Rout v Southern Response Earthquake Services Limited [2013] NZHC 2783 (23 October 2013)

Last Updated: 6 December 2013

IN THE HIGH COURT OF NEW ZEALAND CHRISTCHURCH REGISTRY

CIV 2013-409-000586 [2013] NZHC 2783

BETWEEN PAUL ROUT and GEORGINA ROUT Plaintiffs

AND SOUTHERN RESPONSE EARTHQUAKE SERVICES LIMITED Defendant

Hearing: 7, 8, 9, 10, 11, 14, 15 and 16 October 2013

Counsel: GDR Shand and D S Maclaurin for Plaintiffs

C M Stevens and PJL Leman for Defendants

Judgment: 23 October 2013

REASONS FOR RULINGS OF D GENDALL J

_{AS TO ADJOURNMENT REQUEST AND ADMISSIBILITY OF EVIDENCE}

Introduction

[1] During the trial in this proceeding I was called to rule upon two issues which were:

(a) The request by Mr Shand, counsel for the plaintiffs, for an adjournment of this proceeding for reasons which will follow; and

(b) An objection by Mr Shand to a range of expert evidence provided by the defendant in this proceeding.

[2] On these matters I gave rulings at the time. These rulings were first, to dismiss the adjournment application and secondly, to dismiss each of the evidence

_{admissibility objections. I now give my reasons for those rulings.}

ROUT v SOUTHERN RESPONSE EARTHQUAKE SERVICES LIMITED [2013] NZHC 2783 [23 October

2013]

Adjournment

[3] The trial of this matter commenced on Monday, 7 October 2013. On Thursday, 10 October 2013, when we were into Day 4 of this trial, Mr Shand sought an adjournment of the proceeding on the basis that he said seven additional factual witnesses would now be required to be called by the defendant. This would mean in his view that the eight days scheduled for the hearing of this matter would be insufficient.

[4] The reason why Mr Shand argued that the seven additional factual witnesses would be required was his contention that the expert evidence which was being led and was planned by the defendant contained hearsay, and he was now requiring the defendant to call original factual witnesses who undertook certain tests upon which that evidence was based.

[5] Mr Shand also complained that the need to call these additional seven witnesses at this late time would be prejudicial to the plaintiffs’ case, and this provided further reason for the adjournment sought.

[6] As to these matters, I dismissed this very late request from Mr Shand for an adjournment here. In doing so, I noted that we were in the fourth day of an eight day scheduled hearing. Mr Stevens, counsel for the defendant, confirmed that he had been required to delay another urgent fixture, he had to accommodate the second week of this trial, being days 6, 7 and 8.

[7] Further, I noted that any adjournment would create unnecessary expense and delay and would be problematic for the plaintiffs, Mr Shand’s clients, who are required to leave their Brooklands’ red zoned property, the subject of this proceeding by January 2014.

[8] Accordingly, I determined that an adjournment of this trial at that mid point in the hearing would be inappropriate, given my rulings on the admissibility of the defendants’ expert evidence which are to follow.

[9] The request for an adjournment was dismissed and the trial proceeded.

Admissibility of evidence

[10] In this proceeding the defendant called the following expert witnesses: (a) Mr Craig Brian Lewis - a structural engineer;

(b) Mr Clive Kenneth Anderson – a geotechnical engineer; (c) Mr Donald Bruggers – a geotechnical engineer; and

(d) Mr Mark James Farrell – a quantity surveyor.

[11] Objections to the admissibility of much of the evidence of these defendants’

experts on hearsay grounds were raised by Mr Shand for the first time at about

10 pm on Sunday, 6 October 2013. That extremely late objection in itself is quite unsatisfactory. The objections were repeated on numerous occasions throughout this trial from about the fourth day onwards, as each witness was called and gave their evidence. In each instance I dismissed the objection. I now set out my reasons for those rulings.

[12] First, each of the experts in question gave direct evidence as to tests carried out at the property which had been undertaken under their direction and supervision by staff members from their particular firms. With respect to Mr Lewis, this related to investigations, testing and a structural engineering report of Lewis Bradford, the structural engineering company of which he is a founding director. So far as Mr Bruggers was concerned, this related to testing and a report of Geoscience Consulting (NZ) Limited, a geotechnical engineering firm of which he is an employee. With respect to Mr Anderson, this related to testing and a report provided by Golder Associates (NZ) Limited, a geotechnical engineering company of which he is a director and principal geotechnical engineer. And, as to Mr Farrell from Arrow International, Mr Shand contended that his opinion evidence about costings for the repair or rebuild of the property relied on investigations by another person from Arrow as he had never been to the property. The objections in all of these cases were based upon contentions that much of this evidence was hearsay, as the testing

and investigation in question had been physically carried out by others, and this breached the hearsay rules.

[13] Further, throughout this hearing Mr Shand made many further objections to the admissibility of evidence of these defence experts, when they made reference to and commented upon the other reports from the geotechnical engineers and structural engineers which were before the Court.

[14] As a starting point in considering all these objections, s 6 Evidence Act 2006 must be kept in mind. This sets out the purpose of the Act as follows:

6 Purpose

The purpose of this Act is to help secure the just determination of proceedings by-

(a) providing for facts to be established by the application of logical rules; and

(b) providing rules of evidence that recognise the importance of the rights affirmed by the New Zealand Bill of Rights Act 1990; and

(c) promoting fairness to parties and witnesses; and

(d) protecting rights of confidentiality and other important public interests; and

(e) avoiding unjustifiable expense and delay; and (f) enhancing access to the law of evidence. (Emphasis added)

[15] Section 17 Evidence Act sets out the hearsay rule and provides that a hearsay statement is not admissible except as expressly provided for in the Act. Section 18 deals with general admissibility of hearsay and states that a hearsay statement is admissible in any proceeding if the circumstances relating to the statement provide reasonable assurance that the statement is reliable and one of two other circumstances apply. Those circumstances are that either the maker of the statement is unavailable as a witness, or that the Judge considers that undue expense or delay would be caused if the maker of the statement were required to be called as a witness. Circumstances are defined in the interpretation section, s 16, to include the nature of the statement, its contents, the circumstances that relate to the making of

the statement, any circumstances that relate to the veracity of the person who made the statement, and any circumstances that relate to the accuracy of the observation of that person.

[16] “Hearsay statement” is defined, for the purposes of the Evidence Act in s 4(1) as:

... a statement that-

(a) was made by a person other than a witness; and

(b) is offered in evidence at the proceeding to prove the truth of its contents.

[17] Clearly it is the case that the ability to cross-examine the maker of a statement to test the credibility and accuracy of that evidence is seen as vital in most cases and provides the primary rationale for the hearsay rule.

[18] In this case, Mr Shand complains that the structural engineering evidence of Mr Lewis and the geotechnical evidence of Mr Anderson and Mr Bruggers in each case rely upon testing work undertaken at the property, not by the witnesses personally but by other employees of their firm. As such, Mr Shand contends that those particular employees who conducted the penetrometer and bore hole tests and the other investigations should be called themselves to provide direct evidence. With respect I disagree.

[19] The testing work in question here was carried out in each case by individuals on behalf of the firms for whom they were employed at the time, Lewis Bradford, Geoscience Consulting (NZ) Limited, Golder Associates (NZ) Limited and Arrow International respectively. The testing and investigations were completed effectively by the firms under contracts they had with the defendant to perform the work. That work was undertaken under the direction and supervision of Mr Lewis, Mr Bruggers, Mr Anderson and Mr Farrell respectively, who deposed that personally they checked and discussed the results with the employees concerned and in some cases for example even examined the specific bore hole test material.

[20] Those results then formed part of the individual reports of Lewis Bradford, Geoscience Consulting (NZ) Limited, Golder Associates (NZ) Limited and Arrow International which are before the Court. In most cases, those reports were personally signed by Mr Lewis, Mr Bruggers, Mr Anderson and Mr Farrell individually as co-authors of the reports. These also formed the basis of their evidence here.

[21] Further, at the hearing before me, significantly there was no geotechnical engineering evidence provided by the plaintiffs themselves. Nor did Mr Shand take issue in any way with the veracity or reliability of the testing results in the respective reports.

[22] It must be acknowledged here, as Cross on Evidence notes¹, that:

EVA25.10

An expert witness is not, strictly speaking, permitted to give an opinion in Court based on scientific tests run by assistants unless all those assistants are called upon to give evidence of the results of their tests.

But, in the present case as I have noted above, the evidence shows the tests were carried out effectively by the individual firms contracted to do so by the defendant, and under the clear control and supervision of the individual experts who gave evidence. Arguably too, the tests in the main may not have been “scientific tests” strictly so called, but rather physical tests to gather specific data as to the condition of the property. And, even if the tests in question were truly categorised as “scientific tests” the defendant’s experts here were actively involved in instructing, supervising and analysing those tests, rather than simply giving an opinion on scientific tests run entirely by third party assistants.

[23] For the plaintiffs at the outset of the trial to suggest for the first time that the majority of this evidence of the defendants’ experts should be excluded as inadmissible hearsay, in my view is entirely wide of the mark. I find that Mr Lewis, Mr Anderson, Mr Bruggers, and Mr Farrell as experts who were intimately involved

_{in having the testing and investigation work carried out through their supervision and}

¹ Cross on Evidence (online looseleaf ed, Lexis Nexis at [EVA25.10].

direction, in communicating those results and the reports provided in each case, did not breach the hearsay rule. The evidence in question was theirs as principals of their respective firms. It related to factual findings of the firms and it was those firms who were contracted to carry out the specific testing and investigation that was undertaken.

[24] For these primary reasons, Mr Shand’s objection to this evidence was

dismissed.

[25] For completeness, however, I now turn to consider certain other provisions of the Evidence Act which have relevance here.

[26] Section 23 of the Act deals with opinion evidence and provides that a statement of opinion is not admissible in a proceeding except as provided for in ss 24 or 25.

[27] In this case it seems that s 25, although relating only to opinion evidence of experts, will also apply here. This section relevantly provides as follows:

25 Admissibility of expert opinion evidence

(1) An opinion by an expert that is part of expert evidence offered in a proceeding is admissible if the fact-finder is likely to obtain substantial help from the opinion in understanding other evidence in the proceeding or in ascertaining any fact that is of consequence to the determination of the proceeding.

(2) An opinion by an expert is not inadmissible simply because it is about-

(a) an ultimate issue to be determined in a proceeding; or

(b) a matter of common knowledge.

(3) If an opinion by an expert is based on a fact that is outside the general body of knowledge that makes up the expertise of the expert, the opinion may be relied on by the fact-finder only if that fact is or will be proved or judicially noticed in the proceeding.

...

[28] At the outset here, it seems to me arguable that, in terms of s 25(3), the majority of the objections raised by Mr Shand relate to facts which could be said to

be within the general body of knowledge that makes up the expertise of the individual experts concerned. The structural engineer, geotechnical engineers and quantity surveyor are experienced experts in this region and have been actively involved in hundreds of post earthquake issues of the kind involved here. This is particularly the case as I see it with respect to the present reports from the different firms in which those experts hold office, many of which reports I have also noted emanated from and were signed by the individual experts in question.

[29] There is a reasonable argument as I see it that the facts upon which those reports were based and thus the evidence provided could be considered in each case to be largely within the general body of knowledge making up the expertise of the individual experts.

[30] And, when considering s 25(3):

An expert opinion may also be based on facts that are supplied by others, such as analyses of body tissues carried out by colleagues or the research findings of other scientists.²

[31] Although it is the case that the factual basis of an expert opinion needs to be proven because without it the opinion can be given little weight, in this case I am satisfied that the individual experts involved, given their direction and supervision of the testing and investigation which was carried out for their particular specialist firms, were able to provide factual evidence as to those results. In addition, as I see the position, it would create an anomalous situation if the experts here were not entitled to rely on both the testing and investigations carried out by their firms under their supervision and control, and also their own reports (signed off in most cases by the expert).

[32] Those matters having been properly established, in my view Mr Shand’s secondary objection over the basis for expert opinion from other witnesses (qualified in other disciplines) referred to in those reports and the other expert evidence

_{provided, was also properly dismissed.}

2. Richard Mahoney and others The Evidence Act 2006: Act and Analysis (2^nd ed, Brookers, Wellington, 2010) EV25.06.

[33] Accordingly, for these reasons also, I would have dismissed the objections as to admissibility advanced by Mr Shand.

[34] And, if I had been required to rule on this, I would also have formed the clear view that s 18 Evidence Act discussed at [15] above applied here, such that the statements of these expert witnesses regarding the specialist testing and investigation undertaken was reliable in terms of s 18(1)(a), and given the eleventh hour timing of Mr Shand’s admissibility objection, undue expense and delay would be caused in this trial if those individuals who physically carried out the penetrometer, bore hole and other tests were required to be witnesses. Even if the evidence provided by Mr Lewis, Mr Anderson, Mr Bruggers and Mr Farrell as to this testing may have been hearsay, (and I am satisfied this is not the case) their statements regarding the test results in my view would be entirely reliable in all the circumstances prevailing here, in terms of s 18(1)(a) Evidence Act. This evidence therefore needs to be considered with the Court drawing its own conclusions as to the weight to be given to it in due course.

[35] Also at this point I note in passing that the only structural engineering evidence provided by the plaintiffs here, that of Mr Rakovic, seems to rely entirely on the factual information placed before the Court by the defendant’s experts. In doing so, Mr Rakovic appeared in his evidence to liberally criticise and comment upon the opinions advanced by those experts, without in any way attacking the factual basis for the testing results upon which these opinions were based.

[36] Finally, I leave on one side a further possible (though perhaps remote) issue as to whether, if indeed the statements complained of by Mr Shand do constitute hearsay, nevertheless they may be admissible as part of a “business record” in terms of s 9 Evidence Act. This might appear to be unlikely and somewhat unusual in the circumstances prevailing here, but for completeness, I simply raise it as a possibility, noting that given my other conclusions outlined above, there is no need to address this aspect.

[37] For all these reasons I dismissed each of the admissibility objections raised by Mr Shand with respect to the expert evidence provided by the defendant in this proceeding.

...................................................

D Gendall J

Solicitors:

Grant Shand, Christchurch

DLA Phillips Fox, Wellington