New Zealand Law Society - Courts roundup 15 February - 21 February 2024

Courts roundup 15 February - 21 February 2024

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

2022 04 13 Coote Supreme Court 173

New Zealand Supreme Court

Defamation, interim restraining orders

Peter T Rex LLC v NZME Publishing Ltd [2024] NZSC 10 (15 February 2024)

Unsuccessful leave application – Applicants applied for injunction to restrain NZME Publishing Limited (NZME) from publishing allegedly defamatory statements – Application not been heard – Pending application hearing, applicants sought various interim orders including non-publication order – HC non-publication order terms subject of applicants’ partially successful appeal by applicants to CA – Publishing third applicant’s name, address and identifying particulars prohibited pending further HC order – Applicants sought to appeal to SC – Said CA wrong not to suppress other details they said would enable third applicant’s identification by community in which he is involved –

SC said to reach its decision CA applied previous SC case – Said proposed appeal would largely reprise arguments in CA – It is not argued that in defamation context should be any standard other than that set out in previous SC case – Rather, on proposed appeal applicants would challenge principles as applied to set of very particular facts – No question of general or public importance arose – Application dismissed.

Trust deed, charging clause

Mclaughlin v Mclaughlin [2024] NZSC 11 (15 February 2024)

Unsuccessful leave application – McL and McL sought leave to appeal from CA dismissing appeal from HC decision rejecting their claim for disgorgement of profits from allegedly errant trustee – Now sought leave to appeal to SC –

SC said first proposed appeal ground new – Too late to raise point when parties have not had any opportunity to address it – Other two grounds did not challenge CA’s approach to self-dealing – Rather, concerned Court’s interpretation of trust deed charging clause – Issues primarily factual and, in any event, had insufficient prospects of success – Nothing in CA approach gave rise to any appearance of miscarriage of justice – Application dismissed.

Self-represented litigants, tax assessment

Tailor v Commissioner of Inland Revenue [2024] NZSC 9 (16 February 2024)

Unsuccessful leave applications – IRD assessed self-represented T and T as having failed to pay their taxes – Commenced statutory disputes procedure in Part 4A Tax Administration Act 1994 – Ultimately IRD reassessed first applicant’s tax liability at $42,940.59 and second at $76,206.46 – Neither sum paid –

IRD brought debt proceedings in DC to recover assessed tax liabilities – Neither applicant filed statement of defence – Judgments by default – IRD issued bankruptcy notices – Applicants failed to comply, committing acts of bankruptcy – IRD applied for orders adjudicating them bankrupt – They failed to attend hearing – HC adjudicated them bankrupt on 22 September 2022 –

CA dismissed applications for extension of time to appeal bankruptcy adjudications – Each applicant twice attempted unsuccessfully to recall CA judgment – Then unsuccessfully sought annulment of original orders adjudicating them bankrupt – Recall application also unsuccessful – Sought leave to appeal to SC to enable them to contest their assessed tax liabilities –

SC said proposed appeals did not meet statutory leave criteria for leave – No question of public or general importance – No issue of general commercial significance – Applications dismissed.

New Zealand Court of Appeal

Summary judgment, Drawdown of loan, Misuse of loan funds

Westpac New Zealand Ltd v New Dawn Holdings Ltd [2024] NZCA 11

Successful appeal against refusal to enter summary judgment on appellants claim in debt under a loan agreement with first respondent as borrower and second respondent as guarantor - The first respondent, New Dawn, entered into a loan agreement with the appellant, Westpac, to purchase a residential property in Auckland - The second respondent, Mr Chu, was the sole director and shareholder of New Dawn - The third respondent, Mr Nguy, acted as New Dawn’s solicitor in connection with the loan and purchase, and he also acted for Westpac on a limited retainer - Mr Chu held 75 percent of the shares in New Dawn on trust for Mr Nguy - The property purchase was intended to be a joint venture investment - The full amount of the loan monies were transferred into the trust account of Mr Nguy by Westpac - Mr Nguy did not apply the loan monies to settle the purchase but misappropriated the funds for his own use and to settle debts of his firm - Mr Chu and Westpac were not aware of the misappropriation at the time - Messrs Nguy and Chu continued to fund the interest payments due to Westpac under the loan agreement for a little over 12 months - Settlement did not proceed and the vendor cancelled the agreement by notice - Mr Chu discovered Mr Nguy’s defalcation after instructing his present solicitors in late 2020 and making a formal complaint to the New Zealand Law Society – In the HC the Judge entered summary judgment against Mr Nguy for breach of the limited retainer calculated as the amount of the loan plus interest - The Judge declined to enter summary judgment against New Dawn and Mr Chu, finding that it was arguable that Westpac had retained control of the funds while they were in Mr Nguy’s trust account - The appellant submits that the loan monies were received by Mr Nguy as the appointed agent of New Dawn, and following transfer Westpac had no control over the money - The first and second respondents submit that there is no repayment obligation, as the monies were never advanced to New Dawn, they were held by Mr Nguy as agent for Westpac subject to its instructions - Whether the loan was drawn down when the funds were paid into the solicitor’s trust account - HELD: Summary judgment entered for the appellant against the first and second respondents for the amount due under the loan - Appellant is entitled to costs in the High Court.

Forfeiture of property, Criminal activity, Tainted property

McFarland v Commissioner of Police [2024] NZCA 16

Unsuccessful appeal against forfeiture of property – Registered owners of the property were a company whose shareholders were persons associated with the Epitaph Riders motorcycle club – Ownership of the shares transferred to persons associated with the Head Hunters gang – No money was paid to acquire the property – Improvements made to the property – Respondent applied for forfeiture as the property was tainted property based on the improvements being in part funded by the proceeds of significant criminal activity - Whether the Judge erred in admitting hearsay evidence – Whether the Judge erred in finding that the property was tainted property for the purposes of s50 Criminal Proceeds (Recovery) Act 2009 - Whether the Judge erred in determining that the appellant would not suffer undue hardship if the property were to be forfeited – HELD: hearsay evidence was a business record and therefore admissible – Judge did not err in finding property was tainted property – Judge did not err in hardship considerations – Appeal dismissed.

Defence force, Individual readiness requirements, Vaccinations

Four Members of the Armed Forces v Chief of Defence Force [2024] NZCA 17

Successful appeal against Temporary Defence Force Order 06/2022 (TDFO) which addressed the consequences of failure to meet individual readiness requirements relating to vaccination against COVID-19 - The consequences of not being vaccinated for COVID-19 were in a number of respects more prescriptive and more stringent than those that apply in respect of other vaccinations required by the NZDF Vaccination Schedule - Failure to meet that requirement was more likely to result in dismissal from the Armed Forces – If the member was retained, their retention was to be reviewed at least annually – Appellants applied for judicial review on grounds the TDFO was unlawful because it was inconsistent with legislation – Appealed on same basis – HELD: Respondents have not demonstrated that there was a justification for adopting more prescriptive and more stringent consequences for failure to have the prescribed COVID-19 vaccinations than in relation to other vaccinations – Appeal allowed - Chief of Defence Force is directed to reconsider the TDFO – Interim order prohibiting the Chief of Defence Force from taking any further action pursuant to the TDFO and related instruments until such time as the reconsideration of the TDFO is complete.

Sexual violation, Credibility of evidence, Leave to adduce affidavit evidence

J (CA 519-2022) v R [2024] NZCA 21

Unsuccessful appeal against conviction and sentence – Unsuccessful application to adduce further evidence - Appellant was convicted on a charge of sexual violation by rape - Sentenced to 12 years imprisonment with a minimum period of imprisonment (MPI) of eight years – Appeal on grounds of miscarriage of justice – Credibility of evidence of complainant – Whether starting point adopted in sentencing was manifestly excessive – Complainants evidence compelling and cross-examination thorough – Credibility not in doubt - Not satisfied that it is in the interests of justice to grant leave to adduce the affidavit evidence in support of the conviction appeal – Starting point and end sentence not manifestly excessive - HELD: Application to adduce further evidence declined - Appeal dismissed.

New Zealand High Court

Criminal Cases Review Commission, birthdate

G v New Zealand Police [2024] NZHC 189 (16 February 2024) Thomas J

Successful first referral to HC from Criminal Cases Review Commission of G’s convictions and sentences – Mistake in G’s age (17 vs 15) saw him convicted of offences in DC and sentenced to 11 months' imprisonment, outcome prohibited by legislation – G refugee from war-torn country –

Court accepted G’s relatives' evidence of birthdate, supported by Certificates of ldentity and New Zealand Citizenship –

If in Youth Court, G would not have been convicted but likely admonished and ordered to reside in a welfare institution for 3 months at most –

Convictions imposed, and sentence served over 20 years ago – Convictions set aside – Too late to substitute any other order that could have been made in Youth Court – Sentence quashed.

Sentencing manslaughter, two defendants

R v S and G [2024] NZHC 197 (16 February 2024) Gault J

Sentencing – Followed jury guilty verdicts and earlier guilty pleas to lesser charges – Regarding S: manslaughter by assault, assault with intent to injure x 3 and common assault x 3 – Regarding G: manslaughter by dangerous driving, failing to stop to ascertain injury and common assault – Victim B grabbed and held by S and G from inside vehicle which drove off with victim running alongside, victim managed to jump onto vehicle running board but lost footing and fell off – Vehicle then ran over his head and body – Victim died from injuries – Starting point for G: 4.5 years' imprisonment, with discounts for mitigating factors of youth, previous good character and rehabilitative prospects of 35 percent plus 5 percent for remorse and two months for time spent on bail – Starting point for S: 3 years' imprisonment for offending against B, uplift of nine months for offending against 0, with discounts for mitigating factors of youth, previous good character, rehabilitative prospects and psychological needs of 40 percent and one month for time spent on bail –

End sentence for G: on lead manslaughter charge, 2.5 years' imprisonment, for assault, 3 months' imprisonment, for failing to stop, 6 months' imprisonment and disqualification from driving for 2 years from release date – Sentences to be served concurrently –

End sentence S: on lead manslaughter charge 2 years 2 months' imprisonment, for assault with intent to injure, 9 months' imprisonment, for common assault, 3 months' imprisonment – Sentences to be served concurrently.

High Court of Australia

Offence elements, “entering into agreement …. to commit”

R v Rohan [2024] HCA 3 (14 February 2024)

Successful appeal from Victoria CA – Concerned what necessary to prove that person "involved in the commission of an offence" under s 323(1)(c) Crimes Act 1958 (Vic), where person "enters into an agreement, arrangement or understanding with another person to commit the offence" –

R convicted of 11 offences Victoria County Court – Six convictions – Two of supplying drug of dependence to child and four of sexual penetration of child under 12 years – Depended on prosecution proving R had, within meaning of s 323(1)(c), entered into agreement, arrangement or understanding to commit offence – Prosecution case R and his two co-accused had reached agreement to supply alcohol and cannabis to two complainants (girls aged 11 and 12) and then engage in sexual activity, including sexual penetration, with both complainants – Prosecution case all three co-accused guilty of all charges, irrespective of who carried out actual acts –

Elements of each offence did not include proof of knowledge of victim's age – Required only victim in fact be under 18 years for supply offences and under 12 years for sexual penetration offences – Trial judge did not direct jury that, for "agreement ... to commit the offence" to be established beyond reasonable doubt, prosecution required to prove that co-accused knew complainants ages or they were under specified age –

Allowing appeal, CA said necessary to prove that, at time agreement made, accused knew of or believed in essential facts that made proposed conduct offence – CA said prosecution required to prove beyond reasonable doubt that, when he entered into agreement R knew relevant complainant under 12 for sexual penetration offences and knew complainants both under 18 for supply offences –

Crown successfully appealed to HC – HC unanimously said under s 323(1)(c), not necessary for prosecution to prove accused knew or believed, at time of entering agreement, essential facts that made proposed conduct offence, where knowledge or belief not element of offence itself – Knowledge of age not element of either offence – Not necessary for prosecution to prove that R knew complainants’ ages at time he entered into agreement to commit offences – Appeal allowed.

Hague-Visby rules, Australia Hague Rules

Carmichael Rail Network Pty Ltd v BBC Chartering Carriers GmbH & Co KG [2024] HCA 4 (14 February 2024)

Unsuccessful appeal from Federal Court – Concerned proper construction of Art 3(8) "Australian Hague Rules", which are "Hague-Visby Rules" as modified and incorporated into Australian law by Carriage of Goods by Sea Act 1991 (Cth) – Principal issue whether arbitration clause in bill of lading void as contrary to Art 3(8) Australian Hague Rules, which provided any clause in contract of carriage relieving or lessening carrier's liability for loss or damage to goods otherwise than as provided in Rules shall be void and of no effect –

Arose from contract of carriage (which included bill of lading) between Carmichael, shipper and BBC carrier, for carriage by sea of steel rails from South Australia to Queensland – Clause 4 bill of lading provided "any dispute arising under or in connection with this Bill of Lading shall be referred to arbitration in London" and that "English law is to apply" (arbitration clause) – When rails arrived in Queensland, damaged beyond use – Carmichael commenced proceedings in Federal Court, claiming damages and seeking, as interlocutory application, restraint of arbitration BBC initiated in London – In response, BBC filed interlocutory application seeking stay of Federal Court proceedings – Competing interlocutory applications referred to Full Federal Court for hearing – Full Court dismissed Carmichael's interlocutory application and ordered Carmichael's Federal Court proceeding stayed in favour of London arbitration – Full Court's decision took into account BBC undertaking Australian Hague Rules as applied under Australian law would apply in London arbitration and Full Court made declaration by consent to similar effect (undertaking and declaration) –

HC unanimously dismissed Carmichael's appeal – Said Art 3(8) required Carmichael to establish, on balance of probabilities, arbitration clause relieved BBC from liability or lessened such liability otherwise than as provided for by Australian Hague Rules – Carmichael did not prove to requisite standard – Also said when deciding if carrier's liability is relieved or lessened under Art 3(8), court had to consider all circumstances as found at time of its decision, which here included undertaking and declaration – Appeal dismissed.

Supreme Court of Canada

Constitutional law, First Nations’ rights, federal, provincial separation of powers

Reference re An Act respecting First Nations, Inuit and Métis children, youth and families [2024] SCC 5

Successful appeal from Quebec by Attorney-General of Canada – In 2019, Parliament passed Act respecting First Nations, Inuit and Métis children, youth and families (Act), which established national standards and provided Indigenous peoples with effective control over their children’s welfare –

Act set out national standards and principles that established normative framework, which applied across Canada, to provide culturally appropriate child and family services – For example, principle of best interests of child paramount consideration in decisions or actions in relation to Indigenous child – Act also sets out principle of ensuring cultural continuity, considered essential to well‑being of children, families and Indigenous groups, communities or peoples –

Act also affirmed inherent right of self‑government of Indigenous peoples, recognised and affirmed by s 35 Constitution Act, 1982 – Act said right included jurisdiction to make laws relating to child and family services – For this purpose, Act established framework in which Indigenous groups, communities or peoples could exercise this jurisdiction –

Act specified how its provisions and Indigenous peoples’ jurisdiction to make laws in this area interacted with other laws – Section 21 gave laws made by Indigenous groups, communities or peoples same force as federal laws - Lastly, s 22(3) said for greater certainty that Indigenous laws prevail over provincial laws to extent of any conflict or inconsistency –

After Act passed, Quebec Attorney-General asked Quebec CA to rule whether Act “ultra vires” Parliament’s jurisdiction under Canadian Constitution of Canada – Attorney General asked whether, in light of division of federal and provincial powers under ss 91 and 92 Constitution Act 1867, Parliament had exceeded jurisdiction by passing Act – CA said Act constitutionally valid except for ss 21 and 22(3), provisions giving laws of Indigenous people’s priority over provincial laws –

Quebec Attorney General and Canadian Attorney General both appealed SC – Former argued, among other things, entire Act impermissibly intruded on certain areas of exclusive provincial jurisdiction – Latter countered Act valid exercise of Parliament’s legislative jurisdiction over “Indians, and Lands reserved for the Indians” under s 91(24) Constitution Act, 1867 –

SC dismissed Quebec Attorney General’s appeal and unanimously allowed Canadian Attorney-General’s appeal – Ruled Act wholly constitutionally valid – Essential matter Act addressed involved protecting well‑being of Indigenous children, youth and families by promoting delivery of culturally appropriate child and family services and, in so doing, advancing process of reconciliation with Indigenous peoples – Act fell squarely within Parliament’s legislative jurisdiction under s 91(24) Constitution Act, 1867 – SC saw s 21 as simply incorporation by reference provision – Saw s 22(3), as simply legislative restatement of doctrine of federal paramountcy, under which federal law provisions prevailed over conflicting or inconsistent provisions of provincial law – Appeal allowed.