MIKITASOV V COLLINS HC WHA CIV 2008-488-53

MIKITASOV V COLLINS HC WHA CIV 2008-488-53 6 November 2008IN THE HIGH COURT OF NEW ZEALAND WHANGAREI REGISTRY CIV 2008-488-53BETWEEN IGOR ALEXANDROVICH MIKITASOV Plaintiff AND BERNARD JOHN COLLINS Defendant Hearing: 6 November 2008 Counsel: D R James for Plaintiff R Mark for Defendant Judgment: 6 November 2008(ORAL) JUDGMENT OF HEATH JSolicitors: Palmer Macauley, PO Box 576, Kerikeri Richard Mark, PO Box 172, KerikeriThe application[1] Mr Mikitasov seeks an order for further discovery. He contends that Mr Collins has failed to comply with his discovery obligations to date.Background[2] Mr Mikitasov purchased a property from Mr Collins. That property is situated at 28 Binnie Street, Paihia. The Agreement for Sale and Purchase was dated 24 November 2004. The purchase price was $2,000,000. [3] Mr Mikitasov sues Mr Collins in proceedings issued in this Court on 4 February 2008. There are two causes of action. I summarise each in broad terms. [4] The first cause of action alleges that Mr Collins' breached cl 6.2(5) of the Agreement for Sale and Purchase. It is alleged that his warranty that he had not done or caused or permitted work to be carried out on the property without the necessary permit or building consent and that the works were completed in accordance with that consent was incorrect. [5] The second cause of action is based on an alleged implied term of the Agreement for Sale and Purchase, whereby Mr Mikitasov alleges that Mr Collins was under an obligation to disclose to him any knowledge that he had of weathertightness or dampness concerns about the property at the time the agreement was signed. [6] Claims are brought in respect of alleged diminution in value caused by the breaches of the express and implied terms pleaded. Counsel may wish to consider, however, whether such claims ought to be based on the cost of making good any works that had been carried out other than in accordance with the warranty. [7] Mr Collins defends the proceeding. His Statement of Defence was filed on 10 March 2008.[8] For all practical purposes, the allegations made in the Statement of Claim are met with bare denials. On one view, the Statement of Defence could be said to be evasive. [9] An example relates to the complete denial of paragraph 10 of the Statement of Claim. That is included within the second cause of action. It alleges that Mr Collins was aware of and pursuing weathertightness claims in respect of the Binnie Avenue property and referred to a report from Total Design Ltd of 5 November 2003 to support that allegation. [10] It is clear that that report was in the possession of Mr Collins. It is also clear that proceedings had been issued in respect of such claims against the Far North District Council. Mr Collins' acknowledged positions should have been pleaded specifically. I refer to r 130 of the High Court Rules; see also McGechan on Procedure at paras HR130.02 and HR130.11. [11] I mention these issues because problems relating to discovery seem to have arisen because of the failure to define issues in the pleadings. It is only after the true issues have been defined that parties can embark upon proper consideration of what documents are relevant and what documents are irrelevant for the purpose of completing verified lists of documents.The application for further discovery[12] Mr Mikitasov flagged the possibility of an application for further and better discovery in a memorandum prepared by his counsel, Mr James, for a case management conference before Associate Judge Robinson on 15 September 2008. Paragraph 6 of that memorandum stated that unless Mr Collins reconsidered his list of documents or provided a new one, an application for further and better discovery would be made. [13] The application was made on 19 September 2008. It was opposed by Mr Collins. It may have been better for Mr Collins to acknowledge that disclosure of the additional documents was required but to seek time to file and serve asupplementary list. However, rather than doing that, the application was fully opposed. [14] I have discussed the extent of the discovery required with counsel during the course of the hearing. It seems to me that first it is necessary to define the issues fully through the provision of an Amended Statement of Defence. That should be followed by the filing and service of a supplementary verified list of documents which includes reference to all documents in the possession or control of Mr Collins that have not previously been discovered relating to the following issues: a) First, documents relating to the construction of the office to which reference is made in paragraph 5(a) of the Statement of Claim. b) Second, all documents relating to the construction of the swimming pool to which reference is made in para 5(b) of the Statement of Claim. c) Third, any documents touching on the extent of Mr Collins' knowledge of the construction of the office, construction of the swimming pool and the pursuit of claims in respect of weathertightness issues affecting the dwelling. [15] Mr Mark has indicated today that Mr Collins' position is that work had been completed on the office and the swimming pool by the time he acquired the Binnie Avenue property and that only minor work, not requiring a building consent, was done while he was in occupation. If that were the issue raised by the Amended Statement of Defence, it will be necessary for all documentation relating to Mr Collins' knowledge of the work done to be disclosed. [16] Mr Mark has also raised an issue in respect of the existence of other proceedings in the District Court at Kaikohe between the parties. An application has been made for at least one of those proceedings to be transferred to this Court. The application is scheduled to be heard by the District Court on 27 November 2008.[17] I indicated that I was not prepared to consider deferring further discovery pending any order transferring the proceeding to this Court or the possibility of subsequent consolidation. If the issues raised are as similar as suggested by Mr Mark, then all that will be required is a separate intitulment to a similar verified list of documents which, with very little difficulty, could be sworn by Mr Collins and filed in both Courts. [18] For the purpose of r 300 of the High Court Rules, I am satisfied that there are grounds for believing that Mr Collins has not discovered all documents in his possession or control relating to the construction of the office, construction of the swimming pool, his knowledge of the extent of that construction and his knowledge and pursuit of claims in respect of weathertightness issues. It follows that an order should be made requiring him to file and serve supplementary verified list of documents listing all relevant documents in his possession or control. [19] That list of documents, of course, will also need to identify any documents that have previously been in his possession or control, but no longer are. Separately any documents to which privilege or confidentiality is claimed, will need to be listed independently, with reasons for the claims of confidentiality or privilege, so that those claims can be considered by counsel for Mr Mikitasov before determining whether any application for production should be made. [20] Mr James has indicated that there may be issues arising from discussions today that he would like to consider in determining whether to re-plead more specifically allegations in the Statement of Claim, so that Mr Mark may respond to them. Mr Mark has no opposition to such an order being made.Result[21] I make the following orders: a) Any Amended Statement of Claim shall be filed and served on or before 14 November 2008.b) Any Amended Statement of Defence or Statement of Defence to an Amended Statement of Claim shall be filed and served on or before 28 November 2008. c) Mr Collins' supplementary verified list of documents, addressing the issues to which I have already referred (see para [14] above) shall be filed and served on or before 17 December 2008. [22] The proceeding is adjourned for a further case management conference before Associate Judge Robinson on 9 February 2009 at 2.00pm. The conference can be held by telephone. [23] Given the nature of the discussions which have occurred today and the likely narrowing of issues, the parties may wish to consider whether a settlement conference may be useful. If so, that can be explored with the Associate Judge at that conference. [24] It was necessary for a full hearing to be held today on the application for further discovery. The plaintiff has succeeded on that application. There is no reason to deny costs to him. [25] Costs are awarded in favour of the plaintiff on a 2B basis, together with reasonable disbursements. Both costs and disbursements shall be fixed by the Registrar. __________________________ P R Heath J