Chevin v Valmont - [2020] NZHC 3438

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

I TE KŌTI MATUA O AOTEAROA TĀMAKI MAKAURAU ROHE

CIV-2019-404-1547

[2020] NZHC 3438

BETWEEN
PETER LOUIS CHEVIN

Plaintiff

AND

CLARK VINCENT VALMONT

First Defendant

TIMOTHY LAIRD EDNEY and THE GOLDEN BELT MINING COMPANY LIMITED

Second Defendants

Hearing: 29 October 2020

Appearances:

R Hucker & M Swan for the Plaintiff S Lowery for the First Defendant

D Chisholm QC for the Second Defendants

Judgment:

18 December 2020

JUDGMENT OF ASSOCIATE JUDGE SUSSOCK

This judgment was delivered by me on 18 December 2020 at 4.30pm pursuant to r 11.5 of the High Court Rules

Registrar/Deputy Registrar

Solicitors:
Hucker & Associates, Auckland Bankside Chambers, Auckland D Chisholm QC, Auckland

Chevin v Valmont & Ors [2020] NZHC 3438 [18 December 2020]

Introduction

[1] A security for costs order was made by consent in this proceeding on 24 October 2019 requiring Mr Chevin, the plaintiff, to provide security of $100,000. The proceedings were stayed until the sum was paid or security given in a form acceptable to the Registrar. No date was set by which security was to be provided.

[2]The security ordered has not been provided.

[3] Mr Valmont, Mr Edney and Golden Belt Mining Company Limited (GBMC), the first and second defendants, now jointly seek orders striking out the proceeding or alternatively for an unless order requiring the plaintiff to provide security by 30 November 2020 or the proceeding will be dismissed.

[4] Following the filing of the defendants’ application to strike out, Mr Chevin filed an application to vary the security for costs order, to allow security to be provided in three stages.

[5]Both applications are opposed.

Issues

[6]The issues for this Court are:

(a)Should the proceeding be struck out immediately for failure to provide security?

(b)If not, should the application to vary the security for costs order be granted?

(c)Should unless orders be made?

Background

[7] Mr Chevin filed his claim on 1 August 2019. The claim relates to transactions entered into by companies for which the first defendant, Mr Valmont, was the sole

director. Mr Valmont held shares in these companies as bare trustee for Mr Chevin.1 The plaintiff says the transactions were at an undervalue and were not disclosed to him, in breach of Mr Valmont’s duties as trustee and as a director. The transactions were entered into with the second-named second defendant, GBMC. Mr Chevin alleges the second defendants knowingly received the trust property.

[8] The defendants deny the claims. Mr Valmont says that he acted in accordance with his trustee and director’s duties. Mr Valmont, Mr Edney and GBMC submit that the claims appear to arise out of Mr Chevin’s attempts to circumvent his disqualification as a director pursuant to s 382(1) of the Companies Act 1993.

[9] The defendants further submit that since bringing the claim, Mr Chevin has failed to prosecute it. Mr Chevin has not provided initial disclosure despite several requests from the defendants, and nor has he filed a reply to Mr…

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 Chevin v Valmont

Details

AGLC: Chevin v Valmont [2020] NZHC 3438
Case: [2020] NZHC 3438
Decision Date: 18 December 2020

CaseChat Overview and Summary

The case of Chevin v Valmont [2020] NZHC 3438 involves a plaintiff, Mr. Peter Louis Chevin, who filed a claim against Mr. Clark Vincent Valmont, Mr. Timothy Laird Edney, and The Golden Belt Mining Company Limited. The claim relates to transactions entered into by companies for which Mr. Valmont was the sole director. The plaintiff alleges that the transactions were at an undervalue and were not disclosed to him, in breach of Mr. Valmont's duties as trustee and director. The defendants deny the claims and argue that the claims appear to arise out of Mr. Chevin's attempts to circumvent his disqualification as a director. The issues before the court were whether the proceeding should be struck out immediately for failure to provide security, whether the application to vary the security for costs order should be granted, and whether unless orders should be made.

The court considered the duration of the plaintiff's failure to provide security, which had been more than a year since the security for costs order was made. The court also considered the impact of the failure to provide security on the progress of the proceedings, the lack of any excuse or explanation, the continuation of the breach after reminders, the prejudice to the innocent parties, and whether there is any realistic expectation that the non-compliance will be rectified. The court held that it was not in the interests of justice to vary the consent order because the plaintiff had not provided evidence of his financial position or how his circumstances had changed since he agreed to provide the security in one lump sum. The court also held that an unless order was not appropriate at this stage and allowed a further two months for the provision of security, reserving leave to the defendants to apply to strike out the proceedings again if it was not provided by the date set out in the orders. Costs were directed to be paid to the defendants on a 2B basis.

Orders