Atkinson v Sinclair
[2022] NZHC 919
•4 May 2022
IN THE HIGH COURT OF NEW ZEALAND WELLINGTON REGISTRY
I TE KŌTI MATUA O AOTEAROA TE WHANGANUI-A-TARA ROHE
CIV-2022-485-018
[2022] NZHC 919
BETWEEN PAUL ATKINSON and
GLYN MUMMERY as joint trustees in the bankruptcy of Thomas Ian Sinclair Applicants
AND
THOMAS IAN SINCLAIR
Respondent
Hearing: 3 May 2022 Appearances:
D MacKenzie for Applicants
Judgment:
4 May 2022
JUDGMENT OF ASSOCIATE JUDGE JOHNSTON
[1] This is an application made pursuant to the Insolvency (Cross-Border) Act 2006 and r 24.56 of the High Court Rules 2016 for an order recognising a foreign judgment. The respondent has not entered an appearance in the form of a notice of opposition or otherwise. However, on the evening prior to the hearing he sent an email to the Registrar which in very broad terms might be said to indicate his opposition to the order being sought. I will come back to that.
[2] Applications of this sort are made by originating application pursuant to pt 19 of the High Court Rules. Mr MacKenzie very properly drew my attention to the fact that the requirements of such applications contained in r 24.57 oblige an applicant, when filing an application, or within 25 working days of doing so, to apply for directions as to service under r 18.7 so that the Court may make directions as to service and any incidental orders that are considered just. As Mr MacKenzie said, the application in relation to service that was made in this proceeding did not comply with
ATKINSON v SINCLAIR [2022] NZHC 919 [4 May 2022]
that requirement. Whilst it was made within the required timeframe, what the applicant sought was an order for substituted service. I made such an order on 14 March 2022, and there is now affidavit evidence proving service of the originating documentation.
[3] Plainly the applicants did not comply strictly with the requirements of r 24.57. However, it is important to bear in mind that the overarching object of the Rules is “to secure the just, speedy, and inexpensive determination of any proceeding or interlocutory application” and that r 1.5 provides that a failure to comply with the requirements of the Rules is a mere irregularity that does not render the step in question a nullity, and goes on to provide in effect that the Court can provide relief from non-compliance so long as doing so is in the interests of justice.
[4] I am satisfied that it is in the interests of justice to grant the applicants relief in this case. The question of service was put squarely before the Court although not in the most appropriate form. Having reviewed the pleadings and evidence, it appears to me that, had there been an application for directions for service, the Court would in any event have directed service only on the defendant.
[5] That brings me to the substantive application. Mr MacKenzie filed submissions prior to the hearing to which he spoke. In the circumstances, and particularly in the absence of any formal opposition, I propose simply to summarise the position.
[6] Litigation involving Michael Wilson & Partners Ltd and Mr Sinclair has been carrying on for several years. As I understand it the core dispute arises from an allegation made by the Company that Mr Sinclair and others breached its intellectual property rights. Aspects of the dispute have been litigated in courts throughout the world. However, the core dispute was the subject of arbitral proceedings in London, and is now before the English High Court. On 5 March 2021 the English High Court made an order bankrupting Mr Sinclair — essentially on account of his refusal or inability to pay a multi-million pound costs award arising from the arbitration. The Court also made an order appointing the applicants as the trustees of Mr Sinclair’s bankrupt estate including his world-wide assets.
[7] The applicants believe that Mr Sinclair may own assets in New Zealand. He certainly has some connections with New Zealand. He has been an active participant in litigation here. This litigation concerned property here that he was said to own.
[8] Accordingly, the applicants seek the order they do in order to enable them to make the necessary enquiries and enforce the English High Court’s order in New Zealand if it transpires that Mr Sinclair has assets here.
[9] The Insolvency (Cross-Border) Act effectively implements the UNCITRAL model law governing cross-border insolvency proceedings in this country. The starting point is Chapter III, Article 15(2), which provides that an application for recognition of a foreign judgment is to be accompanied by:
(a)a certified copy of the decision commencing the foreign proceeding and appointing the foreign representative; or
(b)a certificate from the foreign court affirming the existence of the foreign proceeding and of the appointment of the foreign representative; or
(c)in the absence of evidence referred to in subparagraphs (a) and (b), any other evidence acceptable to the Court of the existence of the foreign proceeding and of the appointment of the foreign representative.
[10] I am satisfied that the requirements of Chapter III, Article 15 are met. The affidavit evidence includes a copy of the sealed judgment of the English High Court on which the application is based, and a certificate made on behalf of the Secretary of State as to the appointment of the applicants. Even if the former is not, technically, a certified copy of the English High Court’s judgment, and the latter is not a certificate from the English High Court, I am satisfied in terms of Article 15(2)(c) that the affidavit evidence demonstrates beyond any serious question the existence of the proceeding in that Court and the order made appointing the applicants in the terms already described.
[11]The next relevant provision is Chapter III, Article 17(1) which provides:
(1)Subject to article 6 a foreign proceeding shall be recognised if:
(a)the foreign proceeding is a proceeding within the meaning of subparagraph (a) of article 2;
(b)the foreign representative applying for recognition is a person or body within the meaning of subparagraph (d) of article 2;
(c)the application meets the requirements of paragraph (2) of article 15; and
(d)the application has been submitted to the High Court.
It seems clear that all of those requirements are met in this case.
[13] The definition of “foreign proceeding” includes a “judicial or administrative proceeding in a foreign state, including an interim proceeding, pursuant to a law relating to insolvency in which proceeding the assets and affairs of the debtor are subject to control or supervision by a foreign court, for the purposes of reorganisation or liquidation”. The proceeding in the English High Court falls within that definition.
[14] The definition of “foreign representative” is a person or body, including one appointed on an interim basis, authorised in a foreign proceeding to administer the reorganisation or the liquidation of the debtor’s assets or affairs or to act as a representative of the foreign proceeding”. The applicants fall within that definition.
[15]I have already addressed the requirements of Article 15(2).
[16]Clearly the application is before this Court.
[17]That brings me to Mr Sinclair’s email.
[18] This appears to have been sent at 7.11 pm (NZ time) on the evening prior to the hearing. It is addressed to the Registrar. I set it out in full:
I understand there is an application to be heard May 3rd in Wellington regarding my bankruptcy affairs.
I respectfully wish to inform the NZ Court of the following below and attached:
I was discharged from the UK Bankruptcy March 9th 2022 as brought by MWP.
The Wellington address on the application is my sister and her husband address, I have never lived there, purely a postal address.
From March 2020 to March 2021 I was in NZ for family reasons, funerals and Covid delays to potential business projects overseas staying with friends.
I am currently in Dubai, UAE, staying with friends.
I am a litigant in person and still struggling financially and I do not have current NZ legal representation but was previously represented by Mr JD Dallas (cced) in the past.
I do not understand why such a vexatious and perverted fishing expedition application is before the NZ Court.
I have been based overseas/non-NZ resident for the last ~ 30 years.
I do not have any assets in NZ, and only occasionally operate an ANZ bank account I have had since childhood.
I am willing to assist the NZ Court further, however I am on UAE timezone. [Email is signed by Mr Sinclair.]
[19] Notwithstanding the informality of Mr Sinclair’s email I have given consideration to the points he makes, which seem to come down to these:
(a)first Mr Sinclair says that he has been released from bankruptcy in the United Kingdom and has attached a copy of what appears to be a letter from the UK Insolvency Service confirming that. I assume, for present purposes, that Mr Sinclair was released from bankruptcy on 9 March 2022 as the letter says. That is irrelevant to the current application, except to the extent that it may impose some limits on the assets that the applicants may access. The fact that Mr Sinclair may now have been released from bankruptcy simply means that the applicants’ attention will be focussed on the period down to the date of Mr Sinclair’s release;
(b)second, Mr Sinclair claims to have no assets in New Zealand. The Court is not in any position to make an assessment of that, and nor would it be appropriate for the Court to do so. The purpose of this application is to enable the applicants to ascertain whether or not there are any assets to which they are entitled as trustees of his bankrupt estate.
[20] In short then, there is nothing in Mr Sinclair’s email that can stand in the way of the applicants obtaining the order they seek.
[21] I therefore make an order in the terms sought in paragraphs 1.1 and 1.2 of the applicants’ originating application dated 22 December 2021.
[22] The applicants are entitled to their costs of and concerning this application on a 2B basis together with such disbursements as may be allowed by the Registrar. I authorise the Registrar to settle the costs and disbursements.
Associate Judge Johnston
Solicitors:
Sharp Legal, Wellington for applicants
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