New Zealand Supreme Court

MPI, questioning of

Robertson v R [2021] NZSC 40 (10 May 2021) 

Unsuccessful leave application – R found guilty, after HC trial of 38 charges arising out of fraudulent trading on behalf of clients and taking funds for fictitious shareholdings - Net loss to the victims of this offending over the approximately six-year period was assessed at the time of sentencing to be approximately NZD 1.2 million and AUD 271,200 - Most of the 22 victims were elderly and either retired or approaching retirement – R sentenced to six years and eight months’ imprisonment - MPI of three years and four months’ imprisonment imposed – R appealed unsuccessfully against sentence to CA - Sought leave to appeal out of time to SC - Wanted to argue no MPI should have been imposed - No challenge to of six years and eight months’ imprisonment term – SC said proposed appeal had insufficient prospects of success to justify granting leave – Also, issues not squarely addressed in CA appeal - Rather, appeal focussed on MPI  imposition in R’s case - Nor, on the material before SC was there risk of miscarriage of justice arising from CA assessment of MPI imposition here – Application declined.

Strike-out, freedom of speech, Human Rights Act

Rachelle v Cadogan and ors [2021] NZSC 41 (11May 2021)

Unsuccessful leave application – Self-represented  R’s application arose from DC decision to strike out her claim against C and others for damages of $200,000 – At the heart of her proposed appeal was her claim, which she said was broader than what CA said, had merit – She said, among other things, claim had not been allowed to get off the ground in breach of her right to freedom of speech and the Human Rights Act 1993 - Earlier application for leave to appeal directly from HC to SC dismissed because strike-out principles well settled and were applied by both Courts below - No question of general or public importance arose - Nor did anything R raised suggest any risk of a miscarriage of justice – This application essentially would have SC revisit earlier assessment – CA applied well-settled principles to the application before it – No question of general or public importance – No appearance of miscarriage of justice – Application dismissed.

Family trust, family proceedings

Preston v Preston and ors [2021] NZSC 42 (12 May 2021)

Successful leave application - Approved question whether CA correct to dismiss P’s appeal regarding her claim for an award of part of the assets of the Grant Preston Family Trust under s 182 of the Family Proceedings Act 1980.

Supreme Court of Canada

Rape, consent, capacity to consent

R v GF [2021] SCC20 (14 May 2021)

Successful appeal from Ontario CA - F and B charged with sexually assaulting 16‑year‑old complainant during a camping trip - Issue at trial was whether the complainant, who had consumed alcohol, had consented to the sexual activity with F and B -  Complainant and F both testified and presented diametrically opposed versions of events; B did not testify - Crown said complainant’s evidence clearly established incapacity due to intoxication, and also that the complainant had not agreed to the sexual activity - F and B said complainant not credible, had not been as intoxicated as she claimed, and she had agreed to engage in the sexual activity - Trial judge accepted  complainant’s evidence and convicted F and B of sexual assault -  F and B appealed – CA rejected  argument that the verdict was unreasonable, saying complainant’s evidence not demonstrably incompatible with incapacity to consent – However CA said trial judge failed to identify relevant factors to consider when assessing whether intoxication deprived the complainant of her capacity to consent, and failed to consider consent issue first and separately from capacity – CA said new trial necessary for both F and B – Crown appealed to SC – SC majority said consent was foundation on which Canada’s sexual assault laws based - Consent and the capacity to give consent were inextricably joined, as subjective consent to sexual activity requires both that complainant be capable of consenting and did, in fact, consent - Trial judges are under no obligation to evaluate consent and capacity separately or in any particular order – Here, was open to trial judge to find both that the complainant was incapable of consenting and did not agree to the sexual activity in question, and he did not err in addressing these issues together in his reasons – Appeal allowed.

High Court of Australia

Conspiracy by unlawful means

Talacko v Talacko and ors [2021] HCA 15 (12 May 2021)

Unsuccessful appeal and successful cross-appeal from Victorian CA – JT, his wife and two of their sons undertook a conspiracy by unlawful means - Conspiracy was directed at depriving JT’s siblings, or those claiming through them – the first to fifth respondents (Respondents) – of the value of their rights, a chose in action against JT arising from an unquantified judgment in their favour  chose in action against JT) - Conspiracy involved agreements by which JT donated valuable properties he held in the Czech Republic to his sons (collectively, Donation Agreement) to impede recovery of the anticipated judgment debt, which was later quantified - In 2009 Respondents began proceedings in the Victorian SC concerning, amongst other things, unlawful means conspiracy - In 2011 and 2012, Respondents brought proceedings against the sons in the Czech Republic to set aside the Donation Agreement (Donation Agreement Proceedings) to enable a claim to be made, and enforced, directly against the sons – Victorian SC said unlawful means conspiracy not actionable because  Respondents had not proved they had suffered loss or damage - Primary loss category Respondents alleged,  being prevented from recovering the judgment debt because of the Donation Agreement, said to be only contingent since property value might yet be recovered from the sons through Donation Agreement Proceedings - Appeal to CA allowed because Respondents had suffered loss or damage. SC quantification of primary loss category discounted by 25%, including for prospect that JT might have impeded recovery even without the unlawful means conspiracy - Damages further reduced by 20% to account for speculative prospect of separate recovery from the sons through Donation Agreement Proceedings – JT appealed to HC over whether loss or damage had been suffered such that an unlawful means conspiracy was actionable – Respondents cross-appealed over whether damages for the unlawful means conspiracy should be discounted to reflect the chance of separate recovery from two of the conspirators in foreign proceedings - HC dismissed the appeal, saying CA correct to conclude that Respondents suffered loss or damage so unlawful means conspiracy was actionable. The reason was the value of the Respondents' rights, the chose in action against JT was reduced by JT’s entry into the Donation Agreement – This meant transfer of the properties reduced the available assets to meet the anticipated judgment debt – HC allowed cross-appeals, saying the 20% prospect of success arising from the Donation Agreement Proceedings could not be said to be a benefit of any real value to Respondents that had reduced their loss – Appeal dismissed, cross-appeal allowed.

Search and seizure, judicial review

Zhang v Commissioner of Police [2021] HCA 16 (12 May 2021) 

Unsuccessful application for judicial review – Z, an Australian citizen born in PR China, employed at the New South Wales Parliament - During an ongoing investigation, officers of the Australian Federal Police (AFP) obtained search warrants issued under s 3E of the Crimes Act 1914 (Cth) purporting to authorise search and seizure of material relevant to offences against s 92.3(1) and (2) of the Criminal Code - Corresponding orders relating to material seized made under s 3LA of the Crimes Act following execution of those warrants – Proceeding under HC original jurisdiction, Z sought certiorari writs quashing each warrant and each order together with a mandatory injunction requiring the destruction or return of the seized and copied material - Also sought declarations of invalidity of s 92.3(1) and (2) of the Criminal Code because they infringed the implied freedom of political communication – Z challenged warrant validity on two grounds – First, each warrant failed to comply with s 3E(5)(a) of the Crimes Act because it did not identify the substance of the offences with sufficient precision – Secondly, each warrant failed to authorise search and seizure of "evidential material" because of the invalidity of s 92.3(1) and (2) - Section 92.3(1) relevantly made it an offence to engage in conduct "on behalf of ... a foreign principal" in circumstances where "the person is reckless as to whether the conduct will: ... influence a political or governmental process of the Commonwealth or a State or Territory; or ... influence the exercise (whether or not in Australia) of an Australian democratic or political right or duty" and "any part of the conduct ... is covert" – HC unanimously said Z’s argument regarding compliance with s 3E(5)(a) was untenable - Regarding the constitutional challenge, HC said Z implicitly acknowledged that parts of s 92.3(1) supporting the offences against s 92.3(1) had some valid operation - That being so, argument offences did not exist rejected without needing to determine constitutional argument he presented – Application rejected.

United Kingdom Supreme Court

Local authority rating, liability, piercing the corporate veil

Hurstwood Properties (A) Ltd and ors v Rossendale Borough Council and anor [2021] UKSC 16 (14 May 2021)

Partially successful appeal from CA - Under section 45 of the Local Government Finance Act 1988 (1988 Act), non-domestic rates were charged for a property if four conditions satisfied on a given day - One of conditions was ratepayer was "owner" of the whole of the property - Section 65(1) defined ‘owner’ as "[t]he owner of a hereditament or land is the person entitled to possession of it" - A further condition was that property fell within a class currently set out in the Non-Domestic Rating (Unoccupied Property) (England) Regulations 2008 (2008 Regulations) - Under the 2008 Regulations, rates were charged on all non-domestic properties other than those excluded in regulation 4 - Regulation 4(k) excluded a property "whose owner is a company which is subject to a winding-up order made under the Insolvency Act 1986 or which is being wound up voluntarily under that Act" – HP and various other property companies (companies) granted a short lease of the unoccupied property to a special purpose vehicle (SPV) - SPV became the "owner" and liable to non-domestic rates liability rather than the  companies -  SPV then dissolved or put into liquidation to escape rates liability – Local authorities  said they were entitled to the unpaid business rates either because the lease to the SPV was ineffective to make the SPV the ‘owner’ of the unoccupied property under the 1988 Act, the “statutory interpretation ground”, or because the SPV should be ignored, through “piercing the corporate veil” -  Claims were test cases representative of 55 similar cases – Involved unpaid rates from a few thousand to millions of pounds - Companies applied to HC to have local authorities’ claims struck out - HC agreed with companies on the statutory interpretation ground, but not on the ‘piercing the corporate veil’ ground - On appeal, CA agreed with the companies on both grounds and struck out local authorities’ claims – SC allowed the appeal on the statutory interpretation ground - SC said approach in a 1982 tax case was often viewed as tax-specific, but was based on wider modern approach to legislative interpretation: to read statute as a whole in its historical context and interpret statute to give effect to Parliament’s purpose (so far as possible) - First,  court must ascertain the class of facts intended to be caught by the charge or exemption by interpreting the relevant part of the statute in the context of the whole statutory scheme and its purpose - Second, the court must decide whether the relevant facts, looked at realistically and in the round, fall within the class - Court must avoid tunnel vision – The legislative history of charging rates for unoccupied property showed that the purpose was to deter owners from leaving property unoccupied for their own financial advantage and encouraging owners to bring empty property back into use for the benefit of the community – This was also clear from the various exemptions in regulation 4 of the 2008 Regulations and the zero-rating scheme in section 45A of the 1988 Act - By imposing rates charge on the "person entitled to possession" in the 1988 Act, Parliament intended to encourage the person who had the ability, in the real world, to bring the unoccupied property back in use to do so – On piercing the corporate veil,  local authorities argued that companies interposed SPVs solely to avoid rates liability which would have otherwise been the companies’ liability - Was an abuse of the separate legal personality of the SPV which justified ‘piercing the corporate veil’ - In light of the Court’s decision on statutory interpretation ground, this alternative ground fell away as it depended on the SPVs being ‘owner’ - Nonetheless, SC addressed this ground of appeal and rejected it – Said  ‘Piercing the corporate veil’ a metaphor that was liable to obscure more than illuminate -  In a key case, concept was split into two distinct principles - Relevant here was the ‘evasion principle’ which might apply when a person was under an existing legal obligation which they deliberately evaded by interposing a company under their control - Even assuming this ‘evasion principle’ was coherent (which was debatable), difficulty here was interposing the SPV (and the grant of the lease) did not evade enforcement of an existing legal obligation - This was because rates liability accrued day by day – Thus, before the lease was granted,  companies were liable for any accrued rates and once the lease was granted, only the SPV was liable (assuming that the SPV was "owner") - Therefore, the interposition of the SPV itself was not an abuse of corporate personality - Rather, the abuse was the way in which the SPV’s liability for rates was handled, as the Court discussed under the statutory interpretation ground – Appeal allowed on statutory interpretation ground.