Avon Parnell Limited v Chevin - [2019] NZHC 2582

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

I TE KŌTI MATUA O AOTEAROA TĀMAKI MAKAURAU ROHE

CIV-2019-404-1119

[2019] NZHC 2582

BETWEEN
AVON PARNELL LIMITED

First Plaintiff

RYAN MATTHEW LEGGATT
Second Plaintiff

AND

PETER LOUIS CHEVIN

First Defendant

CLARK VINCENT VALMONT AND RUSSELL PKR TRUSTEE LIMITED

Second Defendants

…/cont

Hearing: 9 October 2019

Appearances:

D Chisholm QC for the Plaintiffs

M A Corlett QC for the First Defendant

S Lowry for the Second, Fourth and Fifth Defendants M A Cavanaugh for the Third Defendant

Judgment:

11 October 2019

JUDGMENT OF GORDON J

This judgment was delivered by me on 11 October 2019 at 10 am, pursuant to r 11.5 of the High Court Rules

Registrar/Deputy Registrar Solicitors: Peter Nolan, Auckland

I M Vodanovich, Auckland Greenwood Roche, Auckland Wootton Kearney, Auckland Evans Bailey, Hamilton

Counsel:D Chisholm QC, Auckland M Corlett QC, Auckland
S Lowery, Auckland
D M O’Neill, Hamilton

AVON PARNELL LTD v CHEVIN [2019] NZHC 2582 [11 October 2019]

GRAEME HAYWARD SKEATES
Third Defendant

NORTHERN INVESTORS TRUSTEE LIMITED
Fourth Defendant

VIADUCT HARBOUR NOMINEES LIMITED
Fifth Defendant

BASECORP FINANCE LIMITED
Sixth Defendant

[1] The plaintiffs, Avon Parnell Ltd (APL) and its director Ryan Leggatt, commenced proceedings alleging that the first defendant, Peter Chevin, had made fraudulent amendments to the Companies Office particulars of APL to incorrectly represent that the first named second defendant, Clark Valmont, was the sole director and the second named second defendant, Russell PKR Trustees Ltd (Russell PKR), was the sole shareholder; and that Mr Chevin then procured a loan in the name of APL from the sixth defendant, Basecorp Finance Ltd (Basecorp), secured against APL’s properties.

[2] Mr Chevin did not file a statement of defence in the prescribed time. Accordingly, the plaintiffs applied for formal proof against Mr Chevin. Mr Chevin now applies for leave to file a statement of defence out of time. The plaintiffs oppose leave being granted.

[3] Both applications were for hearing before me. The parties agreed that the application for leave to file a statement of defence should proceed first. If that application were to succeed, then the formal proof application would be dismissed.

[4] I granted Mr Chevin’s application (on conditions) and accordingly dismissed the application for formal proof. These are my reasons.

Background

[5] The facts which give rise to these proceedings were succinctly summarised by Palmer J in his judgment of 19 June 2019 granting freezing orders. I adopt that summary for the purposes of this judgment:1
[1] The first plaintiff, Avon Parnell Ltd (APL), owns two properties in Parnell, Auckland, on trust for Waihapu Ltd. Mr Tim Edney is the principal of Waihapu Ltd. The second plaintiff, Mr Ryan Leggatt, is the sole shareholder and director of APL and is Mr Edney’s son in law.

[2] Mr Peter Chevin [the first defendant] has been made bankrupt on four occasions and has criminal convictions for dishonesty offences. The plaintiffs believe Mr Chevin, who assisted with the incorporation of APL in April 2015, retained APL's log in and/or…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

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Details

Case: [2019] NZHC 2582
Decision Date: 11 October 2019

CaseChat Overview and Summary

The case of Avon Parnell Limited and Ryan Leggatt against Peter Louis Chevin, Clark Vincent Valmont, Russell PKR Trustee Limited, Graeme Hayward Skeates, Northern Investors Trustee Limited, Viaduct Harbour Nominees Limited, and Basecorp Finance Limited, was heard in the High Court of New Zealand Auckland Registry. The plaintiffs, Avon Parnell Limited and its director, Ryan Leggatt, alleged that Peter Chevin, the first defendant, fraudulently amended the Companies Office particulars of Avon Parnell Limited, incorrectly representing that Clark Valmont, the first named second defendant, was the sole director and Russell PKR Trustee Limited, the second named second defendant, was the sole shareholder. The plaintiffs further alleged that Mr. Chevin procured a loan in the name of Avon Parnell Limited from Basecorp Finance Limited, secured against its properties. The primary legal issue before the court was whether Mr. Chevin should be granted leave to file a statement of defence out of time. The court considered three key factors: whether Mr. Chevin had a substantial ground of defence, whether the delay was reasonably explained, and whether the plaintiffs would suffer irreparable injury if judgment was set aside. The court found that the delay was not lengthy, the plaintiffs had not suffered injury from the delay, and Mr. Chevin's defence was sufficient for the purposes of the application. The court granted Mr. Chevin leave to file a statement of defence but on conditions. The first defendant was to file and serve a statement of defence in response to the amended statement of claim and issue a third party notice by a specified date. The first defendant was also to pay the plaintiffs' costs on a 2B basis. The court dismissed the plaintiffs' application for formal proof.

This case highlights the importance of adhering to court timetables and the consequences of failing to do so. The court balanced the need for strict compliance with procedural rules against the potential injustice of preventing a party from presenting their defence. The court granted leave to file a statement of defence out of time, but only on conditions that the defendant pay the plaintiffs' costs and file a statement of defence by a specified date. This outcome ensures that the plaintiffs are not prejudiced by the delay, while still allowing the defendant an opportunity to present their defence.

Orders