Otter v Residual Health Management Unit CA137/98 [1999] NZCA 367; (1999) 13 PRNZ 367 (23 June 1999)

Last Updated: 16 January 2019

IN THE COURT OF APPEAL OF NEW ZEALAND CA137/98


BETWEEN GARY OTTER

Applicant

AND RESIDUAL HEALTH MANAGEMENT UNIT

First Defendant

AND CHRISTIAN HOSPITAL TRUST BOARD

Second Defendant

AND ANGELA TAYLOR

Third Defendant


Hearing: 8 June 1999

Coram: Gault J Henry J Thomas J Keith J Blanchard J

Appearances: O Woodroofe and P Pa’u for Applicant
A C Hughes-Johnson QC and P A McCarthy for First Defendant
P N Collins for Second and Third Defendants

Judgment: 23 June 1999

JUDGMENT OF THE COURT DELIVERED BY GAULT J

[1] Mr Otter commenced this proceeding alleging (inter alia) negligence by the defendants in circumstances surrounding the death of his wife on 11 July 1992. He claimed damages for “nervous shock”. The first defendant requested further particulars of the nervous shock and asked:
Is it alleged that the plaintiff suffers from psychiatric illness or other medical condition as a result of the actions of the first defendant. If so, what illness or condition?

Please specify the nature of the mental distress in paragraph 11A(d)(i) and the mental trauma in paragraphs 11A(d)(i)-(ii). In particular, do the mental distress and mental trauma refer to a psychiatric illness or other medical condition?

[2] Various particulars were pleaded without clearly meeting the request and at the same time an application was made to the High Court for orders (in the alternative) either that the plaintiff can bring the proceeding without leave, or for leave pursuant to s4(7) Limitation Act 1950 to bring the proceeding outside the two year period specified in the section for actions in respect of bodily injury.

[3] That application came on for hearing on 28 April 1998 before Master Kennedy-Grant. His judgment records what occurred as follows:

In the course of Mr McLennan’s submissions in support of his application for the first order mentioned above, it became clear that the plaintiff does not allege that he suffered a psychiatric illness as a result of his late wife’s death. He alleges only that he suffered and continues to suffer grief and distress as a result of what happened. There is no doubt that that grief and distress were great but the important point is that his claim is made for damages for grief and distress by themselves.

At the conclusion of Mr McLennan’s submissions in support of his application for the first order, counsel for the defendants:

(a) conceded that in the circumstances leave to proceed with this action is not required because a claim for damages for grief and distress without more is not a claim for bodily injury within s4(7) of the Limitation Act 1950; and

(b) applied orally for orders striking out the plaintiff’s claims.

I stood the matter down, initially for half an hour and then until 2.00pm, to enable counsel for the defendants to formulate applications in written form and to enable Mr McLennan to prepare himself for the argument of the strike out applications. I declined his application for an adjournment of the strike out applications, on the ground that, as the merits of the claim were in issue in any event on the leave
application (the second order sought by him), he should be prepared, as competent counsel, to deal with the strike out applications today.

[4] In outcome the Master ordered that the causes of action in negligence be struck out on the ground that the law does not permit the recovery of damages in negligence where the only damage or injury alleged is grief and distress short of psychiatric illness or disorder.

[5] On behalf of Mr Otter application was made for review of the Master’s decision and to remove the matter into this Court in order to secure a definitive ruling on a question of law whether damages for grief and distress are recoverable. The Master’s decision rested on an earlier decision of Master Venning which had been transmitted to this Court so that convenience dictated both matters being dealt with together. However this case, after being listed for hearing in this Court, has taken a different turn.

[6] In this Court, application was made on behalf of Mr Otter for leave to adduce fresh evidence. That, of course, was misconceived since strike out applications are considered on the factual allegations made in the statement of claim. However, it is well established that a claim will not be struck out on the ground that no cause of action is disclosed if by amendment the defect can be remedied.

[7] It now appears there is foundation for an allegation that Mr Otter has suffered a psychiatric illness or disorder and counsel seek the opportunity to so plead, recognising that if that is allowed there will again arise the need for leave under s4(7) of the Limitation Act to proceed.

[8] Mr Hughes-Johnson submitted that having made the concession before the Master that the claim was not in respect of psychiatric illness but only grief and distress, counsel for Mr Otter must now be held to that. We do not agree. Whether or not counsel will be permitted to resile from a concession is a matter for the Court having regard to the interests of justice: GFW Agri-Products Ltd v Gibson CA246/94, judgment 16 November 1995. We are satisfied that Mr Otter should be relieved of the concession in this case, particularly considering the obvious difficulty
with which counsel was confronted before the Master. That does, however, require the matter of costs to be addressed.

[9] An additional ground upon which Mr Otter sought review of the Master’s decision related to his order for costs. The Master awarded costs in favour of the second and third defendants in the sum of $5,000. Mr Collins, who appeared for those defendants argued that in the circumstances the Master’s award should stand even though his order striking out the proceeding will go. He sought also full solicitor/client costs on the appeal with the order to be made against Mr Otter’s solicitors.

[10] Mr Otter is legally aided. He has been accorded a significant indulgence in the opportunity to amend his pleadings to recover a stance previously relinquished. But the possibility of an application for strike out being frustrated by amendment is a risk run by those seeking to terminate proceedings in limine.

[11] Balancing the interests as best we can in the circumstances, we quash the orders made by the Master including his order for costs. We make an order pursuant to s86(4) Legal Services Act 1991 specifying that but for the limitation on his liability for costs under that section, we would have ordered Mr Otter to pay to the second and third defendants costs of the High Court hearing of $2,000 and costs on the review in this Court of a further $2,000.

[12] An amended statement of claim is to be filed and served within 14 days and a fixture (if required) for determination of the application for leave under the Limitation Act is to be sought before the Master within the same time.

Solicitors

Woodroofe & Keil, Auckland, for Applicant Crown Law Office, Wellington, for First Defendant
Glaister Ennor, Auckland, for Second and Third Defendants.