Wijoski v Attorney-General HC Wellington CP384/98

[2001] NZHC 826

IN THE HIGH COURT OF NEW ZEALAND
WELLINGTON REGISTRY CP384/98

BETWEEN T.M. WIJOSKI and R.J. WIJOSKI trading as MAYFAIR NURSERY
Plaintiffs

AND THE ATTORNEY-GENERAL on behalf of THE MINISTRY OF AGRICULTURE & FORESTRY Defendant

Hearing: 31 July and 20, 21, 22 and 23 August 2001

Counsel: S M O’Sullivan and J L Cole for Plaintiffs
H S Hancock and A H Cecil-Gibson for Defendant

Judgment: 4 September 2001

JUDGMENT OF ELLIS J

Solicitors:
Phillips Fox, Wellington for Plaintiffs
Crown Law Office, Wellington for Defendant

The claim and the defence

[1] This is a claim for damages resulting from alleged negligent advice given by MAF Quality Management, a division of the Ministry of Agriculture, in 1997. The plaintiffs were orchid growers. Some orchids became infected and were sent to MAF for analysis and advice on treatment. The plaintiffs followed the advice but the disease spread and their stock was ruined. They claim in tort, contract and breach of the Fair Trading Act 1986, but counsel agreed the essential claim was in negligence and all causes of action would be dealt with on that basis. The defence is that the diagnosis and advice were not negligently given. The defence also relies on a disclaimer made as part of the advice.

The history

[2] The plaintiffs decided to grow cymbidium orchids commercially for flower production. Mrs Wijoski was a Chartered Accountant and had done degree studies in botany, but had no experience in practical horticulture. They researched the proposals thoroughly, built a greenhouse at Raumati and fully equipped it. Over the period 1995 to 1997 they purchased 2,010 orchid plants from reputable growers and established them in their greenhouse. They cared for the plants meticulously and the plants thrived. However in April 1997 Mrs Wijoski noticed a black/brown discolouration on some of the plants. Some had black spots on some leaves and some had both black spots and brown rot in the central part of the plant where first leaves are formed and from which the first pseudobulb eventually develops. There were only a few plants with the disease and they were in pots near each other in one part of the greenhouse. The plants had come from the same source. Mrs Wijoski removed the plants with brown rot from the property to prevent spread of the disease. Mrs Wijoski had been told by other growers that the pathogen fungus Phytophthora was generally the cause of brown rot and that Fongarid was a good chemical to use for this disease, so the plaintiffs sprayed the plants with this in accordance with the manufacturers’ instructions in May/June. By the end of June the disease still kept appearing and the plaintiffs decided to get specialist help. They sent a sample of infected plants to the Ministry of Agriculture, Plant Pathology Division, Auckland for identification of the disease and advice on how to control it. Mrs Wijoski spoke to the MAF plant pathologist on the phone who requested a variety of plants at different stages of infection and a whole plant. These were supplied.

[3] The analysis was in the hands of a senior plant pathologist, Mr Dance. He decided that the question was whether the later material showed infection by the fungus Fusarium subglutinans as in the first sample or by Phytophthora. He noted the leaf lesions looked like Phytophthora and the base of the bulbs looked necrotic. As he knew the plants had been treated with Fongarid he had the material elutriated to isolate the effect of this. Mrs Wijoski says she spoke to Mr Dance on 11 July 1997 by phone and Mr Dance discussed his report which was in the mail. Mrs Wijoski says she was left with the impression that Fusarium subglutinans was not a serious disease and was curable, and that segregation of plants within the greenhouse was appropriate. Mr Dance’s report dated 9 July 1997 was then received. It states:

“MAF Quality Management MINISTRY OF AGRICULTURE

A Division of the Ministry of Agriculture TE MANATU AHUWHENUA

Test Costs : $140 NZPPC Reference : 15359

Other Costs: Client Reference : T.Galvin/Mayfair Nurs.

Total:

NOTE: DO NOT PAY ON THIS AMOUNT

GST AND ADJUSTMENTS WILL BE Charge/AnalysisCode: 2/550061/284/X/611/PHQ

INCLUDED IN THE INVOICE

NEW ZEALAND PLANT PROTECTION CENTRE - DIAGNOSTIC REPLY FORM

SPECIMEN of Cymbidium orchid with black lesions of leaf bases.

DIAGNOSIS:-

Both sets of samples were infected with a leaf rot caused by Fusarium sacchari var subglutinans. This disease appears to be a relative newcomer in this country. The symptoms it shows, and the way it progresses downwards into the young pseudobulbs are indistinguishable from Phytophthora rot; indeed some are not convinced that it is a separate disease and think it to be a secondary invader of Phytophthora lesions albeit a virulent secondary invader able to continue necrotising the tissue regardless of whether the Phytophthora has been brought under control or not.

Phytophthora was not isolated from these lesions, possibly because it was not involved in this syndrome (making the Fusarium the sole cause), or possibly because it had been put into remission by the Fongarid application.

Regardless of the primary or secondary status of the Fusarium it would be prudent to adopt a control programme to gain disease remission.

CONTROL ADVICE:-

• Segregate all infected plants and keep them well separated from healthy plants. Whenever carrying out any operation on the plants, work the healthy plants first and the infected plants last. This is because Fusarium spores are transmissible on hands, clothing and implements.

• If overhead watering, minimise water pressures. Fusarium spares can be water borne.

• Practice good insect control. Fusarium spares are carried by insects.

• Do not apply too much Nitrogen or too little Calcium. Fusarium aggressiveness is increased by high tissue Nitrogen and diminished by high tissue Calcium.

• Spray at two to four week intervals (two during growth flushing, four during growth maturation) with either Octave @ 0.25g/lt or Folicur 25DF @0.4g/lt for three months (infected plants) or for six weeks (healthy plants). Do not apply either of these sprays within three weeks of a Fongarid application or a phytotoxic scorch may occur.

Signed: Mike Dance

Plant Pathologist

Ph [phone]

Dated: July 9, 1997

DISCLAIMER: The information in this report is based upon an examination of the sample supplied and the best information available to the writer at the time of examination. In the absence of knowledge of specific growing conditions or other conditions pertaining to the sample and in the absence of control over how the information is to be applied, any action taken in reliance of this report is the sole decision of the user of the information and is taken at his or her own risk. Accordingly NZPPC disclaims any liability arising out of any use of this information or in respect of any actions taken in reliance upon this information.

[4] The plaintiffs thereupon sprayed the plants with Octave as directed and the plants were segregated and handled as suggested. At the end of the treatment no remission of the disease was observed in the infected plants. The plaintiffs experimented by feeding the plants water only for the months of July, August and September to no avail. Between July and December plants developing crown rot were removed from the property.

[5] Mrs Wijoski says she rang Mr Dance on 9 September 1997 and told him they had had no success with Octave and he responded that it should have worked, but to try Foli-R-Fos, which they did. It made the plants look worse and they continued to develop crown rot. Mrs Wijoski consulted her literature and contacted Ms Topliss a horticultural consultant in Auckland with experience in the field with cymbidium orchids. She said Fusarium subglutinans was an extremely serious primary pathogen of orchids and it was unlikely to achieve remission of the disease. She referred to some research in Italy and said that an application of Benlate to healthy plants prevented the spread of the disease.

[6] Mrs Wijoski sent plant samples to Ms Topliss and also to Dr Cheah at the New Zealand Institute for Crop and Food Research in Levin. Both Ms Topliss and Dr Cheah confirmed the plants had Fusarium subglutinans and no signs of Phytophthera. The plaintiffs thereupon applied Benlate at 2-3 week intervals and noticed an immediate check in new infection and no new infection after three applications. Ms Topliss visited the plaintiffs on 23 December 1997 and her opinion was that Fusarium subglutinans was a primary invader, and you could tell Fusarium subglutinans and Phytophthera apart visually by observing the areas of invasion. She repeated her view that Fusarium subglutinans is a serious disease and that Octave was an inappropriate therapy. She said MAF should have advised immediate removal of infected plants and taken the correct steps to prevent the spread of the disease with a systemic fungicide such as Benlate. She said if that had been done the then healthy plants could have been saved. She recommended that all the plants remaining in December would have to be destroyed.

[7] Mrs Wijoski then phoned MAF repeatedly and asked to speak to the Director or General Manager, no response was forthcoming until she threatened to deliver the remaining plants to MAF’s Head Office. She was then told to put her complaint in writing. She did this through her solicitors on 15 July 1998. In the meantime the plants were kept at a reduced level of cultivation for MAF to inspect. This was done in July 1998 by Dr Funnell, an independent expert in flower production. He found approximately 936 plants of which 48 (5.1%) showed obvious signs of disease while the other plants appeared quite healthy. Samples of the plants were subsequently tested and shown to be infected with Fusarium subglutinans. The plaintiffs destroyed the plants and started again. Mrs Wijoski, who is an accountant as well as having some qualifications in botany, calculated the plaintiffs’ losses and had her calculations and assumptions converted into a succinct loss analysis by Mr Pope who gave evidence that he calculated the losses to be $597,937 as at 19 March 2001.

The scientific knowledge as at July 1997

[8] The prime source of information on Fusarium subglutinans infection of cymbidium orchids is the Italian research of D’Agliano and Carrai in 1994. The original and a rough translation were produced and accepted by counsel. The significant conclusions are:

“As far as intervention with chemical methods is concerned, although accurate experimental research has not so far been conducted, a reliable act of control seems to be carried out with . . . the cupric base with prochloraze and benzimidazole (forbidden for use in greenhouses). In every case if the environmental conditions favour the growth of fungi no commercial formulae amongst those indicated so far as capable, also if used repeatedly, can limit damage to below an economically acceptance level.”

[9] Prochloraze is the active ingredient of Octave, and benzimidazole is the active ingredient of Benlate. Neither of these proprietary fungicides claims on its label to be effective for treating Fusarium subglutinans on orchids. Its use is therefore referred to as “off label”. The reference to “forbidden for use in greenhouses” is apparently indication it has no official approval for such use.

[10] Ms Topliss reacted to this research by preparing her own paper in 1995 warning that Fusarium subglutinans was “a new serious pathogen of cymbidium orchids” and drew attention to the fact that to date no effective chemical control in the field had been discovered. She described the appearance of infected plants, advised the quarantining of new stock and concluded her article in these words:

“2. Develop a quarantine area on your property for all new material that you bring onto the site. Do not mix new plants with your existing stock. This area ideally should be a separate house, if this is not possible then section off a portion of an existing house. You should leave the plants there for at least one season before they are mixed with other stock.

3. If you are suspicious of any problem seek professional help. Visual diagnosis is in itself not adequate.

4. Do not allow other growers to go through your greenhouses in their working clothes. Make sure that you shower and change before you go onto other sites and do not wear those clothes in your greenhouse.

In my opinion Fusarium subglutinans represents a potentially serious threat to the Cymbidium Orchid industry. In the fifteen years I have worked in the industry, it is the most destructive pathogen I have seen in Cymbidium Orchids.”

[11] In view of the criticism of Mr Dance’s advice I have underlined the possibility of keeping quarantined plants in the same greenhouse as other stock. Ms Topliss circulated this article and MAF received a copy. I also observe she too says visual diagnosis is inadequate.

[12] Mr Dance gave evidence about his familiarity with Octave, and I quote from the notes of evidence:

“And your familiarity? I would have prescribed it probably in excess of 1000 times, roughly equally spread between folia applications and root applications. For some of the major pathogens in the industry we had a very bad outbreak of a disease called black root rot in cucumbers from the mid 70s onwards and it put a lot of growers out of business, quickly. And Octave became the miracle chemical for a generation of cucumber growers. It’s not miracle cure because like all systemics it has limited applications. It has proved very useful for small range of diseases which include Fusarium and it’s not in my view in terms of our recommendations very widely prescribed. There would be other chemicals we would prescribe 3 or 4 times as often. But it is an important part of the armoury. There is a place for it and I am aware that what I put on paper is important because of the thing that I don’t like, the bush telegraph, what I write on paper becomes an industry recommendation very easily and that industry recommendation can often mean the difference between the importer continuing to import or withdrawing from registration and import so in a sense I have probably through my prescriptive reports kept the door open for therapeutants which otherwise would not be stopped.

So in summary your familiarity with Octave and variety of uses? It has many many uses, I am familiar with its limits and with its advantages, what it can do and what it can’t do.

The use of term systemic in relation to Octave, could you clarify whether Octave is or is not a systemic therapeutant? It is not a true systemic, because a true systemic circulates throughout the plants, that’s leaves and roots. It is a translaminar systemic as most fungicides are and it is only capable of penetrating into a leaf and across the leaf and has very limited movement up and down a leaf.

Benlate is that a systemic? Benlate is also a translaminar systemic. It is capable of penetrating a leaf and has restricted movement sideways in a leaf.

Looking at effect of fungicide such as Octave on an orchid on which Fusarium is present tell me in relation to the latent presence what the effect of the fungicide Octave would be? Effect would be to kill latent infections.

And by latent you mean? By latent I mean that the Fusarium spore has germinated on the surface of the leaf and penetrated into the epidermis or the eternal layer of the leaf. There it is inactive and not growing. Most latent infections are restricted to single epidermal cells.

Moving now to the effect on the developed Fusarium disease, what would Octave’s effect be on the developed disease, first define developed please? A disease passes from latent to active when certain triggers in the plant permit it. An active infection is one that has spread from a single cell or a latent infection to adjoining cells and cells inside the leaf. The effect of Octave would be to kill some of that infection but not all because Octave is not actively translocated inside the leaf so the effect of Octave would be a limited kill of the fungus and it would prevent any spores being formed on the surface of the leaf.

And this developed or active phase how do you recognise that? In the case of Fusarium for the first day or two it is a water soaked area of leaf which rapidly darkens and becomes black. Both the water soaked phase and the black phase are very visible.

And on the pseudobulb how do you recognise the developed or active phase? It has an identical appearance to the active phase in the leaf.”

[13] Mr Dance also gave evidence of experiments he had done with plants other than orchids. He was the only plant pathologist to give evidence. The evidence led by the plaintiffs was from consultants and growers of significant experience but none had the sort of expertise enjoyed by Mr Dance. After hearing Mr Dance and the criticism levelled at him I am satisfied he is a knowledgeable, careful and conscientious scientist. He was familiar with the literature including the Italian article and Ms Topliss’ article. His approach to prescription is conservative and he was plainly not impressed by the claim that Fusarium subglutinans is such a virulent invader as Ms Topliss suggests. He ranked it out of 10 for counsel as 4 or perhaps 5 on a scale of virulence. I was impressed too with the wide range of other factors that might bear on the impact and spread of a disease and on any treatment of it.

[14] Finally of significance is a report from the New Zealand agent of the manufacturers of Octave. On enquiry by Mrs Wijoski, Mr Rose of BASF New Zealand Limited faxed her on 20 November 1997:

“Teresa,

With regard to your query re efficacy of Octave against F.subglutinans, we have no data specifically on this disease. Octave does control a number of Fusarium spp. at the following recommendations on established plants.

soil drench, 200g Octave/1000 ltrs water, use 6-8 litres of solution/m2.

Unfortunately we have no information for orchids, and application would have to be made off label at your risk.

We are not in a position to make a recommendation for Orchids

I’m sorry I can’t be of any real assistance, if you need any further information, please don’t hesitate to contact me.

Regards, Richard Rose”

[15] Three matters are worth mentioning. First, there are many species of Fusarium of which subglutinans is only one. Second, the expert evidence is that a foliar spray should be much more dilute than a drench. Third, the form of disclaimer is significant and will be referred to later.

[16] As to the state of scientific knowledge as at July 1997 I consider the advent of Fusarium subglutinans was relatively new and was recognised as a serious threat to plants. No known cure was available, but prochloraze and benzimidazole may be effective to control its spread. This indicated that Octave and Benlate were worth trying “off label”. Further, the isolation of infected plants was highly desirable. In terms of isolation the possibilities are destruction, quarantine away from and outside the greenhouse, and isolation within the greenhouse.

The disclaimer

[17] 1 have already set out the disclaimer in MAF’s written advice to the plaintiffs and that in BASF’s advice four months later. It is worth recording the disclaimer in Dr Cheah’s written advice too:

“Recommendation for control

I recommended that ‘Terraclor’ be as a whole plant dip, as the chemical is effective against Fusarium on other crops (NZ Agrichemical Manual). I stressed that the chemical was not registered for use on orchids therefore its use was at the grower’s own risk, and that tests should be carried out on a few plants first, as the chemical may produce phytotoxicity on glasshouse plants.”

[18] Mr O’Sullivan submitted the disclaimer was made after the contract to analyse and advise was entered into and so not part of it. I do not agree. It is actually part of the advice and used not only to avoid liability but also to warn the recipient of the uncertainties involved. This must be so when one considers that the manufacturers of the chemicals do not hold out the sprays as suitable for the suggested purpose, research by the plant pathologists is plainly limited and growing conditions and plant health will vary greatly. None of the reports involve on site inspection.

[19] The defendants witnesses and Mr Dance in particular criticised the plaintiffs for not seeking help from a consultant, that is a qualified person with field experience such as Ms Topliss. I think it is fair to say that the disclaimer would have put the plaintiffs on notice as to the importance of the on site factors in any treatment. It could have been more explicit as to the use of a consultant; but the disclaimer used by all three experts makes it plain that use of sprays “off label” is at the user’s own risk. That is fully justified by the lack of adequate research to enable a more definite outcome to be predicted. In my view anyone receiving any one of the recommendations would realise the uncertainties involved.

[20] I observe too that Dr Cheah did not recommend Octave or Benlate. On the evidence it would appear that Ms Topliss’ advice to use Benlate and remove all plants showing signs of infection would have been more effective, but in my view the matter cannot be judged with the benefit of hindsight, and the Court must view the position from Mr Dance’s position in July 1997.

[21] Coupled with the disclaimer is the significance of the fee charged of $140. It is not the sort of fee one would expect for visiting the site and hands on attention, nor is it the fee charged by someone guaranteeing a treatment in an area of such uncertainty. It rests well with the condition of giving advice, namely that use of off label chemicals was at the sole risk of the plaintiffs. This is the same type of economic analysis approved by the Court of Appeal in DHL International (NZ) Ltd v Richmond Ltd [1993] 3NZLR 10, and see the analysis by Richardson J at page 17.

Breach of duty of care

[22] Counsel agreed this was the fundamental issue to be decided and the test was a consideration of the reasonably careful and prudent plant pathologist. The plaintiffs’ criticism in effect reduced to its claim that Octave should not have been recommended, and that destruction of the diseased plants or their isolation outside the greenhouse should have been recommended. The plaintiffs’ witnesses supported these claims in varying degrees. Ms Topliss said that all diseased plants should have been destroyed and the others sprayed with Benlate. Ms Hawes recommended removal of all infected material, but made no spraying suggestion. Mr Steens recommended removal and destruction of diseased plants and spraying with Benlate or Octave. Mr Clarke recommended removal of infected plant material, recognised there was no registered cure and recommended seeking a consultant’s advice. Dr Funnell, the defendant’s witness, supported what Mr Dance had recommended. Mrs Wijoski drew attention to the fact that her plants did not respond to Octave at all and to the fact that Fusarium subglutinans eventually spread throughout the greenhouse. I accept these matters have been established. Ms Topliss reinforced the thrust of her 1995 article and said Benlate should have been used and rigorous isolation established. She emphasised her view that Fusarium subglutinans was a virulent primary invader and that Mr Dance had understated its pathogenic qualities. Mr Dance described the disease in his report as “virulent” and referred to its “aggressiveness”. Ms Topliss seems to be correct in asserting that there is no known cure but that spread can be controlled. I think Mr Dance agrees with that but was more hopeful that the disease could be put into remission.

[23] While Benlate appeared to have the desired effect, I reject the claim that Mr Dance should not have recommended Octave. There was much to support his recommendation from the Italian research, to Mr Rose’s and Mr Steen’s suggestions and Mr Dance’s own research. I consider his advice in this respect was carefully and knowledgeably given and so dismiss it as a claim of negligence.

[24] I now turn to the destruction or isolation of plants. All are aware that growers will be keen to retain plants if there is a chance of returning them to health and productivity. Further, where a grower has only one greenhouse, the prospect of keeping hothouse plants outside the controlled environment cannot be satisfactory. It is important to bear in mind what actually happened. The infection was noted in one section of the glasshouse where a particular variety from a particular supplier was grouped. That strongly suggests the fungus was introduced to that section and variety initially and would put a grower on notice to enquire from the supplier about the outbreak. Be that as it may Mrs Wijoski disposed of diseased plants and leaves by removal from the property. Further, Mr Dance’s recommendation is very rigorous indeed within the greenhouse, almost impossibly so. I think Mrs Wijoski’s own decision to remove and destroy diseased plants and foliage was an understandable reaction and reinforced by what Mr Dance suggested. It may well be true that complete destruction of more plants may have helped, but it is impossible to know when all became infected with spores, as the large number of apparently healthy plants observed in July 1998 demonstrates. Considering the position as at July 1997 and that Mr Dance was not asked to visit the site to see all the plants, I do not consider he has been shown to act or advise with any lack of care in this regard either.

[25] In conclusion I think that a reasonably careful and prudent plant pathologist in Mr Dance’s position in 1997 who had correctly identified Fusarium subglutinans as the active pathogen was justified in writing his description of the two fungal diseases and in recommending the trial of Octave which contained an active ingredient recognised in the Italian research and which was tested by himself in comparable situations. The fact that no improvement was noted could be due to a variety of reasons other than the lack of efficacy of Octave, but even if Octave could be proved ineffective, the MAF report made it plain that application was at the sole risk of the plaintiffs. All that was required was that MAF provided its report and advice based on “an examination of the sample supplied and the best information available” to Mr Dance. That of course included his own expert knowledge and judgment.

[26] As far as the isolation of diseased stock is concerned, I agree that destruction and removal would be the safest way to proceed, but the other considerations must be given weight, the preservation of stock that could be put into and kept in remission and the lack of another greenhouse. As I have said Mr Dance’s recommendations were rigorous and I do not think his advice and recommendations were other than those of a reasonably prudent and careful plant pathologist.

[27] The plaintiffs, and Mrs Wijoski in particular, did their very best to follow best practice and advice. However they had the misfortune to introduce a relatively new and invasive disease for which there was no known cure, although there were good indications that its spread could be controlled. Mr Dance gave careful well informed advice which Mrs Wijoski followed, but it did not work. As the disclaimers all indicate this was an area with unknown factors where MAF could not be expected to guarantee success. As the three disclaimers all say no one could be sure of success with available chemicals.

[28] For the reasons I have given the plaintiffs’ claims must all fail. There will be judgment for the defendant who will be entitled to costs on a 2B basis plus disbursements if any to be agreed or failing agreement to be fixed by the Registrar.