BBS 2006 Limited v Denzie, Denzie as Trustee of the Denize Family Trust HC Auckland CIV 2010-404-2333

[2010] NZHC 1642

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

CIV-2010-404-002333

BETWEEN  BBS 2006 LIMITED Plaintiff

ANDJOHNATHAN PETER TAPLEN DENIZE, BRONWYN MAY DENIZE AS

TRUSTEE OF THE DENIZE FAMILY TRUST AND JP & BM HOLDINGS LIMITED

Defendants

Hearing:         27 August 2010

Appearances: Ms J Lethbridge for Plaintiff

Ms E James and Ms K Dawson Defendants

Judgment:      27 August 2010

ORAL JUDGMENT OF ASSOCIATE JUDGE DOOGUE

Solicitors:

Grove Darlow & Partners, P O Box2882, Auckland – by email: [email protected]
Knight Coldicutt, Private Box 106-214, Auckland –

by email: [email protected] / [email protected]

BBS 2006 LIMITED V  DENIZE & ORS HC AK CIV-2010-404-002333  27 August 2010

[1]      This matter had a half-day fixture today.  Most of the morning has been taken up with arguments over what evidence should or should not be heard as part of the defended fixture.  The result is I have now reached 12.20 p.m. and we still have not embarked upon arguments on the substantive issues and the fixture will have to be adjourned.

[2]      The main problem here has been the filing of further affidavits.   The key issue in the case it seems to me from my reading of the materials is whether the venture between the parties has achieved a profit and a subsidiary issue is whether there is sufficient information available at this point to determine whether or not there has been a profit.  I would have thought that these issues were clearly raised by the defendants in the notice of opposition filed on 4 June 2010.  The defendants then seemed to identify nearly all the issues about which there has been argument today and yet here we are some two months on or more and further material is being filed at a late stage.  There may be two reasons for that.  The first is a misunderstanding of what rights a defendant has to file affidavits after the applicant’s affidavits in reply have been filed.   In general there is no such right.  The proper course to take if a party considers that the affidavits in reply go beyond being strictly in reply is to invite  the  Court  to  decline  to  read  those  affidavits  or  the  offending  parts. Alternatively a prompt application can be made to the Court to reopen the affidavits. What is not permissible is to file affidavits at the last minute in the near certainty that that will derail the fixture.

[3]      Affidavits have now been filed without consent of the Court by Mr Denize one of the defendants and by Mr Sparrow an accountant who provides accountanting services to Mr Denize and possibly other defendants.   The affidavit concerns two matters.   First of all the key issue that I identified above whether the project had made a profit.  The second matter that is gone into is what the defendants will need if they are to exercise what they assert is their right to have an audit carried out of the accounts of the enterprise.  There seems to be no controversy that whatever previous delays there might have been with the accounts they were available to the defendants at the end of June 2010.  If time was required to make an application for leave to file further affidavits there was more than adequate time to do that and for that to be

accomplished before today’s fixture.   I will say no more about that aspect of the matter.

[4]      The new affidavits having been filed it seems to me that there must be yet another round of reply affidavits and I direct that any further affidavit/s are to be filed and served by 27 September 2010.  Those affidavits are to be strictly in replyto the latest affidavits filed by Mr Denize and by Mr Sparrow.  Given the unfortunate procedural history in this case I further direct that no further affidavits of any kind are to be filed and served without the express leave of the Court.

[5]      The proceeding is adjourned for a further fixture before me at 10 a.m. on 28

October 2010.  It will necessary for the a supplementary bundle continuing the same pagination as the existing bundle to be filed and served and that is to occur 10 working days prior to the fixture.  On the same date the plaintiff is to file and serve a consolidated synopsis of submissions – that is containing the material already filed and any new material in one document.

[6]      The defendants are to file and serve synopsis five working days prior to the fixture.

[7]      I take the view, as I have already mentioned, that today’s fixture could have been salvaged had prompt steps been taken by the defendants to seek leave or even at the conference before Associate Judge Abbott when this matter was first set down, to obtain a timetable for that purpose.   The loss of the fixture today is their responsibility.   There will therefore be an order that the defendants are to pay the costs on a 2B basis of today’s appearances.

[8]      The final matter I mention is that of discovery – because the defendants claim that they are entitled to discovery,  I am not prepared to make an order for discovery at  this  point.    There  is  authority to  the  affect  though  that  in  appropriate  cases summary judgment can be declined in order to give a defendant the opportunity to seek discovery and no doubt if the defendants think there is anything in the point they can raise that in the course of their submissions at the renewed hearing.

J.P. Doogue

Associate Judge