Cowan v Cowan - [2022] NZSC 54

IN THE SUPREME COURT OF NEW ZEALAND

I TE KŌTI MANA NUI O AOTEAROA

SC 33/2022
[2022] NZSC 54

BETWEEN	CHRISTINE MARAMA COWAN First Applicant TE RAHUI JOHN COWAN Second Applicant
AND	JOHN ARTHUR COWAN First Respondent KURT THOMAS GIBBONS AND 170 QUEENS DRIVE LIMITED Second Respondents

Court:	O’Regan, Ellen France and Williams JJ
Counsel:	J Mason for Applicants R C Laurenson for First Respondent C T Gudsell QC and D M Abricossow for Second Respondents
Judgment:	6 May 2022

JUDGMENT OF THE COURT

AThe application for an extension of time to apply for leave to appeal against the first Court of Appeal judgment is dismissed.

BCosts are reserved.

____________________________________________________________________

REASONS

On 12 April 2022, this Court issued its judgment dealing with an appeal involving the same parties to the present application (the appeal judgment).[1]

Facts

[1]Cowan v Cowan [2022] NZSC 43 [SC judgment].

The factual background is set out in detail in the appeal judgment and we will not repeat it here.[2] The following brief summary suffices for present purposes:
[2]At [5]–[13] and [26]–[36].
(a)The applicants claim an interest in a residential property (the property) that was registered in the name of the first respondent (their father) and their late mother.
(b)The first respondent entered into an agreement to sell the property to 170 Queens Drive Ltd (the developer), which plans a significant residential development on the site of the property and a number of adjoining sites it purchased.[3]
(c)The applicants lodged a caveat against the title to the property to protect their claimed interest.
(d)When an application was made for the lapse of the caveat, the applicants applied to the High Court for an order that the caveat not lapse. This was unsuccessful.[4]
(e)The applicants then appealed to the Court of Appeal. It turned out that the caveat had in fact lapsed prior to the High Court hearing. However, the applicants were successful on the merits and the Court of Appeal issued a judgment in which it granted permission under s 146 of the Land Transfer Act 2017 for a second caveat to be lodged. (We refer to this as the first Court of Appeal judgment).[5] Importantly, however, the Court of Appeal’s permission to register a second caveat was subject to a condition that the applicants file an undertaking as to damages to protect the first respondent should the applicants’ substantive claim to the property fail.
(f)The applicants then lodged a second caveat and filed the required undertaking.
(g)The first respondent then applied to the High Court for an order that the caveat be removed. This application was successful: Associate Judge Lester considered that the undertaking that was provided was an undertaking in form but not in substance, as there was no evidence that the undertaking was of value.[6]
(h)The applicants appealed to the Court of Appeal, but their appeal was dismissed. (We will call the Court of Appeal’s judgment in relation to this appeal the second Court of Appeal judgment).[7]
(i)The applicants then applied for leave…

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.

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Details

Case: [2022] NZSC 54
Decision Date: 6 May 2022

CaseChat Overview and Summary

Christine Marama Cowan and Te Rahui John Cowan applied for an extension of time to apply for leave to appeal against the Supreme Court of New Zealand's judgment in Cowan v Cowan (the First Appeal). The Cowans sought to appeal the First Appeal, which concerned the adequacy of an undertaking as to damages. The Cowans argued that the undertaking was not required in the first place and that if it was required, the liability should have been capped. They sought to appeal the First Appeal judgment because the appeal before the Supreme Court was confined to the adequacy of the undertaking, not the requirement for an undertaking in the first place. The respondents opposed the application. The Cowans sought an extension of time because they had not appealed the First Appeal judgment in a timely fashion. The Supreme Court dismissed the application for an extension of time to appeal the First Appeal judgment. The Court considered the considerable delay in appealing the First Appeal judgment, the deliberate decision by the Cowans not to appeal the First Appeal judgment, and the litigation strategy adopted by the Cowans, which focused on the extent of the undertaking rather than the resolution of the underlying dispute. The Court also considered the exposure of the first respondent to loss as a result of the delays in the settlement of the sale of the property, which had increased since the appeal against the second Court of Appeal judgment. The Court found that the interests of the first respondent outweighed those of the Cowans.

The Supreme Court held that the delay of over a year was considerable. The fact that the decision not to seek to challenge the First Appeal judgment was a deliberate decision and the litigation strategy adopted by the Cowans were factors counting against the grant of an extension of time. The exposure of the first respondent to loss as a result of the delays in the settlement of the sale of the property were now even greater than they were at the time of the hearing of the appeal against the second Court of Appeal judgment. In those circumstances, the interests of the first respondent outweighed those of the Cowans. As the extension of time was refused, it was not necessary for the Court to deal separately with the application for a stay. The Court dismissed the application for an extension of time to apply for leave to appeal against the First Appeal judgment. The Court reserved costs, and the respondents have leave to apply for costs in the event that the Cowans are not legally aided.

Orders