Banks v Grey District Council - [2017] NZCA 216

IN THE COURT OF APPEAL OF NEW ZEALAND

CA81/2017
[2017] NZCA 216

BETWEEN	DOUGLAS BANKS AND CHRISTINE SANDRA BANKS Appellants
AND	GREY DISTRICT COUNCIL Respondent

Counsel:

Appellants in person
J Shackleton and N A Taylor for Respondent

Judgment:

(On the papers)

26 May 2017 at 10.00 am

JUDGMENT OF FRENCH J
(Review of Registrar’s Decision)

AThe application for review of the Registrar’s decision dispensing with payment of security for costs is granted.
BThe appellants are ordered to pay security for costs in the sum of $6,600 within 20 working days.

____________________________________________________________________

REASONS

Introduction

Mr and Mrs Banks have filed an appeal against a decision of Associate Judge Matthews adjudicating them bankrupt.[1] Security for costs on the appeal was set at $6,600 but on application by Mr and Mrs Banks, the Registrar dispensed with payment of security.
[1]Grey District Council v Banks HC Greymouth CIV-2016-418-22, 3 February 2017.
The respondent, the Grey District Council, now applies for a review of the Registrar’s decision. Mr and Mrs Banks oppose the review and have filed submissions seeking to uphold the decision.

Background

In the course of protracted litigation between the Banks and the Council over a lease, six different costs orders were made against the Banks. The costs totalling approximately $84,000 were not paid and on 5 August 2016 the Council served bankruptcy notices on Mr and Mrs Banks, relying on one of the costs orders. Mr and Mrs Banks applied to have the bankruptcy notices set aside but were unsuccessful.[2] The Council then applied to have both Mr and Mrs Banks adjudicated bankrupt.
[2]Grey District Council v Banks [2016] NZHC 2663.
Following a hearing on 3 February 2017, Associate Judge Matthews made orders adjudicating Mr and Mrs Banks bankrupt. The Council wanted the orders to be effective immediately. The Banks wanted more time to be able to pay all of the money owing to the Council. They told the Judge they had so far organised approximately $44,000 to be made available on 16 February 2017. The Judge considered some recognition was warranted for the fact the Banks had, albeit belatedly, made a realistic attempt to meet a major part of the total indebtedness. He therefore directed that the adjudication orders were to lie in Court until 1 pm on Friday 17 February 2017 to allow the Banks a final opportunity to clear up their indebtedness to the Council in full.
Mr and Mrs Banks failed to make payment of the total amount outstanding by the due date and accordingly the orders took effect.[3]
[3]Grey District Council v Banks [2017] NZHC 190.
The time for appealing all of the costs orders that comprise the underlying debt has expired.

Decision under review

In her decision, the Registrar found that Mr and Mrs Banks are impecunious. She also found the appeal had merit and that the benefits to be obtained from the appeal appeared to outweigh the potential costs, if only slightly. Taken together those matters amounted to exceptional circumstances…

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: [2017] NZCA 216
Decision Date: 26 May 2017 at 10.00 am

CaseChat Overview and Summary

In the Court of Appeal of New Zealand, the appellants, Douglas Banks and Christine Sandra Banks, appealed a decision by Associate Judge Matthews that they be adjudicated bankrupt. The respondent, Grey District Council, applied for a review of the Registrar's decision to not require the Banks to pay security for costs. The Court of Appeal granted the application for review and quashed the Registrar's decision, ordering the appellants to pay security for costs in the sum of $6,600 within 20 working days.

The legal issues before the court were whether the Registrar was correct in dispensing with the requirement for security for costs on appeal and if the appeal had merit. The court found the Registrar's decision was based on a mistake in the merits assessment of the appeal and that the appeal had little or no prospect of success. The court also found that the appeal did not involve any significant public interest and that it was not just to require the Council to defend the appeal without security for its costs.

The court held that the Registrar's finding that the Banks were impecunious was correct, but impecuniosity alone is not sufficient to justify dispensing with security. The appeal must be one which a solvent appellant would reasonably wish to pursue. The court found that the appeal did not meet this criterion as it had little or no prospect of success and did not involve any significant public interest.

The final orders of the court were that the application for review of the Registrar’s decision dispensing with payment of security for costs was granted, and the appellants were ordered to pay security for costs in the sum of $6,600 within 20 working days.

Orders