Cummins v Body Corporate 172108 - [2024] NZCA 303

IN THE COURT OF APPEAL OF NEW ZEALAND

I TE KŌTI PĪRA O AOTEAROA

CA680/2023
[2024] NZCA 303

BETWEEN	ROBERT JAMES CUMMINS Applicant
AND	BODY CORPORATE 172108 Respondent

Court:	French and Ellis JJ
Counsel:	Applicant in person J B Orpin-Dowell for Respondent
Judgment: (On the papers)	8 July 2024 at 3.00 pm

JUDGMENT OF THE COURT

AThe application for leave to appeal is declined.
BMr Cummins is to pay the Body Corporate’s costs for a standard application on a band A basis and usual disbursements.

____________________________________________________________________

REASONS OF THE COURT

(Given by Ellis J)

Mr Cummins seeks leave to appeal from a decision in the High Court refusing to halt the bankruptcy proceedings taken by Body Corporate 172108 (the Body Corporate) against him.[1]
[1]Body Corporate 172108 v Cummins [2023] NZHC 1535 [High Court judgment].
Leave to appeal is opposed by the Body Corporate and was refused by Associate Judge Johnston in the High Court.[2]
[2]Body Corporate 172108 v Cummins [2023] NZHC 3169 [High Court leave judgment]. Following the refusal of leave in the High Court, Mr Cummins is entitled to apply for leave to this Court under s 56(5) of the Senior Courts Act 2016.
The principal (but not the only) ground of Mr Cummins’ proposed appeal is that the Associate Judge was wrong not to have halted the bankruptcy application because he (Mr Cummins) has various triable cross-claims against the Body Corporate. Mr Cummins refers, in particular, to the decision in Re Bayoil SA where the English and Welsh Court of Appeal held that in the absence of special circumstances it would be an abuse of process to liquidate a company where it has a genuine and serious cross-claim in an amount equal to or exceeding the relevant debt.[3]
[3]Re Bayoil SA [1999] 1 WLR 147 (CA) at 156.
As discussed further below, the cross-claims relied on by Mr Cummins here were claims made by Manchester Securities Ltd (in liquidation) (Manchester) against the Body Corporate in arbitral proceedings, seeking to apportion the costs of repairing its unit property on level 12 of the Hobson Apartments in Auckland between it and the other unit holders under cls 10.3 and 21.2 of the scheme settled by the High Court under s 48 of the Unit Titles Act 1972 (the scheme). Mr Cummins says Manchester’s rights in these claims have vested in him. These arbitral proceedings were, however, stayed on an interim basis (pending further order of the High Court) in 2018.[4]

Wider litigation context

History

[4]Body Corporate 172108 v Meader [2018] NZHC 3356 at [22].

The litigation history, of which the present application forms but a small part, was fairly described by the Associate Judge as “complex”.[5] The overarching dispute between Mr Cummins, Manchester and the Body Corporate over the remediation of Hobson Apartments pursuant to the scheme goes back for over a decade. The scheme pursuant to which the remediation work has been carried out (the need for which arose following the discovery that the building…

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: [2024] NZCA 303
Decision Date: 8 July 2024 at 3.00 pm

CaseChat Overview and Summary

The application for leave to appeal was brought by Robert James Cummins against Body Corporate 172108, challenging the High Court's refusal to halt bankruptcy proceedings against him. The case revolves around the extensive and ongoing dispute over the remediation of the Hobson Apartments in Auckland, a complex issue that has been before the courts since 2010. The core legal issue in this appeal was whether the Associate Judge was correct in refusing to halt the bankruptcy proceedings initiated by the Body Corporate, given Cummins' claims of having various cross-claims against the Body Corporate. Cummins argued that halting the bankruptcy proceedings was necessary due to his substantial cross-claims, which he believed were genuine and serious, akin to the situation in Re Bayoil SA. The court had to determine if the proposed grounds for appeal were seriously arguable and of sufficient importance to warrant further delay.

The Court of Appeal, after considering the extensive litigation history and the current state of the cross-claims, concluded that Cummins' proposed grounds for appeal were neither seriously arguable nor of general or public importance. The court found that the broader context of the litigation, which has been ongoing for over a decade, strongly indicated that the legitimate interests of the Body Corporate and other unit title holders would be prejudiced by allowing the appeal. The court emphasized that the continuation of the litigation was causing significant delay and expense, and the balance of equities did not favor Cummins. Therefore, the interests of justice clearly favored denying leave to appeal. The court also noted that the release of a recent High Court judgment further weakened Cummins' position, as it permanently stayed the arbitral proceedings and found that Cummins' cross-claims could not succeed. Consequently, the application for leave to appeal was declined, and Cummins was ordered to pay the Body Corporate's costs.

Orders