LYTTELTON PORT COMPANY LIMITED v AON NEW ZEALAND LIMITED [2017] NZHC 2215

LYTTELTON PORT COMPANY LIMITED v AON NEW ZEALAND LIMITED [2017] NZHC 2215 [14September 2017]IN THE HIGH COURT OF NEW ZEALANDCHRISTCHURCH REGISTRYI TE KŌTI MATUA O AOTEAROAŌTAUTAHI ROHECIV-2015-409-000428[2017] NZHC 2215BETWEEN LYTTELTON PORT COMPANYLIMITEDPlaintiffAND AON NEW ZEALAND LIMITEDDefendantHearing: 22 August 2017Appearances: N R Campbell QC and S D Williams for Plaintiff/RespondentL J Taylor QC and Z Kennedy for Defendant/ApplicantJudgment: 14 September 2017JUDGMENT OF ASSOCIATE JUDGE CHRISTIANSEN[REDACTED VERSION]This judgment was delivered by me on14.09.17 at 3:30pm, pursuant toRule 11.5 of the High Court Rules.Registrar/Deputy RegistrarDateIntroduction[1] The defendant, (Aon), has filed for consideration:a) An application for orders as to privilege.b) An application for leave to issue a third party notice.c) An application for further discovery.[2] The plaintiff (LPC) opposes those applications.[3] When these matters were called on 22 August 2017 there was only time toconsider the applications as to privilege and for leave to issue a third party notice. Thethird application, for further discovery, was adjourned for hearing before AssociateJudge Osborne, on a date to be arranged. Therefore this judgment only concerns thefirst two applications referred to.Background[4] LPC has sued Aon which arranged insurance cover for LPC for the period1 July 2010 to 30 June 2011 (the period), when the Canterbury earthquake occurred.Vero Specialist Risks Limited (Vero) was the lead insurer for LPC at that time. LPCsued Vero. An outcome was mediated and Vero paid LPC $445,969,000,300 (plusGST) in respect of claims for earthquake damage and business interruption losses.Also a sum of $3,291,984 (plus GST) was paid in respect of LPC's claim in relationto contract works.[5] LPC's claim against Aon is that it failed to exercise reasonable care and skillto obtain cover for the period under a material damage (excluding fire) insurancepolicy (MD policy) which clearly met LPC's need for full reinstatement cover over itsassets, and to meet business interruption costs.[6] LPC alleges it suffered losses totalling $184,810,615.00 as a consequence ofAon's negligence.[7] LPC alleges Aon was negligent in numerous ways, including that leading upto the placement of insurance on 1 July 2010, Aon failed to pass on to insurers thereinstatement cost estimates for various assets, and negligently advised LPC thatcertain matters were uninsurable (and consequently failed to insure them), and failedto obtain cover that clearly and unambiguously had no asset-specific sub-limits, andconsequently obtained inadequate indemnity periods and sums insured.[8] LPC sues Aon for breach of contract and negligence in the placement of LPC'sinsurance program for the period commencing 1 July 2010. Aon placed that insuranceby obtaining signed placing slips from insurers on 1 July 2010. The cover that Aonarranged was effective from that date.[9] The first of the Canterbury earthquakes was on 4 September 2010. Widespreaddamage was caused to LPC's assets. Aon had by that time not finalised the policywording with insurers in breach, LPC says, of Aon's promise that it would do so within60 days of cover.The applications[10] The present applications for consideration are in part about the role if anycarried out by Mr Tony Paterson of the law firm Markit Law. Mr Paterson wasengaged by LPC after the September 2010 earthquake. It is in that connection Aon'sapplication to set aside privilege concerns two emails, one of which was sent to MrPaterson, and the other which reports comment by Mr Paterson regarding the extentof insurance cover.[11] The other matter for consideration concerns Aon's application for leave to issuethird party proceedings against Mr Paterson. Aon's draft third party claim is based ontwo allegations of breach of duty by Mr Paterson and these are that he failed to adviseLPC that the draft MD policy wording did not clearly and indisputably establishsufficient insurance cover.[12] In the Court's view the setting aside privilege application should be dealt withfirst, because in that outcome, as will become apparent by this judgment those issuesaround joinder become refined somewhat.Application to modify LPC's claims of privilege[13] This application was filed on 16 June 2017. It sought orders setting aside ormodifying LPC's claims to privilege over two documents identified in LPC'sdiscovery as LPC.00040 and LPC.01596.[14] Both documents in question were, by LPC's first discovery affidavit ofdocuments, filed and served on 24 March 2016, and listed in Part 1 of the Schedule ofthat affidavit as discoverable documents in LPC's control and for which neitherprivilege nor confidentiality was claimed.[15] Subsequently and following disclosure LPC asserted claims of privilege overthose documents.LPC.00040[16] LPC.00040 is an email which attached seven documents; each of which wasindividually listed and given a unique document number. It reads:[REDACTED]The information in this email and any attachments is confidential, may belegally privileged and is intended for the addressee only. Reading, Copying,disclosure or use by any other person is not authorised. If you are not theintended recipient, please advise the sender by return email and delete thismessage and any attachments. Emails are not secure and cannot beguaranteed to be error free as they can be intercepted, amended, lost ordestroyed and may contain electronic contamination. Anyone whocommunicates with Fawcett Faire Limited by email is taken to accept theserisks.[17] Aon says LPC's claims of privilege over that document should be set aside ormodified, but says privilege claims are anyway unsustainable because the author ofthe document, Peter Faire of Fawcett Faire Limited, was not given authority by LPCto obtain legal advice on LPC's behalf and it did not seek and receive that advice andthat Mr Faire simply passed on information to LPC's solicitor for the purpose ofenabling legal advice to be given directly to LPC. Aon says therefore that LPC.00040is not privileged (because privilege does not attach unless the document has beenprovided by an agent), but if privileged then LPC has waived that privilege becauseits disclosure of that document was not involuntary or mistaken or without LPC'sconsent, and therefore was inconsistent with a continued claim to confidentiality.[18] LPC.00040 was an email from Mr Faire that was sent to Mr Paterson and itwas copied to Ms Meads, then LPC's Chief Finance Officer (CFO). It was marked'private, confidential and privileged'. [REDACTED]LPC.01596[19] Likewise and with respect to that document, Aon claims LPC waived privilegebecause its disclosure to Aon was not involuntary, mistaken, or without consent, butalso because LPC failed to take steps to obtain privilege until about three months afterdisclosure of that document was brought to its attention by Aon.[20] LPC.01596 was an email from Ms Meads as CFO to Mr Rodger Fisher (thenChairman of LPC's Board) dated 26 October 2010 confirming receipt of a letter fromthe Chief Executive of Aon which recorded that [REDACTED].Issues regarding claims of privilege[21] Mr Taylor for Aon submits that if LPC.00040 is to attract privilege then LPCmust establish that its author, Mr Faire:a) Was LPC's authorised representative or agent;b) Was acting under an agency agreement that authorised him to requestor obtain professional legal services on LPC's behalf; andc) Actually requested or retained such legal services.[22] Mr Taylor submits no sufficient evidence has been provided to prove Mr Fairewas its "claims consultant" and its "agent". LPC's failure to do so, submits Mr Taylor,gives rise to the inference Mr Faire was merely an independently contracted claimsconsultant, i.e. he was just a conduit – who just passed information on withoutcomment or input.[23] There is, Mr Taylor submits, no evidence that Ms Meads sought advice orconfirmation from Mr Faire on what instructions ought to be given to Mr Paterson –that she was not deferential to his views. It was she, Mr Taylor says, and not Mr Fairewho directly instructed Mr Paterson; that Mr Faire was not authorised to request orobtain legal services on LPC's behalf. If Mr Faire was LPC's agent then it was as anindependent contractor and not for the purpose of requesting or obtaining legalservices; and that it is apparent from the wording of LPC.00040 that [REDACTED]It is for these reasons, Mr Taylor submits, that LPC's claimed privilege in LPC.00040ought to be set aside.[24] Furthermore, it is submitted LPC has in any event waived privilege in relationto that document because their disclosure of that document by the Courts processeswas not involuntary or mistaken or without LPC's consent, and therefore isinconsistent with continued claims as to confidentiality.[25] Mr Paterson records, Mr Taylor notes, having reviewed each of LPC's 13,500relevant documents before being listed in the first discovery affidavit and hepersonally conducted the second review of approximately 6000 documents that he andhis firm, Markit Law, had identified as relevant and open and he relisted any privilegeddocuments that were mistakenly listed previously in Part 1.[26] Mr Taylor submits claims by Mr Paterson of a mistake and by Ms Meadsclaiming disclosure was inadvertent cannot be accepted, because such a claim isinadmissible. She, it is submitted, was authorised to make the first discovery affidavitand cannot now resile from her consent to disclosure of LPC.00040.[27] The matter has importance submits Mr Taylor, for LPC's case is that Aon didnot provide full insurance cover. It is Aon's case that the two documents in questiondemonstrate that [REDACTED].[28] Mr Paterson deposed that he noted that had LPC.01596 included a reference tolegal advice obtained by LPC, he would immediately have raised an objectionregarding its disclosure. Claims of inadvertence are rejected on behalf of Aon. Theysay Mr Paterson was clearly giving advice about insurance policy cover details andMs Meads, the CFO at the time, was responsible for instructing Mr Paterson in thatregard. Therefore they were persons directly involved in requesting advice regardingthe construction and effect of the draft policy submitted for consideration.[29] Mr Taylor submits that if LPC's claim of privilege in LPC.00040 is upheld thenthe unredacted portions that are in evidence remain nonetheless non-privileged andthose include the attachments to that document including the insurance policydocuments that were provided to Mr Faire by Aon.[30] Regarding document LPC.01596 Aon accepts it contains some privilegedmaterial as emphasised in the sentence [REDACTED].Legal principles[31] Relevant provisions of the Evidence Act 2005 (the Act) include the followingsections:a) Section 54 - relating to communications with legal advisors;b) Section 51 - which deals with interpretation considerations;c) Section 53 - relating to the effect and protection of privilege;d) Section 65 - which deals with considerations of waiver.[32] Section 54 states that communications between a lawyer and a client areprivileged from production if they are confidential and were made for the purpose ofseeking or giving legal advice for the client. It is clear that claims of confidentialityare no different if the communications between lawyer and client were effected by athird party acting as an agent for the purpose of communicating with the other partyto give or obtain legal advice.1[33] In issue is whether Mr Faire of Fawcett Faire Limited, claim consultants, wasor was not acting as an agent for LPC when he sent his LPC.00040 email on 1 October2010. The proper enquiry is whether Mr Faire can be said to have assumed the role1 Wheeler v Le Marchant (1881) 17 Ch D 675.on behalf of LPC in forwarding information to LPC's solicitor (i.e. whether in doingso he was acting on behalf of LPC) and was undertaking that which LPC itself wouldhave by collecting information for the purpose of communicating that to the solicitor.[34] Mr Taylor submits privilege was waived because disclosure was notinvoluntary, mistaken or without consent and indeed was not identified or correcteduntil Aon applied to join Mr Paterson to the proceeding; and that claims by Ms Meadsthat it was inadvertent and by Mr Paterson that it was a mistake, are unacceptable.[35] Mr Taylor says the clear inference to be taken from that document is that[REDACTED]. Moreover it was only upon the application to join Mr Paterson to theproceeding that LPC took steps to challenge the disclosure of LPC's .01596.[36] Mr Taylor refers to the comment of Allen J in Pernod Ricard2. In that caseHis Honour referred to the importance of the speed with which a party moves to correctthe erroneous disclosure of privileged material3. Mr Taylor comments that LPC hadfor three months been fixed with the knowledge of disclosure of the document andtherefore could not now avoid the responsibility for a failure to take steps in relationto its disclosure.[37] It is Aon's backup position that even if Mr Faire acted as an agent, that privilegewas in any event waived.[38] Waiver of privilege is governed by s 65 of the Evidence Act. Section 65(1)provides that waiver may be express or implied. Subsections (2) and (3) deal with thecircumstances in which waiver will be effective. Section 65(2) provides:(2) A person who has privilege waives the privilege if that person, or anyonewith the authority of that person, voluntarily produces or discloses, orconsents to the production of disclosure of, any significant part of theprivileged communication, opinion or document, in circumstances thatare inconsistent with a claim of confidentiality.Considerations2 Pernod Ricard [2012] NZHC 2801 at [49].3 Pernod Ricard at [55][39] There appears little doubt that in this case inadvertence was the dominant causeof disclosure. Usually such disclosure is unlikely to be found to be voluntary.4 Waiverof privilege does not usually occur when a document is inadvertently listed in the"open" part of an affidavit of documents. In the present case the document in questionwas subsequently provided for inspection. Usually when that occurs privilege isgenerally lost unless the inspecting party had been given notice of the mistake beforeinspection – although that outcome is by no means certain. For s 65(2) purposes theCourt's enquiry ought to be about whether that disclosure was instead inconsistentwith the claimed confidentiality.[40] The Court agrees with Mr Campbell's submission that the test involvedconcerns an assessment of all of the circumstances of the case, and it is about wherethe documents have been listed in Part 1 and what was provided for inspection.Relevant factors ought to include whether there was anything to suggest to theinspecting party that the production of the documents was consistent with a continuingclaim to confidentiality. For example, whether there was anything on the face of thedocument putting the inspecting party on notice that it attracted privilege. Further, asMr Campbell notes, s 65(4) separately provides that, despite issues relating to whetheror not disclosure was voluntary or inconsistent with a claim of confidentiality, waiveris not to be found where disclosure involuntarily or mistakenly, "or otherwise occurredwithout the consent" of the privilege holder.[41] In Pernod Ricard, Allan J held that s 65(4) was directed at the "not uncommonsituation" of administrative error or procedural mishap, where the party handing overor disclosing a document never intends to do so.5 Allan J confirmed in thecircumstances there described that it could not have been said the disclosure was aresult of an obvious mistake, and therefore held that privilege could not be maintained.[42] The issue has an important affect in this proceeding. If privilege is maintainedthen LPC has the right to refuse the disclosure of the particular communications, andevidence must not be given of it.6 It may also affect Aon's claims of wanting to joinMr Paterson as a party.4 McGechan on Procedure at [HR8.25.13(1)], citing Kos J in Rolex Group (2010) Ltd v Chaffers GroupLtd [2012] NZHC 1332.5 Pernod Ricard at [45] – [46].6 ss 52 and 53.Conclusions[43] In this Court's view an entitlement to a claim of privilege is clear. As canclearly be inferred from the email, Mr Faire was LPC's insurance claims consultantand agent. The evidence of Ms Meads and Mr Paterson confirms Mr Faire was askedto send the email to Mr Paterson for the purpose of obtaining legal advice from MrPaterson. The email is headed "Private, confidential and privileged". The openingwords note, "As instructed".[44] The Court agrees with Mr Campbell's submission that were it not forMr Faire's engagement as a claims consultant, he would not have received the policydocuments from Aon, and the email that he sent to Mr Paterson would have been sentby someone within LPC; that Mr Faire had collected information in the course ofperforming a task that LPC would have undertaken otherwise – because he wasinstructed by LPC to send that information to Mr Paterson.[45] The Court does not accept there was waiver. The more acceptable view is thatMr Paterson's evidence of an inadvertent mistake in the nature of an oversight isunderstandable, given the number of documents that were reviewed in the discoveryprocess. Further, the Court accepts that it must have been obvious that LPC.00040was a privileged communication because it was sent to its solicitor and clearly marked"Private, confidential and privileged", and that 'label' applied equally to theattachments.[46] The Court accepts that as soon as Mr Paterson became aware that privilege hadnot been claimed for LPC.00040, he on 5 July 2016 emailed Aon's solicitors advisingthem of the mistaken disclosures, and identified the documents in question byreference to their discovery number. On 3 August Mr Paterson emailed Aon'ssolicitors and confirmed that privilege was claimed over the entirety of LPC.00040,and he asked that it be returned or destroyed.[47] Aon's solicitors by a letter dated 15 September 2016 disputed LPC's claim toprivilege over LPC.00040. That letter carefully addressed claims of privilege oversome eight documents that had been listed and had then been disclosed. The letter didnot suggest LPC had waived any privilege in any of those documents. Only whenLPC later claimed privilege did the solicitors respond, noting that it may be necessaryfor the matter to be formally challenged.[48] The Court does not accept that LPC has acted inconsistently with its claim ofconfidentiality, either as to LPC.00040 or to the attachments referred to in thatdocument.[49] For similar reasons the Court dismisses claims of waiver affecting LPC.01596.The Court accepts Mr Paterson's account of the listing of that document as aninadvertent mistake. The document had been inadvertently listed, and disclosure of itinadvertently provided. As Mr Campbell submits, it ought to have been clear to Aon'ssolicitors that the material was privileged and that no general waiver had beenprovided.[50] The Court agrees that LPC acted consistently with continued claims forconfidentiality in relation to both documents, including attachments, and that fairnessdictates that privilege has not been waived under s 65(2). Alternatively, the disclosureof those documents was mistaken in terms of s 65(4), and privilege has not beenwaived.Application for leave to issue a third party notice[51] On 16 May 2017 Aon applied for leave to issue a third party notice against MrPaterson, the solicitor who was, Aon says, retained by LPC to provide legal advice inrelation to material damage insurance cover required to meet LPC's need for fullreinstatement cover of its assets.[52] Leave of the Court is required because the time to issue a notice of joinder asof right expired more than two years ago.[53] Mr Paterson was retained by LPC to provide legal advice in relation to the MDpolicy prior to the wording being, Aon claims, finalised on or about 28 October 2010.Aon alleges that Mr Paterson as the solicitor advising LPC, owed a duty of care toLPC to exercise all reasonable skill and care when advising LPC on the interpretationand effect of the MD policy; that on the basis of documents discovered by LPC, Aonwill allege that if it is found liable in respect of claims that it did not meet LPC's needfor full reinstatement cover, then Mr Paterson similarly failed to advise LPC that thedraft MD policy wording provided to him did not clearly and indisputably establishinsurance cover without asset-specific sub-limits and without estimated reinstatementcost values.[54] Aon's position is that if it is negligent then so too was Mr Paterson negligentand Aon is entitled to a contribution from Mr Paterson. If LPC is successful in itsclaim against Aon then, Aon says, there is a question in this proceeding that ought tobe determined not only between LPC and Aon but, also between LPC and Mr Paterson.[55] Again, and upon this separate issue LPC.00040 together with its attachmentsand LPC.01596, do have significance.[56] Mr Taylor submits it is clear that Ms Meads had engaged Mr Paterson toprovide LPC with legal advice by no later than 4 October 2010. Ms Meads deposedthat when she reviewed the draft MD Policy that had been sent to her by MrMacDonald, LPC's account manager, she was worried the policy was less than clear,particularly as to the basis on which LPC's assets were insured. She relayed herconcerns to Mr MacDonald, and also to Mr Mullin a director of Aon. She reportsreceiving a reply from Mr Mullin which stated the draft policy was "just that" and thatsome more work was still to be done on the wording and that Aon had:A few changes to make to match the intended policy responses agreed withinsurers at the time of placing cover for renewal.[57] It is Aon's position Ms Meads by her email of 26 October 2010 had referredexplicitly to legal advice provided by Mr Paterson [REDACTED].[58] Aon says that this email confirms that Mr Paterson provided legal advice on orbefore 26 October 2010.[59] Mr Taylor submits an obvious inference from available evidence is that MrPaterson gave advice on the proper interpretation of the draft MD Policy wording priorto its finalisation; and as a solicitor advising LPC he owed a duty of care to exercisereasonable skill and care, including in particular when advising on the interpretationand the effect the MD Policy.[60] Mr Taylor's submissions also address LPC's claims that Mr Paterson's joindermay cause delay for the hearing of a 14 week trial set down for 25 June 2018 and forwhich pre-trial directions are yet to be made. Mr Taylor responds that Mr Paterson'sinvolvement while significant was not substantial and there is no reason why all issuesraised by his joinder cannot be readied meanwhile. It is Aon's position that if itsapplication for joinder is denied Aon would be able in any event to issue separateproceedings against Mr Paterson and apply for consolidation of those with thisproceeding. Mr Taylor submits that joinder now would avoid any risk of a multiplicityof proceedings. Aon submits the interests of justice favour the grant of leave.Principles[61] These applications are governed by the provisions of rr 4.4 and 4.8 of the HighCourt Rules.[62] Counsel agree that the general principles in relation to leave are summarisedin Westwood Group Holdings Limited v Rilean Construction (South Island) Limited[Westwood]:7In exercising its discretion the Court must have regard to all relevantcircumstances, including the delay in making the application. For presentpurposes considerations of risks of delay being caused, the avoidance ofduplicity of proceedings, and an assessment of the relative strengths andweaknesses of the parties' cases require consideration.Considerations[63] Previously herein the Court has addressed the details of LPC's claim againstAon. In brief it is claimed Aon negligently failed to provide sufficient insurance of itsassets to ensure sufficient cover to ensure full reinstatement costs would be available.7 Westwood Group Holdings Limited v Rilean Construction (South Island) Limited [2013] NZHC739 at [15].Aon denies allegations of negligence in that regard. It is Aon's claim of a case againstMr Paterson that:a) [REDACTED];b) [REDACTED];c) LPC became concerned that the basis on which its assets were insuredunder the draft MD policy wording were not sufficiently clear (i.e.reinstatement or indemnity) and during the period commencing 11October 2010, LPC then corresponded with Aon regarding LPC'sconcerns;d) On 12 October 2010, Mr Faire emailed Ms Meads as follows:I have been reflecting on Tony's draft letter from you to Aonand the possibility of 'spooking' them with potential PolicyProblems, or disclosing at this stage that LPC has retainedlegal advice. Brokers are very sensitive to the Potentialthreats.e) [REDACTED].f) [REDACTED].g) On 28 October 2010 LPC's policy wordings were finalised, and thesewere provided to Ms Meads on 29 October 2010; andh) On that same date LPC recorded in open correspondence thatMr Faire's email of 1 October 2010 " was provided in the course of for the purpose of providing legal advice in relation to the insurancecontract".[64] It is Aon's case that Mr Paterson gave advice on the proper interpretation ofthe draft MD policy wording prior to its finalisation and, as the solicitor advising LPC,Mr Paterson owed a duty of care to exercise reasonable skill and care in particularwhen advising on the interpretation and the effect of that policy. Further, it is Aon'sposition that the nature of that advice given is relevant to whether Aon is liable to LPC,for if it is, it will contend that Mr Paterson similarly failed to advise LPC that the draftMD policy wording provided to him prior to finalisation did not clearly andunambiguously establish the insurance cover claimed to have been required.[65] In that result, Aon says it is entitled to claim a contribution because of MrPaterson's breach of duty; and that is an issue it says needs to be determined not onlybetween LPC and Aon but also between LPC and Mr Paterson.[66] Addressing those relevant Westward principles, it is submitted by Mr Taylor:a) No unreasonable delay occurs because the 14 week trial date set for 25June 2018 was over 13 months away when the third party notice leaveapplication was filed.b) Regarding claims on behalf of LPC that Mr Paterson would, if joined,no longer be able to act for LPC, and therefore new solicitors wouldhave to be instructed, resulting in delays occurring, counsel says MrPaterson should never have acted in the proceeding anyway because theopen documents demonstrated he directly advised LPC on theinsurance policy terms, and there would always be a likelihood hewould be required to give evidence and anyway, LPC's currentsolicitors have been engaged since 25 May 2017, and its counsel havebeen involved in the proceeding since at least 2012;c) That the events giving rise to the claims occurred at latest when MrPaterson was engaged to advise LPC in early October 2010, andbecause the LPC policy wordings were finalised on 28 October 2010;and therefore Mr Paterson's discovery obligations should be limited inparticular because LPC has already discovered most of its relevantdocuments;d) Aon would have been able to join Mr Paterson as of right had it serveda third party notice within time, and Aon has not been guilty ofunreasonable delay in bringing its leave application;e) The granting of leave will avoid a duplicity of proceedings and preventthe same proceeding being tried twice with different results; because ifAon is unsuccessful by its leave application it will nonetheless defendLPC's claim by reference to Mr Paterson's involvement, and also itwould be able to issue separate proceedings against Mr Paterson andapply for a consolidation of those with this, and would seek to use thedocuments discovered in this proceeding to the extent necessary;f) That a proper balance between the parties' interests would be achievedby the grant of leave, because this is not a case where LPC was notinvolved in the issues between Aon and Mr Paterson;g) That Aon believes it has a strong prima facie case against Mr Paterson;h) And therefore the overall interests of justice would be favoured by thegrant of leave, because there is a question in issue that ought to bedetermined as well between Aon and Mr Paterson.Conclusions[67] The clear evidence is that Aon placed LPC's insurance program for the periodcommencing 1 July 2010 by obtaining signed placing slips from insurers on that date;and that by the time of the Canterbury earthquakes on 4 September 2010 Aon had notby then finalised the policy wording with insurers as it said it would.[68] Mr Paterson's services were engaged after the September 2010 earthquake. Itis Aon's case Mr Paterson failed to advise LPC that the draft MD policy wording didnot clearly and indisputably establish insurance cover without sub-limits, and forestimated reinstatement cost. Aon says if Mr Paterson had given that advice LPCwould have instructed Aon to obtain cover without sub-limits.[69] It is far from clear how Mr Paterson caused or contributed to Aon's claims ofloss when by the time Mr Paterson was engaged LPC's insurance contracts had alreadybeen entered into and the September 2010 earthquake had damaged LPC's assets. Itis clear by the time of Mr Paterson's engagement that the insurance contracts wereformed under the slip system when, once signed by insurers, it constituted a legallybinding contract providing for insurance cover in its own right.[70] LPC's own claim focuses upon what was done or not done prior to theplacement of cover on 1 July 2010. This gives cause to question Aon's claim that MrPaterson's breach of duty caused or contributed to the losses.[71] Aon's case against Mr Paterson focuses on events post-earthquake.[72] It is LPC's case that it did give those instructions to Aon. Therefore and if Aonis correct that Mr Paterson failed to give advice, that failure did not have theconsequence pleaded by Aon because LPC says it had in any event instructed Aon tomake it clear that there were no sub-limits.[73] It is now two years since Aon filed its statement of defence. The documents itidentified in support of its joinder application have, subject to those affected byprivilege, been available by discovery since 31 March 2016. Then it took almost ayear for Aon to advise of its intention to pursue a claim against Mr Paterson.[74] Of course Mr Paterson has had to be removed as a solicitor assisting withLPC's proceeding preparations, notwithstanding LPC's engagement of senior counselmeanwhile. As Ms Meads deposes, Mr Paterson has been LPC's advisor in relation tothis matter since 2010, has a detailed understanding of its business and assets, and ofthe extensive losses that LPC has suffered in the earthquakes. Ms Meads says MrPaterson and his team at Markit Law had responsibility for trial preparation tasks suchas managing LPC's discovery, locating expert witnesses and the briefing of those.[75] Mr Campbell submits that because it is not possible to foresee all eventualitiesthat might follow joinder there is a significant risk that joinder will result in anapplication for adjournment of the June 2018 fixture. The Court agrees that if thatoccurs then likely there will be a lengthy delay if the fixture is vacated.[76] Mr Campbell submits LPC's allegations of breach by Aon focus almostexclusively on what Aon did or failed to do leading up to the placement of cover on 1July 2010 and concerning a period of time with which Mr Paterson had noinvolvement; and that he had no involvement with LPC's claims that Aon failed toprovide proper claims assistance to it. Mr Campbell's concerns are that if Mr Patersonis joined then there will be an extensive review of issues between Aon and Mr Patersonwith which LPC will have no involvement – and that this will add unnecessarily to analready complex trial.Result[77] Aon is at liberty to issue a separate proceeding against Mr Paterson and thento apply to consolidate the two proceedings because Aon says there is an overlapbetween the two. However an application for consolidation will give rise to the samediscretionary considerations as those on a current application and it should not beassumed that any application for consolidation would succeed.[78] It is clear Aon's application and proposed third party claim against Mr Patersonare founded on Aon's use of privileged communications. As earlier noted, LPC'sclaims to privilege over those documents are upheld. Therefore those documents arenot available for Aon's present joinder application.[79] In the Court's view a weighing up of Westward principles favours the declineof the grant of leave to issue a third party notice to join Mr Paterson to this proceeding.[80] Aon's application for leave to join Mr Paterson to the proceeding is dismissed.Costs[81] These will be fixed upon application.Associate Judge Christiansen