J Sainsbury Plc & Anor v WSP Consulting Engineers Plc [2004] EWHC 2610 (TCC)

Case No HT-030355[2004] EWHC 2610 (TCC)IN THE HIGH COURT OF JUSTICEQUEEN'S BENCH DIVISIONTECHNOLOGY AND CONSTRUCTION COURTSCourt No 12St Dunstan's HouseVenue 133-137 Fetter LaneLondon EC4A 1HDDate Wednesday, 10 th November 2004
Before
HIS HONOUR JUDGE SEYMOUR QC
Between
J SAINSBURY PLCClaimantSAINSBURY'S SUPERMARKETS LIMITEDClaimant-v-
Between
WSP CONSULTING ENGINEERS PLCDefendant(FORMERLY WSP KENCHINGTON FORD PLC)DefendantvKELLER LIMITEDPart 20 Defendant
Computerised Transcript of the Stenograph Notes ofSmith Bernal WordWave Limited190 Fleet Street, London EC4A 2AGTel: 020 7404 1400 Fax: 020 7404 1424(Official Shorthand Writers to the Court)
RICHARD FERNYHOUGH QC and JONATHAN LEE (instructed by Herbert Smith) appeared for Claimants.MARCUS TAVERNER QC and RICHARD COPLIN (instructed by CMS Cameron McKenna) appeared for Defendant/Part 20 Claimant.DAVID STREATFEILD-JAMES QC (Instructed by Davies Arnold Cooper) appeared for Part 20 Defendant
JUDGMENTThursday, 10th November 2004Judgment
[1]The application before the court is that of the defendant for disclosure of documents in three classes.[2]Before coming to consider the application in detail, it is necessary to say something about the action in which the application is made and the circumstances in which the application comes to be made.[3]The claimants in the action are J Sainsbury plc and Sainsbury's Supermarkets Limited. The defendant is a company now called WSP Consulting Engineers plc and I shall refer to it as WSP.[4]In 1993 J Sainsbury plc was interested in having a new supermarket constructed on a site at Newhaven in Sussex. WSP was engaged as civil and structural engineers for the purposes of that project.[5]Amongst other things, WSP designed the structure of the supermarket. The building was fairly uncomplicated; it had but one storey. It comprised a structural steel frame around the perimeter of the building and included seven internal steel columns. All of the columns were designed to be and were erected on a piled foundation.[6]The ground floor slab, however, was designed and constructed to be ground bearing. The ground at the site upon which the supermarket was to be constructed was compressible soft clay.[7]It is now common ground that the design of the floor slab as ground bearing was in breach of the term of WSP's contract with J Sainsbury plc that WSP would perform its obligations under the contract with the care and skill to be expected of a reasonably competent structural engineer.[8]The inadequacies in the design of the floor slab became apparent soon after the supermarket was completed. The floor slab began to suffer differential settlement. The question arose: what should be done about that settlement.[9]It was decided that the best, perhaps the only practicable solution was for the ground under the floor slab to be treated by a process called Soilfrac.[10]Soilfrac is a type of what is called generically "compensation grouting". It is a proprietary process of the Part 20 defendant, Keller Limited.[11]Essentially, what Soilfrac involves is inserting cementitious grout under pressure into the ground so as to cause the ground to heave. The process of heave can be controlled so as to permit different amounts of heave in different parts of the ground being treated. In this way, so it is believed, the effects of differential settlement can be counteracted.[12]J Sainsbury plc entered into a contract with Keller Limited under which Keller agreed to undertake the treatment of the ground below the floor slab of the supermarket using the Soilfrac process.[13]The contract incorporated a performance specification which set out the parameters to be achieved by the process.[14]It was recognised that the nature of the process was such that complete success was unlikely to be achieved by one treatment of the ground. The contract therefore included provision for Keller to return to the site to carry out further treatments when a degree of settlement described by counsel in opening the case for the claimants as the "trigger level" had been reached.[15]The price to be paid for each return visit was fixed at a sum of £75,000 subject to adjustment in accordance with an industry formula. In the contract Keller warranted that the performance specification would be achieved.[16]Although the contract for the employment of Keller Limited was made between that company and J Sainsbury plc, it was agreed between J Sainsbury plc and WSP that, without admission of liability, WSP would reimburse J Sainsbury plc for any and all sums which J Sainsbury plc had to pay to Keller for work done under the contract between them. Thus if Keller made any return visits to the site that would be at the expense of WSP.[17]The second claimant, Sainsbury's Supermarkets Limited, acquired the freehold interest in the supermarket at Newhaven in about 1998 following a reorganisation of the J Sainsbury group.[18]From sometime in about the autumn of 1998 Sainsbury's Supermarkets Limited was interested in the possibly of having work carried out at the supermarket in Newhaven with a view to increasing the attractiveness of that store to customers.[19]The initial consideration was of a possible extension. Planning permission for that extension was obtained in the summer of 1999 but it was not in the event acted upon.[20]The next consideration of possible works was of what was called reinvigoration. That was a scheme of rearrangement of the existing supermarket not involving any increase in its external dimensions. Again, that did not proceed.[21]What in the event happened was that a completely new supermarket was constructed, partly on a part of the car park of the original supermarket and partly on the site of the original supermarket itself after that had been demolished.[22]In this action the claimants claim damages from WSP in respect of the admitted breach of contract of WSP in designing the ground floor slab of the original supermarket negligently.[23]The sums which it is sought to recover as damages include in large measure costs incurred in connection with the construction of the new supermarket.[24]The claimants' case is that they lost confidence in the effectiveness of the Soilfrac process and so instead of calling back Keller Limited under its contract to carry out a further treatment of the ground under the original supermarket by insertion of more cementitious grout, they decided the only satisfactory course was to replace the original supermarket totally.[25]WSP's position in the action is, essentially, that the sums which the claimants seek to recover as damages were spent by the claimants not consequent upon the original breach of contract on the part of the defendant, but by reason of a commercial decision that it was advantageous to have a new and bigger supermarket in Newhaven with improved amenities such as air conditioning.[26]Alternatively, it is said it was not reasonable for the claimants, having embarked upon a course of having the ground treated using the Soilfrac process at considerable expense to WSP, then to abandon that course. By so doing, so WSP contend, the claimants had failed to mitigate their loss.[27]Keller Limited has been made a Part 20 defendant in the action by WSP. The claimants make no claim against it. The position of Keller Limited is that, in truth, WSP has no proper claim against it in any event.[28]Today is the seventh day of the trial. Each of the claimants, the defendant and the Part 20 defendant has opened its case fully before me. My attention has been drawn to many contemporaneous documents. Some of those documents contained blanked out passages.[29]The application now before me is in part for an order that some of the documents containing blanked out passages be disclosed to the defendant and the Part 20 defendant without the blanking out.[30]The blanking out has not been very well done. It is possible from reading what has not been blanked out in some instances to guess at, at least, the general nature of what has been blanked out.[31]There is before me a witness statement of Janetta Claire Gibbs in which Miss Gibbs explains that, at least so far as the documents, full disclosure of which is sought, are concerned, what has been revealed in terms of legal advice has been revealed inadvertently.[32]The other categories of document, disclosure of which is now sought, are, first, documents containing what Mr Marcus Taverner QC on behalf of the defendant described as collateral legal advice, that is to say legal advice of the nature referred to in blanked out passages of documents which I must consider in more detail in a moment. Mr Taverner in essence submitted that by referring to such advice, privilege in the advice itself had been waived.[33]The other main application which I have to consider relates to the disclosure of expert advice from a Mr Pepper. The position of Mr Pepper was explained in the witness statement of Miss Gibbs to which I have referred. What she said in her witness statement, so far as is presently relevant, is this:
"The reference to the insurer's technical expert is to Mike Pepper of Harris & Sutherland. Mr Pepper was instructed by Herbert Smith on 29th September 2000 in his capacity as an expert engineer. At this stage Herbert Smith had been instructed by The Royal & Sun Alliance to advise on a claim notified by the claimants under their buildings policy in respect of their Newhaven store. Herbert Smith were instructed by The Royal & Sun Alliance to advise on policy coverage and any subrogated actions available to The Royal & Sun Alliance. "
Mr Pepper produced two reports, dated December 2000 and June 2001, which were paid for by The Royal & Sun Alliance and form the basis for Herbert Smith advising The Royal & Sun Alliance on its legal position. Copies of the reports were provided to the claimants on the basis that they did not disclose them to any third party. "In view of the captive arrangements between the claimants and Royal & Sun Alliance, it was subsequently decided by the claimants to instruct Herbert Smith in April 2003, with Royal & Sun Alliance's consent, to pursue a claim against WSP and not the claim under their insurance policy with The Royal & Sun Alliance. For the avoidance of any doubt, The Royal & Sun Alliance have no involvement in these proceedings, which are funded in their entirety by the claimants."[34]There was a measure of common ground between counsel as to the legal principles applicable to the present application. My attention was drawn to a considerable number of authorities. That upon which Mr Taverner placed particular reliance is the decision of the Court of Appeal in Great Atlantic Insurance Company v Home Insurance Company, a decision of the Court of Appeal reported in [1981] 1 WLR at page 529. It is not, I think, necessary for the purpose of this judgment to refer to any of the particular passages in the judgment of

Lord Justice Templeman to which Mr Taverner drew my attention, save this one, which is on page 537:

"In interlocutory proceedings and before trial it is possible to allow a party who discloses a document or a part of a document by mistake to correct the error in certain circumstances. Where a document has been disclosed as a result of misconduct by the defendants, against the will of the plaintiffs and in any event not by the deliberate act of the plaintiffs, then remedial action both before and during the trial may be possible. But in my judgment the plaintiffs deliberately chose to read part of a document which dealt with one subject matter to the trial judge, and must disclose the whole. The deliberate introduction by the plaintiffs of part of the memorandum into the trial record as a result of a mistake made by the plaintiffs waives privilege with regard to the whole document. I can see no principle whereby the court could claim to exercise or could fairly and effectively exercise any discretion designed to put the clock back and to undo what has been done."
[35]That passage seems to represent a statement of the law which was common ground between Mr Taverner and Mr Richard Fernyhough QC, who appears on behalf of the claimants.[36]Mr Fernyhough summarised the effect of the passage in his written argument before me in what he described as principle two.[37]While Mr Taverner submitted that the application of that principle in the circumstances of the present case to the documents, to which I shall come, resulted in success for his application, Mr Fernyhough countered that that was not so.[38]He drew to my attention and relied upon the decision of the Court of Appeal in a case called GE Capital Group Limited v Bankers Trust reported in [1995] 1 WLR at page 172. That also was a decision of the Court of Appeal.[39]Mr Fernyhough relied in particular upon the judgment of Lord Justice Hoffmann in that case and his consideration of the Great Atlantic case in a passage which, in the interests of brevity, I do not read out but which is to be found between letter C on page 175 and letter A on page 176 of the judgment.[40]Mr Taverner in his turn countered by reference to other authorities, which gave rise to what Mr Fernyhough in his written argument described as principle four. Principle four was articulated in this way:
"Deployment of material in a trial involving reference to and reliance upon the content of privileged material may as a matter of fairness result in an order for disclosure but even then disclosure will be restricted to the relevant transaction."
[41]Mr Fernyhough in his skeleton argument referred to two decisions in relation to this principle. They are important and although one of the passages cited by Mr Fernyhough is quite long, I think it is important that I should read it into this record of the judgment in order to explain my conclusions.[42]The first passage is in a judgment of Mr Justice Mustill in Nea Karteria Maritime Company Limited v Atlantic & Great Lakes Steamship Corporation (No 2), which was reported in [1981] Commercial Law Reports, page 138. The passage is a short one. At page 139 Mr Justice Mustill said:
"... where a party is deploying in court material which would otherwise be privileged, the opposite party and the court must have an opportunity of satisfying themselves that what the party has chosen to release from privilege represents the whole of the material relevant to the issue in question. To allow an individual item to be plucked out of context would be to risk injustice through its real weight or meaning being misunderstood."
[43]The other decision to which Mr Fernyhough drew my attention in this section of his submissions is the decision of the Court of Appeal in Secretary of State for Transport Ex Parte Factortame and Others, R v. The citation of that decision is [1997] EWHC Admin 445. The leading judgment in the Court of Appeal was that of Lord Justice Auld. I read paragraphs 26 to 28:
"The most obvious application of that principle is in relation to a single document, where a party waives privilege as to part of it but seeks to withhold the rest of it - 'cherry-picking' as Style & Hollander have called it. See, for example, the Court of Appeal's decision in the Great Atlantic in which Templeman LJ, with whom Dunn LJ agreed, held that, unless a document is severable as to its subject matter, either the whole or none of it should be disclosed. It also extends to attempted partial waiver of privilege in respect of certain of a number of documents relevant to the same issue or transaction. Of course, the scope for unfairness depends on the breadth of the matter in issue or their severability if more than one, and on the exact relationship and/or relevance to such issue(s) of the documents respectively disclosed and sought to be withheld. It may or may not be that partial disclosure of documents going to a matter or matters in issue, say in an exchange of correspondence with legal advisers, would be unfair. "
Much depends on whether the party making partial disclosure seeks to represent by so doing that the disclosed documents go to part or the whole of an 'issue in question', the expression used by Mustill J in the passage from his judgment in Nea Karteria that I have cited. The issue may be confined to what was said or done in a single transaction or it may be more complex than that and extend over a series of connected events or transactions. In each case the question for the court is whether the matters in issue and the document or documents in respect of which partial disclosure has been made are respectively severable so that the partially disclosed material clearly does not bear on matters in issue in respect of which material is withheld. The more confined the issue, for example as to the content of a single document or conversation, the more difficult it is likely to be to withhold, by severance, part of the document or other documents relevant to the document or conversation. "As Mr Richards observed, all or most of the reported cases deal with narrow issues of that sort. See, for example, the Great Atlantic, Konigsberg and Derby v Weldon (No 10). In Konigsberg the matter in issue was a transfer of land and the question was whether it was a gift or a sale. Peter Gibson J held that the party asserting that it was a sale and who had waived privilege in respect of a letter from her solicitor apparently supporting her case, could not claim privilege in respect of an affidavit sworn by him doubting it. Where the issue is broad, or there are several of them, or where the history giving rise to the litigation is long and/or complicated, partial disclosure which is clearly confined in its impact to one aspect of the case may well not require the all or nothing approach. In such a case it is not, in my view, apt terminology to ask whether a series of connected events or matters is a single 'transaction' or series of separate 'transactions' for this purpose. Where a party's conduct over a period of time is in issue the effect of partial disclosure of documents must depend on the particular facts of the case, usually as seen before trial in the pleadings and in other interlocutory battle-lines drawn by the parties."[44]Before coming to consider the application of those principles to the circumstances of the present case, it is convenient to deal with the submissions of law in relation to the disclosure sought of the report of Mr Pepper.[45]The ground upon which privilege is claimed for that report is what is described as common interest privilege. That concept, at any rate so described, seems first to have seen the light of day in the decision of the Court of Appeal in Buttes Gas and Oil Company v Hammer(No 3) reported in [1981] 1 QB at page 223. That is a decision of the Court of Appeal.[46]For present purposes I think it is sufficient to refer only to the leading judgment, that of Lord Denning, at page 243 in the report. I read between letters B and F:
"I would sweep away all those distinctions. Although this litigation is between Buttes and Occidental, we must remember that standing alongside them -- in the self-same interest -- are the Rulers of Sharjah and UAQ respectively. McNeill J thought that this gave rise to special considerations: and I agree with him. There is a privilege which may be called a 'common interest' privilege. That is a privilege in aid of anticipated litigation in which several persons have a common interest. It often happens in litigation that a plaintiff or defendant has other persons standing alongside him -- who have the self-same interest as he -- and who have consulted lawyers on the self-same points as he -- but these others have not been made parties to the action. Maybe for economy or for simplicity or what you will. All exchange counsel's opinions. All collect information for the purpose of litigation. All make copies. All await the outcome with the same anxious anticipation -- because it affects each as much as it does the others. Instances come readily to mind. Owners of adjoining houses complain of a nuisance which affects them both equally. Both take legal advice. Both exchange relevant documents. But only one is a plaintiff. An author writes a book and gets it published. It is said to contain a libel or to be an infringement of copyright. Both author and publisher take legal advice. Both exchange documents. But only one is made a defendant. In all such cases I think the courts should -- for the purposes of discovery -- treat all the persons interested as if they were partners in a single firm or departments in a single company. Each can avail himself of the privilege in aid of litigation. Each can collect information for the use of his or the other's legal adviser. Each can hold originals and each make copies. And so forth. All are the subject of the privilege in aid of anticipated litigation, even though it should transpire that, when the litigation is afterwards commenced, only one of them is made a party to it. No matter that one has the originals and the other has the copies. All are privileged."
[47]My attention was also drawn in this context to a decision of Mr Justice Rix, Svenska Handelsbanken v Sun Alliance and London Insurance Plc, reported in [1995] 2 Lloyd's Rep at page 84. It is not, I think, necessary for the purposes of this judgment to refer in detail to the judgment of Mr Justice Rix. It is sufficient to say that Mr Justice Rix reached the conclusion in the circumstances of the case before him that a common interest privilege could exist, not only in circumstances where there was litigation but also in circumstances in which legal advice was being sought anterior to that. The case before him concerned a relationship between an insurer and a reinsurer.[48]The other decision to which my attention was drawn in this context is the decision of Mr Justice Saville, as he then was, in Bank of Nova Scotia v Hellenic Mutual War Risks Association (Bermuda) Ltd reported as a note in [1992] 2 Lloyd's Rep 540.[49]Mr Justice Saville considered, between the bottom of the right-hand column on page 541 and the bottom of the right-hand column on page 542 the issue of common interest privilege. For the purposes of this judgment I can cite only a short part of what is a more lengthy consideration which begins at the top of the right-hand column on page 542:
"In my judgment, however, the interest of the plaintiff bank and that of the owners of Good Luck in the action of the latter against the defendants is not a common interest sufficient to found the claim to common interest privilege. It could hardly be suggested (and indeed it was not suggested) that the plaintiffs and the owners could have shared the same solicitor or other lawyer. The plaintiffs were creditors of the owners; their interest was to recover any fruits of the owners' action so as to reduce or at least service that indebtedness; and furthermore their interest in those proceedings generally was by way of assisting them to decide how best to continue to deal with the arm's length commercial relationship between themselves and the owners. The owners' interest, on the other hand, was to prosecute the litigation with a view to reducing their indebtedness to the plaintiff bank; and generally no doubt with a view to persuading the plaintiff bank to continue to finance them. Those interests of the plaintiffs and the owners could not have been dealt with by the same solicitors or other lawyers for the respective interests were (at the lowest) likely to conflict. They could not, in my judgment, be regarded as so close that the Courts could, again using the words of Lord Denning, Master of the Rolls, treat the plaintiffs and the owners as partners in a single firm or departments in a single company."
[50]I turn to the application to the circumstances of the present case of the authorities which I have mentioned relevant to the question of waiver of privilege or disclosure of part of a document.[51]The claimants' case is that the decision to replace the original supermarket and to construct the new supermarket was taken following receipt of advice from the well known firm of engineers Ove Arup & Partners and was taken some time at the beginning of 2003.[52]The defendants' case, explained in the written opening of Mr Taverner and repeated and elaborated, I think, on most of the subsequent days that this trial has so far occupied, was that the decision was taken in principle at some considerably earlier time to seek to turn to account the possibility of a claim against the defendant in order to obtain a fund, which would enable the claimants to construct a new supermarket or at least make a significant contribution to that.[53]Mr Taverner has identified various possible dates at different times as being dates when this consideration first began. In fairness to Mr Taverner, he has been working from redacted documents in formulating a working hypothesis as to what actually went on.[54]However, what is entirely clear, in my judgment, is that critical in this litigation is when and in what circumstances and on the basis of what material the claimants decided to build a new supermarket. That is in fact what this action is really all about.[55]In those circumstances, it is necessary for the claimants to put before the court evidence as to who took that decision, when, in what circumstances and in reliance upon what material. That is the context in which the redacted documents, of which Mr Taverner seeks disclosure of clean and clear copies, need to be considered.[56]The first in time of the documents that Mr Taverner seeks to have disclosed in clear form is an internal e-mail between two gentlemen within Sainsbury's. It was sent by Mr Stephen Smith to Mr Christopher Isherwood. It begins:
"I know you have to deliver a paper to the board on the viability of proceeding with the extension. In that regard I have to inform you that I had a meeting with group insurance and our lawyers last week and that proposal presents us with a big problem."
[57]It is perhaps material to say that the subject identified specifically in this e-mail is, "Newhaven Proposed Extension and Existing Subsidence Problems." I omit the paragraph which follows the words "big problem" in the e-mail and resume after that:
"Our legal advisers tell us that we cannot remove or damage the shafts and pipes until this resolvement process is exhausted. This will almost certainly happen if the extension proceeds."
[58]I pause to comment that that is plainly a record of legal advice given. There follow three redacted sentences, as it appears. They are separately set out, one could describe them as three separate paragraphs. The e-mail resumes:
"These risks must be built into your paper so the board fully realise the wider picture. As a compromise can we not consider an extension on the front of the building instead of the side."
[59]This document, as I have commented, is plainly a partial record of legal advice. It is thus a document which seems to me to fall within the Great Atlantic principle and to require to be disclosed on that account. It is right to say that, as disclosed, it creates a partial or misleading picture for this reason: it is obvious that some risks form part of the consideration. What one does not know is what risks, other than what is expressly recorded as the legal advice.[60]Applying Mr Justice Mustill's approach and that of Lord Justice Auld in the Factortame case, fairness seems to me to require that a complete copy of this document be produced to the defendant and the Part 20 defendant.[61]I move on to the next document which is the subject of a specific application. That is another internal e-mail. It is dated 25th October 2001. It was sent by Mr Isherwood to Mr Nick Jones and Mr Paul Cheesbrough of Sainsbury's and it begins in this way:
"There are outstanding legal actions still ongoing with regard to Newhaven's original construction and the subsidence of the ground floor slab."
[62]I pause to comment that that does not seem to be correct. At any rate, at that date, as I understand it, there were no proceedings pending between any of the parties before me or indeed any other parties which were relevant to what was going on at Newhaven.[63]The second sentence of that first paragraph is a note to this effect:
"May need to go into the reinvigoration paper."
[64]There is then a paragraph, the first sentence of which may be important:
"The original structural engineers have accepted liability for the subsidence."
[65]Again, that is not strictly speaking correct as at that date. The position as at that date was that WSP had funded Keller's works without admission of liability. It was only shortly before the commencement of the trial in this action that liability was formally accepted. The paragraph continues:
"Corrective work, the pumping of grout under the floor slab to arrest its movement, took place in 1997 and was partially successful. However, since 1997 the store has suffered further structural movement and damage."
[66]There follow what again appear to be three redacted sentences or three redacted paragraphs and the e-mail continues:
"In order to ensure that SSL's rights in the above claims are not compromised, Keller must be allowed free access to the grouting pipes to regrout at any time."
[67]It is not necessary for the purposes of this judgment to read further in the e-mail.[68]Mr Fernyhough accepted in relation to the last document to which I referred that that document had been deployed by him in opening his clients' case, he had drawn my attention specifically to it and he had read it to me with the redaction.[69]In contrast, he says of this document that he has not deployed it. He has not drawn it to my attention or sought to rely upon it. He has simply read it at the request of Mr Taverner. That, as it seems to me, with great respect to him, is to misunderstand the concept of deployment of documents in the sense in which Mr Justice Mustill intended.[70]For the purposes of this case, at any rate, where it is necessary for the claimants to prove the decision which they made to replace the original supermarket and when and in what circumstances that decision was made and on the basis of what material, it is appropriate to include in the trial bundle documents of this character.[71]It is appropriate to include them in order to show the process by which the eventual decision was reached. In that sense, merely including them in the trial bundle so they may be referred to by anybody who wishes is deploying the document.[72]In order to understand the document, it is necessary to know, in my judgment, what has been blanked out. That is a requirement of fairness in the sense in which Mr Justice Mustill used that expression.[73]I have commented that some of the material in this e-mail seems actually factually to be incorrect. That seems to me to emphasise that fairness requires that a complete copy of the document be made available so that it is possible to investigate whether to any extent the eventual critical decision was based upon a misapprehension as to the true facts and circumstances.[74]I turn to the next document which is the subject of a specific application and that is another internal e-mail, this one dated 11th March 2002 sent by Tracey Maddock to Kevin McMillan. It is a short e-mail. It begins:
"Your thoughts on the attached, please. I shall then forward to Chris."
[75]There follows a redacted paragraph. Then there is a note to Adrian, one of the people copied with the e-mail:
"I shall give you a buzz to see how you want to deal with this potential refund of part of our costs."
[76]I need not read further in the e-mail. It is possible to surmise from what I have already said what is in the redacted part, that is to say that it was anticipated that a contribution, at any rate, to the costs which it was anticipated would be incurred in some scheme of redevelopment at Newhaven could be obtained.[77]Bearing in mind the possible significance of whether, as it were, the decision was, as presented by the claimants, that faith had been lost in the Soilfrac process as a means by which to remedy structural defects in the original supermarket or whether the decision was actually completely otherwise, as Mr Taverner would have it, that is to say a decision to build a new supermarket and in effect a hunt round for ways of obtaining contributions towards the cost of it, is the critical issue and, in my judgment, in fairness, disclosure of a complete copy of this document is also required.[78]The next document to which I need refer is a document which is entitled "Newhaven Replacement" and the introduction of which says this:
"This paper provides an update from that issued to SDC [that is Stores Development Committee] on 15th March 2002 and deals with the legal and other options available to address the subsidence issues at the Newhaven store."
[79]Mr Taverner makes three applications with respect to this document in different ways. The second page of the document refers to advice from the insurer's technical expert, that is to say Mr Pepper. On the basis of that reference Mr Taverner submits that the defendants are entitled to sight of Mr Pepper's report. The particular reference is:
"Their insurer's technical expert's view is that ground movement will eventually cease but he is unable to predict how many Keller visits will be necessary or how many years it will take."
[80]In my judgment, fairness does not require, on this ground, that Mr Pepper's report be produced. I shall consider later in this judgment whether there are other grounds which do require the production of Mr Pepper's report.[81]The second reference which Mr Taverner relies upon as entitling him to production of some other document is in section two, "Commercial Option", which begins in this way:
"If the board is unhappy with counsel's advice and do not wish to complete the second phase of the Keller scheme, then they can proceed to rebuild the store immediately."
[82]Mr Taverner submits that that reference is sufficient to entitle him to the advice of counsel to the effect there stated.[83]With great respect to him, I disagree. Fairness does not require, in my judgment, the production of counsel's advice. There is a reference to the fact of counsel's advice, there is a summary of the effect of counsel's advice and that is sufficient, in my judgment, for present purposes.[84]The third reference in this document upon which Mr Taverner relies is in section three, entitled "Deal Option". The last sentence of the first paragraph under that heading says:
"It must be stressed, however, that in the event that negotiations fail and we proceed to rebuild, our chances of recovering an amount in excess of that set out in one above are remote."
[85]On the version of the document before me there is no section numbered one; even the numbering has been blacked out. One imagines from the form of the document before me that the number one appears immediately or quite soon after the heading "Way Forward: Available Options".[86]The Stores Development Committee was the committee of directors of the claimants, the function of which was to make decisions, as I understand it, about the undertaking of building works at Sainsbury's supermarkets.[87]It was the body, as I understand it, which eventually made the decision upon which the claimants rely in 2003 to demolish the existing supermarket and to rebuild it.[88]It is plain that the document with which I am now concerned is a document which went to the Stores Development Committee with a view to providing it with information on which to make a decision about the Newhaven store.[89]Fairness, in my judgment, requires that a copy of this document with section one unredacted be provided to the defendant and Part 20 defendant.[90]There is one more document to which I need refer. This, unlike the last one, is a document which Mr Fernyhough accepts he deployed in that he opened it to me.[91]It is a document dated 16th January 2003 and it is entitled "Decision Paper". The author was a Mr Chris Fenner. It was addressed to the Store Development Committee.[92]There is a section "Background". In numbered paragraph 5 in that section three possible options for the store are said to have been considered. None of them is having Keller back to undertake any work on the site.[93]Option three is said to involve part relocation with a new store being built upon the existing car park and that essentially is the option that the claimants decided to adopt. The paper goes on:
"Before proceeding with the favoured option three we sought counsel's opinion as to the appropriate way forward."
[94]There is then a redacted section and the paper resumes:
"In order to assess this Arup geotechnics were briefed to consider whether further grouting would provide an acceptable solution to the settlement problem."
[95]There is reference to advice being sought from counsel. It is obvious, as it seems to me, that following upon the advice of counsel, Arup was given a brief to consider whether further grouting would provide an acceptable solution to the settlement problem.[96]It is of critical significance in this litigation to know what prompted the giving of those instructions to Arup. Was it, as the claimants say, in order to have an independent judgment on whether the Soilfrac process would provide a satisfactory solution if that were tried a second time or was it, as the defendant contends, in order to obtain what could be presented as respectable looking independent evidence in support of a decision they had already made.[97]I have been shown some documents in the course of the opening which, at any rate, cast a cloud over the circumstances in which Arup were instructed and what their original instructions were. Fairness requires, in my judgment, that the passage to which I have referred be unredacted so that the defendants may know what it was that prompted Arup's to be instructed.[98]The remaining matter with which I need to deal is the question of Mr Pepper's report in the context of common interest privilege. The authorities to which I have referred in my judgment established the proposition that in order for common interest privilege to exist there must be a common interest, that is to say the same interest between the parties between whom the interest is said to arise.[99]When I say the same interest, I do not mean that in any technical sense but that in substance the interest of the two parties must be the same such that if there were to be legal proceedings they could be represented by the same solicitors and counsel.[100]There is a common interest in circumstances where an insurer in the name of the insured pursues a claim. There is such a common interest in circumstances in which an insurer seeks to rely upon reinsurance which is in place. There is no such common interest, in my judgment, in circumstances in which the interests of the relevant parties at the time the relevant document or advice is given are opposite.[101]That was so in Mr Justice Saville's case, the Good Luck, as he explained in the passage which I have set out. It was also so, in my judgment, in the circumstances in which the advice of Mr Pepper was obtained by or for consideration of Herbert Smith on behalf of the Royal & Sun Alliance.[102]It is plain from the description of the circumstances in Miss Gibbs' witness statement, as it seems to me, that what prompted the production of that report was a claim by Sainsbury on its buildings insurance policy. That claim was resisted. That is why the advice of Mr Pepper was sought.[103]Mr Pepper's advice seems to have been communicated to Sainsbury with a view to persuading them that there was no claim under the policy, contrary to the position which they had theretofore adopted.[104]It appears that Sainsbury's were persuaded of that and only then and in those circumstances did the positions of Sainsbury's and their insurers, previously opposite, cease to be opposite. But, in my judgment, that is not sufficient to give rise to a common interest privilege in the circumstances.[105]So on the ground of lack of common interest privilege, I do order that the report of Mr Pepper be produced to the defendant and the Part 20 defendant.

Cited in 1 later judgment