Cancian v Cain - [2024] NZHC 1069

IN THE HIGH COURT OF NEW ZEALAND CHRISTCHURCH REGISTRY

I TE KŌTI MATUA O AOTEAROA ŌTAUTAHI ROHE

CIV2023-409-436

[2024] NZHC 1069

UNDER the Defamation Act 1992

IN THE MATTER

of a claim for defamation

BETWEEN

DANNY JOHN CANCIAN

Plaintiff

AND

RHYS CAIN

Defendant

Hearing: 22 April 2024

Appearances:

D G Chesterman for Plaintiff

D H McLellan KC, M O Fee and S O H Coad for Defendant

Judgment:

3 May 2024

JUDGMENT OF ASSOCIATE JUDGE LESTER

(Strike out application)

CANCIAN v CAIN [2024] NZHC 1069 [3 May 2024]

[1] The plaintiff, Mr Cancian, was formerly the sole director of five related companies that carried out residential property development in the Bay of Plenty region. The principal company, for want of a better name, was Bella Vista Homes Limited (BVHL). BVHL and the other related companies have now been removed from the Companies Office Register. I will refer to the other four companies as the “related companies”.

[2] BVHL was placed into voluntary liquidation on 30 November 2017. The liquidators appointed were replaced by the defendant, Mr Cain, and another on 18 January 2018. The related companies were put into liquidation later that year in November 2018 by BVHL with Mr Cain and another, being the liquidators.

[3]By early 2021, Mr Cain was the only remaining liquidator.

[4] Running alongside the company liquidation was that on 16 July 2021, Carters, a supplier of building products, filed an application seeking the bankruptcy of Mr Cancian based on a judgment it had obtained for approximately $1,100,000.00. Mr Cancian opposed the bankruptcy which was halted in July 2022 and remains halted.

[5] Mr Cain’s final liquidation report for BVHL incorrectly referred to Mr Cancian as an undischarged bankrupt. It referred to Mr Cancian as follows: “We note that the director is an undischarged bankrupt” and that Mr Cancian was the director of BVHL. The liquidators’ final report was dated 23 June 2022 and on the same date, final reports were issued for the related companies which also referred to Mr Cancian being bankrupt.

[6] The liquidators’ report was sent to BVHL’s 66 creditors. Each of the related companies had three or four creditors who also received the report in respect of that particular company.

[7] The reports containing the incorrect statement as to Mr Cancian’s status as a bankrupt remained on the Companies Register from 23 June 2022 until 18 August 2022 when it was corrected at the request of Mr Cancian.

[8]The above summary is not substantially in dispute.

[9] Mr Cancian has commenced defamation proceedings against Mr Cain. Mr Cancian pleads at para 28 of his statement of claim:

28.In its natural and ordinary meaning the defendant’s statement meant and was understood to mean and infer in the context of the BVHL Report (‘Natural Meaning’):

Particulars

a.The plaintiff was bankrupt as at 23 June 2022;

b.The plaintiff was subject to bankruptcy laws including the oversight of the Official Assignee;

[10] The statement of defence, as I have said,…

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.

Continue reading Cancian v Cain

Details

AGLC: Cancian v Cain [2024] NZHC 1069
Case: [2024] NZHC 1069
Decision Date: 3 May 2024

CaseChat Overview and Summary

Danny John Cancian has brought defamation proceedings against Rhys Cain, who was the liquidator of Cancian's former company, Bella Vista Homes Limited, and related entities. The claim arises from statements made in final liquidators' reports, which incorrectly stated that Cancian was an undischarged bankrupt as of 23 June 2022. Cancian has applied to strike out the defendant's affirmative defence that he intends to call evidence of Cancian's misconduct to establish that Cancian had a bad reputation prior to the alleged defamation, thereby seeking to mitigate the damages payable to Cancian. The core issue is whether evidence of misconduct and bad reputation is admissible in mitigation if it does not relate to the specific aspect of the plaintiff’s character and reputation that is relevant to the defamation complained of. The court held that the evidence in the defence was not plainly inadmissible and declined the strike out application, finding that the scope of the plaintiff's reputation capable of being harmed by the defamatory material was not limited to being merely bankrupt but extended to his financial affairs, business management skills, and his skill as a builder. The factual context and circumstances surrounding the incorrect statement of bankruptcy, such as the nature of Cancian's debt, his business practices, and the broader context of his company's insolvency, are all relevant to the extent of the harm caused by the defamation. Therefore, these matters are appropriate for determination at trial rather than being struck out in a summary application. The court also ordered the defendant to provide particulars of the affirmative defence within 15 working days and noted that costs would usually not follow the event, but gave parties the opportunity to make submissions on costs.

Orders