 4 September 2025.
[43]Costs will then be determined on the papers.
McQueen J
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