Crichton v Naseri

[2019] NZHC 546

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

I TE KŌTI MATUA O AOTEAROA TĀMAKI MAKAURAU ROHE

CIV-2018-404-2115

[2019] NZHC 546

IN THE MATTER OF

The Samoan Speaking Fellowship of the Avondale Union Parish

BETWEEN

PERELINI CRICHTON and VAAIMALU

SI’ITIA as representatives of the Samoan Speaking Fellowship at Avondale Union Parish

Proposed Plaintiffs/Applicants

AND

TALAOALI’I SAMOA NASERI

Proposed First Defendant/Respondent

MALIEGEGAOI AUMUA

Proposed Second Defendant/Respondent

OLINDA WOODROFFE and COLIN JOHN

WOODROFFE as partners of WOODROFFE LAW PARTNERSHIP

Proposed Third Defendants/Respondents

Hearing:

20 March 2019

Appearances:

M S P Pang for the Proposed Plaintiffs/Applicants I P Tongatule for the Proposed First and Second Defendants/Respondents

J Stafford for the Proposed Third Defendants/Respondents

Judgment:

26 March 2019

JUDGMENT OF POWELL J

[Redacted version]

This judgment was delivered by me on 26 March 2019 at 4 pm pursuant to R 11.5 of the High Court Rules

Registrar/Deputy Registrar Date:

CRICHTON & ANOR v NASERI & ORS [2019] NZHC 546 [26 March 2019]

[1]    The proposed plaintiffs/applicants, Perelini Crichton and Vaaimalu Si’itia (“the applicants”), have applied for pre-commencement discovery from the proposed defendants/respondents (“the respondents”).

[2]    The application arises out of earlier proceedings1 in which the issue was whether a particular group had left a particular church congregation by a particular time (December 2013). The second named applicant was a defendant in those proceedings, while the first and second respondents were part of the group found to have left the congregation at the relevant time, and who in the earlier proceedings were represented by the first named third respondent, Olinda Woodroffe of the Woodroffe Law Partnership.

[3]In his judgment on those earlier proceedings Moore J recorded:2

In or about August 2013 Mr Naseri approached Mr Tuia and requested that he sign an account signatory authorisation form to remove Mr Su’a as an authorised signatory and replace him with Mr Aumua. Mr Tuia, whose grasp of English and understanding of business matters is limited, said he signed the form because he trusted Mr Naseri. Up until that time he and Mr Naseri had been senior officers within the SSF [the Samoan Speaking Fellowship] and both had been strong and vocal critics of Rev Amosa. According to Mr Tuia, the week after Mr Naseri obtained Mr Tuia’s signature Mr Naseri “changed sides” and joined the plaintiffs’ group.

Mr Naseri denied any subterfuge or dishonest conduct in relation to this transaction. He said the removal of Mr Su’a as a signatory and replacing him with Mr Aumua was because Mr Su’a had been removed as Vice Secretary at the May Annual General Meeting. While I am not required to decide this issue the consequence of Mr Naseri and Mr Aumua being authorised signatories of the accounts is that the plaintiffs’ group has been able to control the accounts formerly operated by the SSF. Significantly the funds in these accounts included contributions made by the wider SSF which included members from both the plaintiffs’ and defendants’ groups. Any suggestion the funds in these accounts were derived solely from the generosity of the plaintiffs’ group is misleading. The funds represent the cumulative efforts and generosity of the whole of the SSF.

Over the period since the plaintiffs’ group has controlled these accounts some

$70,000 has been withdrawn for unknown purposes and with the exception of a limited number of automatic payments the SSF has made no contribution to the AUP’s [the Avondale United Parish’s] joint general account with the consequence  the  ESF  [the  English  Speaking  Fellowship]  has  carried the

1      Matamu v Si’itia [2016] NZHC 2516. The judgment was subsequently upheld in the Court of Appeal, Matamu v Si’itia [2017] NZCA 482 and leave to appeal was refused by the Supreme Court Matamu v Si’itia [2018] NZSC 14.

2      At [42]–[44].

burden of meeting the liabilities for the whole of the AUP including the payment of substantial insurance and levy payments.

[4]    The primary purpose of the present pre-commencement discovery application is to obtain further information with regard to the transactions that took place in these accounts from the time Mr Aumua was appointed as a signatory until the accounts were frozen by order of this Court in June 2014. In addition, the applicants also seek documentation relating to various chattels, including instruments belonging to the congregation’s brass band. Finally, the applicants also seek pre-commencement discovery against Mrs Woodroffe’s firm in order to obtain information about the origin of the funds used to pay her accounts.

The legal basis for the application

[5]    The applicants rely on r 8.20 of the High Court Rules 2016 which allows for particular discovery before a proceeding is commenced. In Welgas Holdings Ltd v Petroleum Corporation of NZ Limited,3 McGechan J held that to obtain an order under what is now r 8.20 three things have to be established:

(a)the intending plaintiff is or may be entitled to claim relief against another person;

(b)it is impossible or impracticable for the plaintiff to formulate the claim without the document sought; and

(c)there are grounds for belief that the documents may or have been in the possession of the person concerned.

[6]    In the present case it is clear that different considerations apply to the applicants’ application in respect of the first and second respondents and the application in respect of the third respondents. These will now be considered in turn.

3      Welgas Holdings Ltd v Petroleum Corporation of NZ Limited (1991) 3 PRNZ 33 (HC).

The application against the first and second respondents

[7]    Having heard the submissions of counsel and considered the results of the earlier proceedings, including in particular the passages quoted above,4 I am satisfied that an order for particular discovery before the proceeding is commenced is appropriate with regards to the various bank accounts to which the first and second respondents ended up as authorised signatories around August 2013. First, the circumstances outlined by Moore J clearly give rise to a real probability of a claim against someone, and in particular the first and second respondents as the authorised signatories of the accounts. Likewise, I accept it is impossible or impractical to try and formulate the claim against the first and second respondents without the benefit of knowing what amounts were received and/or paid out. Finally, as the authorised signatories to the accounts there are clearly substantial grounds for belief that the first and second respondents would be in possession of the necessary documentation.

[8]    In the course of the hearing Mr Pang refined what was sought from the first and second respondents in respect of the accounts being:

Documents including bank statements relating to [specific designated bank accounts], run by the Samoan Speaking Fellowship (and subsequently covered by the Freezing Order in CIV-2014-404-00170 Matamu & Ors v Si 'itia & Ors) identifying or otherwise establishing when, from whom, and how much was paid into the accounts and when, to whom, how much and for what purpose monies were paid out of the accounts between 1 July 2013 and 19 June 2014.

[9]    Following discussion of this re-formulation Mr Tongatule took instructions from the first and second respondents and confirmed that they did not oppose orders in those terms being made, but only for the period between July and December 2013.

[10]    It was somewhat difficult to follow Mr Tongatule’s reasoning for this distinction but it appeared to be based somewhat on an argument rejected in the previous proceedings that an identity known as the Pacific Islands Church Avondale had in fact been in existence for some considerable period before 2013. Even if this argument had not been rejected by Moore J in the earlier proceedings it is however difficult to see it could have any relevance to the present application. It appears to be common ground that the fourteen accounts in respect of which the particular discovery

4      At [3] of this judgment.

orders are sought belonged to the original congregation and the issue is whether the monies in those accounts have been used for purposes that were not intended or otherwise approved. It is therefore difficult to see why an order should cease in December 2013 as opposed to June 2014 when the freezing orders were put in place, when the first and second respondents remained in control of the congregation’s accounts notwithstanding they had by that time been found to have left the congregation. I therefore have no hesitation in concluding the order should cover the period between 1 July 2013 and the making of the freezing orders on 19 June 2014.

[11]   The position is different with regard to the provision of documentation relating to the various chattels. As Mr Pang accepted in argument, there is in fact no evidence before the Court to suggest either the first and second respondents had or have any particular knowledge with regard to the chattels and therefore insufficient grounds to establish any belief that relevant documents may be or have been in their possession. Following this discussion Mr Pang appropriately withdrew the application as it related to those chattels and no order was accordingly required on that part of the application.

Application for particular discovery against third respondents

[12]   In his submissions filed in support of the application, Mr Pang suggested that the orders were necessary against the third respondents because Mrs Woodroffe had induced a breach of contract. Following discussion with Mr Pang it appeared that what was suggested was that Mrs Woodroffe had somehow induced those leaving the congregation to leave. It was apparent however there was absolutely no evidential foundation for such a suggestion, nor indeed how, even if there was, it could give rise to any circumstance where the trust account and other billing records of Woodroffe Law Partnership relating to the earlier proceedings might conceivably be relevant.

[13]   Mr Pang subsequently went on to suggest that the information may be relevant if it contained correspondence as between those trying to leave and Mrs Woodroffe that would provide evidence of an intention to utilise the money that is held in the fourteen accounts for the purposes of paying Mrs Woodroffe’s legal fees. Once again there is absolutely no evidence whatsoever to provide any factual foundation for such

an allegation and, on the contrary, there  is  nothing  before  me  to  suggest  that  Mrs Woodroffe was other than the solicitor and counsel for the leaving group.

[14]   The authorities are clear that this process is not to be used as a fishing expedition5 and in the absence of any factual foundation whatsoever for the suggestions made by Mr Pang there can be no grounds for belief that the types of documents  Mr Pang  was  after  may  exist  let  alone  be  in  the  possession  of   Mrs Woodroffe or the Woodroffe Law Partnership.

Decision

[15]   The proposed first and second defendants/respondents are, on or before 10 April 2019, to provide sworn affidavit(s) of documents stating whether any documents referred to are or have been in their possession, custody or power and, if the documents have been but no longer are, when they parted with them and what has become of them. These documents are:

Documents including bank statements relating to [specific designated bank accounts], run by the Samoan Speaking Fellowship (and subsequently covered by the Freezing Order in CIV-2014-404-00170 Matamu & Ors v Si 'itia & Ors) identifying or otherwise establishing when, from whom, and how much was paid into the accounts and when, to whom, how much and for what purpose monies were paid out of the accounts between 1 July 2013 and 19 June 2014.

[16]   Following the filing of the affidavit of documents, inspection is to be completed as between the applicants and the first and second respondents by 1 May 2019. The costs incurred by the first and second respondents on the preparation of the affidavit of document and inspection are to be met by the applicants on a solicitor/client basis, together with reasonable disbursements.

[17]   The application for particular discovery before proceeding commenced against the third respondents is dismissed. Leave is reserved to reapply for particular discovery before proceeding commenced against the third respondents should grounds be disclosed following discovery and inspection of the documents held by the first and second respondents.

5      See, for example, Welgas, above n 3, at [43].

[18]   Although the third respondents abided the decision of the Court it was appropriate that they were represented in this and earlier hearings given the lack of clarity with regard to the orders sought against them. As a result, the third respondents are entitled to costs in the application which I fix in the sum of $1,000 to cover all attendances in respect of the application. There are otherwise to be no costs payable on the application.

Powell J