Colmore-Williams v Pendergrast HC Auckland CIV 2010-404-337

[2010] NZHC 1605

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

CIV 2010-404-337

BETWEEN  PATRICIA KAY COLMORE-WILLIAMS Appellant

ANDDALLAS OLIVE PENDERGRAST AND GRAEME ROSS PENDERGRAST

First Respondents

ANDFRANCES ANNE WYBORN Second Respondent

ANDCHRISTIAN ALEXANDER DAUM, EVA MADELINE DAUM AND WILSON MCKAY TRUSTEE COMPANY

LIMITED AS TRUSTEES OF THE C & M DAUM FAMILY TRUST

Third Respondents

Hearing:         25 August 2010

Appearances: R Mark for the Appellant

D S McGill for the Respondents

Judgment:      31 August 2010

RESERVED JUDGMENT OF ELLIS J

This judgment was delivered by me on 31 August 2010 at 10.30 am, pursuant to r 11.5 of the High Court Rules

Registrar/Deputy Registrar

Solicitors:      Duncan Cotterill, PO Box 5326, Wellesley Street, Auckland 1141

R Mark, PO Box 172, Kerikeri 0245

COLMORE-WILLIAMS V  PENDERGRAST AND ORS HC AK CIV 2010-404-337  31 August 2010

[1]      The appellant, Ms Colemore-Williams has filed an application to adduce evidence in her appeal.  Before considering that application, however, it is necessary to set out in some detail the history of the proceeding to date.

[2]      In late 2006 proceedings were issued in the District Court at Kaikohe against Ms Colmore-Williams and Mr Alister Taylor by the respondents in relation to the sale  to  them  of  four  drawings  that  were  stated  to  be  authentic  works  by Charles Frederick  Goldie.    The  drawings  had  been  supplied  to  Ms  Colmore- Williams’ gallery by Mr Taylor to sell on his behalf.  The respondents were given information  as  to  the  provenance  of  the  drawings  which  had  been  provided  to Ms Colmore-Williams  by  Mr  Taylor  in  an  expert  capacity.    The  fact  that  the drawings were being sold on behalf of the very person who was advising about their origin and authenticity was not, however, disclosed to the respondents at the time of the purchase.

[3]      In due course the respondents formed the view that the drawings were not genuine.  As I have said, proceedings were filed.  Six causes of action were pleaded: negligence, breach of the Fair Trading Act 1986, breach of the Consumer Guarantees Act 1993, breach of contract, precontractual misrepresentation and conspiracy. Ultimately the sixth cause of action, conspiracy, was not pursued.

[4]      Following the filing of the claim many difficulties were encountered by the respondents in their pursuit of it.   In particular it appears that both Ms Colmore- Williams and Mr Taylor failed to comply on numerous occasions with directions made by the Court and timetables.  These deficits were exacerbated by the problems encountered on some occasions in contacting Mr Taylor at all.

[5]      The history of the progress of the matter to trial serves to exemplify the wider problems to which I have referred in the previous paragraph.

[6]      Although it is not entirely clear to me when the matter was first set down for trial by the District Court, my understanding is that in August 2008 Ms Colmore- Williams  sought  a  short  adjournment  of  the  proceeding due  to  ill  health.    The respondents consented to that adjournment.  On 16 October 2008 Judge Joyce QC

directed that the trial was to take place between 4 and 7 May 2009.   On 29 April

2009 Ms Colmore-Williams sought a vacation of that trial date and that was granted by Judge Wilson QC.  On 15 June 2009 the proceeding was set down for a three day trial commencing on 23 November 2009.   On 10 September 2009 Ms Colmore- Williams filed an application for vacation of that trial date which was this time declined by Judge Wilson QC.

[7]      In early November 2009 it became apparent that the respondents would be unable  to  proceed  against  Mr  Taylor  because  he  had  by then  been  adjudicated bankrupt and permission for him to continue the proceedings had not been forthcoming from the Official Assignee.

[8]      On  23  November  2009  the  commencement  of  the  trial  was  deferred  by

24 hours due to the temporary unavailiability of the allocated Judge.  On the same day  Ms  Colmore-Williams  filed  a  further  application  for  an  adjournment.    On

24 November 2009 Judge Sharp (the allocated Judge) declined that application for adjournment on the grounds of the lengthy and repeated delays that had already occurred   and   because   she   considered   that   the   evidence   before   her   as   to Ms Colemore-Williams medical unfitness to attend was questionable.

[9]      At this point Ms Colmore-Williams’ (then) lawyer sought, and was granted, leave to withdraw on the basis (inter alia) that certain allegations that had been made about him by Ms Colmore-Williams in the context of the adjournment application had placed him in a position of conflict.  Ms Colmore-Williams did not attend that day in person due, it seems, to the medical problems she was then experiencing.

[10]     Judge Sharp directed that the matter proceed by way of formal proof and she heard expert evidence from three witnesses for the respondents as to the authenticity of the drawings.  Broadly speaking, that evidence was:

a)        From an expert on the works of Goldie as to whether the drawings were likely to be his;

b)From another expert who said that the drawings had clearly been traced from paintings appearing in the book published by Mr Taylor in 1977; and

c)       From a third expert as to the likely authenticity of the signatures appearing on the drawings.

[11]     On the basis of that evidence (which necessarily was not tested by cross- examination due to the withdrawal of Ms Colmore-Williams’ counsel) Judge Sharp concluded that the drawings were not genuine and entered judgment in the sum of

$20,000 each for the first and third plaintiffs and in the sum of $40,000 for the second plaintiff, plus interest from the date of judgment.

The present application and the respective positions of the parties

[12]     Ms Colmore-Williams has filed an appeal from Judge Sharp’s judgment and it is in the context of that appeal that the present application to adduce evidence arises.  The evidence sought to be adduced is the expert evidence of Mr Taylor as to the authenticity of the drawings.

[13]     Ms Colmore-Williams’ new counsel, Mr Mark, accepted that the reality was that the substantive appeal was unlikely to be able to proceed unless the application to adduce evidence was granted.  It seems to me that the only possible ground upon which it could do so would be that Judge Sharp had been (arguably) wrong to proceed in Ms Colmore-Williams’ absence.  However in all the circumstances I have outlined above, Ms Colmore Williams would, I think, face some difficulty in that regard.

[14]     Mr Mark also very fairly acknowledged the significance of the delays that have previously occurred.   However he submitted that the reason Mrs Colmore- Williams had not been in a position to call the evidence of Mr Taylor or anyone else at the hearing before Judge Sharp was that she had, until very shortly before the trial, proceeded on the basis that Mr Taylor, as second defendant, had an interest in the

proceedings.  She thought that Mr Taylor would naturally be giving evidence on his own behalf and that she would be able to rely on that evidence.

[15]     By way of further explanation for Ms Colmore-Williams’ inability to appear before  Judge  Sharp  he  referred  as  well  to  an  additional  recent  affidavit  from Mrs Colmore-Williams in which she elaborated upon the various medical conditions from which she now suffers (and from which she was suffering in November 2009). I record that Mr Taylor too, in the affidavit containing his proposed expert evidence, referred to medical problems which he said explained why he was not in a position to give evidence on Ms Colmore-Williams’ behalf in November last year.

[16]     For the respondents, Mr McGill submitted that the evidence now sought to be adduced could, and should, have been called before Judge Sharp.  He said no reason of sufficient specialness has been advanced as to why that did not occur.  And while he seemed to accept that Mr Taylor has some expertise in relation to the works of C F Goldie he submitted that any evidence he has to offer in this proceeding could not be “cogent” due to the fact that Mr Taylor’s impartiality, independence and credibility must necessarily all be called into question in that context.

Discussion

[17]     The  applicable  principles  in  relation  to  the  exercise  of  the  Rule  20.16 discretion to permit further evidence to be adduced on an appeal have been recently and usefully summarised in Oceanside Developments Ltd v Cutler.1   At [9] – [11] of that decision Fogarty J said:

[9]     Mr Clay seeks to call this evidence relying first on the proposition that there is always a residual discretion on the part of the Court to grant leave to hear further evidence if there are special reasons for hearing it. He relies on the first sentence in r 20.16(3) which I set out:

20.16 Further evidence

…

(3)   The  court  may  grant  leave  only  if  there  are  special reasons for hearing the evidence. An example of a special

1 Oceanside Developments Ltd v Cutler HC Christchurch CIV-2009-409-835, 21 August 2009.

reason is that the evidence relates to matters that have arisen after the date of the decision appealed against and that are or may be relevant to the determination of the appeal.

…

[10]   It  was  common  ground  between  counsel  that  the  general  policy relating to the adducing of further evidence still follows the criteria usefully captured by Lord Denning’s expressions of the principles in the case of Ladd v Marshall (1954) 3 All ER 745.

… The principles to be applied are the same as those always applied when fresh evidence is sought to be introduced. In order to justify the reception of fresh evidence or a new trial, three conditions must be fulfilled: first, it must be shown that the evidence could not have been obtained with reasonable diligence for use at the trial: second, the evidence must be such that, if given, it would probably have an important influence on the result of the case, although it need not be decisive: third, the evidence must be such as is presumably to be believed, or in other words, it must be apparently credible, although it need not be incontrovertible. …

(at 748)

[11]   Mr Clay relied upon dictum of Cooke P (as he then was) in Telecom v

Commerce Commission [1991] 2 NZLR 557:

… There may be other special circumstances in which the discretion to admit new evidence could properly be exercised. We do not purport to lay down any exhaustive test, but in the instant case we doubt whether anything but specific and important evidence of new technological developments would suffice. …

(at 558)

And the dictum of Gallen J in Comalco New Zealand Ltd v Television New

Zealand Ltd (1996) 10 PRNZ 573:

It  was  material  which  ought  to  be  before  the  Court  for  a proper consideration of the appeal.

(at 581) (McGechan HR716.02) And:

…  [T]he  cogency,  relevance  and  possible  effect  of  the evidence on the result, must be taken into account. Generally speaking, the appeal should not be turned into a new case. It is also  important  that  the  evidence  should  not  have  been available at the earlier hearing by the exercise of reasonable diligence. I accept also however, that the test should not be put  so  high  as  to  require  the  circumstances  to  be  wholly

exceptional. Every case must be considered in relation to its own circumstances. …

(At 579)

And then more recently a decision of Duffy J in Complaints Committee No 1 of the Auckland District Law Society v P (2007) 18 PRNZ 760:

[20]   The circumstances in Comalco differ considerably from those before me. In addition, I do not understand Comalco to represent a significant departure from the standard principles applied to the exercise of the discretion in r 716. The case is a helpful reminder that applications to adduce fresh evidence should be considered in relation to their own circumstances, but it does not derogate from established principles.

[21]   There is always room for the special case where fresh evidence is admitted, even though it was reasonably available for the hearing at first instance. The discretionary power in r  716  is  broad  enough  to  permit  a  Court  to  allow  such evidence to be adduced. Furthermore, discretionary authority should never be fettered by fixed guidelines. But such exceptions would be rare and to occur, the fresh evidence would  need  to  be  cogent  and  material  to  the  appeal's resolution, as was the case in Comalco. When the fresh evidence is neither relevant nor likely to be material and, as well  as  that,  is  not  new  (in  the  sense  it  was  reasonably available at the first hearing) there is no apparent basis for departing from the standard tests for its admission. (at 764)

[18]     As to the first of the three conditions, there was some debate before me as to whether the obligation to establish that the evidence could not have been obtained with reasonable diligence for use at the trial was an absolute one.  Naturally enough, Mr Mark contended that it was not and I am prepared to accept that submission, which was based on the dicta from Complaints Committee No 1 of the Auckland District Law Society v P that was referred to in Oceanside Developments.  However as Duffy J said in the latter case any exception to the general rule will be rare and whether it applies here will depend on the cogency and materiality of the proposed new evidence.

[19]     In the present case, the evidence now proposed to be given by Mr Taylor plainly could have been called at the hearing before Judge Sharp.  While I accept and have  a  modicum  of  sympathy  for  Ms  Colmore-Williams’  intention  to  rely  on Mr Taylor giving that evidence in his role as the second defendant in the proceeding up until just before trial, the reality is that neither she nor her then counsel took any

steps to protect their position in that regard.   There is no evidence before me that they attempted to contact Mr Taylor about the content of his possible evidence nor of any attempt to obtain his evidence in the two weeks between the realisation that the plaintiff would not be proceeding against him and the trial.  For that reason I place only limited weight on what Mr Taylor says about his then medical condition (which was not supported by a medical certificate).

[20]     Although  I do  not  consider  that  the  fact  that  Mr  Taylor’s  evidence  was potentially available to Ms Colmore-Williams at an earlier point should be decisive of the issue before me, it is certainly fair to say that ultimately this is not a factor that activates in her favour.

[21]     As to the second condition referred to by Lord Denning in the Ladd case, there can be no question that expert evidence as to the likely authenticity of the drawings was central to the outcome of the case against Ms Colmore-Williams. However,  Mr  Taylor’s   undeniable  personal   interest  in  the  outcome  of  the proceedings, regardless of whether he remained as second defendant, must render any influence his contrary evidence might have less significant than might otherwise be the case.  Notwithstanding that Mr Taylor was not ultimately proceeded against personally, there can be no question that he has both a financial and a reputational interest in the outcome of the proceeding.  While Mr McGill did not go so far as to say that this necessary absence of impartiality rendered the evidence inadmissible there can be little question that any weight that might be given to it would be seriously diminished.

[22]   Similarly, and in terms of Lord Denning’s third condition, Mr Taylor’s credibility as an expert must also necessarily be diminished by his personal interest in the proceeding.   I agree with Mr McGill that in all the circumstances of the present case Mr Taylor’s evidence is unlikely to be regarded by the Court as particularly cogent or convincing.

[23]     There  is  one  further  matter  that  in  my  view  militates  against  granting Ms Colmore-Williams’ application.   Rule 1.2 provides that the object of the High Court Rules is to “secure the just, speedy, and inexpensive determination of any

proceeding”.   It seems to me that that object is relevant to the exercise of my discretion  under  r  20.16.    As  Mr  Mark  quite fairly accepted,  the  admission  of Mr Taylor’s evidence would hardly lead to a speedy resolution of the dispute; it is beyond question that Mr McGill would wish (and in my view would be entitled) to cross-examine him on it.  I am unable to see how an appellate judge would be able to resolve disputed issues as between Mr Taylor and the respondents’ experts without hearing afresh from those experts.  That, in turn, would probably also require them to be cross-examined.   It seems to me inevitable that a reference back to the District Court would be required.

Result

[24]     In light of all the above matters, together with the protracted history of the matter and the fact that much of the responsibility for the delays (and, indeed, for the issue now before me) must lie at Ms Colmore-Williams’ feet I have formed the view that   the   application   to   adduce   evidence   on   the   appeal   must   be   declined. Ms Colmore-Williams will need to take advice as to whether and in what form the substantive appeal can now be pursued.

[25]     The respondents are entitled to costs on a 2A basis.

Rebecca Ellis J