New Zealand Law Society - Courts roundup 12 December - 18 December 2024
Decisions, proceedings and news from the courts in some common law jurisdictions in the past week.
Singh v R [2024] NZSC 171 (11 December 2024)
Unsuccessful leave application – S tried before DC jury on 10 charges of sexual violation by rape and unlawful sexual connection, male assaults female, injuring with intent to injure and attempted poisoning – Judge, summing up to jury, departed slightly from recommended direction on standard of proof –
Found guilty on six charges, including two representative charges of sexual violation and sentenced to seven years 10 months’ imprisonment – CA dismissed appeal against convictions – Sought leave to appeal to SC –
SC said question of law proposed appeal raises was settled – Proposed appeal would turn on own particular facts and raised no matter of general or public importance – No risk of substantial miscarriage of justice – Application dismissed.
Parson v Chief Executive, Department of Corrections [2024] NZSC 172 (13 December 2024)
Unsuccessful leave application – In 1995 P convicted of rape and abduction of 12-year-old girl – P then 18 years old – Sentenced to 11 years’ imprisonment –
After being paroled, P recalled to prison – Chief Executive applied for extended supervision order (ESO) – Imposed on 16 June 2006 for 10 years – Second 10-year order made with effect from 22 February 2017 – While orders were in place, P approached 15-year-old girl on two occasions with what appeared to be inappropriate intent and found to have child pornography on phone –
Sentencing court had to review ESO where person subject to orders for 15 years – HC satisfied P remained at high risk of committing relevant sexual offence and confirmed ESO – CA dismissed appeal – P sought leave to appeal to SC –
P said CA erred in its interpretation of s 107IAA(1)(a) Parole Act 2002 – SC said leave criteria not made out – Application dismissed.
BNZ v Christian Church Community Trust [2024] NZCA 645
Successful appeal by BNZ against granting of interim injunction preventing it from terminating its banking services to Gloriavale entities - HC satisfied serious question to be tried in relation to breach of contract cause of action, and balance of convenience and overall justice favoured continuing interim injunction until determination of substantive claims -
Not seriously arguable termination clause in BNZ’s standard terms and conditions limited reasons BNZ may terminate its banking relationship with Gloriavale entities - Arguable there was an implied term BNZ must exercise power for purpose for which that power was conferred under the contract - Arguable BNZ’s exercise of termination power subject to an implied term power must not be exercised dishonestly or in bad faith, or capriciously or arbitrarily - Not seriously arguable BNZ breached such an implied term - Not seriously arguable BNZ owed Gloriavale entities a fiduciary duty which would be breached if BNZ terminated its banking relationship with them, or that BNZ estopped indefinitely from terminating relationship – Appeal allowed – Interim injunction set aside
Bagley v R [2024] NZCA 646
Unsuccessful application by B for leave to bring a second appeal against sentence – Successful application to adduce fresh evidence (affidavit from his partner which provided an update of ongoing impact of B’s incarceration on his children) – B sentenced to two years four months imprisonment for several charges including wilful damage, threatening to kill, assault on a person in a family relationship and charges of theft under $500 (x11) - On appeal HC reduced his sentence to two years and two months imprisonment – B argued he should receive a discount for impact imprisonment would have on his children - B and his partner had 11 children aged between 18 months and 17 years of age –
Application to adduce fresh evidence should be granted - Evidence credible and cogent - No risk miscarriage of justice may arise if application for leave to bring second appeal not granted – HC considered materials and authorities relevant to impact of B’s imprisonment on his children – No evidence to suggest B had played a primary or constant caregiving role in his children’s lives, and nothing to suggest that B’s present incarceration was having an undue impact on his children.
Evans v R [2024] NZCA 647
Unsuccessful application by E to appeal his 1984 conviction for careless driving out of time and unsuccessful application for refusal to grant name suppression - E submitted because Criminal Records (Clean Slate) Act 2004 effectively conferred suppression upon him in respect of his conviction, declining his application would prejudice the maintenance of law, engaging s200(2)(g) Criminal Procedure Act 2011 (CPA) - Because E’s appeal rights were exhausted, proceeding had concluded and s397 CPA did not extend the life of Criminal Justice Act 1986 to apply to a fresh application for suppression - Clean Slate Act did not create a suppression regime – It meant an eligible individual was deemed not to have a criminal record when asked about their criminal past - If their criminal record was relevant to a court proceeding, clean slate regime was displaced and their criminal history could be discussed - If an individual considered hardship would result, they needed to seek suppression under the CPA - Section 200(2)(g) CPA was not engaged - Even if it was, hardship faced by E (reputational damage) did not meet threshold to grant name suppression.
Grant v R [2024] NZCA 652
Unsuccessful appeal by G against a sentence of two years four months imprisonment for charges of obtaining by deception (x4) and a concurrent sentence of 18 months imprisonment for being a party to attempting to obtain by deception - Charges arose from mortgage fraud among major trading banks in which E and co-offenders made false representations about their financial position to obtain loans - No basis to adduce a Hōkai Tapuwae report (prepared by Department of Corrections, similar to s27 cultural report) because it was neither fresh nor cogent and provided no insight into the offending beyond that already before the Court - Letter of remorse did not cogently prove genuine remorse because its tenor was that G was ignorant and duped but that explanation had been rejected by the sentencing Judge and was inconsistent with basis of the convictions - Starting point of three years was within range and appropriate - Judge properly assessed relative culpability and roles of other co-offenders – G’s discount for previous good character less because he had spent 10 years serving as a police officer – G’s time as a police officer did not preclude appropriate recognition of his previous good character - Discount for good character matter of impression and 22 per cent global discount for G’s personal factors including impact of imprisonment on children, delay in determination of charges and previous good character was generous and within range – Appeal dismissed.
McDonald v Sanchez [2024] NZCA 674
Successful appeal by M against HC decision which made an order for the return of the parties children to Spain – M and S had two children who had been living with their father in NZ since November 2021 – S lived in Spain - Parties original intention was that children would spend a year living in NZ and then return to Spain – In December 2022 M refused to return children - S successfully sought return of children to Spain under s105 Care of Children Act 2004 which gave effect to the Hague Convention on the Civil Aspects of International Child Abduction -
Children were habitually resident in NZ in December 2022 not Spain - Habitual residence was question of fact – Lower Courts set too high a threshold for acquisition of habitual residence and put too much emphasis on the parents’ original plan –Insufficient weight given to circumstances of children and extent of their connection to NZ - Children had integrated into social, family and community environments - Their residence had necessary stability to be described as “habitual” – Not open to Family Court to make an order for the return of the children to Spain - Requiring children to return to Spain despite their clearly expressed and reasoned wishes was likely to be stressful and have significant adverse effects on their wellbeing - Remaining in New Zealand would be less disruptive to their current lives - Maintaining relationship with mother was important but not sufficient to outweigh other dimensions of the children’s welfare that are best advanced by remaining in NZ – Appeal allowed.
van den Anker Construction Ltd v Wilson Mackay Trustee Company Ltd [2024] NZCA 654
Unsuccessful application by ACL against HC decision which allowed a claim by Trustee Co – ACL was a construction company – Trustee Co owned a residential property – Parties entered into contract to undertake building work - ACL said its proposed appeal raised important question to construction industry of continued application of “temporary disconformity doctrine” –
Question of continued applicability of “temporary disconformity doctrine” could be of wider significance justifying grant of leave, particularly because its applicability had been called into question in England and Wales - But there was a foundation for view that question might not ultimately matter given ACL’s conduct potentially fell within recognised aspect of the doctrine that it did not apply when a builder had made it clear that it did not intend to rectify defective works - Modest sum in dispute, need for proportionality - Application concerned residential building contract for alterations of a garage undertaken six years ago - Amount in issue did not warrant cost of a second appeal.
Bi v Zhang [2024] NZCA 655
Unsuccessful appeal by B against HC decision which dismissed his application for relief under s174 Companies Act 1993 for minority shareholder oppression - B contended he was, and continued to be, unfairly treated as a minority shareholder – He sought orders requiring Z to purchase his shares at fair market value as at date that he was excluded from operation of relevant companies, without deduction for minority shareholding, and proceedings be remitted to HC to determine fair market value –
Given venture failed, Judge’s findings B had misrepresented his qualifications and credentials, and that there was a dysfunctional relationship between the three major players, the value of his investment was not greater than the value of his loan recorded in the accounts – No unfair prejudice arose from B being excluded from the companies at that stage – B was not deprived of ability to extract the fair value of his equity in the companies - He retained ability to extract that value through his loan – Appeal dismissed.
R v Messervy [2024] NZHC 3770 (11 December 2024) Dunningham J
Sentencing – M charged with murder – HC said some mitigating factors evident in facts, but nowhere near sufficient on own to warrant finite sentence – Youth and childhood exposure to violence and severe PTSD taken into account – Life manifestly unjust – End sentence 17 years six months MPI seven years.
Commonwealth of Australia v Sanofi [2024] HCA 47 (11 December 2024)
Unsuccessful appeal from Full Court FCA – Full Court dismissed Commonwealth of Australia (Commonwealth) appeal from FC decision ruling Commonwealth not entitled to compensation under Sanofi undertaking as to damages when obtaining interlocutory injunction –
Sanofi held patent in Australia for drug clopidogrel – On 25 September 2007, Sanofi obtained interlocutory injunction preventing Apotex Pty Ltd (Apotex) from competing with Sanofi with generic clopidogrel products Apotex had developed – Sanofi gave usual undertaking as to damages in terms that it would "submit to such order ... as the Court may consider to be just for the payment of compensation ... to any person ... adversely affected by the operation of" interlocutory injunction –
On 11 April 2013, Commonwealth sought compensation from Sanofi on undertaking as to damages for loss Commonwealth suffered from Apotex being prevented from supplying generic clopidogrel products and obtaining listing on Pharmaceutical Benefits Scheme (PBS) for those products – Commonwealth claimed but for interlocutory injunction, Apotex would have obtained listing of its clopidogrel products on PBS on 1 April 2008 – Said Sanofi's conduct obtaining injunction prevented reduction in prices for clopidogrel products – Commonwealth contended this meant paying higher subsidies and claimed compensation of approximately $325 million –
FC said Commonwealth had not discharged onus of proof, Court not persuaded Apotex would have sought and obtained PBS listing of clopidogrel products from 1 April 2008 if interlocutory injunction had not been granted – Full Court unanimously affirmed FC – HC principal issue whether Full Court erred to affirming FC conclusion –
HC majority said unless there were circumstances such as plain injustice or clear error, would not engage in detailed review of lower courts’ concurrent factual findings of lower courts – Said appeal did not concern any individual rights, nor expose any plain injustice or clear error and concurrent fact findings not clearly wrong, they were open and compelling – Based on primary judge’s undisturbed findings, only $11 million of alleged losses within scope of undertaking as to damages – Appeal dismissed.
Kramer v Stone [2024] HCA 48 (11 December 2024)
Unsuccessful appeal from New South Wales CA – Concerned requirements for establishing liability under "proprietary estoppel by encouragement" – Estoppel which afforded relief in equity founded in assumption as to future acquisition of property ownership, induced by representations upon which there had been detrimental reliance by plaintiff –
K’s mother, L, left K farm property in her will (Farm) – For about 40 years from 1975, S managed farm under oral agreement between S and K's father, Dr K – Dr K died in 1988, leaving L as sole Farm proprietor – Shortly after Dr K's death, L made promise to S "out of the blue", telling S Dr K and L agreed Farm would pass to S on L's death – Concurrent finding of courts below was L knew, when making promise, S relied on promise – No evidence conduct by L, after promise, encouraging S to act in reliance on it, primary judge said likely L forgot promise – Relying on promise S acted to detriment, continuing farming operation for about 23 years after promise made – S suffered financial detriment of receiving irregular and meagre income from Farm and non-financial detriment of living on Farm in substandard accommodation – L died in April 2016 – In her will, left S $200,000 and Farm to K –
Primary judge ruled L's promise gave rise to estoppel entitling S to appropriate equitable relief – In lieu of $200,000, judge declared executors of L’s estate (K and A) held Farm on trust for S – CA executors’ appeal – HC majority dismissed executors’ appeal from that judgment – Said four elements of equitable estoppel arising by encouragement from promise: (i) needed clear and unequivocal promise; (ii) reasonable person in promisor's position must have expected or intended, or promisor must have actually expected or intended promisee would rely upon promise by some action, omission or course of conduct; (iii) promisee must have relied upon promise by acting or omitting to act in general manner that would have been expected; and (iv) consequence of promisee's reliance must be that promisee suffer detriment if promise not fulfilled – HC said S established each of these elements – Rejected executors' submissions that, to give rise to equitable estoppel by encouragement, promisor must have engaged in conduct after promise which further encouraged promisee in course of conduct, action or omission adopted in reliance on promise, or that promisor must have had actual knowledge promisee was relying upon promise – Appeal dismissed.
Elisha v Vision Australia Ltd [2024] HCA 50 (11 December 2024)
Successful appeal from Victoria CA – Appeal principally concerned availability of damages for psychiatric injury to employee where injury arose from how employee's dismissed –
Vision Australia Ltd (VA) employed E in September 2006 – In March 2015, E involved in incident while staying at hotel during travel for work duties – Views differed over incident – Incident reported to E's manager, who, in email correspondence with VA human resources staff, said was unsurprised by allegation given previous reported allegations of aggressive behaviour – On 19 May 2015, E met with manager who told him of "serious" complaint and gave him "stand down letter" requiring attendance at meeting two days later – Letter said meeting would be conducted according to VA enterprise agreement and enclosed "Vision 2015 Disciplinary Procedure" (2015 Disciplinary Procedure) – Allegations set out in stand down letter confined exclusively to misconduct during hotel incident –
At meeting, E denied allegations in letter – Next day, VA management meeting, including E's manager, preferred hotel proprietor's account of incident over E’s – Previous allegations informed decision – Previous allegations not put to E at meeting – E’s employment terminated on 29 May 2015 and he was subsequently diagnosed with major depressive disorder – In August 2020, E commenced proceedings claiming damages for psychiatric injury –
Primary judge said disciplinary process "a sham and a disgrace" and ruled VA breached 2015 Disciplinary Procedure, incorporated into E's employment contract, by failing to provide E with letter containing allegations upon which VA ultimately acted to terminate employment – Awarded damages for breach of contract, saying risk of psychiatric illness not too remote –
Rejected E’s alternative claim for damages for VA breaching duty of care to provide safe system of investigation and decision making for discipline and employment termination – Said claim rested on duty of care not presently recognised under common law – CA allowed VA’s appeal, saying: first, damages for psychiatric injury unavailable for breach of contract other than where psychiatric injury consequent upon physical injury caused by breach or where contract object to provide enjoyment or relaxation; and second, E's psychiatric injury too remote from VA's breach –
HC rejected VA's contention 2015 Disciplinary Procedure not incorporated into E's employment contract and said psychiatric injury part of class of physical or personal injury for which damages recoverable for breach of contract – In any case, said scope of contractual duty determined by reference to nature of liability parties might fairly be regarded as having been "willing to accept" – Further, HC majority said E's loss not too remote because kind of damage suffered (psychiatric injury) and general manner of its occurrence within reasonable contemplation of parties, at time of contract, as serious possibility – HC majority said unnecessary to consider whether VA owed E duty of care in tort alleged – Appeal allowed.
Frenkel v LA Micro Group (UK) Ltd [2024] UKSC 42 (11 December 2024)
Unsuccessful appeal from CA – Concerned true ownership of LA Micro Group (UK) Ltd (“UK”), UK company supplying computer hardware – UK set up in 2004 as joint venture between B and Californian company, LA Micro Group, Inc (Inc), which was itself owned equally by L and F –
UK had two shares, one held by B and one by L, also company’s directors – Before 2010, each share in UK held on trust: for B, as to 49 per cent (in other words, B 49 per cent ‘equitable’ owner of each share); and for Inc, for remaining 51 per cent – UK profits however to be split equally between B and Inc –
In 2010, L and F fell out – F told B that UK was B’s business and F wanted nothing more to do with it – L and B reached agreement on new arrangement (2010 Agreement), binding on Inc as well as B and L – Part that UK profits would be split equally between B and L (rather than Inc) – L also agreed to take on Inc’s debt to UK –
F subsequently claimed they owed (via Inc) share of UK profits – B and UK went to court seeking declaration that, following 2010 Agreement, B and L sole legal and beneficial owners of shares they respectively held – Inc said remained 51 per cent beneficial owner of each share –
HC originally upheld UK and B’s claim – Saying F disclaimed Inc’s interest in UK in 2010 – However, CA overturned and sent claim back to HC to consider several alternative arguments –
HC then said implied term of 2010 Agreement B and L would henceforth own share beneficially as well as legally, such that beneficial ownership of UK would be split 50/50 between them –
However, HC said agreement ineffective because not in writing and signed by Inc as required for dispositions of equitable interests (i.e. interests under trust, like Inc’s 51 per cent equitable beneficial ownership of shares in UK) by s 53(1)(c) Law of Property Act 1925 (LPA) –
CA disagreed, saying Inc contractually gave up beneficial interest and effective despite lack of signed writing because of way particular legal mechanism, ‘constructive trust,’ came into play, meaning transaction fell within exception in s 53(2) LPA –
Inc and F appealed to SC saying transaction ineffective because not signed and in writing as required by s 53(1)(c) LPA –
SC unanimously dismissed appeal – Failing to comply with requirement for signed writing under s 53(1)(c) LPA did not prevent 2010 Agreement from taking effect – Section 53(2) LPA said requirement for signed writing did not affect operation of constructive trust – Circumstances 2010 Agreement created gave rise to operation of purchaser-vendor constructive trust, so case fell within s 52(3) exception –
SC said vendor-purchaser constructive trust (VPCT) which typically arose whenever agreement for sale of property with regard to which courts would grant specific performance – Not disputed that 2010 Agreement subject matter equitable interests in shares in private company – Satisfied requirement – Appeal dismissed.
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