Ben View Farms Ltd v GE Capital Returnable Packaging Systems Ltd HC Auckland AP 24/SW01

[2001] NZHC 735

IN THE HIGH COURT OF NEW ZEALAND
AUCKLAND REGISTRY AP 24/SW01 M 1022/01

BETWEEN BEN VIEW FARMS LIMITED
Applicant/Appellant

AND GE CAPITAL RETURNABLE PACKAGING SYSTEMS LIMITED
Respondent

Hearing: 15 August 2001

Counsel: F G Herbert for Applicant/Appellant
L K O’Connor for Respondent

Judgment: 15 August 2001

JUDGMENT OF FISHER J

Solicitors:
Rice Craig, P.O. Box 72 440, Papakura, Auckland for Applicant/Appellant
Simpson Grierson, Private Bag 92518, Auckland for Respondent

[1] Before the Court for determination are an application to reinstate a withdrawn civil appeal and a consequential application to set aside a statutory demand. A seemingly novel legal question is raised as to the jurisdiction of this Court to reverse an earlier decision on the ground that one of the counsel involved was mentally disabled at the time that he took a critical step in the proceedings.

[2] The facts are that after a defended hearing in the District Court, GE Capital obtained summary judgment against Ben View Farms for about $30,000. Ben View Farms appealed. It instructed A as counsel, he having also acted on the summary judgment hearing. When the matter was called at a callover in this Court on 18 April 2001, A indicated that the appeal would be withdrawn. The appeal was adjourned to the Duty Judge list on 9 May 2001 when it was dismissed on A’s application. In consequence on 2 July 2001 GE Capital served on Ben View Farms a statutory demand for $30,685.63, that being the sum owing pursuant to the District Court judgment which now stood unchallenged.

[3] Unfortunately it turned out that A had been mentally ill at the time that he withdrew the appeal. It is true that the evidence before me does not include any medical report or certificate as it ought to have. However, there can be no room for equivocation over the mental illness given the undisputed evidence that shortly after that he was committed to hospital under the Mental Health Act, the lay evidence describing his illness, and the fact that he had no authority to withdraw the appeal.

[4] The result was that Ben View Farms had to apply to this Court to reinstate the appeal and set aside the statutory demand. The dominant question is whether the appeal can and should be reinstated. If it is reinstated there would appear to be appropriate grounds for setting aside the statutory demand, subject obviously to GE Capital’s right to issue another statutory demand if and when the appeal is dismissed.

[5] The first question is whether there is jurisdiction to reinstate the appeal. The well known article by Master Jacob “The Inherent Jurisdiction of the Court” [1970] CLP 23, and many authorities such as R v Duval (1995) 3 NZLR 203, support the general existence of an inherent jurisdiction to take such steps as may be necessary to safeguard the integrity of the Court’s own processes where to do so would not
expressly or impliedly conflict with any legislative provision to the contrary. Somewhat closer to the present situation is the inherent jurisdiction of the Court to set aside a discontinuance in civil proceedings, as to which see Clemance v Cleary [1995] 9 PRNZ 194.

[6] There have been several decisions in the Court of Appeal, including R v Nakhla (No 2) [1974] 1 NZLR 453, 457; Broadcasting Corporation of New Zealand v Attorney-General [1982] 1 NZLR 120, 127 and R v Elwin(CA 292/97, 25 September 1999), drawing attention to limitations in the power of that Court to re-open appeals once determined. However in that context a contrast has been expressly drawn between the purely statutory jurisdiction of that Court and the inherent jurisdiction of this one (R v Elwin supra at p 4). Even in the Court of Appeal, a purported abandonment can be withdrawn later in special circumstances: R v Pelikan [1959] NZLR 1319; R v MacKay [1980] 2 NZLR 490.

[7] The High Court has an inherent jurisdiction to protect the effectiveness of its own processes in order to avoid miscarriages of justice, at least in circumstances where remedial steps would not expressly or impliedly conflict with legislation to the contrary. Where counsel purportedly appearing for a party in this Court is in fact unable to do so in any meaningful way due to mental disability the Court’s own processes have malfunctioned. For this purpose I would regard a barrister appearing before the Court as one of its own officers.

[8] I am not aware of any legislative impediment to a remedy in this situation. Consequently it seems to me that the Court must have an inherent jurisdiction to step in to avoid any miscarriage of justice which might otherwise result. There would normally be a miscarriage of justice if, without fault on his or her part, a party has been significantly prejudiced by some incompetent or unauthorised act or omission attributable to the mental disability of his or her counsel. Whether a remedy is then appropriate must still be subject to a discretion. Important in the exercise of that discretion will be a comparison between the prejudice to the client on the one hand and the possibility that the other party has acted in reliance on what occurred in a way that can not be adequately redressed in costs, on the other.

[9] For those reasons I accept that there is jurisdiction to reinstate the appeal in the present case if grounds for it can be made out on the facts. I accept that withdrawal of this appeal was due to the ill health of counsel. There does not appear to have been any authority or instruction to withdraw the appeal. Ms O’Connor points out that before the formal withdrawal her firm sent a letter to Ben View Farm’s solicitors recording, among other things, that that was about to happen. In an ideal world those solicitors would have known what was going on with the file and checked with the barrister or the client. However, experience suggests that in New Zealand proper duties and relationships between barristers, solicitors and clients are not always understood and observed. The sworn evidence of the client in this case is that it had no knowledge of the proposed withdrawal of the appeal and certainly did not approve it. There is no reason for questioning that evidence. Nor is there anything to suggest contributory fault on the client’s part.

[10] In those circumstances I do not think that the incapacity from which counsel was suffering should be visited upon his client if undue injustice to GE Capital can be avoided. One must sympathise with GE Capital for the trouble it has been put to. As Ms O’Connor says, one way of addressing that would be to leave it to Ben View Farm and its lawyers to resolve as an issue between them alone. However, for present purposes A is to be treated as an officer of this Court. In my view the greater duty is for this Court to protect litigants against the malfunctioning of its own processes. GE Capital can be adequately protected by awarding it costs on a solicitor-client basis for all steps taken since the withdrawal of the appeal.

[11] I make orders reinstating the appeal and setting aside the statutory demand served on 2 July 2001. Ben View Farms must pay costs to GE Capital in the sum of $3,250 including disbursements.