New Zealand Law Society - Supreme Court round up 6 - 12 August 2021

Supreme Court round up 6 - 12 August 2021

Supreme Court round up 6 - 12 August 2021

Decisions, proceedings and news from the highest courts in some common law jurisdictions in the past week.

New Zealand Supreme Court

Freedom of speech, NZBORA

Moncrief-Spittle and anor v Regional Facilities Auckland Ltd and anor [2021] NZSC 94 (5 August 2021)

Successful leave application - Approved question whether CA correct to dismiss the appeal against HC substantive decision.

Habeas corpus, no originating jurisdiction

D v High Court at Auckland [2021] NZSC 96 (9 August 2021)

Unsuccessful leave application – Self-represented D, an Australian woman, party to Care of Children Act 2004 proceedings relating to her two children - Hearing in Family Court - Appeal against FC judgment where HC upheld FC orders - D shared care of both children with her former partner - Both D and her former partner required to reside within a 30-minute drive of a particular school – D’s position that orders’ practical effect was that she and children were being unlawfully detained - Unsuccessfully sought habeas corpus prior to HC determination – CA rejected her appeal of that decision on 2 December 2020 - Earlier similar proceedings also failed – Following HC decision D applied to SC for habeas corpus with HC judge named as the defendant/respondent – SC judge directed application not be accepted for filing, primarily because SC did not have originating jurisdiction in respect of habeas corpus proceedings - Minute also explained why D’s resort to habeas corpus to resolve her concerns in respect of the Care of Children Act proceedings was misconceived – SC said simple position was for Habeas Corpus Act purposes no detention of D and her children and any challenge to Court orders should be by way of appeal – Application an abuse of process – Application dismissed.

High Court of Australia

Evidence, privilege, self-incrimination

Deputy Commissioner of Taxation v Zu Neng Shi [2021] HCA 22 (4 August 2021)

Successful appeal from FCA Full Court - Commissioner obtained orders in FC freezing S’s worldwide assets - Ancillary orders required S to disclose matters relating to the assets (disclosure order) Section 128A(2) Evidence Act 1995 (Cth) provided if a person subject to a disclosure order objected to complying with it on grounds of the privilege against self-incrimination, person had to prepare affidavit containing information to which objection taken (privilege affidavit) - If court satisfied there were reasonable grounds for the objection, s 128A(5) said court must not require the information in privilege affidavit to be disclosed, subject to s 128A(6) - Under s 128A(6) court could order privilege affidavit, in whole or part, be disclosed if satisfied that, (a) any information in it might tend to prove person committed an offence against or arising under an Australian law; and (b) information did not tend to prove that the person has committed an offence against or arising under, a law of a foreign country; and (c) interests of justice required information to be disclosed - S objected to complying with part of disclosure order on self-incrimination grounds - Primary judge satisfied were reasonable grounds for objection - Also satisfied of matters in s 128A(6)(a) and (b) but said because there were other means Commissioner could use to obtain information in the privilege affidavit, interests of justice did not require it to be disclosed - On appeal, Full Court majority, primary judge's holding that interests of justice did not require disclosure, taking into account other available ways that the information could be obtained – HCA majority allowed appeal – Said Full Court and primary judge took irrelevant consideration into account in failing to be satisfied that the interests of justice required disclosure of information in the privilege affidavit -Inquiry s 128A(6)(c) mandated proceeded on premise that, as part of or in connection with an extant freezing or search order in a civil proceeding, there was an extant disclosure order operating to require information be provided - No part of inquiry to question whether information required to be provided in compliance with extant disclosure order would more appropriately be obtained through some other compulsory process – Appeal allowed.

Employment, Casual “assignments”

Work Pac Pty Ltd v Rossato and ors [2021] HCA 23 (4 August 2021)

Successful appeal from FCA Full Court – Workpac, a labour-hire company , employed R as a production worker under a series of six contracts, or "assignments", to perform work for WorkPac client - At all relevant times, WorkPac treated Mr R as a casual employee - R not paid leave and public holiday entitlements owed by employers to non-casual employees under Fair Work Act 2009 (Cth) (Act) and enterprise agreement which governed his employment – On 16 August 2018, judgment delivered in another case involving WorkPac - In that decision, S, employed in circumstances similar to R, not a casual employee - Relying on that decision, R said not a casual employee, and therefore entitled to be paid for untaken annual leave, public holidays, and periods of personal leave and compassionate leave taken during his employment - WorkPac denied his claims - Filed application in Federal Court seeking declarations that R had been a casual employee for Act and relevant enterprise agreement purposes – Alternatively, WorkPac claimed to be entitled to a set off, or to restitution, of payments it had made to Mr Rossato in compensation for, or in lieu of, the entitlements he claimed –
Full Court said R not a casual employee and declared he was entitled to the payments he claimed - Also rejected WorkPac's set off and restitution claims - WorkPac appealed to HCA – It said "casual employee" an employee who had no firm advance commitment from the employer as to employment duration or days (or hours) employee would work, and provided no reciprocal commitment to the employer - Where parties committed terms of their employment relationship to a written contract and adhered to those terms, requisite firm advance commitment had to be found in parties’ binding contractual obligations; a mere expectation of continuing employment on a regular and systematic basis not sufficient for Act purposes – R’s employment expressly on "assignment by-assignment basis" - R entitled to accept or reject any assignment offer, and at completion of each assignment WorkPac under no obligation to offer further assignments - That R worked according to established shift structure fixed long in advance by rosters did not establish commitment to an ongoing employment relationship beyond each assignment completion - Carrying out each assignment, R worked as a casual employee for Act, enterprise agreement purposes – Not necessary to consider WorkPac's set off and restitution claims – Appeal allowed.

Judicial Committee of the Privy Council

Reflective loss principle, direct-indirect investments

Primeo Fund (in Official Liquidation) v Bank of Bermuda (Cayman) and anor [2021] UKPC 22 (9 August 2021)

Successful appeal from Cayman Islands – Primeo operated as an open-ended investment fund incorporated in Cayman Islands - Invested funds with Bernard L Madoff Investment Securities LLC (BLMIS) - Initially a small proportion of overall investments, growing over time - From 2003, Primeo also placed a small proportion of investments with BLMIS indirectly through Alpha Prime, a Bermudan-domiciled investment fund - From 2004, Primeo also began investing indirectly via another Cayman-domiciled fund, Herald Fund SPC - On 1 May 2007, Primeo switched its remaining direct investments in BLMIS to an indirect investment through Herald Fund SPC - Bank of Bermuda (Caymans) and an associate (BOB) acted respectively as Primeo’s administrator and custodian at all relevant times - On 11 December 2008, Madoff was charged with fraudulently operating a multi-billion-dollar Ponzi scheme - Primeo subsequently placed into voluntary liquidation - On 20 February 2013, Primeo brought claims against BOB for breach of their contractual duties - At first instance, the judge dismissed Primeo’s claims, principally on the basis that strict liability loss and causation had not been established and reflective loss principle barred claims any way - CA agreed reflective loss principle barred Primeo's claims and dismissed Primeo's appeal - Primeo appealed to PC – PC asked to decide whether Primeo's reflective loss principle barred claims, in whole or in part – PC said reflective loss rule did not bar Primeo from claiming in respect of losses suffered each time it made a direct investment in BLMIS, nor from claiming in respect of losses it maintained it suffered by loss of the chance to redeem its BLMIS investments - down to the time of the Herald Transfer – Losses not suffered by Primeo “in its capacity as shareholder” of Herald - So far as relevant, at the time Primeo suffered such losses it was not a Herald shareholder - Not affected by the fact that in the period up to 1 May 2007 Primeo also held some indirect investments in BLMIS via Primeo’s ownership of shares in Herald; those investments were completely separate from Primeo’s direct investments with which PC concerned at this point in this judgment – Appeal allowed.

United Kingdom Supreme Court

Standard of judicial review, policy document, statement of practice

R (on application of BF (Eritrea) v Secretary of State for the Home Department [2021] UKSC 38 (30 July 2021)

Successful appeal by Secretary - Concerned standards a court should apply on judicial review of the contents of a policy document or statement of practice a public authority issued by a public authority - One of two appeals same five Justice panel heard examining this issue. - Immigration Act 1971 (as amended by the Immigration Act 2014) (1971 Act) set out legal regime applicable to asylum seekers - Schedule 2, 1971 Act made distinct provision regarding detention of asylum seekers who were unaccompanied children as compared with adults over the age of 18 – Secretary issued policy guidance for immigration officers in cases of doubt as to the age of an asylum seeker presenting as a child, (Policy) – Policy set out in two documents: (i) asylum instruction entitled Assessing Age; and (ii) relevant section of the general operational guidance issued to immigration officers entitled the Enforcement Instructions and Guidance ("the EIG") – EIG section set out various criteria for circumstances when Home Office would not accept that an asylum seeker was a child - Criterion C relevant to this case - Criterion C initially provided that an asylum seeker would not be accepted as being under 18 if "their physical appearance/demeanour very strongly suggests that they are significantly over 18 years of age and no other credible evidence exists to the contrary" (emphasis in original) - Subsequently amended to include a requirement within Criterion C that two Home Office officials had separately come to this conclusion - Assessing Age instruction gave further guidance on age assessment process, particularly regarding Criterion C –

BF an Eritrean national who arrived in UK in 2014 and claimed asylum - Despite his claiming to be a 16 year old child, immigration officers applying Criterion C initially assessed him as an adult - He was detained as if he were an adult - More detailed age assessments subsequently carried out in 2015 - Eventually decided he was aged less than 18 - BF challenged Policy through judicial review before Upper Tribunal saying Criterion C unlawful, because physical appearance and demeanour were an inherently unreliable guide to age – Not successful before Upper Tribunal, but CA allowed his appeal - Secretary of State appealed to SC – SC unanimously allowed appeal – Rejected CA assessment of Policy lawfulness - whether it created a real risk of more than a minimal number of children being detained and/or created a risk which could be avoided if policy terms were better formulated – Set out principles governing test that should be applied when considering the lawfulness of policies - Standard of judicial review of policy issued by public authority that policy must not direct officials act in a way contrary to their legal obligations - Guidance in policy should not sanction, positively approve or encourage unlawful conduct – Appeal allowed.

Validity of enquiry, computer system address change, estoppal by convention

Tinkler v Her Majesty’s Commissioners for Revenue and Customs [2021] UKSC 39 (30 July 2021)

Successful appeal by HMRC – Key issue whether taxpayer prevented from challenging the validity of an HMRC enquiry into their tax return where both parties have proceeded, for nearly a decade, on mistaken assumption a letter sent to the taxpayer validly initiated enquiry - Under sections 9A and 15 of the Taxes Management Act 1970 (TMA 1970), HMRC had to give notice of an enquiry into a taxpayer’s tax return by sending it addressed to the taxpayer’s usual or last known place of residence, or their place of business or employment – T’s tax return for the year 2003/04 (Return) gave his address as Station Road - On 24 February 2005 HMRC duly changed the address recorded in its computer system to Station Road - On 1 July 2005 address incorrectly changed back to his previous address, Heybridge Lane - That same day, HMRC sent two letters - First was a notice of enquiry into the Return, sent to Heybridge Lane - Second to T’s accountants and tax advisers, BDO Stoy Hayward (BDO), informing them of the enquiry and raising a number of questions about his tax affairs - Included a copy of notice that had been sent to Heybridge Lane - BDO replied to HMRC by letter on 6 July 2005, seeking to claim certain losses that had mistakenly not been included in Return - Said they could not amend Return "as the Return is now the subject of a section 9A TMA 1970 enquiry" - BDO subsequently liaised with T’s personal assistant and responded to HMRC’s questions throughout October and November 2005 - On 1 November 2005, HMRC corrected the address recorded in their system to Station Road - HMRC decided T not entitled to the losses and issued a closure notice on 30 August 2012 stating that he owed £701,990.96 in tax. T said closure notice invalid because initial notice of enquiry had been sent to Heybridge Lane, which was neither his usual or last known place of residence, nor his place of business or employment - HMRC argued that, by operation of the doctrine of estoppel by convention, T estopped from denying enquiry’s validity – CA ruled for T - HMRC appealed to SC – SC unanimously allowed appeal – Said estoppel by convention arose when parties acted on common assumption that given state of facts or law is true - Each will then be estopped against the other from denying the truth of their common assumption - Five principles governing estoppel by convention:

(i) It was not enough that the common assumption is merely understood by the parties in the same way. It must be expressly or impliedly shared between them. Something must ‘cross the line’ between the parties sufficient to manifest an assent to the assumption.

(ii) The expression of the common assumption by the party alleged to be estopped ("D") be such that they may properly be said to have assumed some element of responsibility for it, in the sense of conveying to the party raising the estoppel ("C") an understanding that they expected C to rely upon it.

(iii) C must in fact have relied upon the common assumption rather than merely upon C’s own independent view of the matter.

(iv) That reliance must have occurred in connection with some subsequent mutual dealing between the parties.

(v) Some detriment must thereby have been suffered by C, or benefit accrued to D, sufficient to make it unconscionable for D to assert the true legal or factual position.

Considering principles (i) to (iii), C must rely on the affirmation of the common assumption by D, and the latter must intend or expect that reliance –

Applying principles here SC said fact that HMRC mistakenly represented to BDO that Heybridge Lane was correct address did not prevent HMRC from raising an estoppel by convention - In its letter of 6 July 2005, BDO indicated to HMRC that it too believed that a valid enquiry had been opened. Thereafter, HMRC relied on BDO’s endorsement of the common assumption that the enquiry was valid, as BDO must have expected and intended - Principles (i) to (iii) therefore satisfied – Principle (iv) satisfied because HMRC’s reliance related to the dealings between the parties: the enquiry into the Return - Principle (v) satisfied because HMRC’s reliance on the common assumption was to its detriment, as it did not send another notice of enquiry to T before the time limit to do so had expired – Also, not unconscionable for HMRC to raise an estoppel - HMRC satisfied all requirements for establishing an estoppel by convention - SC also dealt with two additional issues - First, while there was no transaction between HMRC and T, this was not a requirement of estoppel by convention - Mutual dealings between them were sufficient - Second, estoppel by convention in this case would not undermine the statutory protection given to taxpayers by section 9A of the TMA 1970 - Appeal allowed.

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