SIGNAL v BERRY & ORS [2016] NZHC 1126

SIGNAL v BERRY & ORS [2016] NZHC 1126 [27 May 2016]IN THE HIGH COURT OF NEW ZEALANDWELLINGTON REGISTRYCIV 2015-031-35[2016] NZHC 1126BETWEEN ALLAN PHILLIP SIGNAL ANDPRUDENCE LEA SIGNAL ASTRUSTEES OF THE SIGNALPROPERTY TRUSTPlaintiffsAND GEORGE LATHAM BERRY,DAVID RICHARD TRAVERS SALTER,MICHAEL JOHN DE BUYZER ANDDAVID MICHAEL JACKSONFirst DefendantsAND MICHAEL JOHN DE BUYZERSecond DefendantHearing: 17 May 2016Counsel: A R Shaw for PlaintiffsJ Eckford for DefendantsJudgment: 27 May 2016JUDGMENT OF BROWN J[1] The plaintiffs sue the defendants for negligence in the performance of legal services in connection with a subdivision of property at 125 Hickford Road, Foxton.[2] In particular the plaintiffs claim that the defendants failed to secure the issue of titles for the subdivision from Land Information New Zealand by 17 June 2011,the date of expiry of the local authority's certificate to the plaintiffs under s 223 of the Resource Management Act 1991. As a consequence it was necessary for the plaintiffs to seek a new resource consent which resulted in titles for the subdivision not being available until 31 August 2013.[3] Liability is not in dispute and a defended hearing on quantum and some aspects of causation was allocated for three days commencing 14 March 2016.[4] Briefs of evidence were filed and served by the plaintiffs on 1 December 2015 and by the defendants on 15 January 2016.[5] By memorandum dated 3 March 2016 the plaintiffs gave notice of their intention to seek leave to adduce evidence in rebuttal in the form of briefs of four additional new witnesses.[6] The defendants opposed the service of additional briefs by the plaintiffs. Contending that the plaintiffs' description of the proposed briefs as "rebuttal evidence" was misconceived, the defendants submitted that the proper course was an application to the Court for leave to file supplementary briefs including an extension of time given that pleadings had closed on 3 November 2015.[7] Following a telephone conference, Mallon J issued a Minute dated 7 March 2016 which stated:[1] I am not in a position to rule on the admissibility of the proposed further evidence from the plaintiffs. It does, however, seem to me to be what would ordinarily be considered reply evidence. I understand that it is not uncommon for a timetable to make provision for reply evidence but the timetable did not do so here. It does not seem to me to be rebuttal evidence under s 98 of the Evidence Act since thatsection is concerned with evidence after a party's case has closed.Therefore if leave is to be granted to the plaintiffs, it seems to me that this would probably need to be pursuant to rule 9.8. Relevant to whether leave should be granted is that no provision was made for reply evidence, when not uncommonly it would be. Also relevant will be any prejudice to the defendants. The plaintiffs should therefore proceed to file the proposed further evidence as soon as they can, to seek to minimise any prejudice to the defendants. The issue can then be considered further at the hearing unless by that time counsel have reached an agreement about this.[8] Subsequently the defendants filed a memorandum dated 10 March 2016 stating that the proposed additional evidence would prejudice them. They also noted that, given the time allocation for the trial of three days and the number of witnesses (five each for the plaintiffs and defendants), there was no practical way in which the new proposed witnesses could be accommodated.[9] In light of that memorandum Mallon J issued the following direction on 11 March 2016:I refer to the memorandum of counsel dated 10 March 2016. The memorandum asserts that the proposed additional evidence prejudices the defendants because they have insufficient time to respond to it. It further asserts that there is insufficient time to complete the hearing in the allocated time if the additional evidence is to be adduced. The plaintiff is to adviseimmediately if, in light of the defendant's position, it intends to seek toadduce the additional evidence and, if so, whether it seeks an adjournment of the fixture to ensure there is no prejudice to the defendant and to avoid the prospect of an uncompleted hearing next week. If an adjournment is sought the plaintiff should provide a realistic assessment of the hearing time required for a new fixture. The assessment should include time for the witnesses to read their briefs in court and to present closing submissions. The defendants should then respond to the plaintiff as soon as possible.[10] Later that day Mallon J issued a further Minute which stated:Please inform counsel that having considered all memoranda I am vacating the fixture. The matter is not ready to proceed given the late intendedsupplementary evidence from the plaintiffs and the defendant's opposition tothat and the real prospect that there will be insufficient time to complete the hearing in the allocated time. Costs are reserved although there is a real prospect that when considered in due course that costs will be payable by the plaintiff, the plaintiff having sought to file the supplementary evidence very close to trial.[11] The proceeding has since been allocated a fixture of five days duration commencing on 21 November 2016.[12] On 4 April 2016 the plaintiffs filed an interlocutory application for leave to file supplementary briefs of evidence from three new witnesses:(a) Warren Ernest Webb;(b) Anthony John Hooper;(c) John Lloyd Hancock.They also sought leave to file a supplementary brief of Steven John Attwell who had earlier provided a brief.[13] Two of the proposed briefs are reasonably short factual briefs directed to the question of the existence of an oral agreement made in 2008 for the purchase of Lot 6 of the subdivision by Mr Kevin Gunther.[14] The defendants had filed a brief from Ms Ellen Graham which asserts that Mr Gunther told her that he had never agreed to buy Lot 6. The plaintiffs claimed that they and Mr Gunther were taken by complete surprise by Ms Graham's brief, in response to which the plaintiffs wish to lead the evidence of Messrs Webb and Hooper.[15] Mr Webb's intended evidence is that Mr Gunther engaged Mr Webb'scompany in 2008 to deliver four truckloads of metal to Lot 6 to be used by Mr Gunther in forming the driveway to the top of the property.[16] Mr Hooper's proposed evidence is that he was engaged by Mr Gunther in 2008 to provide a quote to establish a power connection to the top of Lot 6 where Mr Gunther was planning to build. The plaintiffs contend that the briefs of evidence of Messrs Hooper and Webb support the plaintiffs' claim of an oral agreement with Mr Gunther in 2008 to purchase Lot 6.[17] The supplementary briefs of Messrs Attwell and Hancock are expert valuation briefs. It is the plaintiffs' contention that the value of the subdivision decreased between the date when titles should have become available and the date when the titles did become available, resulting in a capital loss of $198,000.[18] The defendant's valuation expert, Mr Timmer-Arrends, will say that there was no drop in value at all in the subdivision at the material times.[19] The supplementary brief of Mr Attwell does appear to be strictly in reply to matters raised by Mr Timmer-Arrends. However Mr Hancock, who has not previously provided a brief, critiques the methodology employed by Mr Timmer-Arrends in his subdivision valuation. Mr Hancock is presented by the plaintiffs as not only an expert in valuation but also an expert in valuation standards.[20] The plaintiffs' application is made in reliance on r 9.8 of the HCR which states:9.8 Supplementary briefs(1) A party wishing to offer a supplementary brief must serve it as soon as possible.(2) The acceptance and use of the supplementary brief in court will be at the discretion of the trial Judge.[21] The plaintiffs submit that in the consideration of an application for leave to adduce supplementary briefs, the touchstone will be the interests of justice, citingWestern Park Village v Baho.1 They contend that there will be no prejudice for thedefendants as they will have had the plaintiffs' supplementary briefs and material forsome eight months prior to the new fixture which allows ample time for the defendants to take instructions and obtain any evidence in response.[22] The defendants make spirited opposition to the application. They submit that the standard procedure for civil trials is that briefs of evidence are filed in advance and that further responses or replies should await the hearing and the testing of oral evidence at trial.2 They maintain that the plaintiffs were, or should have been, aware of the existence of the relevant witnesses and their evidence at the time of filing their primary briefs.3 They argue that the plaintiffs are simply seeking an indulgence from the Court in order to bolster their evidence for trial4 and that the evidence simply seeks to corroborate existing evidence. So far as the further evidence of Mr Attwell is concerned, they accept that such evidence can be given orally, if necessary by way of supplementary questions, drawing attention to the procedure under the former r 441G.[23] In the event that the Court permits the new evidence to be received, the defendants seek to serve evidence in reply. They also maintain that they are entitled to costs on the application on an increased basis pursuant to r 14.6.1 Western Park Village v Baho [2013] NZHC 1909 at [12].2 Body Corporate 354085 "Perspective Apartments" v Auckland Council (No 1) [2016] NZHC 200 at [8].3 Currie v Goodwin HC Auckland CIV 2002-404-1820, 27 August 2004 at [30](a).4 Madretsma Farm Ltd v Frizzell HC Napier CP 9/94, 28 March 2001 at [5].[24] Each case turns on its own particular facts. In a number of cases the prejudice has been accepted as especially significant because of the late stage at which the evidence is provided. For example in Madretsma the reply brief in question was served upon the defendants on the last working day before trial. The Judge considered that the defendants should not have been expected to cross examine on material brought to their attention at such a late stage, noting that further examination of the information within it would have been necessary before cross examination could be properly carried out.[25] Similarly in Body Corporate 354085 Palmer J observed:5I also note that one factor to be weighed in the evaluation of the overall interests of justice is the effect on public resources of vacating a four week trial at its outset. Here, the proceedings were commenced in December 2013 and the trial date has been clear since February 2015. This application to adduce supplementary evidence comes at the last minute.[26] Different considerations applied in Currie v Goodwin. In relation to one of the briefs in issue, the Judge recognised that, to the extent that the further evidence was a response to evidence adduced by the defendants, then the plaintiff was entitled to give it orally under then r 441G(a). However in relation to certain other briefs theJudge's principal reason for declining leave was, as he stated, much more fundamental. The evidence had been produced after a mediation conference where it appears that the defendants had disclosed what they perceived to be the flaws in the plaintiffs case and the new evidence, at least in part, went some way to address those flaws.[27] In the present case there would have been clear prejudice if the March fixture had been maintained and leave had been granted to lead the new evidence. However the fixture was vacated and the revised hearing date is almost six months distant. In my view any prejudice occasioned by the service of the supplementary briefs is very materially reduced by the time available to the defendants to respond. Furthermore the expense associated with any extra work can be reflected in the order for costs following trial.5 Body Corporate 354085 v Auckland Council (No 1) above n 2 at [9].[28] When I explored with Ms Eckford any other source of prejudice, I was left with the impression that the defendants consider that they are disadvantaged by the fact of the plaintiffs being able to improve on their evidential case. However, if thefact of improving a party's case precluded the grant of leave to serve supplementary briefs, I doubt that leave would ever be given.[29] In the circumstances leave is granted to the plaintiff to lead the evidence inthe supplementary briefs. I note the defendants' point that Mr Attwell's furtherevidence could be led orally. However a brief has been provided and I consider that it is more efficient that it be read, subject of course to any oral evidence direction.[30] The normal rule is that costs follow the event. However the plaintiffs have been granted an indulgence and I do not consider that an order for costs in their favour is appropriate. The defendants seek costs notwithstanding that the application has been successful. I do not consider, once the trial had been vacated, that it wasappropriate for the defendants to continue to resist the plaintiffs' application. There will be no order for costs on the plaintiffs' application.____________________________Brown J