BDO Manawatu Limited v Bell - [2013] NZHC 3189

IN THE HIGH COURT OF NEW ZEALAND WELLINGTON REGISTRY

CIV-2013-485-6845 [2013] NZHC 3189

UNDER the Insolvency Act 2006

IN THE MATTER of the bankruptcy of ROBERT ARTHUR BELL

BETWEEN BDO MANAWATU LIMITED Judgment Creditor

ANDROBERT ARTHUR BELL Judgment Debtor

Hearing: 27 November 2013

Counsel: O J B Lee for Judgment Creditor
Judgment Debtor in Person

Judgment: 2 December 2013

JUDGMENT OF GODDARD J

This judgment was delivered by me on 2 December 2013 at 3.30 pm, pursuant to r 11.5 of the High Court Rules.

Registrar/Deputy Registrar

Solicitors:
Duncan Cotterill, Wellington for Judgment Creditor

BDO MANAWATU LIMITED v BELL [2013] NZHC 3189 [2 December 2013]

[1] Before the Court are two applications by Mr Bell, the judgment debtor: an application to set aside a bankruptcy notice dated 4 October 2013, which was served on Mr Bell on 7 October 2013; and an application to set aside a sealed judgment of the District Court dated 16 September 2013. The District Court judgment is in favour of BDO Manawatu Ltd (BDO) in the total sum of $53,849.14 and is in the following terms:

This proceeding was heard on 30 August 2011 and 3 October 2011 at Porirua District Court before the Honourable Judge C N Tuohy, who, having heard from A Darroch, counsel for the Plaintiff and the Defendant in person, and having heard the evidence adduced, and following an appeal being dismissed by the Honourable Justice Williams on 11 July 2012 and the dismissal of two recall applications dated 31 May 2013 and 3 September 2013, the Plaintiff is entitled to:

1. Judgment in the sum of $5,596.70;

2. Interest totalling $1,363.97 to 31 May 2013;

3.Costs in the sum of $38,877.58 in relation to the District Court hearing; and

4. Costs on the appeal in the sum of $8,010.89.

Total - $53,849.14 to 31 May 2013. Date: 16 September 2013

“Asha Prasad”
(Deputy) Registrar

Brief history

[2] On 9 December 2011, BDO obtained the above referred to judgment in the District Court at Porirua in the sum of $10,793.71 in damages plus interest calculated at $11,554.59.

[3] Judge Tuohy concluded the judgment by making the following provision for an award of costs in favour of BDO:

The plaintiff is to make the necessary calculations and present a judgment for approval and sealing which should have attached a schedule of legal costs with sufficient detail to enable the Court to assess whether they are reasonable.

[4] Subsequently, costs in the District Court were fixed on a solicitor-client basis in the sum of $38,877.58. Had costs been awarded on a category 2B basis they would have totalled around $18,000.00. It appears however that costs were sought on a solicitor-client basis because a Calderbank offer made by BDO to settle the matter prior to trial on a without prejudice basis, except as to costs, had not been accepted by Mr Bell.

[5] Mr Bell appealed against Judge Tuohy’s decision in the District Court decision, both as to result and as to quantum and…

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: [2013] NZHC 3189
Decision Date: 2 December 2013

CaseChat Overview and Summary

BDO Manawatu Limited brought an application against Robert Arthur Bell, the judgment debtor, seeking to enforce a bankruptcy notice and a sealed judgment against him. The dispute involved a legal battle over a judgment debt of approximately $53,849.14. The central legal issues the court had to decide were whether the bankruptcy notice and the sealed judgment could be set aside. The court had to consider the procedural aspects of the bankruptcy notice, the correctness of the sealed judgment, and the implications of the prior judgments and appeals on the current applications.

The court examined the procedural history and prior judgments, noting that Mr Bell's notice of opposition to the bankruptcy notice was served out of time, although filed within the time limit. The court also considered the inherent jurisdiction to look behind a judgment and the difficulty in doing so where a full hearing had already taken place. The court found that there was an error in the sealed judgment relating to the interest figure, which should be corrected. The court reduced the judgment sum from $53,849.14 to $52,485.17. The court also noted that while Mr Bell partially succeeded in his application, no costs order would be made as he represented himself.

The court concluded that the District Court judgment could be amended under section 66(6) of the District Courts Act 1947, and directed the amendment of the certificate of final judgment. The court also directed that the bankruptcy notice be amended and served again, with strict adherence to the time limits for any future applications to set it aside.

Orders