Cain v Mettrick
[2022] NZHC 258
•23 February 2022
IN THE HIGH COURT OF NEW ZEALAND CHRISTCHURCH REGISTRY
I TE KŌTI MATUA O AOTEAROA ŌTAUTAHI ROHE
CIV-2018-409-000548
[2022] NZHC 258
IN THE MATTER of an application by Crux Publishing
Limited to access court documents pursuant to the Senior Courts (Access to Court Documents) Rules 2017
BETWEEN
R J CAIN and R G LOGAN as liquidators of STONEWOOD HOMES LIMITED (In
Receivership and Liquidation),
STONEWOOD HOMES NEW ZEALANDLIMITED (In Receivership and Liquidation) and HOLMFIRTH GROUP LIMITED (In
Receivership and Liquidation) Plaintiffs
AND
B A METTRICK
First Defendant
AND
J BOULT
Second Defendant
Hearing: On the papers Counsel:
R K P Stewart for Applicant M Colson QC for Plaintiffs
W J Palmer for First Defendant
G J Ryan and N J McKessar for Second DefendantJudgment:
23 February 2022
JUDGMENT OF ASSOCIATE JUDGE PAULSEN
This judgment was delivered by me on 23 February 2022 pursuant to Rule 11.5 of the High Court Rules
Registrar/Deputy Registrar Date:
CAIN v METTRICK (Media Access) [2022] NZHC 258 [23 February 2022]
[1]This judgment concerns a media request for access to the court file.
[2] The plaintiffs are the liquidators of Stonewood Homes Ltd, Stonewood Homes New Zealand Ltd and Holmfirth Group Ltd. The defendants are former directors of the companies. The second defendant (Mr Boult) is presently the Mayor of the Queenstown Lakes District.
[3] The plaintiffs brought this proceeding seeking damages over alleged breaches of directors’ duties and the recovery of remuneration received by the defendants. The claims were defended. The litigation was settled prior to trial and the proceeding discontinued. The terms of the settlement are partially confidential, but the plaintiffs have reported on the settlement in their statutory report dated 19 November 2021.
[4] Crux Publishing Ltd (Crux) publishes an online news website in the Queenstown, Wanaka and Central Otago areas and is a digital member of the New Zealand Media Council.
[5] Crux has applied, pursuant to rr 8 and 11 of the Senior Courts (Access to Court Documents) Rules 2017, for access to, and copies of, the following documents from the court file:
(a)All judgments, orders and minutes, including any record of the reasons given by a judge for the judgment, order or minute concerned.
(b)The pleadings filed by each party.
(c)Any other document in respect of which there is no claim of privacy or confidentiality by any party to the proceeding.
[6] The plaintiffs and the first defendant will abide the decision of the Court on Crux’s request. Mr Boult opposes it.
The Rules
[7] Under s 173(1) of the Senior Courts Act 2016 any person may have access to court information of a senior court to the extent provided by, and in accordance with, rules of court.
[8] The relevant rules are the Senior Courts (Access to Court Documents) Rules 2017 (“the Rules”).
[9] Rule 8(1) gives every person a right to access the formal court record relating to a civil proceeding. This is a civil proceeding.
[10] The term “formal court record” is defined in r 4. It includes some but not all documents that Crux wishes to access. It relevantly reads as follows:
formal court record means any of the following kept in a registry of the court:
…
a judgment, an order, or a minute of the court, including any record of the reasons given by a Judge:
[11] In respect to documents that are not part of the formal court record, the relevant provisions for present purposes are rr 11, 12 and 13.
[12] Rule 11(2) sets out the matters that a person applying for access must specify in their application. This includes sufficient particulars of the document so that the Registrar may identify it, and the reasons for asking for access to the document.
[13] Rule 11(7) provides that if a request for access is granted it can be granted on conditions.
[14] Rule 12 sets out the matters the Court must consider in determining a request for access under r 11. The Judge is required to consider the nature of, and the reasons given for, the request and to consider the following matters in so far as they are relevant to the request or any objection to the request:
(a)the orderly and fair administration of justice:
(b)the right of a defendant in a criminal proceeding to a fair trial:
(c)the right to bring and defend civil proceedings without the disclosure of any more information about the private lives of individuals, or matters that are commercially sensitive, than is necessary to satisfy the principle of open justice:
(d)the protection of other confidentiality and privacy interests (including those of children and other vulnerable members of the community) and any privilege held by, or available to, any person:
(e)the principle of open justice (including the encouragement of fair and accurate reporting of, and comment on, court hearings and decisions):
(f)the freedom to seek, receive, and impart information:
(g)whether a document to which the request relates is subject to any restriction under rule 7:
(h)any other matter that the Judge thinks appropriate.
[15] There is no presumption in favour of disclosure of information, nor is there any hierarchy of the relevant factors to be considered by the Court under r 12. A balancing of all relevant considerations is required.
[16] However, in addition, the Rules differentiate between three stages of proceedings and set three different approaches to the balancing process. Rule 13 provides that in applying r 12, the Judge must have regard to the following:
(a)before the substantive hearing, the protection of confidentiality and privacy interests and the orderly and fair administration of justice may require that access to documents be limited:
(b)during the substantive hearing, open justice has—
(i)greater weight than at other stages of the proceeding; and
(ii)greater weight in relation to documents relied on in the hearing than other documents:
(c)after the substantive hearing,—
(i)open justice has greater weight in relation to documents that have been relied on in a determination than other documents; but
(ii)the protection of confidentiality and privacy interests has greater weight than would be the case during the substantive hearing.
The formal court record
[17] The documents in the first category sought by Crux form part of the formal court record. Crux correctly submits that pursuant to r 8(1), every person has the right to access the formal court record relating to a civil proceeding subject to the qualifications in rr 6 and 7. Crux is entitled to obtain a copy of any judgment, order or minute of the Court and any record of the reasons given by a judge, to the extent that there is no enactment, order or direction prohibiting access or publication thereof.
Why is access being sought and the parties’ positions
[18] In relation to the other documents Crux seeks to access, the starting point is the nature of the request and the reasons for it. Crux considers this litigation is of public interest, particularly to the ratepayers of Queenstown due to Mr Boult being the Mayor and as he may seek election to public office in the future. Crux says it intends to write and publish a report of the proceeding and wishes to have access to source documents to ensure its reporting is fair and accurate.
[19] Crux understood access to documents on the file had been given to another media agency (Stuff Ltd) and considers it should at least be provided with the same documents. It appears, in this regard, that on 21 August 2018 Gendall J granted Stuff access to only the statement of claim and statement of defence filed in the proceeding.
[20] In support of its application, Crux emphasises the principle of open justice (r 12(e)) and the freedom to seek, receive and impart information (r 12(f)).
[21] Mr Boult submits that, while r 13 is silent on the position when a settlement has been reached, the application is to be considered at the stage “before substantive hearing” and it follows privacy and confidentiality factors, and the orderly and fair administration of justice, may require access to documents on the court file being limited.
[22] Consistent with this, Mr Boult submits the most relevant factors in assessing Crux’s application are the orderly and fair administration of justice (r 12(a)), the right
to bring and defend civil proceedings without the disclosure of any more private or commercially sensitive information than is necessary to satisfy the principle of open justice (r 12(c)), the protection of confidentiality and privacy interests (r 12(d)), and other matters (r 12(h)). In relation to “other matters”, Mr Boult challenges Crux’s motives for making the application. He considers its real motive is to harm his reputation and in support of this has provided examples of articles published by Crux and correspondence from it which he says is unbalanced, inaccurate, speculative and inflammatory.
[23] Mr Boult considers the principles Crux relies upon, open justice (r 12(e)) and the freedom to seek, receive and impart information (r 12(f)), are not strong factors in this case.
[24] Applied to the facts, Mr Boult says Crux’s application should be refused because:
(a)The proceeding has been discontinued and the parties have entered into a settlement agreement with no admission as to liability which is significantly governed by confidentiality.
(b)There is minimal, if any, remaining public interest in the matter as a consequence of the settlement.
(c)The subject matter of the proceeding has already been substantially reported, as has the settlement, by Crux and other media outlets and the plaintiffs.
(d)As a consequence of the settlement and the incomplete nature of the court file, there is little prospect of fair and balanced reporting of the later stages of the proceeding, even by an independent and impartial media body.
(e)The applicant has shown by its actions to have a biased and partial view against Mr Boult and there is a high risk of unfair and unbalanced reporting.
[25] I note that in reply to Mr Boult’s submissions, Crux did not take issue with the proposition that prior to (and after) a substantive hearing parties are entitled to the protection of confidentiality and privacy but says that must be within reasonable limits.
Some case law
[26] The case of Crimson Consulting Ltd v Berry involved a media request for access to court documents, made after settlement and discontinuance of a High Court proceeding prior to trial.1 In the High Court, Palmer J had granted access to redacted versions of the statement of claim and statement of defence.2 That decision was upheld by the Court of Appeal which found:
(a)No particular factor in r 12 has paramountcy over any other (including the principle of open justice).3
(b)The principle of open justice is fundamental to the common law system of civil and criminal justice and is engaged when access involves media organisations who wish to investigate and report on proceedings.4
(c)Where the access application relates to a dispute between private entities that was settled and there was no hearing, other matters set out in r 12 other than the principle of open justice have particular significance.5
1 Crimson Consulting Ltd v Berry [2018] NZCA 460.
2 Berry v Crimson Consulting Ltd [2017] NZHC 3026.
3 At [16] referring to Schenker AG v Commerce Commission [2013] NZCA 114, (2013) 22 PRNZ 286 at [21], [29] and [37].
4 At [33].
5 At [34].
(d)Rule 12(a), which refers to the orderly and fair administration of justice, gives focus to the undesirability of interfering with access to justice through the courts by discouraging the filing of proceedings because of the fear of damaging or embarrassing publicity.6
(e)When matters were still at the pleading stage, there is an element of unfairness on the parties in the publication of one side of the story. There being no hearing in court, the need for transparency and public scrutiny is less because pre-trial the court is generally not determining substantive issues.7
(f)The principle of open justice, and the freedom to seek information, are important factors which do not cease to work in the pre-trial stage.8
(g)It is important the public know generally what type of business is being conducted in the courts of New Zealand and transparency of the court process at all stages is in the public interest.9
(h)Reporting on a statement of claim and a statement of defence, provided it is fairly done, is one way of informing the public so that the business of the courts is known and transparent.10
[27] The Court of Appeal allowed access to the redacted statement of claim and statement of defence but refused access to the evidence and memoranda on the court file. It considered this struck the right balance because:11
Commercial sensitivity is maintained, there is no undue interference with the privacy of the parties, and the public confidence in the administration of justice can be maintained, while the nature of the dispute and thus the business of the Court can be known by the public. There is nothing in the allegations and denials that has a particular pejorative or personal flavour. The need to have transparency in Court proceedings is met by redaction and access.
6 At [36].
7 At [39].
8 At [40].
9 At [40].
10 At [41].
11 At [43].
[28] The case of Donaldson v Skyking Investments Ltd also concerned a media application for access to the court file in a civil proceeding that had settled before trial.12 Palmer J allowed access to the pleadings, judgments and minutes on the court file as he considered this maintained the transparency of court proceedings essential to preserve public confidence in the administration of justice. He did not allow access to other documents on the file, including procedural applications and supporting evidence, as there was little public interest in those when the resulting judgments were available and there was no substantive hearing of the case. He noted the evidence supporting the parties’ positions also contained private information and the parties were entitled to protection of privacy within reasonable limits given they had not aired their dispute in public.13
Should access to documents other than the formal court record be granted
[29] Crux correctly relies on the principle of open justice and freedom to seek and receive information. They are plainly engaged in a request by the news media in a case like this.
[30] I do not accept Mr Boult’s submission that as the claims against him have been settled and there is information concerning the litigation and settlement from other sources, there can be no legitimate public interest in the proceeding. I consider the public has a genuine interest in knowing about litigation involving the collapse of a substantial group of companies owing many millions of dollars to creditors. Such public interest survives settlement of the litigation and, here, would also arise from the fact Mr Boult holds public office. However, as the proceeding settled without a hearing, other factors, including the protection of confidentiality and privacy interests, and the orderly and fair administration of justice, have particular significance.
[31] As was the case in Crimson Consulting and Donaldson v Skyking Investments Ltd, I consider granting Crux access to the pleadings but not to other documents on the court file (other than those that form part of the formal court record) is the appropriate course in this case. Access to the pleadings is appropriate as it recognises
12 Donaldson v Skyking Investments Ltd [2019] NZHC 3083.
13 At [13].
the principles upon which Crux relies, it maintains transparency of the court process and is in the public interest. It will not, in my view, be a substantial interference with rights to protect confidentiality or privacy.
[32] Mr Boult makes the point that at the time of settlement, the plaintiffs had filed an amended statement of claim superseding their earlier pleadings and, as the defendants had not filed a statement of defence to the amended statement of claim, the court file is “one-sided”. He contends fair and balanced reporting cannot be achieved because his response to the amended allegations is unknown.
[33] There was no analysis provided of the content of the statements of claim to support Mr Boult’s submission. Having compared the two documents, I do not accept it. The original pleadings identify the nature of the allegations that are made against Mr Boult and his responses to them. Insofar as the amended statement of claim raises new allegations, Mr Boult’s concern can be addressed by the imposition of a condition that any report of a new allegation in the amended statement of claim is to make it clear the defendants did not respond to it before the settlement was reached.
[34] A large part of Mr Boult’s submissions opposing access concerned articles published by Crux about the litigation and the settlement. He argues the articles have been unbalanced and breach Media Council statements of principle. As noted, it is said the intention of Crux is to damage Mr Boult’s reputation. I have also been provided with email correspondence received by Mr Boult’s solicitors in recent times from Peter Newport, Crux’s Managing Editor, which it is argued is further evidence of this intention. It is also said that as Peter Newport swore an affidavit in this proceeding (albeit supporting an application by Mr Boult) Crux cannot be independent in its reporting.
[35] I accept some criticism can be levelled at aspects of Crux’s reporting to date. However, to the extent that is so, Mr Boult has made no complaint to the Media Council and I am not prepared to infer that it is Crux’s intention to harm Mr Boult. Nor do I consider failings on Crux’s behalf are sufficiently egregious to justify the refusal of its application.
[36] However, I do not consider that it is appropriate to allow access to other documents on the file, notably procedural applications and supporting evidence. To the extent that procedural applications were determined by the Court, there are judgments available. Further, the most significant procedural matter was Mr Boult’s application for a stay of the proceeding. The extensive affidavit evidence supporting the positions taken on that application contains both private and confidential information of the parties and non-parties whose interests should be protected.
Result
[37] Crux is to have access to any documents that are part of the formal court record as defined in r 4 of the Senior Courts (Access to Court Documents) Rules 2017 to the extent there is no order or direction prohibiting access or publication thereof.
[38] I grant Crux access to any statement of claim, statement of defence or statement in reply filed by any party. This is subject to the condition that in any report of a new allegation made in the plaintiffs’ amended statement of claim dated 4 June 2021, Crux is to make it clear the defendants did not respond to the allegation before settlement was reached.
[39]In other respects, I do not grant Crux’s application for access to the court file.
O G Paulsen Associate Judge
Solicitors:
Robert Stewart, Barrister, Auckland Mike Coulson QC, Auckland Buddle Findlay, Christchurch
White Fox & Jones, Christchurch
3
4
0