Clarke v Watts

[2010] NZCA 221

IN THE COURT OF APPEAL OF NEW ZEALAND

CA588/2009
[2010] NZCA 221

BETWEENNEIL MARTIN CLARKE
Applicant

ANDCOREY DANIEL WATTS
Respondent

Counsel:Applicant in person
D G Dewar for Respondent

Judgment:31 May 2010 at 10.30 am 

JUDGMENT OF ARNOLD J

The application for review of the Registrar’s decision declining a dispensation from paying security for costs is declined.

REASONS

Introduction

[1]       The applicant, Mr Clarke, filed an appeal in this Court and then applied, out of time, for dispensation from the obligation to pay security for costs.[1]  The Registrar declined his application and security was set at $4740.  This is an application for review of that decision.

Background

[1]Court of Appeal (Civil) Rules 2005, r 35(3).

[2]       Mr Clarke filed an action in the Wellington High Court against the Police, with Mr Watts as second defendant, alleging false imprisonment and breach of the New Zealand Bill of Rights Act 1990.  After the defendants applied to strike out the action, Mr Clarke discontinued the proceedings.  On 9 March 2006, Associate Judge Gendall ordered Mr Clarke to pay costs of $4,680 to Mr Watts. 

[3]       Mr Clarke then began fresh proceedings based on identical allegations against the defendants in the Wellington District Court.  Mr Watts applied for those proceedings to be dismissed, on the basis that Mr Clarke had failed to pay the costs ordered by the Associate Judge, and those proceedings were also discontinued.

[4]        Mr Clarke then applied for leave to appeal to this Court against the costs award.  On 17 May 2007, leave was declined for want of jurisdiction.[2]  The Court held that since the Associate Judge was exercising the jurisdiction of a Judge sitting in chambers,[3] the appropriate course was for Mr Clarke to seek a review of the decision in the High Court.[4]  This Court awarded costs against Mr Clarke on his failed application.  Mr Clarke then sought leave to appeal from the Supreme Court, but only in respect of the further costs award, not the failed application.  The Supreme Court declined leave to appeal on 9 October 2007.[5]

[2]      Clarke v New Zealand Police [2007] NZCA 294.

[3]      Judicature Act 1908, s 26J.

[4]      Ibid, s 26P.

[5]      Clarke v New Zealand Police [2007] NZSC 83.

[5]       Mr Watts meanwhile issued bankruptcy proceedings against Mr Clarke, on the basis of the unpaid costs order.  Mr Clarke sought orders staying execution of the costs order and setting aside the bankruptcy notice until the challenge to the costs order had been determined. The proceedings were stayed on 19 June 2007 on the condition that Mr Clarke pay $4,901.18 into Court, being the sum of the original costs and interest.  Mr Clarke made payment accordingly.

[6]        After this Court’s decision denying jurisdiction, Mr Clarke filed an application in the High Court for leave to review the costs award out of time.  Dobson J declined leave.[6]  The Judge noted that the total delay was in the order of 14 months.  Extraordinary circumstances were required to grant such an extension, and there was a risk of undermining the importance of time limits and achieving finality in litigation.[7]  While the delay could not be attributed entirely to Mr Clarke, he did not proceed with the urgency that might be expected of a litigant seeking the Court’s dispensation for an extension of time.[8]  The Judge also considered the merits of the proposed review. Mr Clarke submitted that the costs award should not have been made because he was in receipt of legal aid. The Judge found that Mr Clarke was not in fact legally aided[9] and so the argument for review lacked merit.[10]

[6]      Clarke v New Zealand Police HC Wellington CIV-2005-485-245, 26 February 2008.

[7]At [11].

[8] At [6].

[9] At [16].

[10] At [21].

[7]       Mr Watts then applied for the release of the funds.  Ronald Young J ordered that the funds be released to Mr Watts’ solicitors.[11]  Mr Clarke filed further documents in the High Court and in consequence the Registrar continues to hold the funds in trust.  Mr Clarke now appeals to this Court against Ronald Young J’s decision.

Security for costs

[11]      Clarke v Watts HC Wellington CIV-2006-485-2461, 7 September 2009.

[8]       In the normal course, appellants in civil proceedings in this Court are required to pay security for costs.[12]  If an appellant wishes to apply to the Registrar for a waiver of security, he or she must do so within 20 days of filing the appeal.[13]  The Registrar may vary or waive security “if satisfied that the circumstances warrant it”.[14]

[12]Court of Appeal (Civil) Rules 2005, r 35(2).

[13]Ibid, r 35(3) and (6).

[14]Ibid, r 35(6).   

[9]       In the present case, the Registrar declined the application because it was out of time, and indicated that Mr Clarke’s impecuniosity was an insufficient basis to waive security.  

[10]     Security for costs will be waived where it is in the interests of justice to do so.  Given that the normal rule is that security must be provided, there will need to be some exceptional circumstance to justify waiver.[15]  The circumstances of the appeal are relevant, in the sense that the appellant must honestly intend to pursue it and it must be arguable – respondents should not face the threat of hopeless appeals without provision for security.  The novelty or importance of the issues raised in the appeal will be particularly significant, as will the question whether there is any public interest in having them determined.[16]  Impecuniosity alone is not usually sufficient to justify a waiver, but may be reason to reduce the quantum of security.[17]

Discussion

[15]Fava v Zaghloul [2007] NZCA 498 at [9].

[16]Creser v Official Assignee CA196/05 12 June 2006, at [29].

[17]Fava v Zaghloul [2007] NZCA 498 at [9]; Easton v Broadcasting Commission [2009] NZCA 252 at [5].

[11]     Mr Clarke has applied for a review of the Registrar’s decision on the grounds that as a beneficiary he is impecunious. He also says that the appeal will not proceed if security is ordered, which will result in a miscarriage of justice as he has not had the opportunity to litigate the original claim. Mr Clarke says that in a “previous case of the same incident” (which is not identified) he was granted legal aid but one of the defendants was adjudged bankrupt so the case was abandoned.  The proceeding involving Mr Watts was discontinued when counsel withdrew and he was unable to engage new representation.

[12]     While Mr Watts has not opposed the waiver, that may be due to the failure of Mr Clarke to serve the appeal and application for waiver on Mr Watts.  In a memorandum to the Court, counsel for Mr Watts submits that the notice of appeal does not identify any alleged deficiencies in the judgment to be appealed from.

[13]     While I accept that Mr Clarke is impecunious, that in itself is insufficient reason to waive security.  I also acknowledge that the appeal is unlikely to proceed if security is ordered.  However, I consider that there are good reasons to require security in this case.

[14]     First, so far as the appeal relates to the validity of the costs order by Associate Judge Gendall in 2006, that challenge has run its course.  The appeal is limited to Ronald Young J’s decision to release the monies, not the original costs order.

[15]     Second, the argument that a miscarriage of justice will result if a waiver is not granted is unfounded.  While the original claim has not been litigated, this appeal does not touch upon the merits of that claim.  Had Mr Clarke challenged the costs order in a timely manner, fresh proceedings could have been issued. Unfortunately for Mr Clarke, the claims contained in the original proceedings may now be time-barred.[18]

[18]Limitation Act 1950, s 4.

[16]     Third, and fatally, the appeal has no prospect of success. Mr Clarke has not identified any alleged errors in Ronald Young J’s decision, and there are no arguable grounds of appeal. The order to release the monies was a natural consequence of the High Court’s confirmation of the costs award.  As any appeal would be hopeless, Mr Watts should not be put to the expense of resisting the appeal without some protection for costs.

[17]     While impecuniosity can be grounds for a reduction in quantum of security, a reduction is not warranted in this case.  There is no public interest in the appeal and it has no prospect of success. The appeal will not address Mr Clarke’s sense of grievance as its source is unrelated to this appeal.  Accordingly there is no reason to reduce the amount of security.

[18]     In the result, I consider that the Registrar was right to require Mr Clarke to pay $4,740 by way of security for costs.

Decision

[19]     The application for review of the Registrar’s decision declining security for costs is declined.  There is no order for costs.

Solicitors:

Thomas Dewar Sziranyi Letts, Wellington for Respondent