Clarke v Forsyth Barr Limited

[2017] NZCA 300

IN THE COURT OF APPEAL OF NEW ZEALAND

CA277/2017
[2017] NZCA 300

BETWEEN	MATTHEW SIMON CLARKE Appellant
AND	FORSYTH BARR LIMITED Respondent

Counsel:

Appellant in person
C J Griggs and C M Kenworthy for Respondent

Judgment:

(On the papers)

14 July 2017 at 3.00 pm

JUDGMENT OF FRENCH J
(Review of Registrar’s decision)

AThe application for review of the Registrar’s decision refusing to dispense with security for costs is declined.

BSecurity for costs in the sum of $6,600 must be paid into Court by 4 August 2017.

____________________________________________________________________

REASONS

Introduction

1. Mr Clarke has filed an appeal against a decision of Duffy J in the High Court.  In her decision, the Judge declined Mr Clarke’s application for summary judgment and struck out his statement of claim.[1]

   [1]Clarke v Forsyth Barr Ltd [2017] NZHC 842.

2. Security for costs on the appeal was set at $6,600.  Mr Clarke applied for dispensation from payment under r 35(6)(c) of the Court of Appeal (Civil) Rules 2005.  In a decision dated 7 July 2017, the Registrar declined to grant dispensation and directed that security of $6,600 was to be paid by 4 August 2017.

3. Mr Clarke disputed the correctness of the Registrar’s decision.  His email protesting the decision has been treated as an application for review and referred to me for determination.

Background

1. In initially applying for dispensation, Mr Clarke advised that he was unemployed, had no assets and was living in emergency housing.  Although he did not provide any documentary verification of his financial position, the Registrar said it appeared he was likely to be impecunious.  Ultimately, she put that to one side because her decision turned on an assessment of the merits of the appeal, which she found lacking.

2. The proceedings arise out of Mr Clarke’s previous employment with Forsyth Barr Ltd as an investment adviser.  In 2015, Forsyth Barr initiated a disciplinary investigation against him.  As a result of this investigation, Forsyth Barr and Mr Clarke entered into an exit agreement.  Mr Clarke resigned from his employment.  The terms of the exit agreement included provisions releasing Mr Clarke from the restraint of trade covenant in his employment agreement and regulating client transfers, as well as a provision that the agreement was in full and final settlement of all claims Mr Clarke might have against Forsyth Barr.

3. As Mr Clarke himself acknowledged, the statement of claim he filed in the High Court is prolix.[2]  Justice Duffy said she found it difficult to discern exactly what causes of action he was relying on but that it could “broadly be inferred” he was relying on three, namely:[3]

   (a)Forsyth Barr failed to act in good faith towards him during their employment relationship.

   (b)Forsyth Barr breached the parties’ alleged verbal agreement regarding 11 conditions of employment.

   (c)Forsyth Barr breached the exit agreement …

   [2]Mr Clarke said the prolixity is necessary to detail his claim.

   [3]At [39].

4. Justice Duffy held that the first two causes of action could not succeed because they were within the exclusive jurisdiction of the Employment Relations Authority.  As regards the third cause of action, she accepted this would be justiciable in the High Court because it related to conduct that took place after the employment relationship had ended.  However, she considered the pleading breached r 5.17 of the High Court Rules because it did not specify the alleged breaches of the exit agreement, and was oppressive.[4] 

   [4]At [38] and [44].

5. The grounds of the appeal are said to be that the Judge (influenced by Forsyth Barr) has misinterpreted the cause of action outlined in the statement of claim.  In particular Mr Clarke contends his claim does not involve any of the three causes of action identified by the Judge.  Rather his claim, correctly understood, is a claim disputing the legitimacy of the exit agreement itself.  The notice of appeal also states that Duffy J erred in not allowing Mr Clarke the opportunity to direct the Court about his intended cause of action before hearing Forsyth Barr’s opposition to his summary judgment application and its application to strike out the statement of claim.

6. In his email disputing the Registrar’s decision, Mr Clarke has not raised any new matters of substance but chosen to engage in unacceptable abuse of both the Registrar and Duffy J.

7. I am satisfied the appeal does not raise any issues of public interest and that it is an appeal which a reasonable and solvent litigant would not pursue.  It is clear that the statement of claim was deficient.  It is not sufficient for Mr Clarke to simply assert that he is questioning the “legitimacy” of the exit agreement.  In order to comply with the High Court Rules and fully and fairly inform Forsyth Barr of the nature of the claim, the statement of claim needed to specify on what basis he alleged the exit agreement was invalid.  A statement of claim should speak for itself and not require an oral direction to the court.

8. There is the further point too that if the reason the exit agreement is said to be invalid relates to employment issues, then there may be a jurisdictional issue. 

9. As noted by the Registrar, Mr Clarke’s remedy is not to pursue what can be fairly described as a hopeless appeal but to file a new statement of claim that complies with the Rules and pleads a cause of action within the jurisdiction of the High Court.

Conclusion

1. I am satisfied the Registrar has not made any error in her decision and it is a decision with which I agree.  It would be unjust to require Forsyth Barr to defend the judgment under appeal without the usual protection as to costs provided by security.

2. The application for review of the Registrar’s decision refusing to dispense with security for costs is accordingly declined.

3. Security for costs in the sum of $6,600 must be paid into Court by 4 August 2017.

Solicitors:
Forsyth Barr Ltd, Wellington for Respondent