The Minister of Education v Carter Holt Harvey Limited [2020] NZHC 1539

The Minister of Education v Carter Holt Harvey Limited [2020] NZHC 1539 [2 July 2020]IN THE HIGH COURT OF NEW ZEALANDAUCKLAND REGISTRYI TE KŌTI MATUA O AOTEAROATĀMAKI MAKAURAU ROHECIV-2013-404-1899[2020] NZHC 1539UNDER Consumers Guarantees Act 1993, the FairTrading Act 1986, the Building Act 2004BETWEEN THE MINISTER OF EDUCATION ANDOTHERSFirst to Fourth PlaintiffsAND CARTER HOLT HARVEY LIMITEDDefendantAND AUCKLAND COUNCIL AND OTHERTERRITORIAL AUTHORITIES LISTEDIN SCHEDULE 1 TO THE FIRSTAMENDED STATEMENT OF CLAIM BYTHIRD DEFENDANT AGAINST FIRSTTO FIFTIETH THIRD PARTIESFirst to Fiftieth Third PartiesHearing: 2 to 5 June 2020Counsel: JA Farmer QC, NF Flanagan, J Carlyon, EC Rutherford andKM Moon for PlaintiffsDM Salmon, M Heard, ED Nilsson, HAT Bush andSGT Ma Ching for DefendantJudgment: 2 July 2020JUDGMENT (No. 9) OF FITZGERALD J[As to pre-trial interlocutory applications – admissibility and discovery]This judgment was delivered by me on 2 July 2020 at 3pm,pursuant to Rule 11.5 of the High Court Rules.Registrar/Deputy Registrar .. Date..Solicitors: Meredith Connell, AucklandLeeSalmonLong, AucklandCONTENTSMinistry's challenge to the admissibility of Carter Holt's evidenceIntroduction and preliminary points [7]Category A – the causation evidence [17]Category A objections – submissions [34]Category A objections – discussion [40]Category B – the building practice evidence [55]Category B objections – submissions [59]Category B objections – discussion [61]Category C evidence – objections and submissions [63]Category C evidence – discussion [68]Miscellaneous objections [76]Carter Holt's challenge to the admissibility of the Ministry's evidenceIntroduction and approach [96]Irrelevance – material not addressing the pleaded defects [101]Not evidence in replyIntroduction [117]Reply evidence – principles [120]Application to the Ministry's reply evidence - overview [137]Reply evidence that is repetitive of evidence in primary briefs [141]Reply evidence which does not address new matters, but expands on or"bolsters" topics already discussed in primary briefs [144]Reply evidence which raises new matters/late testing evidence [169]"Late" testing evidence included in Ministry's October 2019 briefs [175]Ministry's evidence as to Shadowclad's performance on particular schoolbuildingsIntroduction and submissions [187]Discussion [197]Objections to hearsay statements [207]Gregory O'Sullivan [208]Christopher Ross (reply brief) [213]Peter Graham (reply brief) [215]Jeanette Drysdale (primary brief) [219]Philip O'Sullivan (primary brief) [221]Robin Wakeling (primary brief) [227]Thomas Wutzler (reply brief) [228]Ministry's application for discovery related ordersIntroduction and orders sought [234]Legal principles [248]Why the Ministry says there is evidence of ongoing systemic issueswarranting the orders sought [258]Search for documents held by a further custodian [285]Orders and result [292]Schedule ASchedule B[1] The defendant, Carter Holt, is the manufacturer and supplier of a claddingproduct called Shadowclad. Shadowclad was used to clad a number of buildings atschools around New Zealand. In these proceedings, the plaintiffs (who I will refer tocollectively as "the Ministry") say that Shadowclad is inherently defective and unfitfor purpose, in that when it is used to clad school buildings by way of direct fix (thatis, without a cavity), it causes or will cause those buildings to fail from aweathertightness perspective.[2] Carter Holt disputes that Shadowclad is inherently defective in the manneralleged. It says the issues the Ministry is experiencing with the weathertightness ofschool buildings is nothing to do with the inherent quality of its product, but is theresult of a range of construction, installation and maintenance defects (which I willrefer to collectively as "construction defects").[3] There are more than 800 school buildings in issue. A six-month Stage 1 trialis scheduled to commence before me on 3 August 2020. Three key issues will bedetermined at the Stage 1 trial:(a) whether Shadowclad is defective in fact;(b) whether Carter Holt owes the Ministry a duty of care; and(c) if the answer to (b) is "yes", whether Carter Holt breached that duty bydesigning, manufacturing or supplying Shadowclad for use on schoolbuildings.[4] In accordance with timetable orders leading up to the Stage 1 trial, the partieshave each discovered a (very) large number of documents and exchanged briefs ofevidence to be adduced at the trial. Those briefs of evidence, from 56 witnesses,extend to thousands of pages. Unsurprisingly in a trial of this nature, the vast majorityof the evidence will be expert rather than factual evidence.[5] I have been case managing these proceedings since 2017 and have deliveredeight earlier judgments on various interlocutory matters. There are presently threepre-trial interlocutory applications before the Court:(a) first, the Ministry challenges the admissibility of aspects of CarterHolt's briefs of evidence;(b) second, Carter Holt challenges the admissibility of aspects of theMinistry's briefs of evidence; and(c) third, the Ministry seeks orders in relation to Carter Holt's claims ofprivilege over discovered documents and in particular, that:(i) Carter Holt provide an individualised factual explanation foreach claim of privilege it has made; and(ii) those explanations and the underlying documents are thenreviewed by an independent barrister appointed for that purposeby the Court, who will then make recommendations to the Courton whether privilege has properly been claimed.[6] I address the applications in the order set out above.Ministry's challenge to the admissibility of Carter Holt's evidenceIntroduction and preliminary points[7] The Ministry's application relates to three categories of Carter Holt's evidence:(a) Category A – being evidence to be called by Carter Holt about the causeof undue water ingress in particular school buildings (the "causationevidence").1 The Ministry says the causation evidence is irrelevant,2 orif relevant, its probative value is outweighed by the risk it will1 The bulk of the Ministry's challenges to admissibility fall into this category.2 Evidence Act 2006, s 7.needlessly prolong the proceedings.3 The Ministry says the causationevidence does not support the proposition that Shadowclad does notroutinely lead to undue water ingress; rather, it merely shows that therelevant school buildings also suffer from other defects and issues. Itsays that if this evidence is admitted, it will need to fully engage withit, including by way of extensive cross-examination, thus needlesslyprolonging the proceedings.(b) Category B – being evidence as to the Ministry's procurement practicesand management of its property portfolio (the "building practiceevidence"). Again, the Ministry says this evidence is inadmissible onthe grounds of irrelevance, or its probative value is outweighed by therisk of it needlessly prolonging the proceedings. The Ministry says thisis because the evidence relates only to causation and/or Carter Holt'saffirmative defences which will not be determined at the Stage 1 trial.(c) Category C – being evidence said to be inadmissible hearsaystatements.[8] There are two preliminary matters on which it is helpful to comment beforeaddressing each of the above categories of evidence:(a) first, in an earlier judgment delivered by me on 25 February 2019, Iaddressed (as a matter of principle) the admissibility of the causationevidence (the "Admissibility Judgment");4 and(b) second, the approach to determining admissibility challenges pre-trialin civil proceedings.[9] At an earlier stage of these proceedings, and in light of indications by CarterHolt of the type of evidence it proposed to call at the Stage 1 trial, the Ministry soughtorders that evidence as to the cause of water ingress in individual school buildings was3 Section 8.4 Minister of Education v James Hardie New Zealand Ltd [2019] NZHC 245.irrelevant and thus inadmissible at the Stage 1 trial. In my Admissibility Judgment, Ideclined to make such an order, which was being sought in a vacuum without visibilityof the actual evidence to be called. Rather, I noted that detailed evidence as to the factthat construction defects are causing undue water ingress in particular school buildingssays nothing, at least in and of itself, about Shadowclad as a product and whether it isalso contributing to or will in the future cause such water ingress. But despite this, Iobserved that the causation evidence was unlikely to be wholly irrelevant. Thefollowing extracts from my Admissibility Judgment are illustrative of the approach Itook:[37] Is, therefore, the disputed evidence relevant and otherwiseadmissible? In a simple way, relevance can be tested by applying thefollowing sequence of logic:(a) Some school buildings have already suffered undue wateringress;(b) Factors such as faulty design, construction and/or poorinstallation of Shadowclad are causing the undue wateringress; therefore(c) Shadowclad is not a defective product in the sense alleged bythe Ministry.[38] I accept Mr Farmer's submission that there is a non sequitur in theabove reasoning. Ultimately, I understood Mr Miles to accept this,acknowledging that evidence to the effect that other factors are causing unduewater ingress would "beg the question" of whether Shadowclad was also areason for that outcome.[39] That must be right. For example, evidence that Shadowclad has beenimproperly installed on dozens of buildings causing undue water ingress doesnot, in and of itself, say anything about whether Shadowclad as a product iscontributing to the water ingress, or will in the future cause water ingress. Allit demonstrates is that an allegedly faulty product has also been installed in afaulty manner and the latter is causing undue water ingress. Or using the cartyre and silicone breast implant examples referred to above, evidence that afaulty braking system is routinely causing some vehicles to lose road tractionin wet conditions does not, in and of itself, say anything about whether thetyre on the same vehicle is also contributing to those effects, or even once thebraking system is fixed, it will routinely have such effects. Nor does evidencethat other external factors are causing serious health issues in a woman whohas silicone breast implants mean the silicone breast implants are not alsocausing or contributing to (or will in due course cause or contribute to) thesame health issues.[40] I do not agree with the Ministry, however, that the evidence CarterHolt proposes to lead is wholly irrelevant. The purpose for which it is to beled is in my view important. As noted above, Mr Miles says Carter Holt'sexperts' primary evidence will be that they have seen nothing to suggest anyobserved undue water ingress is the result of Shadowclad's alleged inherentdefects (at least when properly installed and maintained). In support of thatprimary evidence, Carter Holt's experts wish to also be able to say, in effect,that the Court can have confidence in their view that Shadowclad performs asintended because they can explain the observed water ingress by pointing toother factors. In this way, and as I understood Carter Holt to have advancedits argument, the disputed evidence is only to be deployed in the context ofand for the purpose of supporting its experts' primary evidence that thepleaded defects in Shadowclad do not routinely, or will not routinely, lead toundue water ingress in buildings to which it is affixed.[41] Ultimately, and subject to any objection it might raise on the basis ofs 8 of the Evidence Act once it sees the disputed evidence, the Ministry acceptsthat evidence of the type described at [12](b) above is relevant at the Stage 1trial, including whether the pleaded inherent defects have caused buildings tofail to meet the performance requirements of the Building Code. To bolsterits primary evidence that the pleaded inherent defects have not caused thebuildings to fail, Carter Holt ought to be permitted to adduce supporting orcorroborative evidence which suggests the failures are being caused whollyby other factors. I therefore accept that in a general sense, the disputedevidence, at least when deployed in the manner discussed, has some probativevalue in the context of the issues to be determined at the Stage 1 trial.[42] The Ministry is right, however, to be concerned that such evidencemight seek to bring the issue of individual causation back into the Stage 1 trial.The Stage 1 trial is not concerned with detailed consideration of, or the makingof findings on, the various causes of water ingress in particular schoolbuildings. Detailed evidence of other causes of water ingress in a largenumber of individual buildings risks diverting attention from what will be akey question at the Stage 1 trial and the most probative evidence in relation toit – namely evidence directed to whether Shadowclad as a product is fit for itsintended purpose.[footnotes omitted][10] The Ministry's present challenge to the causation evidence must therefore beconsidered in the context of these observations.[11] As noted, the second preliminary point is the proper approach to pre-trialdetermination of admissibility of evidence in civil proceedings. This is relevant toboth the Ministry and Carter Holt's admissibility applications.[12] Simon France J examined these issues in his very recent judgment in Cridge vStudorp Ltd (delivered in April of this year), litigation not dissimilar to the presentproceedings (involving a cladding product manufactured by James Hardie).5 AsSimon France J noted, there is a degree of reluctance on the part of the Court to5 Cridge v Studorp Ltd [2020] NZHC 794.determine admissibility challenges on a pre-trial basis in civil proceedings,particularly challenges based on relevance.6 This is because determining thesechallenges will often require the Court to consider the challenged evidence in thecontext of all the evidence to be called at trial. This is particularly so in very large andcomplex proceedings such as. In such cases, it is generally unrealistic to expect thetrial Judge to have a detailed knowledge or understanding of all the evidence at thepre-trial stage.[13] In Cridge v Studorp, Simon France J also made the following observationsabout the approach to determining admissibility challenges pre-trial with which Irespectfully agree and accordingly adopt:[11] As noted, some cases – Air Chathams, Diagnostic Medlab andPrattley Enterprises Ltd v Vero Insurance New Zealand Ltd – are proffered asexamples of evidence being excluded prior to trial. I accept they are indeedthat, but regard them of no particular precedent value. In the particularcircumstances of each case the Court felt able to make a pre-trial decisionconcerning admissibility. In doing so, the Court was applying the principlesalready identified.[12] Mr Hodder accepts that evidence may be provisionally admitted witha final decision of admissibility deferred until a fuller context is known. Forevery decision in which evidence is excluded prior to trial, in civilproceedings, I have no doubt there will be more, by a considerable factor,where the decision has been deferred. There are good reasons for this. Forexample, relevance can be difficult to determine in advance. Applications toexclude on this basis prior to trial often simply reflect the lens the applicantparty brings to the proceeding. A Judge, not at that stage as familiar with thematerial as counsel, will properly be hesitant to exclude for relevance.[13] On the requirement for an expert to be impartial, Air Chathams is anexample where the Court felt able to determine a lack of neutrality solely onthe basis of the brief. It was obviously a flawed brief. The Court described itas "studded with condemnatory remarks". More often, however, it will bedifficult to assess the issue without hearing from the witness, especially whenthe impartiality is said to be evidenced by only a few comments in a lengthybrief that otherwise complies. The danger of over-weighting incautiouslanguage must be borne in mind.[14] The same can be said for complaints about exceeding the scope ofone's expertise. Often it is not possible from the qualifications alone to discernthe complete experience underlying a qualification, and oral explanation canclarify. Particularly with technical evidence, caution is needed before too hastyan assessment is made about whether the evidence falls within the scope ofwitness's expertise.6 At [6] and [12].[15] I accept the starting point is a party has an onus to ensure that its briefsof evidence on their face comply with the High Court Rules. It also should beacknowledged that there are both difficulties and costs for the other partyconfronted with a non-complying brief. It can be difficult to respond tosubmission presented in the guise of a brief, and ultimately unhelpful to theCourt if the response manifests itself as opposing submissions also in the guiseof a brief. Further, there may be unnecessary cost in producing expert evidenceto counter evidence that either is not impartial or exceeds its proper scope.[16] Balancing this, and in addition to the reservations I have expressedabout the ability pre-trial to accurately determine these matters, there are thepolicy concerns identified by Hammond J in Air Chathams:[48] Judges are always hesitant to rule out a brief of evidence at theoutset. First, one can never be completely confident that something mightnot be useful or matters might have been misperceived by the Judge atthe outset. Secondly, Judges do not lightly turn away from the seat ofjustice matters of "evidence" which one side would like to have beforethe Court. This leads to a sense of grievance on the part of plaintiffs thatthey have not had their full day in Court.[17] Ultimately, in determining these applications, a Court returns to a needto strike a balance, bearing in mind there are firm rules about expert evidencethat should be complied with. On the other hand, insistence of slavishadherence, with the need to amend and recast evidence that otherwise will justbe ignored, is to be avoided.[Footnotes omitted][14] The difficulties inherent in ruling on admissibility challenges pre-trial isparticularly acute in this case given the sheer volume of evidence that has beenexchanged between the parties and the sheer volume of the admissibility challengeseach party has made. By way of example, on Carter Holt's admissibility application,a schedule listing the individual challenges extends to more than 100 pages.Accordingly, while the parties were in agreement that all their admissibility challengesought to be dealt with pre-trial and on a challenge-by-challenge basis, that is, withrespect, simply unrealistic.[15] Given the issues noted by Simon France J and the particular difficultiesinherent in this case, I have deliberately adopted a cautious approach to rulingevidence inadmissible on the present applications. In some instances, I have been ableto accurately assess the admissibility of the evidence and I have made rulingsaccordingly. But for many of the challenges, it would be inappropriate or is simplyimpossible to rule on admissibility pre-trial. Accordingly, admissibility challenges onwhich I have not ruled in this judgment will need to await trial.7 I would hope,however, that the broader observations I have made in this judgment assist the partiesto winnow down the scope of challenged evidence to focus on that of real significance.[16] I turn now to the specific Carter Holt evidence to which the Ministry objects.Category A – the causation evidence[17] This aspect of the Ministry's challenge largely concerns the evidence to begiven by Neil Alvey and Frank Wiemann.8[18] Before addressing Messrs Alvey and Wiemann's evidence, it is relevant to notethat the Ministry's core building expert evidence will focus on buildings from fourcase study schools (which I will refer to as the "Stage 1 buildings"), one test hutconstructed specifically for the purpose of this litigation and approximately18 additional school buildings.9 It is also relevant to note that the Ministry does notchallenge the admissibility of Carter Holt's specific building evidence detailing well-built and apparently well performing Shadowclad buildings, or evidence that thedamage observed in particular schools relied on by the Ministry to demonstrateShadowclad's alleged defects has in fact been caused or contributed to by factors otherthan Shadowclad.[19] Mr Alvey is a building surveyor who until recently was the principal of KaizonLimited (Kaizon). Kaizon was engaged by Carter Holt in 2013 to inspect theMinistry's school buildings. Mr Alvey personally inspected 107 of the Ministry'sschool buildings clad in Shadowclad, as well as the four Stage 1 buildings and the testhut. He also inspected wall models made of Shadowclad and discussed by ThomasWutzler, a witness to be called by the Ministry.7 Pursuant to s 14 of the Evidence Act 2006, evidence may be provisionally admitted. Remainingchallenges to admissibility can be dealt with at trial, on a witness by witness basis in closings, orby way of rulings in my substantive judgment.8 Excluding schedules, Mr Alvey's brief of evidence is 246 pages in length. Mr Weimann's briefof evidence is 120 pages in length.9 As discussed later in this judgment, Carter Holt objects to the admissibility of the Ministry'sevidence on these additional school buildings. I say there are "approximately" 18 of theseadditional buildings, as there was some dispute at the hearing about how many of them theMinistry experts will give evidence on. But whether it is 18, 20 or 22 additional buildings is notmaterial to determining Carter Holt's admissibility challenge.[20] Mr Alvey is of the opinion that Shadowclad, when properly installed andmaintained, will meet the weathertightness requirements of the New Zealand BuildingCode.10 He says the Ministry's case that Shadowclad compliant buildings will stillleak is inconsistent with his inspection of a large numbers of school buildings. Thefollowing extracts from section 5 of his brief of evidence ("Summary of the basis formy evidence") is indicative of the overall thrust of his opinion:Performance of Shadowclad from my inspections5.7 Having inspected a large number of buildings clad in Shadowclad, I amof the opinion that Shadowclad, when properly installed, will performand meet the requirements under the Building Code. When it is installedcorrectly in accordance with the building consent documentation andgood trade practice the cladding both does not allow water entry andremains durable. When it is installed incorrectly, especially when thereare multiple defects in installation, water entry is inevitable. It is nodifferent to any other cladding product in this respect.5.8 While the majority of buildings I have seen were being subjected torepairs for the reasons set out above, I have seen Shadowcladperforming with no evidence or signs of any ingress or damage tobuildings, or large parts of buildings. On occasions the buildings haddefects in construction some of which led to isolated water ingress.5.9 Berkley Normal Middle School Block A, Classroom 7 (B0022),Frankton School Block G (B0105), Lucknow School Block D (B0271),and Snells Beach School classroom blocks Kahikatea, Kauri, Manawaand Puriri and the Administration and Library Block are all examplesof buildings that are reasonably constructed and largely performing. Ihave described these buildings further in Schedule 3 to this brief ofevidence.5.10 The Snells Beach School buildings were inspected under the amendedinspection protocol as non-claim buildings. It appears that they hadbeen investigated by the plaintiffs' experts who had carried outextensive sheet removal and destructive testing, but they were excludedfrom the claim despite being clad in direct-fix Shadowclad.Widespread design, construction and maintenance issues5.11 The common theme throughout all of my investigations is that there hasbeen a significant lack of proper design, construction and use ofShadowclad when installed on school buildings. Almost all of thebuildings I inspected had significant installation issues which either10 For ease of reference, I will refer to buildings on which Shadowclad has been properly installedand maintained as "Shadowclad compliant buildings".presented a weathertightness or durability risk, or which had resulted inthe failure of the building envelope and water ingress or damage of thekinds alleged by the plaintiffs. It was not surprising to find that thebuildings were failing, because of how poorly they had been designed,built and maintained.5.12 In many cases, the installation issues reflected failures to adhere toCHH's specifications, or poor design or building practice orworkmanship. The errors were so basic that they indicated a completedisregard to CHH's specifications and standard industry practices forthe installation of cladding. Similarly, maintenance on many schoolswas poor, resulting in the premature deterioration of the cladding andother building elements.Causes of failure on school buildings5.13 The failure of the school buildings within the claim in my experiencehas been a result of:(a) Multiple defects in construction and design;(b) Poor build quality;(c) Failures to follow the building consent documentation;(d) Incomplete building consent documentation;(e) A lack of appropriate maintenance of the building in question;or(f) A combination of the above.[21] The Ministry does not object to paragraphs 5.7 to 5.10 in the above extract, butsays paragraphs 5.11 to 5.13 are inadmissible, together with following paragraphs inwhich Mr Alvey expands on the type of construction defects he has observed in schoolbuildings.[22] Mr Alvey then goes on to state:Kaizon's findings are consistent with Ministry reports5.20 Kaizon's findings are consistent with the findings and the conclusionsof the reports commissioned by the Ministry from Prendos and HamptonJones, and which I understand served as catalysts to this proceeding.5.21 The Prendos report is dated 7 February 2011. It was based on a visualsurvey of 1,074 buildings constructed or modified after 1994 at 199 schools inthe Auckland area. A copy of the report can be found at document[PL00100180]. The buildings surveyed by Prendos were not limited tobuildings clad in Shadowclad.5.22 The report indicated that building defects were present in many of theschool buildings surveyed, including as a result of poor building practices.The executive summary at page 4 includes the following observation:This survey indicated that building standards in schools are poor, due toa combination of high risk materials, poor tradesmanship, and non-durable designs. The incidence of buildings requiring repair is very high,typically higher than observed in the residential sector, even for normallyreliable material such as brick.5.23 It continues at pages 5-6:[S]chools have been using building techniques that have a high failurerate, such as untreated timber, fibre cement with unreliable joints,multiple and complex junctions, blocked weep holes on internal drainagecavities, among other factors. We observe that the residential sector hasgreatly improved its weathertight performance since 2004 due to changesin design standards and compliance, primarily E2/AS1. However schoolsare predominantly built by commercial contractors working to differentstandards, and while some change has occurred since 2004 (notably useof treated timber in framing), our survey observed a significant numberof defects allowing water ingress into school buildings, even fromrecently built projects.5.24 At page 10 under the heading "The problem", the report notes thatdesign issues, such as back sloping soffits are typical in the school buildingssurveyed. The report does not provide details of specific defects in any of thebuildings inspected. However, at section 3, "Findings", it makes clear thatdefects were found to be present in a high percentage of buildings irrespectiveof cladding type (see page 15), including cladding materials which aregenerally considered "robust" to weathertightness issues, such as brick (seepage 16).5.25 The Hampton Jones report is dated April 2012.3 It is based on a visualsurvey of 6,130 buildings constructed or modified after 1994 at 1,592 schoolsacross the country. Like the Prendos report, the survey was not limited tobuildings clad in plywood. The report contains fewer details as to defects, butmakes a similar observation as to design practices in respect of schoolbuildings. At page 11, it notes:It was observed during the National Survey that many school buildingsare designed with the objective of conveying a certain image. This couldbe due to cultural influence or the desire to give an impression of amodern or innovative environment. These aspirations for schoolbuildings often do not align with good weathertightness principles[23] The Ministry does not object to this part of Mr Alvey's brief.[24] The balance of Mr Alvey's brief of evidence addresses each of the allegedinherent defects in Shadowclad listed in schedule 2 to the Ministry's statement ofclaim. His discussion of each alleged defect generally follows the following format:(a) some introductory comments about the defect;(b) his opinion that he has not seen the alleged defect in Shadowclad whencorrectly installed and maintained (and giving "good" examples wherethat is the case);(c) that in many school buildings he has inspected, a range of constructiondefects exist which he considers is causing the undue water ingress thatcan be observed (and giving "bad" examples of this); and(d) a response to the Ministry's experts' evidence in relation to the allegeddefect.[25] The Ministry generally objects to those parts of Mr Alvey's evidence whichfall into (c) above (together with two schedules to Mr Alvey's brief in which he listseach building he has inspected and "checks" a box as to whether he has seen variousconstruction defects in each building, or summarises the school buildings sufferingfrom construction defects on a defect-by-defect basis).11 The Ministry's objectionsare sometimes to a whole paragraph or a series of paragraphs of Mr Alvey's brief, orin some instances, to a particular sentence within a paragraph. Generally, the Ministryhas not objected to a statement of the specification requirements for installation ormaintenance of Shadowclad12 or to Mr Alvey's evidence of problems that can arisegenerally where those specifications are not met,13 but does object to his discussion ofsuch requirements not having been met in particular buildings he has inspected and11 Schedule 4 ("Buildings I have inspected and issues found") and Schedule 6 ("Table of defectsfound on school buildings"). The Ministry does not object to Schedule 3 ("Examples of wellconstructed buildings") or Schedule 5 ("Non claim buildings I have inspected").12 For example, the Shadowclad specification requirements as to ground level clearances, at 8.13 to8.15 of Mr Alvey's brief of evidence.13 For example, paragraph 8.16 of Mr Alvey's brief of evidence, excluding the first sentence;paragraph 8.21, excluding the last sentence; paragraph 8.61, excluding the last sentence; paragraph25.56 excluding the last sentence; paragraph 32.4.water ingress occurring as a result.14 The objection to this latter aspect of Mr Alvey'sevidence is not universal, however. There are aspects of Mr Alvey's brief of evidencein which he discusses construction defects he has seen in school buildings to whichthe Ministry does not object.15 Or, where Mr Alvey gives a general view as toproblems he has seen in school buildings he has inspected (which is not objected to),16and then a specific reference to a particular school building (which is objected to).17[26] As noted, the balance of the Ministry's challenge to the category A evidence islargely found in Mr Wiemann's brief of evidence.[27] Mr Wiemann is a registered building surveyor and a director of sectionOneLimited, a building surveying firm. Carter Holt engaged him in 2017 to carry outinspections of the Ministry's school buildings which are the subject of this claim.Mr Wiemann has inspected 84 school buildings, the test hut, certain wall modelsconstructed by the Ministry's experts, as well as three of the four Stage 1 buildings.63 of the 84 school buildings Mr Wiemann has inspected form the basis of parts of hisbrief of evidence.[28] The following extracts from Section 2 of Mr Wiemann's brief ("Summary ofmy opinions") provide an overview of his evidence:2.1 I understand that the plaintiffs have alleged that Shadowclad routinelyfails to perform and meet the requirements of the Building Code and otherrelevant standards due to alleged inherent defects when installed on lightbuildings in a direct-fix application.2.2 In short, I do not consider that the pleaded defects have beendemonstrated. My opinion is informed by the large number of inspections Ihave carried out.2.3 When Shadowclad is installed correctly according to CHH's technicaldocuments and the requirements of the Building Code, and in accordance withgood design principles, good building practice and normal maintenance, Iexpect that it will meet the durability and relevant requirements of theBuilding Code.14 For example, the first sentence of 8.16 of Mr Alvey's brief of evidence; the last sentence ofparagraph 8.21 to 8.23; the last sentence of paragraph 8.61; the last sentence of paragraph 25.56;paragraphs 32.5 and 32.6.15 See, for example, paragraphs 8.31, 8.34, 8.66(a) to (c), 15.17 and 22.7.16 See, for example, paragraph 24.15.17 See, for example, paragraph 24.15.2.4 I have identified weathertightness issues and damage at a large numberof the schools that I have inspected. However, almost without exception theseissues were present where there were faults in design, workmanship, ormaintenance.2.5 All school buildings I inspected showed some, and often severeinstallation defects, negatively affecting the performance of the Shadowcladsheets and often resulting in significant damage to both the sheets and thebuildings. Many buildings also had basic design issues which contributed towater ingress.2.17 Based on my inspections I consider that Shadowclad is leaking wheremultiple of the installation issues I have set out are present, often compoundedby poor maintenance. The installation defects that individually would notnecessarily have affected the performance of the cladding were found to bethe overriding cause of water ingress when considered in combination.2.18 In my view, the weathertightness issues seen on school buildings arenot a result of any inherent defects in the Shadowclad product but are due toa combination of separate departures from good practice, Building Coderequirements and CHH's installation requirements.[29] The structure of Mr Wiemann's brief then follows a similar format to that ofMr Alvey, in that he goes on to comment on each of the alleged inherent defects inShadowclad and in relation to each, comments on the specification requirements forinstallation and maintenance, and expresses his opinion that when these requirementsare met undue water ingress is highly unlikely. He then goes on to say that during hisinspections, he often observed construction defects which mean the specificationrequirements were not met and that "a combination of [these] defects has caused wateringress at all of the sites that I destructively inspected."18 For some of the allegeddefects, Mr Wiemann gives examples of where specification requirements have beenmet and where he says no undue water ingress is evident. He generally concludes thatthe water ingress caused and damage observed at school buildings was a result of otherconstruction defects and is not an example of any inherent defects in Shadowclad.19[30] Mr Wiemann's brief of evidence also contains a section in which he commentson the Ministry's evidence in relation to two of the Stage 1 buildings. The overallthrust of this aspect of Mr Wiemann's evidence (in which he gives a range of examples18 Paragraph 8.16 of Mr Wiemann's brief of evidence. The Ministry object to this paragraph, as wellas its surrounding paragraphs.19 Paragraph 8.59.of construction defects at those school buildings) is that the damage to the Stage 1buildings has been caused by poor installation and maintenance, rather than inherentdefects in Shadowclad or Carter Holt's technical literature.20[31] The Ministry's objections to Mr Wiemann's evidence follow a similar patternand theme to those it has made to Mr Alvey's brief of evidence. The Ministry objectsto those aspects of Mr Wiemann's evidence which deal with construction defects inthe school buildings. The objections are largely to whole paragraphs or sections ofMr Wiemann's brief of evidence, and are not so "granular" as many of those toMr Alvey's brief.21[32] Minor objections are taken to what the Ministry says is also causation evidencein other Carter Holt briefs of evidence. The Ministry objects on this basis to nineparagraphs in Paul Barnett's brief,22 and four paragraphs in Peter Jordan's brief.23[33] The Ministry does not object to that section of Mr Wiemann's brief discussedat [29] above, or any of the examples he gives of construction and installation defects.Category A objections – submissions[34] Mr Farmer QC, senior counsel for the Ministry, submits that Carter Holt'scausation evidence falls squarely within the type of evidence I indicated in myAdmissibility Judgment would not be admissible, or at the very least would be of lowprobative value. He says it suffers from the very non sequitur discussed in thoseaspects of my Admissibility Judgment set out at [9] above. And to the extent Mr Alveyand Mr Wiemann in particular purport to give "primary" evidence that Shadowclad isnot inherently defective with the causation evidence deployed in a "supportive" or20 Paragraph 29.4.21 My overall impression is that a greater proportion of Mr Wiemann's evidence addressesconstruction defects than Mr Alvey's evidence, which may explain the slight difference in thenature of the Ministry's objections to each.22 Mr Barnett's brief is 19 pages long. The paragraphs objected to largely relate to alleged lack ofmaintenance at school buildings.23 Mr Jordan's brief is 62 pages long. The paragraphs objected to contain high level observations ofconstruction defects in 99 schools Mr Jordan has inspected, and that he considers there also tohave been maintenance failures by the schools. While Mr Jordan lists the school buildings he hasinspected in a schedule to his brief, the schedule does not contain any detail in relation to thealleged construction defects said to exist at each of the schools."collaborating" role, Mr Farmer says that in substance, the causation evidence isMr Alvey and Mr Wiemann's primary evidence; that is, there is no other support fortheir conclusion that Shadowclad is not inherently defective other than the fact thatthe school buildings suffer from a range of construction defects.[35] Mr Farmer says the causation evidence is therefore inadmissible. But even ifthe Court were to conclude it has some, albeit limited, probative value, he submits thats 8 of the Evidence Act 2006 (the Act) is engaged, given leading the causation evidenceand, importantly, the need to respond to it, will needlessly prolong the proceedings.Mr Farmer submits for example, that in relation to the schedules attached to Mr Alveyand Mr Wiemann's briefs of evidence, the Ministry will be required to critique thatevidence building-by-building, elevation-by-elevation and defect-by-defect, includingas a result of the Ministry's cross-examination obligations under s 92 of the Act.Mr Farmer says the Court could not have any regard to the conclusions drawn byMr Alvey and Mr Wiemann unless their evidence had been tested by the Ministry inthis way. Mr Farmer says that is the very approach I rejected in my Stage 1 judgment.[36] Carter Holt accepts that it has taken a different approach to the evidence overallto the Ministry. Carter Holt says the Ministry is trying to demonstrate that Shadowcladis inherently defective largely by laboratory and other similar testing, whereas CarterHolt's experts are looking at the performance of Shadowclad in "the real world".Mr Salmon, senior counsel for Carter Holt, accepts that in that sense, the parties are"ships in the night". But at least in relation to the Ministry's building specificevidence, Mr Salmon says that just as the Ministry's experts are giving evidence oftheir observations of building performance in the real world, so too are Mr Alvey andMr Wiemann.24 Mr Salmon says it cannot be the case that the Ministry's buildingspecific evidence is admissible but Carter Holt's is not. If Carter Holt's causationevidence is excluded, Mr Salmon says this would mean the only evidence at trial ofShadowclad's performance "in the real world" will have been driven by the Ministry'sselection of school buildings which would be highly prejudicial to Carter Holt.24 The Ministry says that its building specific evidence is not evidence of building performance, butrather of Shadowclad's performance on particular school buildings.[37] In terms of the particular aspects of Mr Alvey and Mr Weimann's evidence towhich the Ministry objects, Mr Salmon submits the causation evidence is advanced inthe supporting or contextual role envisaged in my Admissibility Judgment. By wayof example, he notes that Mr Alvey gives evidence of a number of Shadowcladcompliant buildings which are not suffering undue water ingress and which tend toprove that Shadowclad is not inherently defective, and then contrasts this with hisevidence of his inspections of buildings with construction defects and where unduewater ingress is occurring.25 Mr Salmon says this approach informs Mr Alvey'sprimary opinion that Shadowclad does not, for example, "absorb and retainproblematic amounts of moisture when properly designed and installed". In otherwords, and as Mr Salmon emphasised in his oral submissions, it would beinappropriate to look at the challenged evidence in isolation, rather than in the broadercontext of the witness's entire evidence. Mr Salmon also rejects the suggestion thatCarter Holt's evidence as a whole "ignores" Shadowclad as a product, and says thecausation evidence also needs to be considered in the context of Carter Holt's evidenceoverall, much of which is directed to Shadowclad's inherent characteristics. Viewedin this broad way, he says it is clear that the causation evidence, which forms arelatively small part of Carter Holt's evidence overall, is being deployed in asupporting role.[38] Mr Salmon further submits that evidence of alleged maintenance issues onschool buildings not only provides critical context to whether reliable conclusions canbe drawn about Shadowclad as a product, but is also relevant to the contractual matrixinto which Shadowclad was sold and whether it is fair, just and reasonable for theCourt to find that Carter Holt owes the schools (as end users) a duty of care. Andwhile accepting that the Supreme Court stated that vulnerability as part of theproximity analysis is to be assessed by likely plaintiffs as a class (and not anyparticular plaintiff),26 Carter Holt will argue that the Crown is in a "class of its own"25 Mr Salmon notes that the smaller number of compliant buildings addressed by Mr Alvey andMr Wiemann simply reflects that there are not very many such buildings in the overall pool ofbuildings the subject of this claim.26 Carter Holt Harvey Ltd v Minister of Education [2016] NZSC 95, [2017] 1 NZLR 78 at [54],citing Body Corporate No 207624 v North Shore City Council [2012] NZSC 83, [2013] 2 NZLR297 [Spencer on Byron] at [197]–[198].as a plaintiff.27 It will therefore argue that the Ministry's maintenance policies arerelevant to the duty of care assessment. Mr Salmon says these points are of particularrelevance to the Ministry's challenge to aspects of Mr Barnett's evidence.[39] Finally, Mr Salmon also queries the Ministry's submissions on the need tocross-examine witnesses on the causation evidence, at least to the detailed extentsuggested. He notes that the Ministry has always accepted that the school buildingssuffer from a range of construction defects so that the overall thrust of the causationevidence ought not to be in dispute. This is particularly so given the Stage 1 trial willnot be determining or making findings on individual causes of undue water ingress inindividual school buildings. Mr Salmon says the proper focus of the cross-examination would be what inferences or conclusions can be drawn from the experts'overall evidence as to what they observed during their inspection of school buildings.Category A objections – discussion[40] I decline to rule the causation evidence inadmissible. My reasoning follows.[41] First, I accept the Ministry's submission that detailed evidence of constructiondefects in school buildings which are causing undue water ingress does not, in and ofitself, say anything about the performance of Shadowclad as a product. I reached thatconclusion in my Admissibility Judgment. But I also concluded that, when deployedfor the purpose identified in that judgment, causation evidence would have someprobative value. Ultimately, so long as the evidence passes the gateways of ss 7 and8 of the Act (and s 25 in the context of expert evidence), how Carter Holt chooses tomeet the Ministry's case is a matter for it.[42] I have carefully reviewed Mr Alvey and Mr Wiemann's briefs of evidence.They both, and Mr Alvey in particular, advance a primary view or conclusion as to theperformance of well-constructed buildings which they say do not leak (which I willrefer to as their conclusion "A"), and then contrast that with the performance of poorlyconstructed buildings which they say do leak (which I will refer to as their conclusion27 Referring to Williams J's recent judgment in Stafford v Accident Compensation Corporation[2020] NZCA 164 at [158]–[394]."B"). The witnesses say, in effect, that it is proper to infer from conclusions A and Bthat it is not Shadowclad which is causing buildings to fail to comply withweathertightness requirements, but the construction defects which they haveidentified. And while the Ministry says that the very foundation for Mr Alvey andMr Wiemann's conclusion "A" is thin, or is in fact conclusion "B", I consider that amatter for trial.[43] The relevance of the challenged aspects of Mr Alvey and Mr Wiemann'sevidence must also be considered in the context of Carter Holt's evidence as a whole.I for one certainly do not have any real sense at this time of the detail of Carter Holt'sevidence overall, which is dense technical evidence to be given by some 33 (mainlyexpert) witnesses.[44] I also consider that some aspects of the Ministry's objections are, prima facieat least, illogical or inconsistent. For example, there are aspects of Mr Alvey'sevidence where he discusses, at a general level, problems which occur if Shadowcladspecifications are not followed (evidence which is not objected to by the Ministry),followed by examples of those problems occurring in actual schools (evidence whichis objected to). Further, some of the objections are to parts of paragraphs only (forexample, one or two sentences) and I agree with Mr Salmon that such a "surgical"approach to pre-trial admissibility rulings is unwise and could leave aspects of thebriefs incoherent.[45] Carter Holt also says some of the challenged evidence is deployed not for thepurpose of assessing whether Shadowclad is defective in fact, but whether Carter Holtowed a duty of care to the end user schools. This is particularly so in relation toevidence of maintenance policies and programmes. As noted, Mr Salmon suggestedthat this is relevant to the contractual matrix which the Supreme Court emphasisedwould be relevant to whether a duty of care ought to be found. At least as a matter offirst impression, the Ministry's maintenance programmes or policies would not appearto fall within the contractual matrix, which is more to do with the relationship betweenthe parties (being the focus of the proximity inquiry overall). As noted, Carter Holtwill also argue that maintenance programmes and policies is relevant to the questionof vulnerability. As far as I am aware, matters such as these have not been advancedby Carter Holt previously as relevant to the duty of care inquiry. Ultimately, however,whether evidence concerning the Ministry's maintenance programme and policies isrelevant to the duty of care inquiry is not something I can or ought to rule on in thispre-trial judgment. This is particularly so given the Supreme Court has emphasisedthat the two stage analysis used to determine whether a duty of care is imposedprovides a framework, not a straightjacket.28[46] Turning to s 8 of the Act, can I be satisfied at this stage that the probative valueof the causation evidence is outweighed by the risk it will needlessly prolong theproceedings?[47] I do not consider there is a risk Carter Holt leading the causation evidence willneedlessly prolong the proceedings. The evidence forms a relatively small part ofMr Wiemann's brief overall, and an even smaller proportion of Mr Alvey's briefoverall. The evidence concerning the Ministry's maintenance policies is more limitedin scope again. The Category A challenged evidence accordingly forms a relativelysmall part of Carter Holt's evidence as a whole. There was no suggestion by eitherparty that Mr Alvey or Mr Wiemann would need to be taken through each line entryof the schedules to their briefs of evidence. The reading of the Category A challengedevidence will not in my view adversely or materially impact the length of the trial.[48] The Ministry's main concern was the need for it to cross-examine the witnesseson these aspects of their evidence and the extent of cross-examination required. I donot agree, and consider the Ministry somewhat overstates the issues arising in thiscontext.[49] Mr Farmer first referred to the Ministry's duty to cross-examine Carter Holt'switnesses on the causation evidence. But there are pragmatic limits on the cross-examination duties contained in s 92 of the Act. Cross-examination is required onlyon "significant matters in issue" in the proceedings.29 The individual causes ofwater ingress at individual school buildings are not in issue at the Stage 1 trial and no28 North Shore City Council v Attorney-General [2012] NZSC 49, [2012] 3 NZLR 341 [The Grange]at [149]. The two "stages" are proximity between the parties and policy considerations.29 Section 92(1).findings will be made on those matters. What is a significant matter and "in issue" inthe proceedings is what inferences can properly be drawn from the causation evidence,in the context of the evidence as a whole, on whether Shadowclad is an inherentlydefective product. The Ministry will no doubt wish to cross-examine witnesses suchas Mr Alvey and Mr Wiemann on the inferences and conclusions they have drawn inthis regard.[50] Further, the Court of Appeal has observed that the duty embodied by s 92(1)of the Act was intended to give a witness the opportunity "to respond to evidence thatis to be called later".30 In that way, the rule is designed to "protect the interests of theparty that has called the witness, not the interests of the party who is cross-examiningthe witness".31 There will be no contradictory evidence "to be called later" by theMinistry on individual construction or installation defects on individual schoolbuildings which, out of a matter of fairness, ought to be put to witnesses such asMr Alvey and Mr Wiemann. In that sense, the cross-examination duty suggested bythe Ministry does not arise. Rather, and as the Court of Appeal has noted, whether(and to what extent) a party cross-examines an opposing witness on topics where thereis no duty to do so will be a matter of trial tactics.32[51] Accordingly, the extent to which the Ministry cross-examines on the causationevidence is a matter for it. Its view that the causation evidence is irrelevant, or at leastof marginal probative value, may inform the extent to which it engages in this task.Further, whether cross-examination on the causation evidence triggers the sort ofprejudice required to exclude otherwise relevant evidence is to be considered in thecontext that the Ministry accepts that many school buildings in the claim suffer fromconstruction defects.33[52] Whether the probative value of evidence is outweighed by the risk it willneedlessly prolong the proceedings ultimately involves a balancing exercise. I have30 R v Stojanovich [2009] NZCA 210 at [22].31 At [22].32 Martin v R [2015] NZCA 606 at [44].33 See, for example, Carter Holt Harvey Ltd v Minister of Education [2015] NZCA 321, (2015) 14TCLR 106 at [22]; Ministry of Education v James Hardie [2019] NZHC 245 at [23]; Mr GregorySullivan's affidavit sworn in these proceedings and dated 19 December 2017 at [22]; Ministry'ssubmissions on the present application, at [3.31].concluded that the risk that cross-examination on the challenged evidence will"needlessly" prolong the proceedings is overstated. And as Hammond J made clear inAir Chathams, Judges "do not lightly turn away from the seat of justice matters of'evidence' which one side would like to have before the Court."34 Hammond J'scomment that to do so can lead to a sense of grievance on the part of plaintiffs thatthey have not had their full day in court applies equally to defendants. Carter Holt isfacing a very significant claim by the Ministry. The Category A challenged evidenceis an important aspect of Carter Holt's defence to the claim. The Ministry of coursesays the causation evidence does not meet its claim that Shadowclad is an inherentlydefective product. But how and on what basis Carter Holt chooses to defend thatallegation it is a matter for it. Accordingly, even if the causation evidence prolongsthe proceeding (and there was no suggestion admitting it would mean the proceedingwould extend beyond the current six-month fixture), I do not consider it would"needlessly" do so.[53] For completeness, the Ministry also suggests that admitting the causationevidence would needlessly prolong the proceeding given the Councils would no doubtwish to be heard, because they could be affected by any findings made in respect ofthe relevant buildings. But no specific findings will be made as to the cause of anyparticular water ingress on particular school buildings. And Carter Holt has agreedwith the Councils that it will not hold the Councils to any such findings in any eventmade at the Stage 1 trial, in which the Councils are not participating.[54] In conclusion therefore, and taking into account the very real difficulties inaccurately determining pre-trial challenges to admissibility on the grounds ofrelevance (particularly when that is complex expert evidence); that the causationevidence is likely to have some probative value; that it has not been suggested thecausation evidence will prolong the proceedings beyond the current scheduled fixture;and coupled with the policy considerations noted above, I decline to rule that thecausation evidence is inadmissible.34 Air Chathams Ltd v Civil Aviation Authority of New Zealand (2003) 16 PRNZ 676 (HC) at [48].Category B – the building practice evidence[55] The building practice evidence is much more limited in scope than theCategory A evidence and concerns funding arrangements or budget decisions made bythe Ministry in relation to its property pool. The objections relate to a small numberof paragraphs within the evidence to be given by Mr Barnett, Mr Higgins andMr Aitken.[56] Mr Barnett's brief of evidence is 19 pages long. The Ministry object to eightparagraphs of his proposed evidence. Those paragraphs:(a) Provide Mr Barnett's opinion on a five-year property programme, as aplanning tool for capital works. The Ministry does not object toMr Barnett's reference or description of the property programme butobjects to his opinion as to it effectiveness.(b) Provide an overview of a new procurement model for school contractsand Mr Barnett's view on the impact of this model on the quality ofschool buildings. Again, the Ministry does not object to the generaloverview of the procurement model but objects to Mr Barnett's opinionin relation to it.(c) A brief description of Mr Barnett's role in project management ofschool construction contracts and changes in policies or guidelineswhich he states were intended to shift responsibility for projectmanagement to Boards of Trustees. The paragraphs objected to set outMr Barnett's concerns at the time of how the Ministry was managingits property portfolio, including maintenance.[57] Mr Higgins' brief of evidence is 67 pages long. The Ministry objects to nineparagraphs within it. Those paragraphs relate to Mr Higgins' experience working onMinistry projects over the last 20 years, including as the Ministry's agent in runningprocurement processes. Mr Higgins provides a general overview of the tender processemployed and in which he was involved, including that it adopted a lowest cost bidapproach. Mr Higgins outlines his opinion of the risks involved in such an approach,both to the principal and contractor.[58] Mr Aitken's brief of evidence is 30 pages long. The Ministry objects to oneparagraph within it. That paragraph forms part of a broader discussion of the role ofmanufacturers' literature in the design stage of a construction project. Mr Aitken statesthat he has been involved in a number of education projects in which the Ministryrequested cost savings which he considered led to premature failings of buildingelements (citing Botany High School as an example).Category B objections – submissions[59] The Ministry says the building practice evidence is irrelevant in that despitetrying to "join the dots" between the way in which the Ministry financed and resourcedits projects, the ways in which the Ministry maintained those buildings and the damagecaused to school buildings, the evidence says nothing about Shadowclad as a product.The Ministry did not suggest that if the evidence has some probative value, that isoutweighed by a risk its admission would needlessly prolong the proceeding.[60] Carter Holt responds by stating that the building practice evidence is not beingadduced for the purpose of demonstrating Shadowclad is not defective in fact, but forthe purpose of the duty of care inquiry. It submits that it provides "important factualcontext necessary to analyse whether Carter Holt owes a duty of care." It says theevidence is relevant to whether Carter Holt should be exposed to liability incircumstances where the Ministry has policies directly impacting the quality of itsschool buildings, performance of construction contracts and frequency ofmaintenance.Category B objections – discussion[61] The observations I have made at [45] above in relation to those aspects of thecausation evidence which relate to maintenance programmes and policies applyequally to the building practice evidence. Again, it is premature in my view to cometo any view on the relevance of the building practice evidence to the duty of careinquiry. This is particularly so given the very limited scope of the building practiceevidence in the context of Carter Holt's evidence as a whole.[62] I therefore decline to make a pre-trial ruling that the building practice evidenceis irrelevant.Category C evidence – objections and submissions[63] The Category C objections concern aspects of the evidence to be given byDr Tripti Singh and Mr Michael Straube. The Ministry objects to this evidence on thebasis it is inadmissible hearsay.[64] Dr Singh refers to an article written by a David Page, a technical officer atScion (formerly the New Zealand Forest Research Institute, a Crown ResearchInstitute) titled "Plywood – How durable is it as sheathing?". Dr Singh refers to theconclusions drawn in that paper, namely that H3 treated plywood cladding will have aservice life of more than twenty years even when left uncoated, and that decay hasdeveloped only where the decay hazard has been greater than H3.[65] Mr Page is not going to give evidence at the Stage 1 trial. The Ministry saysthe contents of his article are being advanced for the truth of their contents andtherefore meet the definition of a hearsay statement. The Ministry say the hearsaystatements are particularly objectionable given they relate to a key issue in dispute inthis proceeding, namely the durability of Shadowclad.[66] Carter Holt does not dispute that the evidence is a hearsay statement. But itsays it falls within the exception to the hearsay rules contained in s 129 of the Act("Admission of reliable published documents"). Section 129 provides as follows:129 Admission of reliable published documents(1) A Judge may, in matters of public history, literature, science, or art,admit as evidence any published documents that the Judge considersto be reliable sources of information on the subjects to which theyrespectively relate.(2) Subpart 1 of Part 2 (which relates to hearsay evidence) and subpart 2of Part 2 (which relates to opinion evidence and expert evidence) donot apply to evidence referred to under subsection (1).[67] Carter Holt notes that Mr Page's article was published in Scion's May 2000newsletter "Wood Processing Newsletter". It further says that the statutory purposeof Scion as a Crown Research Institute is to carry out research,35 and it is required bys 5 of the Crown Research Institutes Act 1992 to pursue excellence in all its activitiesand to comply with any applicable ethical standards in carrying out its research. CarterHolt says the Court can therefore be satisfied the published study to which Dr Singhrefers is a reliable source of information.Category C evidence – discussion[68] The authors of Mahoney on Evidence: Act and Analysis observe that s 129"codifies the common law exception to the hearsay rule that admitted accreditedhistories, scientific works and maps in order to prove facts of a public nature".36[69] I am not persuaded the article written by Mr Page is admissible pursuant tos 129. While the article is likely to be a reliable source of information, at least to thethreshold necessary to admit the evidence (rather than saying anything as to whetherit is accepted),37 it is not clear to me that the article concerns facts of a "public nature"to which s 129 is directed. Further and in any event, even if I had concluded the articlewas admissible pursuant to s 129, I would have placed little if any weight on it. Thedurability of Shadowclad is a highly contested issue in this proceeding and will be thesubject of significant expert evidence and cross-examination. Mr Page would not beavailable to be cross-examined on the conclusions drawn in his article. For that reason,that evidence on a critical matter at trial would not be substantially helpful to the Court.[70] For completeness, I note the Ministry does not object to Dr Singh's (direct)reference to Scion's service test records (which are also referred to in Mr Page'sarticle). To the extent Dr Singh makes direct reference to the Scion test records, Iaccept Carter Holt's submission that they would be admissible under the businessrecords exception (s 19 of the Act). They were prepared by Mr Page, having directknowledge of the information recorded, and were made in the course of Scion's35 Crown Research Institutes Act 1992, s 4.36 Elisabeth McDonald and Scott Optican (eds) Mahoney on Evidence: Act and Analysis (ThomsonReuters, Wellington, 2018) at [EV129.01] (emphasis added).37 Noting that s 129 only concerns the admission of evidence, which does not then have to beaccepted by the fact-finder; see Mahoney on Evidence at [EV 129.01].business. They were matters of routine and were completed some 22 years ago. Iagree with Carter Holt that in such circumstances, Mr Page is unlikely to have anyindependent recollection of test records completed by him so long ago.[71] Accordingly, to the extent Dr Singh relies on the Scion test records as afoundation for her own opinion, that is permissible. But I exclude as inadmissiblehearsay Mr Page's article and the conclusions he draws in it.[72] In terms of the Ministry's objection to Mr Straube's evidence, Appendix F tohis brief of evidence is a report which states on its face that it was prepared by aMr Richard Cakar. Mr Cakar is not giving evidence at the Stage 1 trial. The Ministrysays the report is being relied on for the truth of its contents, namely observations andfindings of Carter Holt's testing of the Ministry's models. For that reason, it is said tobe inadmissible hearsay.38[73] Carter Holt says the report is actually a report by Mr Alvey, who will be givingevidence at trial and thus the report falls outside the definition of a "hearsaystatement". I note that on the face of the document, however, Mr Alvey is listed as a"peer reviewer" to the report. That does not suggest Mr Alvey is the author of thereport or that the statements contained in it are his. Rather, it suggests Mr Alvey hasreviewed Mr Cakar's statements.[74] Carter Holt says the background to the report was an inspection carried out byMr Alvey and Mr Cakar together, in which Mr Alvey was the lead inspector withMr Cakar recording his views. These are factual matters, however, about which thereis no evidence before the Court.[75] As I conveyed to counsel at the hearing, I do not have sufficient informationon which to reach a concluded view as to the admissibility of the Cakar and Williamsreports. Factual information as to how they came to be prepared is required. This mayrequire a short voire dire with Mr Alvey during the trial. To the extent necessary (forexample, Mr Straube is called before Mr Alvey), the material can be admitted on a38 I note that a similar report authored by a Mr Williams and also annexed to Mr Straube's brief ofevidence raises the same issues.provisional basis pursuant to s 14 of the Act. And if the background to the preparationof the reports is as stated by Carter Holt, then it may well be that the reports will beadmissible pursuant to s 18(1)(a) and (b)(ii) of the Act (particularly given Mr Alveywill be available for cross-examination on them).Miscellaneous objections[76] Denver Simpson – The Ministry objects to paragraph 38 of Denver Simpson'sbrief of evidence. Mr Simpson is Carter Holt's general counsel. Paragraph 38 of hisbrief refers to a separate set of proceedings against Carter Holt before this Court, thesubject of which is 133 residential buildings. The Ministry says evidence of theseseparate proceedings is irrelevant to the issues to be determined at the Stage 1 hearing.[77] Carter Holt says the reference to the proceedings is part of a broader discussionby Mr Simpson of the number of complaints it has received concerning Shadowclad(which are said to be low) and thus relevant to whether Shadowclad is defective in factand routinely causes buildings to fail. The same point is made concerningMr Simpson's reference to the number of buildings comprising the representativeaction.[78] I accept that evidence of the volume of complaints, and the number of partieswho have joined a well-publicised representative action, may have some probativevalue to whether Shadowclad is inherently defective as alleged (the chain of logicpresumably being that if Shadowclad were inherently defective as alleged, the numberof complaints and size of the representative action would be far larger). That aspectof paragraph 38 of Mr Simpson's brief of evidence is admissible on that basis. Butthat part of paragraph 38 commencing "of the 18 inspections" falls outside this basisfor admissibility. That part of paragraph 38 states that all properties in therepresentative action suffer from construction defects. That is a statement of opinionfor which Mr Simpson has not been qualified. And it is stated in such broad and highlevel terms that it will not be substantially helpful to the Court in any event. That partof paragraph 38 is accordingly inadmissible.[79] Joao dos Santos – The Ministry objects to Mr dos Santos' brief as a whole.Mr dos Santos's brief is 20 pages long. Mr dos Santos has a background ineconometrics and statistics. He provides evidence addressing the appropriatestatistical sampling approach to ascertaining whether Shadowclad is defective, basedon the Ministry's building stock. He also addresses the merits of the Ministry'sapproach to proving its claim which relies (in part) on the four Stage 1 schools and thetest hut (and testing of four Shadowclad sheets). The Ministry says Mr dos Santos'sevidence is irrelevant given it (wrongly) proceeds on the assumption that theMinistry's case is premised on a representative-sample basis, when it is not. It is notsuggested that to the extent the evidence has some probative value, it will needlesslyprolong the proceedings.[80] Carter Holt says the Ministry's objection is misconceived. Carter Holt pointsto the Ministry's statement of claim, which alleges that the inherent defects inShadowclad will result in buildings "routinely" failing and that Shadowclad is "likely"to cause buildings on which it is installed to fail. Carter Holt therefore submits thatthe nature of the Ministry's claim will require the Court to draw conclusions aboutShadowclad generally based on the evidence advanced by the Ministry at trial.[81] Carter Holt says that it (and Mr dos Santos) are plainly aware that the Ministryis not seeking to prove its claim by representative sampling. Carter Holt says:[The plaintiffs] have elected instead to seek to prove their claim based onnovel experimental extrapolations from observations of four buildings and atest hut. The experimental extrapolations are in turn based on materialproperties of Shadowclad derived from four sheets of plywood. The plaintiffs'case depends directly on the proposition that the evidence they wish to lead isa sufficient basis for the allegation pleaded.Mr dos Santos' brief of evidence comments on the statistical validity, orotherwise, inherent in the plaintiffs' approach. His evidence is directlyrelevant to whether or not the plaintiffs can discharge their burden of proof.[82] At the hearing, Mr Salmon summed up the position as being that Mr dos Santosis to give evidence on whether the four sheets examination "makes good science".39Mr Farmer suggested it is "just taking econometrics too far".39 Noting that in the context of an earlier judgment, Carter Holt foreshadowed calling this type ofevidence; see Minister of Education v James Hardie Ltd [2018] NZHC 1481 at [38]: "Carter Holt'sexperts say that simulation of the type proposed by the Ministry is not possible or reliable."[83] I decline to rule the evidence inadmissible. Given the purpose for which CarterHolt proposes to lead the evidence at trial, the basis for the Ministry's objection to thebrief falls away. Further, it is not possible to say at this point that the evidence is notrelevant for the purposes of s 7, which has a relatively low threshold.40 Moreover,whether Mr dos Santos' evidence is taking "econometrics too far" is a matter for trial.And the very complexity of this type of expert evidence (being a matter whichMr Farmer emphasised) mandates a cautious approach to its admissibility.[84] Robert Davenport – Mr Davenport is an architect employed by AnkuraConsulting Group LLC in the United States. He is the leader of Ankura's ProfessionalLiability and Defective Construction Focus Group. He explains that given thesimilarities of the practice of architecture here and in the United States, he isrecognised by the New Zealand Institute of Architects as qualified for New Zealandpurposes.[85] Mr Davenport first provides an opinion on the similarity of various physicalattributes of Shadowclad and plywood "siding" (which I take to be panelling) productsin the United States. It is inherent in this aspect of Mr Davenport's brief that heconsiders Shadowclad and the US plywood products he discusses to be similarproducts. Mr Davenport then carries out a comparative analysis of specifications orstandards applicable to plywood siding products in the US and the Carter Holtliterature for Shadowclad. The overall thrust of this aspect of his brief is that there aremany similarities between the US standards/guidance and the Carter Holt literature,and thus the Carter Holt literature can be considered reasonable in the way it specifiesShadowclad and provides guidance on matters such as installation and maintenance.[86] The last section of Mr Davenport's brief is a critique of certain aspects ofMessrs Hubbs, Finch and Alexander's briefs (witnesses to be called by the Ministry),particularly their conclusions drawn from wall system testing. Mr Davenport is of theview that the Ministry witnesses have identified various water ingress entry or highrisk points but fail to recognise that:40 Wi v R [2009] NZSC 121, [2010] 2 NZLR 11 at [8].(a) as a matter of industry custom and under the Shadowclad literature, thedesign, construction and maintenance of these risk points rests withothers;(b) Carter Holt has disclaimed responsibility for these risk points in itsliterature; and(c) Carter Holt as product manufacturer has no control over them in anyevent.[87] The Ministry says Mr Davenport's evidence about plywood siding products inthe US is irrelevant given those products are not the same as Shadowclad. TheMinistry filed an affidavit by Mr Wutzler in support of this aspect of its application,in which Mr Wutzler (who responsibly prefaces his discussion with the observationthat he is not in a position to give evidence on US plywood or US building standards),states that it appears to him from reading Mr Davenport's brief that there aresignificant differences between Shadowclad and the American products. Mr Wutzlerrefers, for example, to the differences between Shadowclad, made of pinus radiata,and what he understands to be the more durable softwoods of Northern America.Mr Wutzler also notes that to the extent Mr Davenport suggests the Shadowcladliterature is reasonable (by comparing it with applicable US plywood installationguides), there is insufficient contextual information to make this useful information.[88] Mr Davenport has given an affidavit in reply, in which he states his company'sresearch reveals a "distinct similarity" between pinus radiata and similar coniferousspecies used in manufactured products in the United States. The Ministry notes thatMr Davenport provides no detail of this "research" or why or how he says the typesof wood are "distinctly similar".[89] Carter Holt says the Ministry's objections to Mr Davenport's brief "fail toappreciate the confined purpose of adducing his opinions, which are relevant contextfor assessing whether a duty of care should be recognised, and relevant to whetherCarter Holt failed to take reasonable care in preparing product literature". Carter Holtaccordingly says that the matters raised by Mr Wutzler do not affect the validity ofMr Davenport's analysis. Carter Holt points to the Ministry's allegation that CarterHolt's specifications failed to provide adequate and accurate instructions and failed totake into account real world building conditions and practices and says:Evidence addressing the level of detail in specifications for a similar productin a market so similar that architects' qualifications are recognised issubstantially helpful in assessing whether this allegation is correct.[90] I accordingly proceed on the basis that Mr Davenport's evidence is not to beled by Carter Holt for the purpose of arguing Shadowclad is not defective in fact.[91] To the extent the Ministry suggests the products to which Mr Davenport refersand Shadowclad are not the same or similar, that is a trial issue that Mr Davenport canbe cross-examined on in due course. This is not a matter I can or ought to rule on inthis pre-trial judgment.[92] As to the second aspect of the Ministry's objection, namely that the last partof Mr Davenport's brief (summarised at [86] above) is inadmissible submission, Iaccept that parts of it have an air of submission about them. But much of that perhapsreflects the particular language deployed by Mr Davenport rather than his underlyingopinion. For example, while framing his conclusion as "taking exception to theinconclusive nature of the [Ministry's] experts' opinions wherein they attempt toincorrectly shift the entire responsibility for causation and liability of sidingperformance to CHH", this reflects his overall opinion that the water ingress seen byMessrs Finch, Hubbs and Alexander in their testing is due to elements outside CarterHolt's control and responsibility as a product manufacturer (both on the basis ofindustry custom and its own product literature). And while at first blush it might bethought that a review and commentary on the Shadowclad literature is not a matter forMr Davenport's expertise (but rather the Court's own views), I cannot exclude thatMr Davenport's analysis, coming as it does from his level of knowledge and expertise,will not be substantially helpful to the Court.4141 In this context, I note that Mr Wutzler appears to address similar matters, stating in his affidavitin support of Carter Holt's opposition to the Ministry's application that "[a]s I have explained inmy brief of evidence, I consider that a cladding manufacturer should consider the performance ofits cladding product in conjunction with the other elements of a wall assembly Importantly, theShadowclad specifications included information on all these aspects of the wall design."[93] Finally, the Ministry says Mr Davenport's evidence will needlessly prolongthe proceedings because it will require evidence to be sworn by the Ministry inresponse.[94] But the time by which the Ministry was to file its evidence in reply has passed(some time ago). At the time it filed its reply evidence, the Ministry was not inpossession of any ruling that the challenged aspects of Carter Holt's evidence wereinadmissible. It is therefore not a matter of the evidence "coming in" at this point asthe Ministry suggests. Ultimately, a party cannot proceed on the basis that evidencemay be ruled inadmissible pre-trial, for that reason choose not to file reply evidence,and then when its pre-trial admissibility challenges are not accepted, proceed on theassumption it will be permitted to lead further evidence in reply. While the Ministrymay wish to engage an expert to assist it with matters to put to Mr Davenport by wayof cross-examination, whether any such expert can give a brief of evidence would needto be the subject of an application for leave to file reply evidence out of time.Accordingly, as matters presently stand, I do not accept Mr Davenport's evidence willneedlessly prolong the proceedings.[95] I turn now to Carter Holt's application in relation to the Ministry's evidence.Carter Holt's challenge to the admissibility of the Ministry's evidenceIntroduction and approach[96] Carter Holt's application does not itself identify those particular aspects of theMinistry's briefs of evidence which are challenged.42 Rather, the challenged aspectsof the Ministry's evidence are identified by the relevant passages in the briefs beinghighlighted and the basis for the objection stated in the margin alongside thathighlighting (for example, "relevance", "submission" and so on).4342 Other than in relation to certain hearsay objections in relation to Mr Gregory O'Sullivan'sevidence, which are listed in a schedule to the application. The Ministry has agreed to removefrom Mr O'Sullivan's evidence the aspects referred to in the schedule. I accordingly say nothingfurther about this aspect of the application.43 There is no particular explanation or submission given for each objection.[97] Carter Holt's objections are extensive. The Ministry produced a tabularschedule of the individual objections which itself runs to over 100 pages. It willimmediately be apparent that it is extremely difficult for the Court to deal with thisvolume of individual challenges pre-trial, both because the individual challenges werenot (for obvious reasons) the subject of submissions at the hearing, and the sheer timeit would take to work through each challenge in any event.[98] A pragmatic approach must therefore be taken. I have formed that view thatthe most appropriate approach, and hopefully of most assistance to the parties, is tofocus on the more substantive objections which were addressed at the hearing, and putaside for present purposes objections which I consider can be dealt with on a witness-by-witness basis at trial. For these reasons, I do not propose to address objectionsmade on the basis of "submission", "speculation", "not substantially helpful" or"outside area of expertise". These sorts of objections are readily dealt with as andwhen the evidence is to be given at trial, or easily "filtered" by a trial Judge whenconsidering particular aspects of evidence during trial. And in relation to theremaining categories of objections, some are able to be addressed on an individualbasis, but for some, I can only offer general guidance to the parties (which willhopefully assist ongoing consideration of the evidence in question).[99] Putting aside objections of the nature described in the preceding paragraph,Carter Holt's objections fall into the following categories:(a) irrelevance;(b) material which is not proper reply evidence and will needlessly prolongthe trial;(c) comment and investigation on individual school buildings which goesbeyond the Stage 1 buildings and the test hut;(d) comment on testing carried out by the Ministry's witnesses after thedate for service of without prejudice versions of the Ministry's briefson Carter Holt; and(e) hearsay.[100] I address each in turn.Irrelevance – material not addressing the pleaded defects[101] Carter Holt submits that the Ministry's briefs contain extensive references toazole-related treatments of Shadowclad, galvanised nails (relating to the suggestionthat Shadowclad is incompatible with them) and "face checking" (being aphenomenon where the outer veneers of plywood cladding sheets are susceptible tosmall splits once the veneer is exposed repeatedly to moisture and heat, with the splitssaid to increase the cladding's proneness to water ingress).[102] Last year, I ruled on the relevance of each of the above three matters, notingthat they had not been pleaded by the Ministry as being or giving rise to allegedinherent defects in Shadowclad. My ruling on face checking was in the context of theMinistry's application for particular discovery. I declined this aspect of the Ministry'sapplication. My rulings in relation to galvanised nails and azole-based treatmentswere in the context of the Ministry's application for leave to amend its pleadings,which application I also declined. The Ministry has appealed that judgment, but notthe judgment on face checking.[103] Against this background, Carter Holt says that the Ministry's evidence on eachof these three topics is irrelevant, given none of these matters arise for determinationon the pleadings.[104] Azole-based LOSP treatment – The challenged evidence forms part of theevidence to be given by Jeanette Drysdale. Ms Drysdale refers to various Carter Holtdocuments said to show issues in relation to azole-based treatment in the period after2006, when Carter Holt changed from tributyl tin (TBT) Light Organic SolventPreservative (LOSP) treatment to azole-based LOSP treatment. Carter Holt says thisevidence is irrelevant. The Ministry says Ms Drysdale's evidence is relevant becauseit is aimed at the treatment process rather than the type of treatment. The upshot ofMs Drysdale's evidence is what she says are treatment issues arising after 2006, fromwhich it can be inferred similar problems occurred prior to 2006.44 She has sworn anaffidavit in support of the Ministry's opposition to Carter Holt's application statingthat because, other than changing from TBT to azole-based LOSP treatment,"everything else stayed exactly the same", inferences as to the pre-2006 period areappropriate.[105] Carter Holt has filed an affidavit in response, sworn by one of its in-housecounsel overseeing this litigation, Ms Lang Sui. She says the factual propositionunderlying Ms Drysdale's evidence that "everything else stayed exactly the same" iswrong.[106] Carter Holt does not suggest that if this aspect of Ms Drysdale's evidence hassome probative value, it will needlessly prolong the proceedings. Rather it says thatthere is a risk of the evidence being given undue weight.[107] The factual premise on which this aspect of Ms Drysdale's evidence is basedis not something I can (or ought) to rule on in this pre-trial judgment. If that factualpremise is correct, then there may be a basis for drawing inferences from the post 2006period as to what went before. And the Court is well used to assessing the weight tobe given to evidence. Risk of evidence being given undue weight is more of concernwhen the fact finder is a jury.[108] I accordingly decline to rule the evidence concerning treatment processes afterthe change to azole LOSP is inadmissible.[109] Galvanised nails – Carter Holt's objection is to references in the Ministry'sevidence to Shadowclad's alleged incompatibility with galvanised nails. An exampleis that of Mr Gregory O'Sullivan's reference to a Carter Holt document stating the useof galvanised nails was incompatible with the product "despite our literature indicatingit was ok". Carter Holt says I have already ruled the alleged incompatibility withgalvanised nails irrelevant for the purposes of discovery, given the suggestedincompatibility did not feature as part of the Ministry's case on the pleadings. Carter44 This is in the context of what the Ministry says is a paucity of documents relating to treatment inthe period prior to 2006.Holt says for the same reasons, evidence as to this suggested incompatibility is alsoirrelevant and therefore inadmissible.[110] The Ministry says my earlier decision declining it leave to amend its pleadingsto include as a defect Shadowclad's alleged incompatibility with galvanised nails isunder appeal (and thus, pending resolution of that appeal, the evidence ought to beadmitted). It also says that irrespective of the outcome of the appeal, the evidence isrelevant to a more general point, namely that Carter Holt was aware that its literaturewas incompatible with the product but did nothing about it.[111] I do not accept the Ministry's argument. As matters currently stand,Shadowclad's suggested incompatibility with galvanised nails is not relevant on thepleadings. And the alternative basis upon which the Ministry says the evidence isrelevant is based on the premise that Shadowclad is incompatible with galvanisednails.[112] I accordingly rule the evidence concerning Shadowclad's allegedincompatibility with galvanised nails inadmissible, but with leave reserved to theMinistry to apply for a direction that the evidence may be led in the event its appeal issuccessful.[113] Face checking – Like galvanised nails, I have previously ruled that facechecking is irrelevant on the Ministry's pleaded case, both as an inherent defect itself,and as a contributing cause to a pleaded inherent defect (namely whether Shadowcladis inherently prone to moisture absorption). In response to Carter Holt's position thatevidence as to face checking is irrelevant, the Ministry says Carter Holt relies heavilyon its position that paint will ameliorate Shadowclad's undue absorption of moisture,thus the existence of face checking as a means of "undermining" paint's efficacy ishighly relevant.[114] The difficulty in the Ministry's case is that I have already ruled that facechecking, at least as an alleged defect in and of itself, or as a contributing cause to analleged inherent defect, is not relevant on the pleadings. The Ministry is correct thatmy earlier judgment related to discovery of documents by Carter Holt and notadmissibility of evidence. But if evidence is not relevant in some way to an issuearising on the pleadings, it will be inadmissible.[115] I accept however, that where Carter Holt's advances a positive case thatpainting of Shadowclad sufficiently ameliorates any propensity for Shadowclad toabsorb undue moisture, the Ministry's witnesses are entitled to respond to that and saywhy they disagree. I also agree that some references to face checking appear to bemade in the context of overall observations of what various witnesses saw when theyinspected school buildings. It would be artificial to "carve out" of that observationalevidence some things that were in fact seen.[116] I do not consider it is possible to accurately rule on this aspect of Carter Holt'sapplication pre-trial, at least on a global basis. It is not entirely clear to me just nowmany aspects of the Ministry's evidence are challenged on this basis. Carter Holtrefers to three (brief) examples in its submissions. From a (necessarily) high levelreview of the hundreds of individual challenges made by Carter Holt, it seems thatreasonably few relate to face checking.45 What can be said at this stage is that I amnot prepared to rule on a pre-trial basis that every reference to face checking in theMinistry's evidence is inadmissible. Individual challenges will need to await trial.Not evidence in replyIntroduction[117] A significant aspect of Carter Holt's challenge to the admissibility of theMinistry's evidence is that its reply briefs of evidence exceed the proper scope of suchevidence. Carter Holt says that extensive tracts of the reply briefs repeat or seek tobolster the content of the Ministry's primary briefs of evidence, or introduce newmatters not dealt with in its primary evidence or Carter Holt's evidence.[118] By way of background, I made timetable orders for the Ministry to serve replybriefs of evidence "strictly in reply". It was to do so by 28 February 2020, after havingreceived the Carter Holt briefs on the last working day before the summer and45 The odd reference or two in various briefs of evidence, the highest concentration being inMr Alexander's evidence.Christmas shutdown.46 The concept of a plaintiff's reply briefs being "strictly inreply" and to be served in a reasonably short time period after receipt of thedefendant's briefs highlights the general expectation that reply evidence will beconfined. It is also relevant context that the High Court Rules make no provision forbriefs of evidence in reply. And it is fair to say that, despite reply evidence having inthe past been timetabled in civil proceedings, this is much less so in more recent times.At the parties' request, I was prepared to timetable reply briefs given indications fromearlier interlocutory hearings that the parties' respective experts may be approachingthe question of whether Shadowclad is inherently defective from different vantagepoints.[119] The Ministry's primary briefs of evidence totals some 1254 pages with 2640pages of appendices. Its reply briefs extend to 744 pages with 2882 pages ofappendices. I fully accept that the length of reply briefs is not itself determinative.But the sheer extent of the Ministry's reply evidence is of some (prima facie) concern.Reply evidence – principles[120] As noted, the High Court Rules do not provide for reply briefs of evidence.The Rules do, however, expressly provide for reply affidavits on interlocutoryapplications.47 And in doing so, r 7.26 is clear that an "affidavit in reply must belimited to new matters raised in the notice of opposition or in an affidavit filed by therespondent".48 Rule 9.76 (concerning the form and content of affidavits generally) isto a similar effect. Under that rule, an affidavit, if in reply, must be confined to matters"strictly in reply" and the Court may refuse to read an affidavit that, being in reply,introduces "new matter".49 As noted by Toogood J in Commissioner of Police v TRS,these requirements assist in securing the "just, speedy and inexpensive determinationof any proceeding or interlocutory application".5046 In the event, I granted a two week extension for the Ministry to complete its reply evidence.47 Rule 7.26.48 Rule 7.26(2) (emphasis added). See also Newstoon NZ Ltd v Horton Media Ltd [2015] NZHC2925 at [27]; and Greys Avenue Investments Ltd v Harbour Construction Ltd HC Auckland CIV-2009-404-2026, 12 June 2009 at [17].49 Rules 9.76(1)(d)(ii) and 9.76(2)(a)(ii).50 Commissioner of Police v TRS [2014] NZHC 1116 at [6], referring to r 1.2 of the High Court Rules2016.[121] The Ministry relies on observations made in Fisk v Nicholls for what might beseen as a more expansive approach to reply evidence than discussed above.51 In Fisk,Associate Judge Matthews said that when assessing the admissibility of replyevidence, the Court must have a firm eye to the relevance of the evidence and theimportance of ensuring each party is treated fairly and justly in the presentation of itscase.52 He further stated that:53[8] It must also be remembered that evidence in reply is not confinedmerely to acceptance or rejection of evidence given in opposition. The latteris the factual basis of a respondent's case, disclosed formally for the first time.It may well be necessary, therefore, and is permissible to file evidence whichis new in the sense that it was not part of the applicant's original evidence, butpresents the applicant's factual material relevant to the respondent's evidence.Plainly, therefore, it can potentially be extensive. Assessment of whether it isin reply rests not on its extent, nor whether it is original, but on whether itrelates to the evidence of the respondent, and is relevant to the issues.[Emphasis added][122] In Commissioner of Police v TRS (also relied on by the Ministry), Toogood Jcited the above passage from Fisk with approval. Importantly however, he did so inthe course of discussing other contexts under the High Court Rules where "the Courtshould not take an unduly rigid view of the exercise of its discretion to permit thereading of a reply affidavit which may stray outside the boundaries of a strict reply".54In that context, Toogood J stated that he agreed that:55 the assessment of whether the Court should exercise its discretion to readan affidavit in reply should not rest on its extent, nor whether it is original,but on whether it relates to the evidence of the respondent, and is relevant tothe issues.[Emphasis added][123] Accordingly, Toogood J was not accepting the Fisk approach as setting theboundaries for reply affidavits in interlocutory matters. Clearly if a reply affidavitdoes not exceed the scope of what is permitted under r 7.26 (and other similar rules),the need to exercise a discretion does not arise. Toogood J also observed that undueinconvenience or cost incurred by a respondent as a consequence of the filing and51 Fisk v Nicholls [2012] NZHC 2507.52 At [7].53 At [8].54 Commissioner of Police v TRS [2014] NZHC 1116 at [17] (emphasis added).55 At [20].reading of a reply affidavit which is not strictly in reply can be met by an order forcosts.56[124] Later decisions of this Court have followed this approach.57[125] The authors of Sim's Court Practice observe that while r 7.26 restates thenormal rule on the contents of affidavits in reply, the Court in Evans v A W Builders(a decision citing Fisk and Commissioner of Police v TRS) "may have enlarged thecontent allowed evidence (sic) when it allowed evidence relevant to the issues raisedin the notice of opposition".58 But that decision also adopted the approach endorsedin Commissioner of Police v TRS in the context of the discretion to read a non-complying reply affidavit.59[126] For completeness, I refer to Associate Judge Osbourne's (as he then was)observations in Heli Holdings Ltd v Helicopter Line Ltd, that:60[29] The "new matters" to which a plaintiff may by r 12.11(2) file a replyaffidavit are self-evidently not all the matters contained in thedefendant's opposition evidence. The "new matters" to whichr 12.11(2)(a) refers will generally fall into two categories, being:(a) The grounds of defence which the defendant had not previouslybought to the plaintiff's attention; and(b) Any more sophisticated arguments or evidence going to supportthat particular ground than had previously been provided by thedefendant to the plaintiff.[127] It is ultimately helpful to return to the words used in r 7.26 (and similar rulesexpressly permitting reply evidence), namely that an "affidavit in reply must be limitedto new matters raised in the notice of opposition or in an affidavit filed by therespondent".61 The rule is framed in plain and mandatory terms. While affidavitevidence in reply will by definition "relate to" the evidence of the respondent and be56 At [20].57 See, for example, Evans v AW Builders Ltd [2019] NZHC 1152 at [32]–[33] and [38].58 Sim's Court Practice (online ed, LexisNexis) at [HCR7.26.4] (emphasis added).59 Evans v AW Builders Ltd [2019] NZHC 1152. Paul Davison J stated (at [38]) "[a]dopting thereasoning of Toogood J in Commissioner of Police v TRS, I consider that this is a case forexercising my discretion to allow Mr Turner's reply affidavit to be introduced as evidence."60 Heli Holdings Ltd v Helicopter Line Ltd [2014] NZHC 664 at [29], concerning affidavits in replyin the summary judgment context.61 Rule 7.26(2) (emphasis added).relevant to identified issues, it is also "properly confined to replying to matters raisedfor the first time in the defence".62 There are other processes available if, for somereason, not all relevant and significant evidence has been put before the Court throughthe exchange of affidavits (such as granting leave to file supplementary or "rejoinder"affidavits, or to cross-examine the deponent of an affidavit). Deploying such processesenables proper consideration of the importance of the evidence to the issues before theCourt, and whether and if so how any resulting prejudice to the respondent can beavoided. Permitting free-ranging affidavits in reply is not a proper substitute for this.[128] What then of briefs of evidence in reply, which are not contemplated under theRules? The reason reply briefs are not expressly catered for in the Rules but replyaffidavits are, is likely because the trial process involves oral evidence, whereimportant points of reply can be led as part of a witness's evidence in chief or will beelicited by counsel complying with his or her obligation under s 92 of the Act.Evidence "in reply" elicited in these ways will be far more helpful and informative tothe Court than a reply brief which mechanically responds to each paragraph of adefence witness's brief.[129] Where reply briefs have been timetabled, however, what is their proper scope?It is common ground that reply briefs are not an opportunity to "back fill" evidence inchief, and that reply briefs should only address matters in the defendant's briefs thatcould not reasonably have been anticipated in the plaintiff's evidence in chief. But theMinistry, relying on Fisk and Commissioner of Police v TRS, submits the approach toreply evidence is not as confined as Carter Holt suggests. To the extent the Ministrysuggests that the test for reply evidence is that it relates to the defendant's evidenceand is relevant to the matters in dispute,63 I disagree for the reasons set out at[120]– [127] above. Such a threshold sets the bar too low (and in the context ofinterlocutory applications, is inconsistent with the plain words of r 7.26).62 See ASB Bank Ltd v Hartley HC Auckland CIV-2011-404-2668, 11 November 2011 at [24](emphasis added), a summary judgment proceeding.63 Which it appears to do, see Ministry's submissions in opposition to Carter Holt's application at[3.3] and [3.7].[130] There is relatively little case law directly addressing the proper scope of replybriefs of evidence. In SCC (NZ) Ltd v Samsung Electronic New Zealand Ltd Jagose Jcommented on the reply briefs of evidence served in that case, observing that:64 [i]f reply briefs are permissible at all (for the High Court Rules make noexpress provision for them), they are strictly to be in reply: responding onlyto relevant matters raised for the first time in the briefs to which they arereplying. The analogy is to be with the constraints applicable to affidavits inreply, for which the High Court Rules do make provision.If permitted at all, reply briefs are not an opportunity to deny the truth of thedefendant's proposed evidence by restating or enlarging on facts already setout in the plaintiff's statements. That is repetitious and argumentative. Neitherare they an opportunity for a plaintiff to keep its powder dry, by putting up abarebones case at the outset, for the substance of its evidence 'in reply', afterseeing the defendant's proposed evidence.A plaintiff's proposed evidence should be everything on which it requires torely to make out its case against the defendant. Further oral evidence can beled at trial as may be necessary to amplify some newly-significant point in theplaintiff's case, or to patch some uncontemplated hole in that case, identifiedby the defendant's proposed evidence. Otherwise, a defendant's evidence isto be tested through cross-examination, and not by denial, argument, orrepetition 'in reply' from the plaintiff's witnesses.[Footnotes omitted][131] Similarly, in Houghton v Saunders, Dobson J observed that reply briefs "areintended to address matters in the defendants' briefs that could not reasonably beanticipated in the plaintiff's original briefs".65[132] In Wheeldon v Body Corporate 342525, the defendant applied to strike outsome of the plaintiffs' reply evidence on the basis it was not confined to matters strictlyin reply and instead introduced new material.66 Muir J identified "two broad issues",the first being whether "in so far as the reply briefs challenge the evidence of thedefendant's expert, should this have been adduced as evidence-in-chief?"67 Thesecond issue was whether certain destructive testing referred to for the first time in theplaintiffs' reply evidence should have been obtained prior, to avoid embarrassment tothe defendant of "having to deal with an entirely new issue effectively on the eve of64 SCC (NZ) Ltd v Samsung Electronic New Zealand Ltd [2018] NZHC 2780 at [204]–[206].65 Houghton v Saunders [2014] NZHC 423, (2014) 21 PRNZ 721 at [3], cited with approval in BodyCorporate 330324 v Auckland Council [2015] NZHC 1485 at [22].66 Wheeldon v Body Corporate 342525 [2015] NZHC 336.67 At [20(a)].trial?"68 Muir J concluded that the evidence in question could not be "properlyregarded as reply evidence" and that:69if the plaintiffs' case depended on attacking the assumptions andmethodology underpinning the Origin report, that, in my view, should havebeen done in primary affidavits.[133] The last sentence drew a direct analogy with the decision in McLennan vAttorney-General, in which Salmon J had stated that:70Mr Riley's affidavit does not put in issue for the first time as a matter ofevidence, that the Dean valuation represented a current market value, the Rileyaffidavit adds nothing to what has always been available in the valuation itself.If the plaintiffs' case depends on attacking the methodology of the valuationthat should have been done in primary affidavits.[134] Muir J revisited the issue of reply evidence in Body Corporate 330324 vAuckland Council, in which a 12-week trial was adjourned given the plaintiffs soughtto amend their pleadings shortly before trial and had served extensive "reply"evidence.71 That evidence included new testing evidence not dealt with in theplaintiffs' primary briefs (described as an attempt to "backfill" the primary evidenceand "a matter which could and should have been reasonably anticipated andtherefore been the subject of evidence in chief");72 reference to destructive testingcarried out after service of the primary briefs and which the defendant's experts didnot have an opportunity to observe; and reference for the first time to schedulesdetailing results of extensive site inspections carried out prior to the primary briefs butnot referred to in them.[135] Muir J said the following:[41] Again I consider the evidence which the plaintiffs propose to call isnot properly categorised as reply evidence in that it could reasonably havebeen anticipated in the plaintiffs' original briefs. Mr Lewis, for the plaintiffs,fairly concedes that the core sampling, described by Mr Grayson as the "onlyreliable means of measuring a crack" could have been undertaken in the initialround of investigations and that the defendants' experts can reasonably beexpected to undertake similar testing. Again, however, he suggests that, if thedefendants were sufficiently motivated, such testing could be completed by68 At [20(b)].69 At [27].70 McLennan v Attorney-General HC Auckland M267/98, 15 July 1999 at 5 (emphasis added).71 Body Corporate 330324 v Auckland Council [2015] NZHC 1485.72 At [21] and [23].the commencement of trial or soon after and that there is sufficient flexibilitywithin the proposed trial schedule to accommodate late provision of briefs.[42] Again I consider that unrealistic within the context of all the othercalls on experts and counsel's time in the three weeks remaining beforecommencement of trial. Although, as counsel for the defendants sensiblyacknowledge it may have been possible to deal with isolated evidential issuesin combination with trial preparation, it is the cumulative effect of the multipleissues arising out of the amended pleadings and proposed evidence which isthe problem[136] Muir J accordingly did not strike out the offending material, but the trial wasdeferred to accommodate the prejudice to the defendants.Application to the Ministry's reply evidence - overview[137] As the above authorities make clear, reply briefs of evidence are not a vehiclefor engagement on every aspect of a defence witness's brief and/or reiteration orexpansion of the plaintiff's primary evidence. Nor are they a vehicle for introducingwholly new matters. Mr Flanagan, counsel for the Ministry, suggested at the hearingthat much of the Carter Holt evidence is new, in the sense the briefs were the first timethe Ministry had seen Carter Holt's engagement with and evidence on the Ministry'scase. But as Associate Judge Osbourne made clear in Heli Holdings Ltd v HelicopterLine Ltd, "new matters" does not extend to all the matters in a defendant's evidence.While Mr Flanagan is correct that Carter Holt's evidence is "new" in that it is the firsttime the Ministry has seen Carter Holt's evidential response to its case, what must benew is a new "matter" or "topic" on which it is fair and just for the Ministry to havethe opportunity to respond.[138] In relation to some of the reply evidence challenged by Carter Holt, and whenquestioned as to how Carter Holt can be expected to respond to it, Mr Flanagan said itshould be permitted to file evidence in response. But that merely highlights the issuein play; the very fact there is a need for evidence in response confirms that the replyevidence exceeds the proper boundaries. The confined nature of reply briefs (ifpermitted) is to avoid the spectre of multiple iterations of evidence in response.[139] It will be clear from the above that I am of the view that parts of the Ministry'sreply briefs which are challenged by Carter Holt appear to exceed the properboundaries for reply evidence. I say "appear to" as again it is not possible to assesseach challenge on an individual basis. Other than a small number of specific examplesdiscussed at the hearing, the only "submission" from Carter Holt on each challenge isthe notation "not in reply" next to the relevant paragraph or section in the Ministry'sreply briefs of evidence.73 This does not illuminate, for example, whether theobjection is because the text is repetitive of evidence in the primary brief; is expandingon or "bolstering" the evidence in the primary brief; or is said to raise wholly newmatters. In these circumstances, it is ultimately impossible for the Court accurately toconclude: first, whether individual aspects of the reply briefs fall outside the properbounds of reply evidence; second, if it does, what is the prejudice, if any, to CarterHolt; and third, what steps can and ought to be taken to eliminate or ameliorate anysuch prejudice?[140] Given these constraints, I again deal with and make rulings on some of thespecific examples addressed at the hearing and provide guidance which will hopefullyassist in determining which objections will be pursued at trial. It may also assist theparties to reach some accommodation on any additional evidence Carter Holt mightwish to serve in advance of trial to deal with anything it says is wholly new in theMinistry's reply briefs.Reply evidence that is repetitive of evidence in primary briefs[141] For practical reasons, I do not address all aspects of the Ministry's replyevidence which is said to be repetitive of its primary evidence. This is perhaps theleast "objectionable" type of non-complying reply evidence, given it does not itselfrequire a defendant to confront new arguments or factual matters. And the Court isalive to the fact that repeating points already made does not make them any morepersuasive or true. The issue arising from this type of non-complying reply evidenceis that it needlessly prolongs the proceedings, in that repetitive evidence will need tobe read.73 There are 256 individual challenges to the reply evidence on the basis it is "not evidence in reply".Only seven paragraphs within Carter Holt's written submissions address the challenges to thereply evidence.[142] It was not suggested that doing so in this case would risk exceeding thecurrently allocated trial time. But I would encourage the Ministry to review its replyevidence in this context and excise aspects which are plainly repetitive of a witness'searlier brief. Some examples from the Ministry's reply evidence are given in ScheduleA attached to this judgment[143] Should any specific issues remain, leave is reserved to Carter Holt to raise themat the outset of the relevant witness's evidence.Reply evidence which does not address new matters, but expands on or "bolsters"topics already discussed in primary briefs[144] From an initial review of the Ministry's reply evidence, there appears to be areasonable amount of reply evidence falling within this category. It is generallypresented on the basis of disagreeing with the relevant Carter Holt witness on aparticular topic and then explaining the reasons why. This will often refer back toaspects of the reply witness's primary brief, but then include further detail and/or anexpansion of the matter already addressed in the primary brief.[145] The Ministry says that a witness explaining the reasons why they do not agreewith the other party's witnesses' evidence is properly evidence in reply. I disagree.By definition, evidence which does this by referring back to and expanding on thematerial in the primary brief is not evidence on new matters that could not reasonablyhave been anticipated and addressed in the plaintiff's briefs of evidence.[146] Again, a few examples from the Ministry's reply briefs, as set out in ScheduleB to this judgment, highlight the approach.[147] I have considered whether evidence of this nature ought to be struck out.Subject to the discussion of aspects of Mr Frazer's reply evidence at [152]–[166]below, on balance, I have determined not to, at least at this pre-trial stage. As noted atthe outset of this judgment, a cautious approach must be taken to pre-trial admissibilitychallenges in a case of this nature. I reiterate the three further observations made at[139] above. For example, it might be that upon more detailed analysis, some of theaspects of the evidence challenged by Carter Holt on this basis is in response to newmatters or issues raised in the Carter Holt briefs. For example, Carter Holt haschallenged aspects of the reply brief of Mr Peter Lalas (who did not give a primarybrief of evidence). Mr Lalas gives evidence on the test specifications which he wroteand which were used by Mr Wutzler in his façade testing (addressed in Mr Wutzler'sprimary brief of evidence). The Ministry says it did not and could not have anticipateda challenge to the test specifications themselves, rather than how Mr Wutzler hadcarried out the tests and what conclusions he drew from them. I do not know whetherthe test specification material in Mr Lalas reply brief was material which ought to havebeen included in the Ministry's primary briefs of evidence.[148] Further, to the extent the challenged evidence expresses disagreement withaspects of Carter Holt's witness's evidence and then explains the reasons why, thatevidence may well have been elicited in cross-examination in any event, throughCarter Holt's counsel complying with their duty under s 92 of the Act. As variousauthorities and commentators observe, "there is no duty to cross-examine where thewitness has already had the opportunity to comment on the conflicting factualevidence yet to be called".74 The Ministry's witnesses, at the point at which they aregiving evidence, will have already had the opportunity to comment on Carter Holt'sevidence yet to be called (through their reply briefs). Accordingly, while additional(unnecessary) time will be taken by the Ministry's witnesses reading non-compliantaspects of their reply briefs, the material may reduce the extent to which Carter Holtwill need to cross examine those witnesses on certain topics.[149] I wish to be clear, however, that the above should not be taken as anendorsement of including such material in reply briefs. The difficulty with statementsof disagreement (and the reasons for that disagreement) being addressed in expansivereply briefs rather than through cross-examination is that the latter is much more likelyto lead to:74 Elisabeth McDonald and Scott Optican (eds) Mahoney on Evidence: Act and Analysis (ThomsonReuters, Wellington, 2018) at [EV92.02(1)]. There is no reason why this should not also applyto opinion evidence. See also Hewinson v Police (1987) 3 CRNZ 27 (HC) at 32–33; and Gutierrezv R [1997] NZLR 192 (CA) at 115. Rule 9.15 of the High Court Rules 2016 notes that theexchange of briefs does not affect the cross-examination duties in s 92 of the Act, though as noted,the Rules do not provide for reply briefs of evidence. The exchange of briefs referred to in r 9.15are accordingly to each party's primary briefs only.(a) a more efficient means of eliciting the areas of disagreement and thereasons why;(b) a more focussed approach (namely on the significant matters in dispute,rather than a paragraph-by-paragraph response to the opposing party'sbriefs of evidence);(c) a less argumentative approach, which is unattractive in expert evidenceand risks bleeding into submission; and(d) importantly, a format of evidence more readily understandable and thusof assistance to the Court (for example, the plaintiff witness being takento aspects of conflicting defence evidence yet to come and being invitedto express a view on it, rather than reading aloud written responses toparagraphs in briefs of evidence that have not yet been heard by theCourt).[150] Carter Holt does not point to any specific prejudice arising from this aspect ofthe Ministry's reply evidence. Carter Holt may well need to lead some additionalevidence from its witnesses to respond to matters in the reply briefs which expand orbuild on material addressed in the Ministry's primary briefs but which does not go asfar as raising wholly new topics. Carter Holt can proceed on the basis that a fairlyliberal approach to this will be adopted. Subject to receipt of submissions from theparties, I am also minded to make a costs order against the Ministry. Although I havenot made individual rulings on all aspects of the reply evidence challenged, there issufficient non-compliance in my view that it should not go unmarked. At the veryleast, Carter Holt and its advisers will have spent considerably more time than theyought to have done reviewing the reply briefs. I make timetabling provisions at theconclusion of this judgment to receive submissions from the parties on this topic.[151] I also reserve leave to Carter Holt to raise at trial any specific aspects of theMinistry's reply evidence which is challenged on this basis and in respect of which itsays it has or will suffer specific prejudice.[152] I noted above the evidence of Mr Frazer. The challenged aspects of his replybrief was the subject of submission at the hearing.[153] Mr Frazer did not give a primary brief; in other words, he is a new "reply"witness. There is of course nothing wrong in a new witness giving reply evidence, solong as that evidence is properly evidence in reply.[154] Carter Holt objects to section 4 of Mr Frazer's reply brief of evidence on thebasis that it does not address new matters raised in Carter Holt's brief of evidence, butbolsters and adds to material already addressed in the Ministry's primary evidence.[155] The starting point for consideration of this objection is paragraph 23.34 ofMr Philip O'Sullivan's primary brief of evidence, in which he discusses the gapbetween Shadowclad sheets (above and below the z-flashing) as specified in theShadowclad literature. The specified gap was 10 mm (being a 5 mm gap for bothabove and below the z-flashing), which Mr O'Sullivan considers inadequate, evenafter normally expected timber frame shrinkage. Mr O'Sullivan goes on to giveinformation about expected timber shrinkage rates.[156] Mr Alvey, who is to give evidence for Carter Holt, responds to this aspect ofMr O'Sullivan's evidence at paragraphs 20.20 to 20.25 of his brief of evidence. Hedisagrees that shrinkage is an issue. He also takes issue with the shrinkage rates givenby Mr O'Sullivan.[157] There might matters have been expected to end. The exchange of briefs clearlyaddress and set out the experts' respective views on the adequacy or otherwise of thespecified gap between Shadowclad sheets. But Mr Frazer's reply brief comments indetail on the expected timber shrinkage rates discussed by Mr O'Sullivan andMr Alvey and states that "Mr Alvey's argument that 5 mm is a suitable drainage gaphas not been substantiated by any modelling or experimentation that I am aware of".Mr Frazer then commences a fairly detailed discussion of likely shrinkage rates ofpinus radiata, including by reference to various scientific studies, published bulletins,detailed calculations of estimated frame shrinkage, a whole section discussing theshrinkage characteristics of Shadowclad and studies of linear movements of plywoodnot discussed in the Ministry's primary briefs. Mr Frazer then concludes that"Mr Alvey takes no account of any of this".[158] In my view, this is a prime example of reply evidence exceeding properboundaries and verging on introducing wholly new matters (to the extent of the newstudies, tests and so on referred to in Mr Frazer's brief), and at the very least, bolsteringmaterial already addressed in the primary briefs.[159] Mr Flanagan noted that the primary method to deal with evidence such as thisis cross-examination, but there would also be no objection by the Ministry to furtherevidence coming in from Carter Holt in response. In an example such as this, whichwas the subject of submission at the hearing and on which I am comfortable I canmake an accurate assessment, the appropriate course is to strike the material out. Itcould and ought to have been addressed in the Ministry's primary briefs.[160] Another example arising from Mr Frazer's brief is his discussion of MetalexClear. Again the start point is Mr Philip O'Sullivan's evidence. He discusses MetalexClear at paragraph 21.28 of his primary brief. This is in the context of his critique ofCarter Holt's specifications on what should be done when a Shadowclad sheet is cut(for example to install a window). He notes that the specifications refer to "sealing"the cut edges with zinc naphthenate (that is, Metalex Clear), and goes on to discussthe inadequacies for this purpose of using copper naphthenate, which Mr O'Sullivansays is superior to zinc naphthenate. Mr O'Sullivan goes on to address results oftesting he carried out to treating cut plywood samples with Metalex Green (that is,copper naphthenate), which he says is not sufficient to prevent water ingress throughthe cut edges.[161] Mr Greaves for Carter Holt discusses the preservative treatment of Shadowcladgenerally and observes (at [33] of his brief of evidence) that breaching thispreservative is not recommended, but accepted to be unavoidable at times, for examplewhen there is to be cutting of a sheet on site. Mr Greaves states that "some form ofsupplementary treatment [should] be applied to the newly exposed cut surfaces" (butdoes not say anything further than this). This does not raise any new matter or topicnot addressed in the Ministry's primary briefs of evidence.[162] Mr Frazer comments (albeit briefly) on Mr Greave's evidence, reiteratingMr O'Sullivan's evidence that the Carter Holt specifications specify Metalex Clear forsealing cut edges and then expresses his own opinion on that product. He concludesthis discussion by stating "my PhD thesis confirmed that zinc naphthenate is notsuitably effective as a sapstain control agent. In short, Metalex Clear will do very littleto prevent Shadowclad from decay".[163] Again, this is an example of reply evidence exceeding the permittedboundaries. It covers material that could have been anticipated to be addressed in theCarter Holt evidence and should have been included in the Ministry's primary briefs.It also introduces new material, namely Mr Frazer's PhD thesis, which is not appendedto his report or, as far as I am aware, otherwise available to Carter Holt. This aspectof Mr Frazer's evidence is also struck out.[164] Section 5 of Mr Frazer's reply brief is of the same nature. This addressesCarter Holt's specifications for painting Shadowclad. The Ministry's witness on thistopic in the primary briefs is Mr Coveney, and Mr Hackney is to give evidence forCarter Holt. Section 5 of Mr Frazer's reply brief of evidence is a detailed response toMr Hackney's opinion that water-based coatings are the modern standards and thatacrylic primers perform very similarly to solvent based ones. Mr Frazer says hedisagrees with both those statements and then goes on over approximately five pagesto explain why (noting the improved performance of alkyd primers over acrylicprimers), with reference to various charts, scientific studies, graphs and the like.[165] But Mr Coveney specifically discussed these matters in his primary brief,including solvent (or alkyd) based coatings versus water (or acrylic) based coatings.Mr Coveney also comments in his primary brief on the Shadowclad specification of athree coat acrylic paint system. Thus the adequacy or otherwise of the Shadowcladspecification has already been dealt with in the Ministry's primary brief, and thecomparison between acrylic and alkyd primers was something that could have beenaddressed in the Ministry's primary evidence. Again therefore, Mr Frazer's detailedevidence offered by way of reply on these topics is not materials that falls within theproper bounds of reply evidence.[166] This section of his reply brief (5.2 to 5.32) will also be struck out.[167] If the Ministry wish to pursue leading this evidence, it should seek leave to callit as supplementary evidence. To the extent it does so, I will deal with that applicationat the outset of the trial. It may be that the parties can reach some accommodationaround material like this (including any steps which Carter Holt might need to take torespond to it).[168] The above analysis is the type of exercise required to enable the Court toaccurately rule on evidential challenges such as this. In the absence of this sort ofanalysis by Carter Holt, it is not possible for me to "trace back" from the passagesobjected to in the reply briefs to the relevant Carter Holt evidence, and then back tothe original Ministry evidence. As such, any particular challenges which Carter Holtproposes to pursue will need to await trial.Reply evidence which raises new matters/late testing evidence[169] This is perhaps the most egregious form of non-complying reply evidence andwhich can often give rise to real prejudice to a defendant. It was evidence of thisnature which Muir J declined to read in Wheeldon v Body Corporate 342525 andwhich led to the adjournment of the trial fixture in Body Corporate 330324 v AucklandCouncil.[170] One particular aspect of alleged new material contained in the reply briefswhich was addressed by Carter Holt in some detail at the hearing is "late testing"evidence.[171] This testing (moisture absorption and retention testing) is addressed inMr Wutzler's reply brief (at [324] onwards and exhibits TW37 and TW38). It wascarried out over the period September 2019 to February 2020.75 In fact, as Mr Lalasexplains in his reply brief, the test specification for that testing was changed by him in75 The Ministry's final version primary briefs were served in October 2019. I address belowchallenges to testing evidence contained in these October 2019 briefs, which was not included inthe July 2019 "without prejudice" versions of the briefs served on Carter Holt. It is not clear tome whether this point is material however, in that the final testing results in Mr Wutzler's replybrief have effectively overtaken any interim results reported in his October 2019 brief.September 2019, to reduce the amount of simulated rainfall and to include some dryperiods. The final testing carried up to February 2020 was accordingly based on thatnew test specification. Mr Wutzler also states that two samples of the plywoodinvolved in this testing were sent away for further analysis (by Beagle ConsultancyLtd), with the resulting report attached at TW38 to his reply brief.[172] Plainly this new testing, completed in February 2020, and the test result, arenot evidence in reply. At best it is supplementary evidence.[173] It is appropriate to strike this material out of Mr Wutzler's reply brief, namelyparagraphs 324 onwards and exhibits TW37 and 38. This also applies to paragraphs9.9 to 9.14 of Mr Lalas' evidence (which addresses the new test protocol that is thebasis for the final test results). Again, if the Ministry wish to pursue this evidence, itshould seek leave to call it as supplementary evidence, to be dealt with on the samebasis as set out at [167] above. I observe however, that in a case such as this, I acceptthere may be instances of testing and the like which has not all been completed in timefor the exchange of briefs of evidence. It appears that some Carter Holt witnesses hadalso flagged in their briefs of evidence ongoing testing of this nature (thoughMr Salmon stated at the hearing that those witnesses no longer propose to adduce suchtest results at the hearing). The earlier iteration of the testing (before the specificationchange) was also included in the Ministry's primary briefs served in October 2019 andnoted that the results were interim only and would be updated. It is therefore not thecase that this type of testing has been "sprung" on Carter Holt on the eve of trial.[174] Nevertheless, and as Mr Flanagan properly acknowledged at the hearing, thetesting results are not reply evidence and should not form part of the reply briefs.Absent any agreement between the parties as to the Ministry leading this testingevidence (and any steps Carter Holt may wish to take in response to it), I will hearargument on whether it should be submitted as supplementary evidence at the outsetof trial."Late" testing evidence included in Ministry's October 2019 briefs[175] Carter Holt objects to certain testing results addressed for the first time in theMinistry's briefs of evidence served in October 2019, which were not included in thewithout prejudice versions of the briefs served on Carter Holt in July 2019. TheMinistry says there can be no complaint or suggestion of the inclusion of "late" testingin its October 2019 briefs because those briefs were served in accordance with thetimetable.[176] By way of background, the Ministry's briefs of evidence were originally dueto be served in July 2019. By that point, however, there had been delays in Carter Holtcompleting its discovery. The Ministry was (understandably) hesitant to complete andserve its briefs without having reviewed Carter Holt's full discovery. There wasdiscussion between the parties and the Court as to whether an appropriate course mightbe for the Ministry to serve its briefs in accordance with the original timetable, butwith leave to file supplementary briefs addressing anything arising out of Carter Holt'sfurther discovery. In the event, however, the Ministry proposed that it serve its briefsin accordance with the existing timetable on a without prejudice basis, and serve itsfinal briefs a short time after receipt of the last tranche of Carter Holt's discovery.[177] To this end, in its case management memorandum dated 12 July 2019, theMinistry sought the extension of time for filing its briefs of evidence on this basis. Itstated that:The Ministry's extension is sought on the basis that Carter Holt still hasnot completed its discovery. The timetable (set by consent) initially providedfor discovery to be provided in two tranches, with the second tranche beingprovided by 31 May 2019. As has been noted in the past, the Ministry and its witnesses are concernedat the possibility that they may be required to file evidence without the benefitof considering and assessing Carter Holt's discovery.[Then sets out proposal for provision of briefs on a without prejudice basis]In the Ministry's submission, that strikes a fair balance between ensuring thatthe Ministry is not prejudiced by Carter Holt's delay in provision of itsdiscovery and allowing the current timetable to remain in place as much aspossible. On that basis, the current timetable directions for the filing of CarterHolt's evidence would remain unchanged. Given that Carter Holt will havethe benefit of much of the Ministry's evidence, it cannot seriously complainthat it is prejudiced by that approach.[178] In my conference minute dated 18 July 2019, I noted "the Ministry has filedan application for an extension of the time to the date by which it is to service its briefsof evidence. This arises from delays in Carter Holt completing its discovery".[179] Carter Holt was broadly in agreement with the Ministry's proposal.[180] By memorandum dated 19 July 2019, Carter Holt proposed a number oftimetable orders which envisaged the Ministry serving its briefs of evidence on awithout prejudice basis on 26 July 2019, with the time for filing and service of theMinistry's briefs of evidence on a final basis to be extended until three weeksfollowing service of Carter Holt's final tranche of discovery. Ultimately, the timetableorders proposed in Carter Holt's 19 July 2019 memorandum were made by consent.76[181] Accordingly, the very premise for the extension of time for the Ministry'sbriefs of evidence was the delay in Carter Holt completing its discovery. The partiesalso exchanged correspondence at the time the Ministry served its without prejudiceversions of the briefs, with the Ministry's cover letter stating:As part of the briefing process, the intention has been for each of the expertsto peer review the others' briefs. That process has not been able to occur yetbecause the briefs have not been able to be finalised (as a result of CarterHolt's discovery being incomplete). That process will be carried out and mayresult in further changes being made to the briefs. Similarly, as you are aware,Jim Farmer QC has injured himself and had to have surgery, meaning that hehas been unavailable to review the briefs. He will do that as soon as he is ableto, but that may also result in changes. Finally, final proof readings, cross-reference and formatting will not be carried out until the briefs are in finalformat.[182] The matters flagged in the Ministry's letter were therefore "changes" to thebriefs as a result of a peer review process (which needed to be carried out once CarterHolt's discovery was complete); a review by senior counsel; and other proof-readingand similar changes. None of this envisaged the inclusion of wholly new material,unless arising from Carter Holt's late discovery.[183] Against this backdrop, I consider it wrong for the Ministry to suggest there wassome type of general extension of time for the filing of its briefs to what ultimately76 My minute dated 25 July 2019.became October 2019.77 I would not have granted such a general extension of time,given it would have led to an overly short period of time for Carter Holt to completeits own briefs of evidence (which were due in December 2019). Mr Flanagan alsosuggested there were no restrictions on the changes that the Ministry could makebetween the without prejudice and final versions of the briefs. In response my questionof how Carter Holt would have been expected to deal with very significant andsubstantive changes, Mr Flanagan acknowledged that there could not be an "abuse ofprocess" on the part of the Ministry. But that begs the question. If there were norestrictions on the changes that could be made between the versions of the briefs, thenthere would be no process to abuse.[184] I am accordingly satisfied that the new testing and test results included in theMinistry's October 2019 briefs of evidence was not the sort of new evidence envisagedby either the parties or the Court that might be included in the final briefs.[185] Despite the above conclusion, however, I do not propose to strike out the "late"testing evidence contained in Mr Wutzler's brief of evidence served in October 2019.First, and as explained earlier in this judgment, it appears it has been overtaken in anyevent, given Mr Lalas' re-write of the test protocol in September 2019 and the updatedtest results included in Mr Wutzler's reply brief of evidence. Second, by the time thesubstantive hearing commences, Carter Holt will have had the October 2019 testresults for almost a year. Third, Carter Holt did not raise with the Court any issue orprejudice arising from the test results when it received the Ministry's briefs in October2019.78 Fourth, Carter Holt has responded to this testing evidence in its December2019 briefs at 9.21 to 9.28 of Mr Straube's brief of evidence. He does not commenton any prejudice or time constraint in him responding to this material. Carter Holtsays in its submissions on the present application that "Carter Holt's experts have been77 Submitting, for example, that "because that evidence was served within the timetable providedfor, there is no basis for Carter Holt to say that it is prejudiced in its ability to respond to thatevidence."78 It did make its concerns known to the Ministry, stating in a letter dated 25 October 2019 that itintended to work towards the December 2019 deadline for its briefs, "however it will apply for anextension of time if that is in doubt on the basis of these issues." It did not apply for an extension.severely constrained in their ability to reply to this material". But there is no evidentialmaterial explaining what that severe constraint is.79[186] Ultimately, any further opportunity for Carter Holt to deal with this testingmaterial will need to be considered in the context of any application by the Ministryto admit as supplementary evidence the updated and final testing results purported tostand as reply evidence in Mr Wutzler's reply brief.Ministry's evidence as to Shadowclad's performance on particular school buildingsIntroduction and submissions[187] Carter Holt objects to those aspects of the Ministry's briefs which addressShadowclad's performance on individual school buildings other than the Stage 1buildings and the test hut. For ease of reference, I will refer to this as the "additionalbuildings evidence".[188] Carter Holt does not say the additional buildings evidence is irrelevant. On thecontrary, Carter Holt's position has always been that the best evidence of whetherShadowclad is inherently defective is evidence of its performance on school buildingsin the "real world". But it says that in the lead-up to the hearing before me on whetherthere would be a Stage 1 trial in this proceeding, the Ministry committed to its casebeing advanced on the basis of "laboratory-type" evidence and testing, evidence froma small number of monitored school buildings (i.e. the Stage 1 buildings) and thespecially constructed test hut. It accepts the Ministry indicated there would be someevidence of Shadowclad's performance on other school buildings, but says this waspresented as being demonstrative or illustrative only of the findings drawn from itsother evidence.[189] Carter Holt argues that contrary to the Ministry's commitment as to the natureof its evidence, the additional buildings evidence details Shadowclad's performance79 Mr Alvey comments on an inspection of the Ministry's models and test huts when some othertesting appeared to have been taking place at that time, which was the prolonged duration andabsorption testing addressed in Mr Wutzler's October 2019 brief. His evidence is to the effect thatas the testing had not been addressed in Mr Wutzler's July 2019 brief, he did not see any need fora detailed inspection. But what particular prejudice arises is not stated.on some 22 individual school buildings. This is said to include detailed destructiveand other specific testing, including moisture testing undertaken on both cladding andtimber framing, and mould and decay testing of cladding samples, timber framing andbuilding underlay. Carter Holt says this far exceeds the type of "demonstrative" or"illustrative" evidence the Ministry foreshadowed.[190] Carter Holt says it reasonably relied to its detriment on the Ministry'scommitment, by focussing its own building inspection programme on buildings thatwere about to be remediated, the Stage 1 buildings and buildings to be addressed in itsown evidence. And despite being on notice of the additional buildings evidence fromJuly 2019, Carter Holt says it wasn't practical for it to change its focus to theseadditional buildings and carry out inspections of all of them prior to finalising its ownevidence in December 2019, including because of its experts' work schedules, thelead-times necessary to arrange inspections and the sheer volume of work beingcarried out in the July to December 2019 period. Carter Holt says that as a result, ithas inspected only six of the additional buildings relied on by the Ministry, and evenin those cases, it has not always had the opportunity to attend during the Ministry'stesting. Carter Holt says it is too late for this prejudice to be remedied, given anyinspections carried out now will be well after the time period to which the Ministry'sevidence relates and the buildings may have changed considerably in the interim.[191] Carter Holt accordingly says the Ministry is estopped from leading this type ofevidence.[192] In response, the Ministry first highlights the "blanket" nature of Carter Holt'sobjection, being to every reference to any school building that is not one of the Stage1 buildings, irrespective of its context. Mr Flanagan submits this has led to objectionsbeing made to the Ministry's reply evidence on buildings addressed in Carter Holt'sown evidence.[193] But putting aside the difficult of dealing with what it says is a blanket objection,the Ministry says it made it clear from the outset that its evidence would includeShadowclad's performance on individual school buildings. The Ministry also disputesthere are 22 additional school buildings involved, stating that the number is morearound 18.80 It further says the evidence is very much deployed in a secondary orillustrative way in any event, to demonstrate the inherent defects in Shadowclad "inaction" on the buildings referred to. It also says that the evidence is limited toparticular parts or aspects of the buildings only (to demonstrate Shadowclad'sperformance), and is therefore far more restricted than Carter Holt's "whole ofbuilding" causation evidence.[194] The Ministry says that in any event, there is no or no serious prejudice to CarterHolt from the evidence being admitted. The Ministry says Carter Holt has in factinspected a reasonable number of the school buildings in issue and in a number ofcases, has carried out its own destructive testing.81 The Ministry also notes that inrelation to the schools that Carter Holt has not inspected, it has had this evidence sinceJuly 2019 yet has taken no steps to arrange inspections. And contrary to the practicaldifficulties and lead times referred to by Carter Holt, the Ministry says it has oftenaccommodated inspections on much shorter notice than is strictly required under theinspection protocol. Mr O'Sullivan also says in an affidavit sworn in support of theMinistry's opposition that even if destructive testing has occurred before the otherparty's expert has inspected a building this is not a significant issue, as the bulk of theelevation the sample was taken from will remain available for inspection. He alsonotes that many of the experts in this case, including Carter Holt's experts, giveevidence based on their review of photographs and reports by other experts; in otherwords, without always conducting their own inspection.82[195] The Ministry confirms that those schools which Carter Holt has not inspectedremain available for inspection. Mr Flanagan confirmed at the hearing that the80 I accept this to be the case, though the precise number of school buildings is not material toresolving the objection.81 In a schedule attached to Ms Halpin's affidavit of 15 April 2020, it is accepted that Carter Holthas not inspected nine of the school buildings in issue. Some inspections have also been"particulars" inspections, which Carter Holt says were visual only inspections carried out by"council practices experts" rather than its registered building surveyor experts. (The "particularsinspections" were to enable Carter Holt to give particulars of its claims against the Councils, thethird parties to these proceedings.)82 Mr Alvey has sworn an affidavit in response, generally disputing Mr O'Sullivan's views, andnoting that a desktop review of photographs or another expert's report is no substitute for a first-hand inspection. Mr Alvey also addresses the issues arising from not attending and observing theMinistry's testing on the additional schools. Mr O'Sullivan agrees that a desk-top review is notas good as being able to inspect the building itself, but is of the view that the disadvantagesdiscussed by Mr Alvey are overstated.Ministry would "facilitate [an inspection] in the next day" if required, as well asfacilitating any questions about the challenged evidence. The Ministry also notes thatthe underlying inspection report for each of the additional buildings has been providedto Carter Holt.[196] For completeness, I note that Carter Holt argued, albeit somewhat faintly, thatthe admission of the non-Stage 1 building evidence would needlessly prolong theproceedings. This was not pressed in Carter Holt's oral submissions. I also note thatin its memorandum dated 16 March 2020, some seven months after having receivedthe Ministry's without prejudice briefs of evidence in July 2019, Carter Holt agreed itwas unlikely the hearing would require the full six months' fixture.Discussion[197] I decline to strike out the additional buildings evidence for being inadmissible.[198] I start with the proposition that the evidence is relevant. Indeed on CarterHolt's own case, evidence of Shadowclad's performance on buildings in the "realworld" is the best evidence. It is therefore admissible under s 7 of the Act unlessexcluded by s 8. That requires the evidence's probative value to be outweighed by therisk that the evidence will have an unfairly prejudicial effect on the proceedings.[199] In this context, I am not persuaded the Ministry gave the type of "commitment"to the type of evidence it would lead at the Stage 1 hearing which Carter Holt nowsuggests. The evidence to be led by the Ministry at the Stage 1 hearing was addressedin Ms Halpin's affidavit sworn on 19 December 2017. It is helpful to set out therelevant extract from her affidavit in full, so the reference to the additional buildingsevidence (at point 5(g) below) is seen in context:5. Much of Carter Holt's evidence is directed at how Carter Holtthinks that the Ministry will and should prove its claim. It is notcorrect, as Carter Holt's evidence suggests, that the Ministry is notgoing to refer to any buildings in the claim. It will rely on a varietyof evidence to establish that Shadowclad is defective. Thatevidence includes (in broad terms and without waiver of privilege):(a) The testing of Shadowclad models and wall assemblies: theMinistry has created models of various Shadowclad details(such as a horizontal z flashing at the sheet joint), which havebeen constructed to precisely replicate the requirements of theShadowclad specifications. Those models have been and aresubjected to:(i) tests in laboratory conditions that are designed toreplicate real world rain, wind and solar conditions,which will demonstrate if and where water enters behindthe cladding via the particular detail in question; and(ii) tests that demonstrate the amount of water thatShadowclad absorbs.(b) Evidence obtained from the monitoring of four schoolbuildings over past years. That process has involved theinstallation of sensors and equipment to measure variousindicators such as temperature, relative humidity, air qualitylevels, moisture levels, pressure differences, energyconsumption and air flows over a period of time. The sensorsare in wall cavities, in Shadowclad sheets, and on the exteriorof the building (to measure weather conditions) and allow thetracking of moisture through the building. The data obtainedfrom the monitoring allows the Ministry to:(i) measure and understand the long-term performance ofShadowclad; and(ii) isolate effects such as moisture ingress from buildingdefects so that it is possible to identify those areasthat have, for example, high moisture contentreadings as a result of water penetrating the claddingat defective construction detail, or simply as aresult of the cladding system itself.Because the effects of design and construction defects can beisolated, the monitoring results will demonstrate theperformance of Shadowclad generally.(c) Evidence from a small building, called a test hut, that has beenbuilt specifically for this litigation and is perfectlyconstructed in compliance with the Shadowcladspecifications. The test hut replicates the details used in themodels referred to above and uses a combination of newShadowclad sheets, used Shadowclad sheets obtained fromschools, and different finishes (painted, unpainted, stain, darkand light colours). As with the school buildings noted atparagraph 5(b) above, computerised monitoring and otherequipment has been installed in the test hut, which is exposedto the elements near a school site in Rotorua. Monitoring ofthe test hut allows the Ministry to assess the performance ofthe Shadowclad over time by tracking moisture movingthrough the building. Because the test hut does not have anydesign or construction defects other than those inherent in theShadowclad system, the results will demonstrate how theShadowclad system performs in real world conditions butwith no issue as to building defects.(d) Computer modelling: the monitoring data and furtherlaboratory testing to establish the physical properties ofShadowclad will be used to carry out computer modelling thatpredicts how Shadowclad will perform in differentcircumstances. For example, modelling evidence candemonstrate the effect of climatic changes on a particularbuilding or the effect of slight changes, such as the presenceof eaves, to the performance of a building. That, in turn, willdemonstrate how Shadowclad generally performs in differentconditions and in the absence of design or constructiondefects. I understand that this type of evidence is used inweathertightness litigation in North America (includingcases regarding inherent defects in building products) but hasnot been used in New Zealand before.(e) Evidence of testing of Shadowclad sheets sold in the relevantperiod to determine the level of preservative treatment inthem, and expert evidence from a bio-degradation expert asto what can be concluded in that respect as to Shadowclad'sdurability when exposed to moisture;(f) Evidence of testing of the performance of paint when usedto seal the edges of Shadowclad sheets (including analysisat a microscopic level of the structure of such a sheet, howpaint adheres to it, and how moisture moves through thepaint);(g) Expert evidence from building surveyors with experienceof Shadowclad in practice, both on school buildings andmore generally. I understand that one of those experts,Mr O'Sullivan, has sworn an affidavit in reply to that swornby Carter Holt's experts. Contrary to what Carter Holtsays, the Ministry will naturally rely on evidence fromschool buildings, although that evidence will besupplementary to the test evidence set out above and willbe illustrative of Shadowclad's defects on school buildings.So, the Ministry's evidence will consider Shadowclad as itis installed on a school building to demonstrate:(i) how Shadowclad works in practice on schoolbuildings – how and where water enters thebuildings, where it goes, and what the effect of thatwater entry is;(ii) how particular defects work on school buildings –how they tend to manifest, and the prevalence andeffects of those defects; and(iii) how the evidence obtained from the testing outlinedabove is supported/corroborated by evidence fromactual school buildings.[200] As can be seen from (g) above, the additional buildings evidence was describedas "supplementary" to the test evidence and "illustrative" of Shadowclad's defects onschool buildings. But it is tolerably clear, in my view, that sub-paragraphs (i) to (iii)of (g) above indicated that the evidence would not be a "once over lightly" high levelcomment or example only. And to be substantially helpful expert opinion evidence,some kind of detailed investigation of Shadowclad's performance on individual schoolbuildings would have had to be carried out in any event, to back up any high levelconclusions.[201] I agree with Carter Holt that it is somewhat unfortunate it was only made awareof the identity of the additional school buildings when it received the Ministry'sevidence (on a without prejudice basis) in July last year. Why there was not earlierclarity as to the buildings which would be the focus of the Ministry's evidence isunknown to me. But no issues in this regard, or orders, were raised with or soughtfrom the Court at the time. Further, Carter Holt was on notice from 2017 that buildingsother than the Stage 1 buildings and the test hut would be the subject of the Ministry'sevidence. And it has been on notice of the actual school buildings since July last year.[202] I also take into account that Carter Holt did not seek to inspect the additionalschool buildings during the five-month period between receipt of the Ministry'sevidence in July and the completion of its own evidence in December 2019. I fullyappreciate that Carter Holt had its own work-streams and priorities at that time,including, no doubt, inspections and reporting on the building specific evidence that itproposed to include in its own evidence. But if the prejudice is as serious as is nowbeing alleged, it is somewhat surprising that no steps were taken to secure anyinspections of the buildings at that time.[203] I also note that the Ministry has disclosed building inspection reports for allthe additional buildings in issue. I accept Carter Holt's submission that this is nosubstitute for an in-person inspection – Mr O'Sullivan does not disagree with this. Butit is also clear that together with these reports, Carter Holt has inspected a goodproportion of the additional buildings, some on a destructive basis, and others on anadmittedly more limited "particulars inspection" basis. Carter Holt is not, therefore,dealing with these buildings in a vacuum.[204] I also note that Carter Holt has previously itself sought to down-play theprejudice arising from one party's experts not being present at the other party'sinspections and/or testing, and thus having to rely on other experts' building reports.In its submissions in opposition to the Councils' application to strike out some ofCarter Holt's third party claims (including on the basis of prejudice arising from aninability to inspect), Carter Holt referred to Hall v Auckland Council in which theWeathertight Homes Tribunal rejected the submission that the inability to inspect ahome prior to remediation caused any significant prejudice, given the property hadbeen inspected by other experts.83 In light of Carter Holt's submissions on that issue,in my judgment on the Councils' application I stated:84[A]s CHH submits, and the Councils accept, the vast majority of thosebuildings have been inspected by Ministry and CHH experts. As such, it isnot the case that there is no expert record in relation to those buildings. CHHsubmits those experts are under a duty to provide impartial evidence to theCourt and not be advocates for the parties. While that may be so if thoseparticular experts give evidence in these proceedings (and are thus subject tothe expert witness code of conduct), that is not necessarily the case where anexpert is simply retained by one party. That said, I proceed on the basis thatthe experts have carried out their inspection work in a professional and propermanner. There is nothing to suggest otherwise.Accordingly, and again while I accept there is likely to be some prejudice tothe Councils in not being able to carry out its own inspections on the43 buildings concerned, that is not prejudice which warrants the Third PartyNotices being set aside or struck out. [205] I am also mindful of the Ministry's confirmation that it will facilitate anyinspections Carter Holt now wishes to carry out, and that it will facilitate the answeringof any queries Carter Holt's experts might have in relation to the buildings. Indeed,given each party's experts' overriding duty to the Court, that should go without saying.This exchange of information would also be a usual component of expertconferencing. Accordingly, should Carter Holt's experts have further queries inrelation to the additional buildings evidence, I proceed on the basis that the Ministryand its experts will facilitate this.[206] In summary therefore, I am not satisfied the probative value of the additionalbuildings evidence is outweighed by the risk of it having an unfairly prejudicial effect83 Hall v Auckland Council [2012] NZWHT 6 at [74].84 Minister of Education v James Hardie New Zealand [2018] NZHC 22 at [117] and [118].on the proceedings.85 And to the extent there is any residual prejudice to Carter Holt,arising from either not inspecting any particular building or not being present at anytesting carried out by the Ministry's experts, this will presumably be addressed byCarter Holt's experts when giving their evidence. If accepted, that may affect theweight to be given to the relevant evidence.Objections to hearsay statements[207] The final category of Carter Holt's objections is inadmissible hearsay. Iaddress these objections by reference to the witnesses concerned.Gregory O'Sullivan[208] Carter Holt objects to paragraph 6.15 of Mr O'Sullivan's reply brief ofevidence, which is a reference to an email between Carter Holt employees TreavorReader and Clinton Stanley. In his email, Mr Reader comments on the performanceof Shadowclad on well-constructed schools. It appears to be led by the Ministry forthe purpose of the truth of its contents, namely that even on well-constructed schools,there are issues with water ingress.[209] Accepting that the statement is prima facie hearsay, the Ministry says it isnevertheless admissible pursuant to s 34 of the Act as an admission contained in adocument. An "admission" is a statement that is adverse to a person's interest in theoutcome of the proceeding and which is made by a person who is or becomes a partyto a civil proceeding.86[210] An issue which arises in relation to this and other hearsay statements theMinistry says are admissible pursuant to s 34 is whether the relevant Carter Holtemployee was authorised to make the alleged admission on Carter Holt's behalf.There will normally be no difficulty where the person making the statement is adirector of the company concerned.87 But the position may not be so clear-cut in the85 Or, looking at the matter through an estoppel lens, that the Ministry made the commitment assuggested by Carter Holt, or there is such a degree of detriment from reasonable reliance on thecommitment that it would be unconscionable for the Ministry to lead the evidence.86 Evidence Act 2006, s 4(1).87 As in the case of Levin v West City Construction Ltd [2013] NZHC 929, [2013] NZCCLR 18.case of lower level employees. And there is no evidential material before me toaccurately rule on such matters. The same difficulty was encountered by SimonFrance J in in Cridge v Studorp Ltd, where he observed that:88 some of the statements are claimed by the plaintiffs to be admissionsbinding on James Hardie, and may just be irrelevant observations byemployees if not so qualifying. With these I do consider that pre-trialdetermination without the benefit of oral evidence is premature. The Court'sdetermination of the admissibility of the statement as an admission will beassisted by a better understanding of the role of the maker at James Hardie,and the context in which the statement was made, as well as the usual hearsayissues such as the accuracy of the reporting of the statement.[211] A similar objection is made by Carter Holt to paragraph 15.19 ofMr O'Sullivan's reply brief, in which he refers to statements made in emailcorrespondence between a Mr Wakefield and Mr Malone at Carter Holt. Mr Maloneis a witness in this proceeding. Accordingly, to the extent any of the statements areattributable to him, they are not hearsay statements. But to the extent they arestatements attributable to Mr Wakefield, there is no information before me as toMr Wakefield's authority to make the alleged admission.[212] Accordingly, objections to hearsay statements which are said by the Ministryto be admissible under s 34 of the Act will need to await trial.Christopher Ross (reply brief)[213] Carter Holt objects to parts of paragraph 7.8 of Mr Ross's brief of evidence inreply in which Mr Ross explains that he took three samples from a particular sheet ofcladding, and then refers to findings made as a result of those samples. The Ministrysays that the analysis of the samples was carried out by Dr Wakeling, a witness in theseproceedings, and the underlying analysis report has been discovered. On this basistherefore, the analysis results are not hearsay statements.[214] A similar objection is made and response given in relation to paragraph 7.11 ofMr Ross' reply evidence. Again, to the extent the underlying analysis was carried outby Dr Wakeling, given he will be a witness in the proceeding, the analysis is not ahearsay statement.88 Cridge v Studorp Ltd [2020] NZHC 794 at [21].Peter Graham (reply brief)[215] Carter Holt objects to paragraph 6.11 of Mr Graham's reply brief of evidence,in which he refers to confirmation from a school that a school block at the time ofbeing inspected was part-way through the planned maintenance cycle for externalpainting, and the building was last painted in late-2015. It appears to be accepted bythe Ministry that the school's confirmation is advanced for the truth of its contents.The Ministry has confirmed it will source and discover the maintenance records ifavailable, which it says will be admissible under s 19 of the Act. Or alternatively, itconfirms it will obtain a short statement dealing with the timing of the maintenance atthis particular school.[216] On this basis, no pre-trial ruling is required.[217] Carter Holt also objects to paragraph 6.16 of Mr Graham's brief which is areference to the analysis results of samples taken from Berkley School. Again, theMinistry says the analysis was completed by Dr Wakeling and thus no hearsay issuearises.[218] The same challenge is made and response given in relation to paragraph 6.35of Mr Graham's statement. Again, on the basis the underlying test analysis wascreated by Dr Wakeling, no hearsay issue arises.Jeanette Drysdale (primary brief)[219] Carter Holt objects to paragraph 7.18 of Ms Drysdale's brief of evidence inwhich she refers to observations made in a report from Carter Holt's discovery aboutCarter Holt's treatment processes. Again, the Ministry appears to accept that thestatements are prima facie hearsay statements, as it says the statements are admissibleunder s 34 of the Act.[220] The particular admission(s) said to be made in the report are not spelled out bythe Ministry. The underlying report is written by a Mr Fortune. Again, there is noinformation before me as to his position or authority within Carter Holt. Like earlierobjections on this basis, a pre-trial ruling is not possible.Philip O'Sullivan (primary brief)[221] Carter Holt objects to paragraph 21.14 of Mr O'Sullivan's original brief ofevidence. This recounts discussions he had with Carter Holt executives in whichMr O'Sullivan states "they were not happy with MoE's proposed 'ban' of H300SPtreated plywood". There then follows a series of statements made by Mr O'Sullivanhimself.[222] On the basis the challenge is to the statements made by Carter Holt executivesthat they were not happy with the proposed "ban", then to the extent the purpose ofleading the evidence is to prove the truth of its contents, they would be hearsaystatements. It is not immediately apparent to me, however, why the fact the executiveswere not happy about the ban is relevant to any of the issues for determination at theStage 1 hearing in any event. A pre-trial ruling is not possible.[223] Carter Holt also objects to paragraph 27.8 of Mr O'Sullivan's brief, in whichhe refers to statements made in an article written by Guy Cavanagh, marketingengineer at Carter Holt. Mr O'Sullivan characterises these statements asdemonstrating Carter Holt knew the benefits of cavities long before they firstintroduced them for the Shadowclad system in 2005.[224] Putting aside whether such analysis of what Carter Holt did or did notappreciate at any given time is substantially helpful expert opinion evidence (or moreakin to commentary or submission), it is not entirely clear a hearsay issue arisesanyway. Mr Cavanagh is recorded as saying "a drained layer in thin skin claddingswould almost eliminate the issue". If the statement is being advanced for the truth ofits contents (namely that a drained layer in thin skinned claddings would eliminate theissue), then a hearsay issue arises. But if it is being advanced for the purposes ofdemonstrating knowledge of the suggested benefits of a drained layer, it would notamount to a hearsay statement.[225] But even if a hearsay statement, the Ministry says it is admissible under s 19of the Act. Assuming for present purposes that the BIA News magazine is a "businessrecord", there is no information before me to assess whether Mr Cavanagh isunavailable, or he would be unlikely to recollect the matters dealt with, or that undueexpense or delay would be caused by calling him. I also query the material's relevancein any event, given Mr Cavanagh is referring to the benefits of a drained layer in thinskin claddings, being stucco, plaster on fibre cement or polystyrene claddings. Howthis relates to the inherent qualities of Shadowclad is not explained.[226] For all these reasons, a pre-trial ruling is not possible.Robin Wakeling (primary brief)[227] Carter Holt objects to paragraph 11.4 of Dr Wakeling's brief of evidence inwhich he says he is aware of an additional large number of Beagle reports coveringShadowclad analysis. The Ministry says that Dr Wakeling (who will give evidence attrial) authored all the Beagle reports and therefore none of their contents are hearsaystatements. If this is correct, then I agree with that conclusion.Thomas Wutzler (reply brief)[228] Carter Holt objects to paragraphs 76, 78 and 79 of Mr Wutzler's reply brief.This appears to be on the basis that paragraph 76 refers to matters stated by aMr Aitkin, and at paragraph 78, there is a reference to a Carter Holt document dated18 August 2010 on the basis of which Mr Wutzler says Carter Holt was aware that itsspecifications were inadequate. Mr Wutzler sets out his conclusions from thesematerials at paragraph 79.[229] I am not prepared to deal with these objections on a pre-trial basis. There is noinformation before me as to the precise basis for the objections (other than, as observedearlier in this judgment, the one word notation in the margin of the brief that thechallenge is "hearsay"). To the extent this is to be pursued by Carter Holt, it will needto await trial.[230] The same result applies to Carter Holt's objection to paragraph 204 ofMr Wutzler's reply brief.[231] Finally, Carter Holt objects to paragraphs 324 to 332 of Mr Wutzler's replybrief on a number of grounds, including on the basis that it "includes hearsaypassages". I have already struck this evidence out as exceeding the scope of replyevidence. As noted, the Ministry will need to seek leave to introduce it assupplementary evidence.[232] I merely observe that if the hearsay challenges are to be maintained, CarterHolt will need to spell out what it is that is said to be hearsay and why. I note theMinistry submits that to the extent the objection is the reference to underlying Beagletest reports, then Dr Wakeling carried out that testing and is a witness in theproceeding. There is also reference to one of Dr Wakeling's colleagues attending thedeconstruction of a test sample, recording the moisture content and takingphotographs. The photographs themselves would not be a hearsay "statement". Tothe extent the record of moisture content readings are strictly a hearsay statement, theymay well be admissible as a business record (particularly if there is no challenge tothe readings themselves, rather than Dr Wakeling's conclusions drawn from them).Again, these matters will need to await trial.[233] I turn now to the third and final application for determination, namely theMinistry's application for discovery related orders.Ministry's application for discovery related ordersIntroduction and orders sought[234] On 20 December 2019, I delivered a judgment on the parties' respectiveapplications to set aside privilege claims made by the other (the PrivilegeJudgement).89 The Ministry's application concerned approximately 26 Carter Holtdocuments relating to end user complaints, and challenged Carter Holt's claims oflitigation privilege and without prejudice privilege in those documents. I set aside theclaims of litigation privilege in 22 of the documents90 and upheld three out of the fourclaims to without prejudice privilege.91 I also provided guidance for Carter Holt tocarry out a re-review of the privilege claims in relation to other end user complaintsdocuments. This led to Carter Holt re-reviewing some 3,800 documents and as a89 Minister of Education v James Hardie New Zealand [2019] NZHC 3487.90 At [46].91 At [53].result, disclosure of a further 1,393 documents. Of those 1,393 documents,approximately 800 were photographs. As part of the review process, 755 documentswere also re-classified by Carter Holt as irrelevant.[235] Carter Holt's challenge to the Ministry's litigation privilege claims concernedsome 1,400 documents, largely building inspection reports. Given the number ofdocuments in issue, it was not possible to rule on the privilege claims on an individualbasis. I nevertheless did not accept some of the principles of litigation privilege uponwhich the Ministry had claimed privilege. I again provided guidance for the Ministryto conduct a re-review of some of the documents in question (certain inspection reportspre-dating 2013). As a result of that process, the Ministry disclosed 99 reports thathad previously been identified as privileged, maintained the claim of privilege over81 reports, reclassified 19 reports that had been identified as privileged as irrelevantand disclosed 10 further reports not previously discovered.[236] Despite each party conducting a thorough review of certain categories ofdocuments following the Privilege Judgment, the Ministry remains concerned atprivilege claims maintained by Carter Holt. Like the documents the subject of thePrivilege Judgment, these largely relate to end user complaint documents. But ratherthan claims of litigation privilege, the Ministry's present focus is Carter Holt's claimof without prejudice privilege. The Ministry also raises a concern in relation to asmaller number of documents over which privilege has been claimed on a solicitor-client basis, being documents passing to or from Carter Holt's in-house counsel.[237] A key aspect of the Ministry's application is its complaint that, contrary to thePrivilege Judgment, Carter Holt has not provided meaningful, individualisedexplanations for the factual basis upon which it claims privilege, or the factual basisupon which documents previously identified as relevant (but privileged) have now bereclassified as irrelevant. In his oral submissions, Mr Flanagan expressly eschewedany suggestion of bad faith or incompetence on part of those lawyers carrying outCarter Holt's discovery and the re-review. But he submits there is sufficient evidenceof anomalies in the process, coupled with Carter Holt's failure to provide meaningfulexplanations for its privilege claims, that it can be inferred that some kind of systemicissue has arisen.[238] The Ministry's claim for relief is twofold:(a) First, it seeks an order that Carter Holt provide an individualisedexplanation for every document over which privilege is claimed (exceptdocuments subject to solicitor-client privilege and to which externallegal counsel are a party, and documents created for the purpose of thisor one other proceeding to which Carter Holt is a party). This orderwould extend to 2,347 documents, and necessarily covers a wider rangeof documents than end user complaint documents.(b) Second, it seeks an order that an independent barrister be appointed bythe Court to review Carter Holt's explanations and the privilegeddocuments, to assess the merits of the privilege claims.[239] The Ministry accepts that the orders it seeks are unusual. But it says such acourse is warranted given the residual concern in relation to Carter Holt's discoveryprocess and with the substantive hearing fast looming, it will assist in "drawing a line"under the continuing discovery dispute.[240] Carter Holt opposes the application. It first says the application has been filed(well) after the close of pleadings date and thus leave is required but has not beensought. It says that leave should not be granted. There was a specific timetable forany applications concerning discovery, to ensure all such applications were dealt withwell in advance of trial. Carter Holt says that aspects of the application are mattersabout which the Ministry has known since early 2019. Further, to the extent it purportsto rely on the results of Carter Holt's re-review in February 2020, Carter Holt saysthere is no proper basis arising from that review for the orders sought, which willconstitute a significant distraction for Carter Holt in the period immediately precedingthe substantive trial.[241] On the substance of the application, Carter Holt says the fundamental premisefor the Ministry's arguments (namely that contrary to the Privilege Judgment, CarterHolt has "failed" to provided individualised explanations for its privilege claims) ismisconceived. It says the Privilege Judgment did not order or otherwise require suchindividualised explanations to be given. Rather, the judgment required a re-review ofthe privilege claimed in relation to end user complaint documents which Carter Holtand its legal advisers have since carried out. It says the re-review has been carried outby senior lawyers acting for Carter Holt with a full understanding of the dispute andthe principles set out in the Privilege Judgment and led to disclosure of furtherdocuments as appropriate. This includes a number of internal documents which theMinistry says are adverse to Carter Holt's interests, which highlights that an overlybroad approach to privilege has not been taken.[242] Carter Holt also says that in any event, and contrary to the impression soughtto be created by the Ministry, it has engaged repeatedly and in a meaningful way onthe Ministry's queries on privilege claims. And to the extent the Ministry points tovarious anomalies or concerns in relation to particular documents, Carter Holt saysthose concerns are largely misconceived, or to the extent there is the odd example ofan error in the process (which is inevitable in a discovery of this size), this does notsuggest any systemic issues warranting the unusual relief sought.[243] Before turning to the relevant legal principles and their application to this case,two preliminary points can be made.[244] First, the Privilege Judgment did not itself order, or otherwise require CarterHolt to provide an individualised explanation for every document over which it hasclaimed privilege. Rather, having set aside privilege claimed in a selection of CarterHolt's documents that were then before the Court, I encouraged both parties to conducta re-review of certain categories of documents given I did not agree with some of theprinciples they had adopted to their claims of litigation privilege. In doing so, Iobserved that the schedules of explanations of privilege claims produced by bothparties were not particularly helpful in illuminating the basis upon which privilege hadbeen claimed,92 but did not rule or order the production of more "meaningful"schedules as the Ministry suggests. And it is implicit that what the Ministry now seeksby way of "individualised explanations" goes further than what is required by the92 At [98].Rules for the listing of privileged documents, given there would otherwise be no needto make the order now sought.93[245] Certainly if there are ongoing discussions around the basis for particularprivilege claims, it will of course be helpful for parties to engage in that process andexplain why privilege has been claimed. It may avoid the need for Court input. Butif one party is not satisfied with that engagement or the explanations given, it is opento it to seek orders pursuant to r 8.25 setting aside privilege claims (as each party didlast year and which led to the Privilege Judgment). In that context, and assuming someevidential foundation has been raised in relation to the challenge, the party claimingprivilege will need to satisfy the Court that privilege has been properly claimed.[246] Given the points made at [244] above, it cannot be said that Carter Holt has"failed" to provide individualised explanations that it was ordered to provide by thePrivilege Judgment or is otherwise required to provide by the Rules. I therefore seethe real issue as being whether there is sufficient material presently before the Courtto suggest there has been a systemic issue with Carter Holt's approach to claimingprivilege and which warrants the relief sought by the Ministry.[247] The second preliminary point is that of leave. The point was not pressed toany significant degree in Carter Holt's oral submissions. But while it is right that theMinistry requires leave to file its discovery application, I am prepared to grant leave.The application relies heavily on matters arising from Carter Holt's re-review ofdocuments which only occurred in the first part of this year and after the close ofpleadings date. And while there are some aspects of the application which relate tomatters pre-dating that process, it is clear that the Ministry's concerns have grownwith Carter Holt's successive tranches of discovery, the re-listing of privilegeddocuments in February of this year, and ongoing engagement in relation to privilegeclaims. When determining the application, however, I do take into account the natureof the orders sought by the Ministry, the inevitable work involved in Carter Holtcomplying with the orders if made, and that the period following the close of pleadingsdate should be when the parties and their lawyers can focus on trial preparation.93 I note the Ministry specifically does not seek orders that Carter Holt produce a new list ofprivileged documents which complies with the Rules' listing requirements.Legal principles[248] The discovery process, including assessing relevance and claims to privilege,is largely a matter of self-assessment. The reason why litigating parties and the Courtcan have confidence in those making such assessments is that in addition to being theirclient's legal adviser, they are also an officer of the Court. Solicitors also have apositive duty under the High Court Rules to take reasonable care to ensure their clientunderstands its discovery obligations and fulfils those obligations.94 The Lawyers andConveyancers Act (Lawyers: Conduct and Client Care) Rules 2008 also contains rulesdirected to lawyers' conduct in connection with discovery and privilege, includingprohibiting privilege claims being made unless there are proper grounds to do so.95[249] The Court accordingly starts from the premise that lawyers advising litigatingparties are cognisant of and comply with their discovery-related obligations. Therewill accordingly need to be sufficient information before the Court before it willconsider it necessary to "look behind" a party's legal advisers' own assessment ofrelevance and privilege.[250] As noted, challenges to privilege claims are specifically addressed by r 8.25which provides as follows:8.25 Challenge to privilege or confidentiality claim(1) If a party challenges a claim to privilege or confidentiality made in anaffidavit of documents, the party may apply to the court for an ordersetting aside or modifying the claim.(2) In considering the application, a Judge may require the documentunder review to be produced to the Judge and may inspect it for thepurpose of deciding the validity of the claim.(3) The Judge may—(a) set aside the claim to privilege or confidentiality; or(b) modify the claim to privilege or confidentiality; or(c) dismiss the application; or(d) make any other order with respect to the document underreview that the Judge thinks just.94 High Court Rules 2016, r 8.13.95 Lawyers and Conveyancers Act (Lawyers: Conduct and Client Care) Rules 2008, r 13.9.[251] The Ministry's application is not, strictly speaking, an application pursuant tor 8.25. The Ministry does not challenge any particular privilege claim made by CarterHolt or seek orders from the Court setting aside or modifying privilege claims. Rule8.25's references to making orders in relation to "the document under review"confirms it is directed at document specific inquiries. The Ministry's application doesnot do this. Rather, it is pitched at a higher level, raising broad concerns in relation todocument types and categories and as a result, seeks a review of all Carter Holt'sprivilege claims (save for two excluded categories). As noted earlier, the orders soughtwould attach to more than 2,300 documents.[252] The principles applicable to r 8.25 applications are nevertheless of assistanceto some aspects of the present application. They were considered recently by Wylie Jin NZ Iron Sands Holdings Ltd v Toward Industries Ltd, a case with some parallels tothe present.96 In commenting on the approach to be taken to applications under r 8.25,Wylie J said the following:[21] Clearly the Court has a discretion whether to inspect a document, andthe rule does not qualify that discretion in any way. There is no requirementthat a Judge be satisfied of any particular circumstances before inspecting and,in appropriate cases, overruling a claim to privilege. A ruling after inspectinga document said to be privileged, even without the benefit of submissions, ismore likely to further the ends of justice than a ruling without inspection.97Nevertheless, documents should not be provided to the Court for inspection"as a matter of automatic practice".98[22] It has been suggested by the learned authors of McGechan onProcedure that there has been a greater willingness in recent times to inspectdocuments in the interests of getting to the truth of the matter.99 However, atleast one commentator in the United Kingdom has suggested that there areinherent difficulties in inspection by the Court. He has noted as follows:100Day to day decisions as to whether to disclose specific documentsare taken by the lawyers. No-one else is in a position to make thosedecisions, and there is in practice no supervision by the court as towhether, for example, the lawyers have taken wrong view ofprivilege or relevance. Applications for specific disclosure onlyprovide the most limited supervision because the other partysimply will not be aware in most cases of the facts relied upon tojustify a particular claim for privilege or irrelevance, and the basis96 NZ Iron Sands Holdings Ltd v Toward Industries Ltd [2019] NZHC 1416, [2019] NZAR 1199.97 Seamar Holdings Ltd v Kupe Group Ltd [1995] 2 NZLR 247 (CA) at 247–249.98 General Accident Fire & Life Assurance Corp Ltd v Elite Apparel Ltd [1987] 1 NZLR 129 (CA)at 133.99 A C Beck and Others McGechan on Procedure (online ed, Thompson Reuters) at [HR8.25.02].100 C Hollander Documentary Evidence (13th ed, Sweet and Maxwell, London, 2018) at [7-64].for such decisions will not usually be apparent. Given that basicpremise, it is illogical that a Court to be asked to intervene otherthan in a case where there is a reason to believe on evidence thatthe lawyers have either misunderstood their duty or are not to betrusted with the decision making. These will be very exceptionalcases. But, more importantly, inspection by the court is usuallyeffected in circumstances in which only one party has seen thedocuments in question. It is extremely unsatisfactory that thecourt should be asked to make a decision where the informationavailable to the parties is different. There has more recentlybeen greater recognition of the problems to which inspection bythe court gives rise. It now seems to be treated as "a solution oflast resort". [253] In NZ Iron Sands, the plaintiff said there were various factual matters orcircumstances which meant there was reason to believe the defendant's lawyers hadeither misunderstood the relevant law or taken an unduly liberal approach to claimingprivilege.101 Those circumstances included that a number of the defendant'sdocuments had initially been said to be privileged but were later made available on anopen basis. The plaintiff suggested there had never been a proper basis to claimprivilege over those documents, giving rise to concerns about the remaining privilegeclaims. The plaintiff also pointed to the fact that a number of the challenges related tosolicitor-client privilege claims over communications with in-house counsel, whichgives rise to particular difficulties when in-house counsel wear more than one "hat".Counsel for the plaintiff accordingly submitted that it could be expected that a numberof "marginal calls" had had to be made by the defendant and its advisers whenreviewing these communications. In those difficult cases, the plaintiff submitted thatthe balance should be struck on a document-by-document basis by a Judge or anindependent Queen's Counsel appointed by the Court for that purpose.[254] The defendant in NZ Iron Sands noted that the plaintiff's proposal wasunprecedented and argued that there were no grounds for making the orders sought. Itargued that the starting presumption is that the affidavit of documents is complete.This particularly so, it was said, given the affidavit of documents in that case had beensworn by a solicitor. In addition, the defendant's discovery process had beenundertaken by its external advisers and not by in-house counsel. Affidavits had also101 Such as the lack of internal emails and reports discovered by the defendant; no relevant documentsdisclosed over certain critical time-periods; no records of meetings, minutes, call logs or emailsaround the relevant time; and extensive redactions having been made to some discloseddocuments.been filed by those external solicitors working on the discovery process, including onan additional review of all relevant and privileged documents over the time periodbeing challenged.[255] Faced with these competing positions, Wylie J said the following:[34] Where a solicitor swears an affidavit as to the status of documents,the Court will normally require cogent evidence to challenge that view,before going behind the affidavit of documents.102 When solicitors swearaffidavits of documents, they are of course officers of the Court, and there isan obligation on them to consider each document, and make a carefulevaluation as to whether it is proper to make a claim for professional privilegein respect of the document.103 It has been held in the United Kingdom thatthe Court should not itself inspect documents unless there is credibleevidence that the lawyers have either misunderstood their duty, or theyare not to be trusted, or there is no reasonably practicable alternative.104[35] Here, Ms Morrison's initial affidavit of documents has been proved,at least in part, to have been wrong. Claims to privilege were made whichshould not have been made. However, there is nothing to suggest that thereview exercise undertaken by Mr Kerkin and others at Chapman Tripp wasundertaken in anything other than a thorough manner.[36] Nevertheless, the issues which confronted Chapman Tripp in itsreview were not simple. The application of the law relating to the scope oflegal advice privilege, particularly where the claim is in relation tocommunications to and from in-house counsel and where legal advice is likelyto be intermingled with commercial advice, is not always simple. Thedominant purpose for the creation of the document may not always be clearand the answer in each case will not necessarily be obvious. Wherecommercial advice and legal advice are intertwined, issues of facts and degreewill arise, involving a weighing of the relevant importance of the identifiedpurposes for which the communication was prepared.[38] Where the Court is minded to go behind an affidavit of documents,there are various options open to it. It can conclude that the person claimingprivilege has not discharged the burden that lies on him or her and orderdisclosure and/or inspection. It can order a further affidavit to deal withmatters the earlier affidavit did not cover or on which it is unsatisfactory. Itcan order cross-examination of the deponent, who has produced the affidavitof documents. It can inspect the documents itself.105102 Jones v Monte Video Gas Company (1880) 5 QBD 556 (CA); Carter Holt Harvey Ltd v FletcherHoldings Ltd [1981] 2 NZLR 613 (HC); Foley's Transport Ltd v Weddel NZ Ltd (in rec & liq)(1996) 9 PRNZ 392 (HC); McCullagh v Robt. Jones Holdings Ltd [2015] NZHC 1462, (2015) 22PRNZ 615 at [7]; and Lighter Quay President's Society Incorporated v Waterfront Properties(2009) Ltd [2017] NZHC 818 at [16(b)].103 Seven Network Ltd v News Ltd [2005] FCA 142 at [33].104 National Westminster Bank plc v Rabobank Nederland [2006] EWHC 2332 (Comm) at [34] and[49]–[51].105 West London Pipeline & Storage Ltd v Total UK Ltd [2008] EWHC 1729 (Comm) at [74].[39] While I do not doubt the endeavours that Chapman Tripp has made, itseems to me that, given the intrinsic difficulties with legal adviser privilege,given the "margin calls" that will have been required in this case, and giventhe need to ensure that the substantive issues in dispute are fully and properlyheard by reference to all properly admissible material, the most sensiblesolution in the present case is to direct discreet inspection of sampledocuments, to see whether there has been any systemic error, which may haveresulted in an overly liberal approach being taken to the issue of legalprofessional privilege.[40] I have considered whether I should undertake the inspection myself,or whether it should be undertaken by another Judge or an Associate Judge.Both Mr O'Brien and Mr Hodder submitted that an Associate Judge would beappropriate if I got to this stage. Mr O'Brien acknowledged that there is nojurisdiction permitting the appointment of an independent QC to undertake thetask, and in any event, it is properly a judicial function. Here, theseproceedings have been allocated to me as a Commercial Panel member. I amthe allocated Judge, and I will be conducting the trial. Authorities in theUnited Kingdom suggest that in such circumstances, investigation by a Judgenot connected with the case is preferable.106 I adopt that approach.[Emphasis added][256] Wylie J ordered that a sample of 52 documents107 be made available to theCourt for inspection (by an Associate Judge). In the event, following the review(described by Wylie J in a later judgment as a "protracted process"), the plaintiff'schallenge to the privilege claims was dismissed.108[257] Dealing briefly with the jurisdictional point noted at [40] in the above extractfrom NZ Iron Sands, Mr Flanagan acknowledged that if I were of the opinion thatinspection of Carter Holt's privilege claims was warranted, it would not be appropriatefor an independent barrister to make findings on those privilege claims; that is rightlya judicial function. But Mr Flanagan said the appointment of an independent barristerto make recommendations on the privilege claims would be appropriate and ofassistance, given the number of documents in issue.106 Atos Consulting v Avis plc (No 2) [2007] EWHC 323 at [57]; and National Westminster Bank plcv Rabobank Nederland [2006] EWHC 2332 (Comm) at [57].107 Being approximately 10 per cent of the documents in respect of which privilege had been claimed.108 NZ Iron Sands Holdings Ltd v Toward Industries Ltd [2019] NZHC 2883 at [20(b)]. The onlyexample to which the parties referred me of an independent barrister being involved in reviewingchallenged privilege and relevance claims was a process adopted by Fisher J in ClearCommunications Ltd v Telecom Corporation of New Zealand Ltd (1999) 14 PRNZ 477 (HC). Theindependent barrister was appointed to inspect challenged documents, express preliminary viewsas to relevance and privilege, and refer continuing disputes to the Court for formal determination.Fisher J noted (at 486) that the independent barrister had reported "[i]n respect of the vast majorityof documents examined it was plain that a correct approach had been adopted. Where I haveexpressed a reservation or a contrary view, it is fair to say this appears to be a result of the difficultyof the exercise."Why the Ministry says there is evidence of ongoing systemic issues warranting theorders sought[258] The Ministry first says Carter Holt's original list of documents did not identifyprivileged documents in accordance with the Rules; rather, it simply identified broadcategories of documents which were said to be privileged and spanned a period from1993 to the present. Carter Holt acknowledged these issues given that, over time, ithas engaged in a process to provide further iterations of the privileged section of itsdiscovery list. I have also accepted there were listing deficiencies in Carter Holt'searlier lists, ordering that it produce a compliant list.109[259] I am not persuaded that earlier listing issues are relevant (or materiallyrelevant) to the present application. Those issues concerned the form of listingdocuments rather than issues about the substantive claims to privilege. I infer fromearlier discovery disputes between the parties that the electronic discovery processemployed by Carter Holt has not always gone to plan. Mr Salmon acknowledged thisin his oral submissions at the hearing, noting it had been a "learning process". ButCarter Holt's claims of privilege have not been made by a computer process and theevidence on the current application is that they have been made by senior lawyers withknowledge of the matters in issue and the principles set out in the Privilege Judgment.I accept that the listing issues have made the Ministry's task of interrogating someprivilege claims more difficult. But this in and of itself does not indicate a systemicproblem with the substance of the privilege claims made.[260] The Ministry next says that the inadvertent disclosure of some documents overwhich privilege had been claimed but which the Court later set aside raises furtherconcerns. I agree this is relevant to the present application, as it was in NZ Iron Sandscase.110 It demonstrates that in at least that respect, the original affidavit of documentswas not correct. But the privilege claims I set aside had been made on the basis oflitigation privilege and were limited to end user complaint documents. In the PrivilegeJudgment, I found that both parties had adopted an approach to litigation privilegewith which I did not agree. Importantly, this led to the re-review process adopted by109 Minister of Education v James Hardie New Zealand [2020] NZHC 82.110 See [35] of the extract set out at [255] above.both parties, and both parties changing the classification of about 50 per cent of theparticular documents which were subject to the re-review. That shows the processworked and the correct principles were applied.111 And unlike the privilege claim atissue in the Privilege Judgment, the Ministry's current application primarily relates towithout prejudice privilege. In the Privilege Judgment, I upheld three out of the fourwithout prejudice privilege claims. This does not itself indicate a systemic issue withCarter Holt's application of without prejudice privilege.[261] Carter Holt has also confirmed that it has disclosed on an open basis all initialcustomer complaints. It has also disclosed on an open basis the end point of CarterHolt's engagement with customers, namely the record of any settlement reached. Theareas generating most debate are communications between the customer and CarterHolt between these two ends of the spectrum, and internal Carter Holt documentsdiscussing those matters. As noted in the Privilege Judgment, I found that Carter Holthad generally taken an appropriate approach to claiming without prejudice privilegeover end user complaint documents. And for the purposes of the re-review, CarterHolt also had the specific guidance on the application of without prejudice privilegeto end user complaints.[262] There is nothing presently before the Court which indicates there is a real riskthat Carter Holt has misunderstood the principles set out in the Privilege Judgment.The Ministry points to Ms Lang Sui's comment in her affidavit that "without prejudiceprivilege is appropriately claimed in respect of an internal CHH communicationsdiscussing a potential offer of settlement of a claim raised by an end user" and saysthis suggests that an overly broad approach to without prejudice correspondence hasbeen taken. I do not agree. Proceeding on the basis that there is in fact a disputebetween the customer and Carter Holt (in the sense discussed in the PrivilegeJudgment), internal documents discussing a potential settlement of a claim would besubject to without prejudice privilege (being a document "made in connection" withan attempt to settle the dispute). I do not understand the Ministry to suggest thatinternal communications of this nature were not intended to be confidential (and Ireadily accept they would be).111 Ms Lang Sui explains the process for the re-review in her affidavit sworn on the presentapplication, which indicates it was conducted in a thorough and proper manner.[263] Again, therefore, the re-review process itself does not give rise to sufficientconcern to justify the approach now being sought by the Ministry.[264] At the hearing before me, the Ministry also produced two schedules ofparticular documents and privilege claims which it says give rise to broader concernsas to Carter Holt's approach to privilege claims. I will refer to the documents referredto in these schedules as the "example documents". But other than three specific typesof documents listed in the schedule to the Ministry's application for which "furtherexplanations" were required (i.e. rather than a specific challenge to privilege), none ofthe example documents was the subject of the Ministry's application (or Ms Martin'saffidavit sworn in support of it). This is not ameliorated by the fact that some of theexample documents (but not all) were listed in Schedule 3 to the Ministry'ssubmissions filed on the application, to which Carter Holt responded in a scheduleattached to its own submissions.[265] Mr Salmon and Mr Nilsson emphasised the nature of the Ministry's application(i.e. not being a specific challenge to privilege pursuant to r 8.25) and the difficulty ofhaving to respond to the example documents when they were not themselves thesubject of the application. I was initially not attracted to this "jurisdictional" typeargument. But on reflection, I agree with Carter Holt that this led to Carter Holtresponding to some of the example documents "on the hoof" and without theappropriate affidavit evidence being available. This in turn led to instances ofevidence being given from the bar as to the basis upon which privilege had beenclaimed, being far from ideal. It ultimately highlights the difficulty with the broadscope and nature of the Ministry's application, rather than an application challengingprivilege in specific documents, so that those documents are then the subject of properevidence and submission. I accordingly take these matters into account whenconsidering whether the example documents suggest a broader or systemic issue withCarter Holt's privilege claims.[266] Turning to the schedules of example documents produced by the Ministry,Schedule 3 to its submissions raised the following concerns:(a) Documents with "explanations" that are inconsistent with the partieslisted (11 specifically identified documents, 22 unidentified documentsand 44 unidentified photographs);(b) Documents over which without prejudice is claimed but which havesurrounding context that indicates they are not privileged (sixdocuments);(c) Redactions of material that appears to be relevant (three documents);and(d) At least 101 (largely unidentified) documents over which solicitor-client privilege has been claimed but where the list names neither aninternal Carter Holt lawyer or an external legal adviser as a party to thecommunication.[267] Carter Holt responded to each of these concerns in a schedule attached to itsown submissions. The Ministry then handed up at the hearing a further iteration ofthe schedule with further comments on Carter Holt's responses.[268] In summary, I am not persuaded that the matters addressed in Schedule 3 giverise to a real concern of systemic issues in Carter Holt's approach to privilege. Forexample, as to (a) above, Carter Holt notes that some 1198 items in its list match thedescription given by the Ministry. It does not therefore know to which 22 documentsthe Ministry refers. Carter Holt nevertheless notes that discovery lists will bepopulated by the "top level" document in an email chain, when the substantivecommunication over which privilege is claimed may be lower down in the email chain.An example given was a communication with in-house counsel for the purposes ofobtaining legal advice, which is then forwarded on to someone else within Carter Holt.The Ministry is right that if the top level email does not itself attract privilege, theproper course would be to redact the privileged material and produce the top email onan open basis. But equally, the top email may be irrelevant – for example where theprivileged material is simply forwarded on with no relevant content in the top email.If anything, it shows that in some cases there has been a listing format error. Somelisting matters are also explained by the documents being authored by parties outsideof Carter Holt in which case metadata has been used to populate the list.[269] I am unable to conclude from the fact there are a small number of documentswith "explanations" which are inconsistent with the parties listed that there is asystemic issue with the substance of Carter Holt's privilege claims.[270] As to (b) above, one example referred to by the Ministry is an email betweenCarter Holt and Brodie Kane of Fair Go over which without prejudice privilege hasbeen claimed. The Ministry submits that open documents show Ms Kane waspreparing a story for Fair Go about Shadowclad. It says in those circumstances,communications with Ms Kane can hardly be expected to be confidential. Carter Holtresponds that it has disclosed a number of documents concerning the Fair Go story,highlighting that it is not seeking to cloak these materials in privilege. It maintains itsclaim to privilege in the particular email stating (from the bar) that Ms Brodie wascommunicating on a particular customer's behalf in respect of an offer and negotiatinga settlement. Without more, I cannot discern anything sinister or obviously wrongwith the privilege claim in relation to this document.[271] There is one document in this set which Carter Holt accepts was inadvertentlycoded for privilege. Other documents are drafts of documents (for example, settlementagreements) prepared by Carter Holt's legal advisers where the final copy has beendisclosed. Draft iterations of documents that are reviewed by legal counsel are oftenthe subject of privilege claims. Again, nothing in this persuades me of systemic error.The same can be said for examples in open documents, where customers have thankedCarter Holt for the steps they have been prepared to take to their claim. The Ministrysays this is inconsistent with there being a "dispute". I am not satisfied that is so; asCarter Holt notes, the mere fact it dealt with a matter in a way which the customer isappreciative says nothing itself as to whether there was a dispute. Carter Holt and itslegal advisers are alive to the need for there to in fact be a dispute between it and acustomer to attract without prejudice privilege. The Privilege Judgment made thatclear.[272] There are also some documents in this set to which the same listing commentsmade at (a) above apply. The Ministry accepts the responses provided by Carter Holt.Again, this goes to some listing issues rather than systemic issues as to the basis forclaiming privilege.[273] As to (c) above, this does not relate to Carter Holt's privilege claims (butapproach to relevance). Again, having reviewed the scheduled concerns, Carter Holt'scomments and the Ministry's responses, there is nothing in this category whichsuggests systemic issues with privilege claims.[274] As to category (d) above, few specific examples are given. The Ministry refersto documents listed with authors such as Arch Wood Protection (NZ) Ltd, TimTechChemicals Ltd and personnel from the Wood Processors Association, and that theseseem inconsistent with Carter Holt's explanation that the majority of documents forwhich solicitor-client privilege is claimed but which list a third party as an author orrecipient are draft documents created for the purpose of obtaining legal advice.Mr Nilsson, delivering Carter Holt's oral submissions on the detailed aspects of thediscovery application, took me to similar examples in the Ministry's list of documentswhere solicitor-client privilege has been claimed but where no internal or externalsolicitor has been listed as a party to the communication. Mr Nilsson also highlightedthe difficulty of responding to the particular anomalies raised by the Ministry whenthey had not been the subject of its application and therefore were not the subject ofevidence before the Court.[275] As noted earlier, the Ministry's application listed three specific types ofdocuments in relation to which it had concerns and for which it sought an order thatdocument by document explanations be provided. Two of these were addressed in theparties' submissions, namely "Heads Up" reports and "standards".[276] In relation to the former, Carter Holt says the Heads Up reports were preparedfor and sent to Carter Holt's in-house legal counsel for the purposes of seeking legaladvice. It was also sent at the same time to technical staff. This was presumably toenable all relevant advice to be sought and obtained on what corrective steps couldand ought to be taken.[277] A "Heads Up Report Procedure" produced on the application lists threecategories of seriousness of compliance failure, "extreme" (risk of potential productfailure); "high" (Fair Trading Act breach, potential loss of third party certification);and "moderate" (potential loss of market confidence). In all three cases, one of theHead's Up Report Recipients is a member of Carter Holt's in-house legal team (listedas the first recipient in all cases). The procedure document also says that the solutionto the compliance failure identified in a Head's Up Report must be signed off by theSite Manager, the Operations Manager, and reviewed by legal counsel and theCompliance Manager.[278] Carter Holt submits that this confirms that the purpose of the reports was toinform legal counsel of an issue and seek advice on the appropriate action.[279] Ultimately, the Ministry's application only sought an explanation for the basisupon which privilege has been claimed. Carter Holt has provided that explanation. Aruling on whether the Heads Up Reports are privileged is not sought on the Ministry'sapplication. I merely observe that it appears a Heads Up Report is prepared for thepurpose of obtaining legal advice, that is, rather than being prepared for another non-privileged purpose and then provided to the legal adviser for review.112 But it alsoappears to be prepared for other purposes, such as seeking and receiving technicalinput.[280] Where a communication is addressed to a number of recipients for commentand advice, only one of which is a lawyer, an issue may arise as to whether thedominant purpose for which the document was prepared must be to obtain legal advicebefore legal advice privilege will attach. Whether a dominant purpose test ought toapply to legal advice privilege, and the approach to multiple addresseecommunications, is subject to some controversy in other common law jurisdictionsand divided opinion between leading commentators.113 At least on the face of the112 Such as the draft television scripts in issue in Simunovich Fisheries Ltd v Television New ZealandLtd [2008] NZCA 350 at [160]. The draft scripts were nevertheless held to be privileged becausedisclosure of them would reveal the legal advice given, through the iterative changes to the drafts.113 See, for example, Bankim Thanki The Law of Privilege (3rd ed, Oxford University Press, Oxford,2018) at [2.184]; Colin Passmore Privilege (4th ed, Thomson Reuters, London, 2020) at [2-156]and [2-168]–[2-178]; and Hodge M Malek (ed) Phipson on Evidence (19th, Thomson Reuters,London, 2018) at [23-77].relevant sections of the Evidence Act, a distinction appears to be drawn betweenlitigation privilege (which expressly incorporates a dominant purpose test) and legaladvice privilege (which does not).114 But as noted, it is not necessary for me to gofurther on the Ministry's application on matters such as this. It is sufficient to say forpresent purposes that the mere fact legal advice privilege has been claimed over theHeads Up Reports does not indicate to me broader or systemic issues with CarterHolt's approach to claiming privilege.[281] The Ministry also sought an individualised explanation in relation to privilegeclaims in relation to "standards". Carter Holt explains that the documents in questionare draft internal policy documents prepared for review and legal advice by in-housecounsel. Again, nothing more than an explanation was sought and has been given.Again, some brief observations may assist. It is not uncommon for draft material suchas this to be subject to claims of solicitor-client privilege, including on the basis thatdisclosure of the draft documents would, when assessed against the final versions,disclose the legal advice provided.115 Accordingly, the mere fact that Carter Holt hasclaimed legal advice privilege over documents described in its list as "standards" doesnot in and of itself suggest anything sinister or untoward in its broader approach toprivilege.116[282] I am also unpersuaded that Carter Holt's reclassification of approximately710 documents, or 20 per cent of those documents subject to the re-review,117 asirrelevant, mandates the relief sought. To put this in context, the Ministry itself re-classified some 10 per cent of the documents the subject of its own re-review asirrelevant. I do not therefore see the number of documents reclassified as a result ofthe re-review as particularly informative of whether there are ground for broaderconcern. And reclassification of documents as irrelevant in a lengthy and complexdiscovery exercise such as this does not necessarily suggest anything unusual oruntoward. Carter Holt's discovery has been provided in a number of tranches. As114 A point noted in Colin Passmore Privilege (4th ed, Thomson Reuters, London, 2020) at [2-157].115 Simunovich Fisheries Ltd v Television New Zealand Ltd [2008] NZCA 350 at [170]–[171].116 For the avoidance of doubt, I am not suggesting in relation to Heads Up Reports or "standards"that the privilege claims made are or are not correct. That is not the issue before the Court. Rather,the only relevant issue is whether the fact privilege has been claimed in relation to such documentsweighs in favour of making the orders sought on the Ministry's application.117 Rather than 20 per cent of all documents discovered by Carter Holt.time has gone on, reviewers have become more familiar with the documents and thecase, and earlier judgments I have delivered have clarified the scope of relevance insome areas. Ms Lang Sui confirms that the re-review process was also carried out bysenior members of the review team with a greater knowledge of the proceedings thanthose who conducted the initial review (and thus who took a fairly cautious approach).In addition, in relation to specific examples referred to in Ms Martin's affidavit insupport of the application, Ms Lang Sui has provided explanations in her affidavitwhich prima facie appear to answer the concern. In all these circumstances, awinnowing of relevant material does not itself suggest a broader problem.[283] Drawing all these threads together, I am of the view that there would need tobe fairly cogent evidence before me of a potential systemic error in Carter Holt'sapproach to privilege claims to warrant the broad and intrusive approach of anindependent review of every document over which privilege has been claimed (otherthan two particular categories). As already noted, this would involve a review ofthousands of documents. The matters raised by the Ministry show there have been aseries of listing issues in Carter Holt's discovery. The discovery process has beenlengthy and vexed. But the remedy for the sorts of ongoing listing issues (which Ihave already ordered) is that Carter Holt produce a compliant list. It is also correctthat Carter Holt has not maintained some earlier privilege claims. That is not unusualin many discoveries, particularly larger exercises such as this. All parties accept thatsome mistakes will be made. Carter Holt's discovery extends to more than30,000 documents. The number of documents and the issues raised in this judgmentneed to be assessed in that context. And the nature of the application, and the mannerin which argument developed on it highlights that that if there are to be challenges toprivilege claims, the application needs to be focused on the specific documents in issueso that the appropriate evidence can be put before the Court.[284] I therefore decline to grant the relief sought on this aspect of the Ministry'sdiscovery application.Search for documents held by a further custodian[285] The final aspect of the Ministry's discovery application is an order that CarterHolt carry out searches for relevant documents from a further custodian.[286] The further custodian is a Mr Brian Robinson, who was an account manager atCarter Holt from at least 2012 to 2018. He was involved in investigating and resolvingend user complaints, including in relation to Shadowclad. The Ministry is particularlyfocused on such documents, saying they are highly relevant to key issues at trial,including whether Shadowclad is defective in fact.[287] Carter Holt does not dispute that Mr Robinson is likely to hold relevantdocuments. He also still works for Carter Holt. This means that searching for relevantdocuments would not need to interrogate back up servers. But Carter Holt points tothe lateness of the application, and disputes the Ministry's suggestion thatMr Robinson's role and likelihood of holding relevant documents has only becomeapparent through the most recent tranche of discovery by Carter Holt (in February thisyear). A Mr Malone, a member of the Carter Holt technical support team, provided anaffidavit on the application noting that Mr Robinson would involve Mr Malone in thecomplaints he received at an early stage. Mr Malone also notes that Mr Robinson hadlimited authority to settle end user complaints and thus would have had to involveother more senior personnel. Mr Malone says that he therefore expects that anydocuments relevant to the issues in this proceeding that may be in Mr Robinson'semail files would be captured in Mr Malone's documents (being a custodian for thepurpose of Carter Holt's original searches). In all these circumstances, Carter Holtsays it would be disproportionate for it to now have to engage in a process of searchingfor more documents, particularly with the substantive trial looming.[288] I am conscious that the parties' efforts should, as far as is possible, be focusedon pre-trial preparation at this stage. I also note Carter Holt's submission thatMr Robinson in fact featured in a number of documents disclosed by it in earliertranches, such that is not correct that he only came to the Ministry's attention on theproduction of the additional documents following the end user complaint privilege re-review.[289] Despite these matters, however, there is no dispute that Mr Robinson holdsrelevant documents. Some may already have been captured through searches of othercustodians' documents. But some may not be. Ms Lang Sui did not point to anyparticular process or timing difficulties in searching at least Mr Robinson's emails,which does not require recourse to historical servers.[290] Given the application is for what are accepted to be relevant documents, I donot consider it disproportionate to require Carter Holt to carry out further searches ofMr Robinson's documents. But to maintain proportionality, this must be with somelimits. This will be only over the time period for which Mr Robinson was an accountmanager (which the Ministry notes was from at least 2012 to 2018). The searches areonly required to be conducted against Mr Robinson's electronic emails files; manualsearches of hard copy materials are not required. Searches of historical servers are notrequired. Leave is reserved should further clarity be required around these limitations.[291] I also do not make any timetabling orders for the production of any furtherrelevant documents. Leave is reserved should orders be required. Obviously the taskshould be completed by Carter Holt as soon as reasonably practicable. But I do notexpect the documents will need to be the subject of expert review or comment inadvance of trial (particularly as expert commentary on another party's internaldocuments is unlikely to be substantially helpful).Orders and result[292] I have made some pre-trial rulings on each party's admissibility application,but many challenges will need to await trial. Specific rulings on the admissibility ofsome items of evidence are made in the body of this judgment. In terms of some ofthe more substantive matters raised on the admissibility applications:(a) I have declined to rule Carter Holt's causation evidence inadmissible.(b) I have declined to rule the Ministry's evidence concerning non-Stage 1buildings inadmissible.(c) I have concerns at the scope of the Ministry's reply evidence and haveruled some of that evidence inadmissible.(d) I seek submissions from the parties on a potential costs order againstthe Ministry for what I consider to be reply evidence which exceeds theproper boundaries of such evidence. Carter Holt may file amemorandum on this topic within 10 working days of this judgment,with the Ministry filing a response within a further five working days.(e) I have declined the Ministry's application for orders that Carter Holtprovide individualised explanations for its privilege claims, or that anindependent barrister be appointed to review the underlying documents.[293] Costs on these applications should be determined now rather than reserved.Costs submissions on the applications are to be filed within 15 working days of thisjudgment, with responses filed within a further five working days.____________________Fitzgerald JSCHEDULE A(a) Mr Gregory O'Sullivan's reply brief10.5 I explained in my first brief that the weathergroove is too small toprevent capillary action, and in longer periods of rain it can actuallyfill with water which then overfills and flows sideways, causing decay.In response, Mr Alvey simply says that the weathergroove is as largeas it can be without compromising the integrity of the cladding, andsays this is consistent with E2/AS1. He says that he has not seen anyissues caused by the size of the weathergroove in the examples.10.6 While it may be true that the weathergroove is as large as it can be,that does not mean that the size as detailed is adequate. It is not, forthe reasons I have already explained in my first brief of evidencewhich Mr Alvey does not engage with.10.9 I explained in my first brief of evidence that the dimensions of theweathergroove are so tight that builders often ended up driving thenail through the weathergroove, which restricts its function andprovides another opportunity for water ingress.10.10 Mr Alvey does not consider shiplap joints particularly difficult to fix.However, keeping the weathergroove clear of nails is difficult byCarter Holt's own admission, as I explained in my first brief. Builderscannot be held responsible for failing to achieve this detail. Thesystem is entirely at fault where nails, or their heads, penetrate theweathergroove or slightly intrude into the weathergroove. These are adirect result of the intolerance built into the joint.10.11 Mr Wiemann says that the shiplap joint will perform if properlyinstalled, but then goes on to say that he has observed widespreadfailure to install the shiplap joint properly. This simply confirms whatI have said in my first brief – the dimensions are too tight, and are notachievable for the vast majority of builders.(b) Ms Shorter's reply brief22. Mr Lipson is mistaken in paragraph 25 that no school studies werepresented. I presented over five pages of evidence coveringrespiratory health effects with mould and dampness exposure inschools (see pages 29 -34 of my previous brief). I disagree with MrPrezant and Mr Lipson that schools are not the same as houses. As permy brief, there is little plausible evidence why an exposure in oneenvironment would not present a risk in another environment, theWorld Health Organisation also state this (see page 13 of my previousbrief). There are no biological reasons offered by either expert as towhy an individual exposed to contaminated air in their home wouldnot be just as likely to suffer health effects in contaminated buildingselsewhere.(c) Ms Burnie's reply brief3.2 As set out in my evidence, the presence of certain types of mould orfungi inside buildings is known to be associated with detrimentalhealth effects. It can also indicate moisture issues and damp buildingsare also generally regarded as detrimental to the occupants' health(d) Ms Drysdale's reply brief6.2 As I mentioned in my initial brief, there are limited documentsrelating to treatment prior to 2005. It is therefore unclear how CarterHolt ensured compliance by its chemical suppliers or third partytreaters. That is an important omission because, as set out in my firstbrief, the information we have from the Gorman report shows wideranging failures in understanding critical parameters in the treatmentprocess and their consequences.(e) Mr Boulton's reply brief2.4 I disagree with Mr Alvey and Mr Hackney. As I said in my initial brief,I am of the view that the specifications only required flashings in"coastal regions" be primed and painted(f) Dr Wakeling's reply brief6.28 Mr Meder says at paragraph 29 that he would not expect anysignificant decrease in the fungitoxicity of TBTO when it degrades inthe wood. At paragraph 45 Mr Meder cites his article from 1991(Archer and Meder) as support. However, Mr Meder's statement (andhis article) is completely contrary to established knowledge and theliterature which I cited in section nine of my first brief which shows adecrease in TBTO retentions within a few years or less and thereforea logical derivation of loss of fungitoxity, regardless of the form of thebreakdown compounds. In any event, the study referred to in thearticle referred to by Mr Meder is irrelevant to the present situation:(a) the experiment was designed to test the effects on durabilityof any breakdown of TBTO that might be occurring in thetreatment plant prior to treating any wood. It involved treatingthe wood with degraded TBTO solutions where degradationmost likely occurred over a period of weeks/months, ratherthan letting the TBTO degrade in the wood over many years(which is what actually occurs in-service). It does not,therefore, test the effects of TBTO degradation in wood;(b) the article refers to the possible unreliability of the test methodbecause of a suspected inhibitory effect of the volatilebreakdown products build up in the confined space of a smalltest jar, on the ability of the laboratory decay fungus to makecontact with the wood test blocks. This is clearly not a factorthat would occur in-service;(c) no raw data is provided, and so the reliability of the resultscannot be tested.8.6 The Beagle results recorded in my original evidence were of a singleTBT-based product that repeatedly had advanced decay, usually of aparticular type (soft rot) occurring in the same kind of location (edgesof Shadowclad) within similar timeframes that are known to causeTBT breakdown and loss. Instead of discussing this profoundlysignificant finding, a finding that is very likely to be a causalcorrelation, Mr Meder and CHH's other experts dismiss it as anartefact of some kind. That is especially odd when (as I have notedabove) Dr Singh herself concludes that Shadowclad will not performif exposed to significant amounts of moisture, and tends to fail on thebottom edge, and given Meder's own observations of "unexpectedresults, unanswered questions, contradictions and uncertainties" withrespect to TBT performance and of the highly unpredictablebehaviour of TBT (paragraph 6.32) .(g) Messrs Hubbs and Finch's reply brief1.2.7 These general comments do however highlight the importance ofmany of the items which we have already addressed in our BOE suchas:(h) Mr Gregory O'Sullivan's reply brief1188.1 The defendant's experts do not address my evidence in respect oftimber treatment. Instead, Mr Alvey and Mr Wiemann assert that ifShadowclad is installed correctly then it should not be exposed tomoisture for prolonged periods.8.2 At paragraph 17.4 of my first brief of evidence, I give four examplesof defect 4. I address each of these examples in detail in Appendix Cof my first brief of evidence. For completeness, I record that thesamples taken from each of the four schools were in areas that werecompliant with the specifications and had no construction orinstallation defects.118 This also includes material effectively "bolstering" the primary evidence (i.e. that aspectcommencing "for completeness".SCHEDULE B(a) Ms Burnie's reply brief of evidence3.1 Both witnesses suggest that my evidence is not determinative of whatis occurring in particular buildings or the performance of Shadowclad.I readily accept that I have not been asked to determine theperformance of Shadowclad (my evidence was never intended or putforward on that basis), but I disagree that what was found present orotherwise on the samples submitted is not determinative of what maybe occurring in particular buildings. My role is to analyse samples thatare provided to me and determine what is or isn't present and provideinformation that can then be used by others, in this case buildingsurveyors, to help form conclusions about buildings or productperformance.3.2 As set out in my evidence, the presence of certain types of mould orfungi inside buildings is known to be associated with detrimentalhealth effects. It can also indicate moisture issues and damp buildingsare also generally regarded as detrimental to the occupants' health.Both Mr Lipson and Mr Prezant agree that mould and indoordampness is a health issue and should not be tolerated, regardless ofwhere in the wall cavity it is found. They do question whethercausality has been established, such that particular moulds can belinked to particular health effects, but they do not disagree with thebasic proposition that indoor mould and dampness is a problem thatmust be remedied. In considering correlations to human health andwhether buildings should be remediated, I do not consider that is isnecessarily essential to identify which species of mould has caused aparticular health effect. Rather, the association between mould andadverse health effects is such that damp buildings or buildings withmould will need to be remediated to mitigate any adverse healtheffects irrespective of which particular mould has caused the healtheffects.3.3 Visible mould growth on building materials is always indicative ofmoisture issues including moisture ingress and general buildingdampness, which is, as discussed above, associated with a number ofhealth problems for building occupants. Therefore whether the mouldis growing on the inside of the building paper inside the wall cavity,or outside of it is of secondary importance to the primary issue of itbeing present. In any case, I consider that the types of buildings foundin schools are likely to be under negative pressure relative to theoutdoors, which means that spores from mould growing in the wallcavity would have the capacity to move into the classrooms on aircurrents through wall and/or ceiling penetrations.3.4 While I agree with Mr Prezant that any mould colonisation inside abuilding is undesirable and should be remediated, I consider that thelevels of Stachybotrys found in the samples is a serious cause forconcern, for the reasons I discuss below.3.5 I disagree with Mr Prezant's comment at paragraph 96 that myanalysis of the samples sent to Biodet is unsatisfactory. When fungallevels are clearly above background levels, and include species thatare known to occur in moisture compromised buildings, it is clear thatthis is important in terms of possible damaging effects on health.(b) Mr Gregory O'Sullivan's reply brief of evidence6.78 In his brief of evidence, Mr Alvey questions whether the sheet waspainted up the base of the sheet to the required height of 150 mm. Iam of no doubt that the rear of the sheet was primed up to 150 mm.6.79 As with Te Kura Kaupapa Maori o Te Ara Rima, Mr Alvey points tothe relevant Prendos report and the "List of Concerns" identified inthe Prendos investigation, namely installation failures which arecontrary to the Carter Holt specifications.6.80 Mr Alvey claims that the sample in the photograph at paragraph16.76(c) of my first brief of evidence appears to be from a similarlocation to the sample in photograph 1.25 of the 2014 JohnsonvilleSchool Prendos report, the inference being that if the sample inphotograph 1.25 of the Prendos report had water ingress issuesattributable to installation failure, then the same is likely of the samplediscussed at paragraph 16.78(c) of my brief of evidence.6.81 Mr Alvey's claim is incorrect. The sample in paragraph 16.76(c) ofmy first brief of evidence did not come from a similar location to thesample in photograph 1.25 of the Prendos report. A photographshowing the location where the sample was taken from is below.6.82 This sample had been installed in compliance with Carter Holt'sspecifications and did not have an accent board, let alone an un-flashed accent board, as evident from the location photo above.Accordingly, there is no basis to allege water ingress occurred fromthe installation issues mentioned in the 2014 Prendos report.11.24 Mr Alvey states in his brief of evidence that he has not seen issueswith flashings that have been correctly installed during hisinspections. This is inconsistent with my inspections. Even wheninstalled in accordance with Carter Holt's specifications, corrosionstill occurs. See for example my findings from my inspections atOrewa Primary and Whangarei Intermediate at paragraph 2.23 of myfirst brief of evidence.12.14 This photograph shows a base board which has been fixed directly tothe face of the cladding at the base of the sheet, without a flashing.Mr Alvey and Mr Wiemann say that the accent board was non-compliant with the specifications, the 1990 specifications in the caseof Mr Alvey and the 1992 specifications in the case of Mr Wiemann.Both are incorrect.12.15 Block D at Johnsonville School was constructed in 2003. Given the2003 specifications were not introduced until June 2003, Block D wasbuilt in accordance with the July 1999 specifications. The fixingarrangement shown in the photograph above matches Detail (J) of the1999 specifications.13.8 Again, Mr Alvey claims that the extensive moisture ingress Iidentified in a section of cladding removed on the upper level of thewest elevation was due to extensive construction defects, includingthat gun nails had been used to secure the cladding, and water entry atthe sheet joints is occurring.13.9 All buildings, even those that have been well constructed, can haveminor faults which will enable a small amount of water to enter thebuilding envelope. Building systems must allow for this by havingadequate draining paths. This is required by the Building Code atclause E2.3.7:Building elements must be constructed in a way that makes dueallowance for the following:(a) the consequences of failure;(b) the effects of uncertainties resulting from constructionor from the sequence in which different aspects ofconstruction occur;(c) variation in the properties of materials and in thecharacteristics of the site.13.10 In the case of Shadowclad, the clamping that occurred by fixing thecladding sheets to the framing, in all situations prior to 2005 and forthose with a risk rating of 6 or lower after 2005, prevented water fromdraining down. This means moisture will be trapped behind the sheetand will lead to undue dampness and damage that cannot beeliminated by diffusion, because of the particular qualities ofShadowclad sheets.(c) Messrs Hubbs and Finch's reply brief of evidence1.2.12 To address similar comments discounting the usefulness of calibratedmodels made by Mr Nutter, it should be reiterated that WUFI isprimarily used as an explanatory tool within our brief to supplementour field hygrothermal monitoring, field testing and laboratory testingwork. The building science and the behaviour of building materialssuch as Shadowclad within wood-framed wall assemblies isinfluenced by numerous variables. To better explain what variablesare important to the behaviour of Shadowclad we have used WUFI asa tool primarily to perform parametric studies of properties such asrainfall exposure and solar radiation, Shadowclad surface conditionproperties (paint, colour, absorptivity etc) and to look at thecomparative performance of Shadowclad on walls in differentclimates of New Zealand. More so we have exhausted significanteffort in the art and science of calibrating WUFI models to themeasured data with laboratory testing, field testing and experiencewith design and repair of wood-framed buildings with the intention ofproducomg more accurate simulations. The resulting simulations arediscussed in detail to illustrate known facts about building materialsand assemblies in relative comparison and in simple examples andlayperson terms (i.e. Shadowclad will get wetter when exposed tomore rain, or absorb more water with a more absorptive paint, less sunmeans wetter conditions etc.). These relative comparisons, clearlypresented in our brief, help put into context the likely contribution ofdifferent factors and help validate or disprove opinions on both sidesof the case.1.2.19 As referenced in our brief, and re-acknowledged here there are manyexamples across North America, Europe, New Zealand, Asia andelsewhere that have successfully used WUFI models, often calibrated,specifically for the purpose of demonstrating or predicting theperformance of building materials and assemblies under the influenceof real-world conditions. Some Canadian, American, European, andNew Zealand reference examples where WUFI has been calibratedwith field monitoring dated include: [(Finch & Straube, 2007) (Ueno& Lstiburek, 2014) (Straube & Schumacher, 2003) (Lstiburek, Ueno,& Musunuru, 2015) (Bassett & McNeil, 2006) (Schumacher &Reeves, 2007) (Grin & Smegal, 2013) (Arena, 2014) (Holm, 2001)(Kuenzel & Kiessl, 1997) (Kunzel, Stockl, & Zirkelbach, 2014)(Salonvaara, Karagiozis, & Holm, 2001) (Kuenzel, Schmidt, & Holm,2002) (Overton, 2016) (Finch, Straube, & Richmond, 2007)(Karagiozis, 2004) (Building Science Consulting Inc., 2014)). Thesemany peer reviewed published examples counter Mr Nutter'sconclusion, based on limited references, that "current publishedresearch surveying hygrothermal computer modelling programsincluding WUFI confirms that computer analysis is still not a reliablepredictor of real-world hygrothermal behaviors and outcomes". Itshould however be acknowledged, and as authors will confirm, toimprove reliability of models, specifically for WUFI that monitoringor real-world data should always be used to check the models prior toextrapolation. Hence the approach we have taken. As a result,Mr Nutter's generic conclusion at 8.1.6 does not apply to our work.(d) Mr Coveny's reply brief of evidence4.3 Irrespective of the exact cause, Mr Hackney agrees that sharp edgespresent particular difficulties and that this is a well known feature ofacrylic paints, but he says that "normally as more coats are applied thecorner does eventually get covered". I do not agree. In my view, thedifficulties of painting the corner are such that it will always have alesser paint film, thereby reducing the coating's protective effect atthe edge. The much thinner coating at the edge is illustrated in thephotographs in my brief of evidence. In order to achieve a film buildof 100μ at corners, the reasonably experienced and conscientiouspainter referred to in Mr Hackney's brief would need to paint slowlywith a brush at every corner, applying a number of coats, which wouldbe an exhaustive and time consuming process.4.14 Despite this, Mr Hackney acknowledges that best painting practice "isnot perfect for coating the edges and grain ends of timber claddings"but a "satisfactory job" can be obtained. However, even then"maintenance is key and it appears that the maintenance needs to becarried out by a "reasonably competent painter" who is said to beresponsible for inspecting and recoating the edges. This confirms theparticular difficulties posed by the bottom edge and the care andattention required to ensure an adequate coating. I have read the paneledge moisture absorption testing results section of Messrs Hubbs andFinch's brief of evidence. The testing results show effectiveness ofedge coating and back priming that broadly conforms with myexpectations. I am of the view that the product design needs to takeinto account some absorption of water regardless of paint coating.Also, I analysed the bottom of new pre-primed Shadowclad sheets in2016. Even Carter Holt's own pre-primed sheets had problems,including voids and pinholing within the coating exposing the endgrain of the vertical veneers and cracks.(e) Mr Wutzler's reply brief of evidence96. Mr Alvey states that the Shadowclad specifications only allowunpainted edges when the sheets were not intended to be painted orwhen used for structural purposes. I disagree that this is clearly statedin the Specifications. In my opinion the specifications requiredpainting of bottom edges and sheet laps only leaving the top edges ofsheets unpainted.97. Each of the Specifications included a statement (in a section referringto "preparation of the sheets") to:Prime or precoat bottom edges of sheets and inside shiplap jointsif painting or staining, see painting recommendations. (Myemphasis.)98. That is an express restriction of priming or precoating to bottomedges.99. I acknowledge that a later statement in each Specification (inreference to painting the sheets) refers to the fact that "laps and edgesshould be sealed" (or words to that effect). The wording was notrestricted to "bottom" edges but I consider that the direction to primeor pre-coat bottom edges suggests that the sealing of edges onlyapplies to bottom edges.100. I have set out the wording which appeared in each Specificationrelating to the priming of bottom edge:(f) Mr Philip O'Sullivan's reply brief of evidence7.3 Neither of these really addresses the issue. In response to the first, Iconsider that it is incumbent upon a manufacturer such as CHH,marketing and selling a cladding system; to design that system in sucha way that buildings built using it will comply with the Building Code.If the cladding sheets CHH manufactures cannot incorporate a largerweathergroove, then an alternative means of keeping the jointweathertight may be required, or the depth of the sheets may need tobe increased.7.4 As to the second point above, it is correct that that Acceptable SolutionE2/AS1 did provide for the use of the vertical shiplap joint from July2005. However, as noted in my First Brief, at [15.18], the shiplap jointwas removed from the Acceptable Solution from August 2011. Sobetween 2005 and 2011 the shiplap joint was allowed, but only in lowrisk situations when directly fixed over building wrap to framing, andthere had to be a rear air barrier. In moderate and higher risk situations,a drained and vented cavity had to be included.7.5 As I explained in my First Brief, at [15.4], I was on the Workgroupthat worked on the development of Acceptable Solution E2/AS1 ThirdEdition, which came into effect in 2005. As I noted, at the time, wewere unaware of the poor performance of plywood cladding. We were,for example, unaware of complaints that CHH had received over theyears regarding building clad in its product. Accordingly, we were notconcerned with including the shiplap joint that formed part of theShadowclad system. I was not involved in 2011 when the shiplap wasremoved from the Acceptable Solution.7.6 In any event, whether the shiplap was consistent with the AcceptableSolution or not does not address the question of whether it performsadequately in the real world. I refer to the discussion in my First Briefat [22.1] to [22.21].7.7 When the shiplap joint was removed from E2/AS1 in 2011, CHHcould no longer say that its system fell within E2/AS1. It was clearlyan alternative solution. CHH responded by going to BRANZ andobtaining an Appraisal for the "Shadowclad Direct Fixed CladdingSystem". CHH's expert witnesses place considerable reliance on thisAppraisal. For example, at [125] of his evidence, Mr Aitken statesthat:In my view, the Shadowclad detailing for this joint is effective inpreventing or mitigating moisture ingress when properlyinstalled and the best sources of knowledge and advice available(E2/AS1 and BRANZ) have since from at least 2004 regardedthe shiplap joint to be a reasonable and weathertight solution.7.8 Mr Aitken appears to base his opinion on the performance of theshiplap joint on the fact that it was included in E2/AS1 Third Editionand then included in the 2011 BRANZ Appraisal, rather than withreference to any observations of the real world. I disagree thatE2/AS1 and BRANZ were the best sources of knowledge available toCHH. A reasonable manufacturer would carry out its own testing.Both E2/AS1 Third Edition and the BRANZ appraisal came out afterCHH had been using shiplap joint for many years so one would expectCHH have taken steps such as testing to satisfy itself as to theperformance of this joint well before then.7.9 As set out in my First Brief at [15.19] to [15.29], when the shiplapwas removed from E2/AS1 in 2011, CHH had to do something inorder for its product to continue to be seen as acceptable in the market.It appears from email correspondence that they had concerns that theshiplap joint may fail pressure testing in a direct-fix applicationHowever, they then proceeded to obtain an Appraisal that they knewwas not based on any testing of the system in a direct-fix application.