Daily Freight (1994) Limited v Mosese

[2014] NZHC 217

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

CIV-2013-404-003851 [2014] NZHC 217

BETWEEN

DAILY FREIGHT (1994) LIMITED

Plaintiff

AND

SUSHILA DEVI MOSESE Defendant

AND

MATAGI MOSESE Second Defendant

Hearing:	17 February 2014 (by telephone conference)
Appearances:	P Davey for the Plaintiff E Telle for the First and Second Defendants
Judgment:	18 February 2014

FINAL JUDGMENT OF ASSOCIATE JUDGE SARGISSON

This judgment was delivered by me on 19 February 2014 at 5.00 p.m. pursuant to Rule 11.5 of the High Court Rules.

Registrar/Deputy Registrar

Date.......................................

Solicitors:           Neilsons, Auckland

Howard-Smith & Co, Auckland

DAILY FREIGHT (1994) LIMITED v MOSESE & Anor [2014] NZHC 217 [18 February 2014]

[1]      I  issued  an  interim  judgment  on  18  December  2013  against  the  first defendant, Sushila Mosese.

[2]      In that judgment  I referred to Ms Mosese’s claimed defence based on a

settlement agreement with a third party and set out the interim result:

[24]   I note that though counsel for the plaintiff argues that this not  a  case  where  damages  should  be  deferred  to  trial, he  acknowledges  that  judgment  should  not  be  given for  $4,449,967.94  in  an  unqualified  way.     Based  on Body Corporate 185960 v North Shore City Council  he submits that the Court should enter judgment for liability and for quantum in the sum of $4,449,967.94, but noting by way of qualification that the full amount of the settlement sum cannot be enforced by reason of the settlement with the third party.

[25] Such approach presupposes that the defendant is not designated as a beneficiary in the settlement agreement for the purpose of the Contracts (Privity) Act.  Though I do not consider that this remaining issue necessarily warrants deferral for trial as I have noted I do not propose to rule on that issue without hearing more from counsel.

[26]    In the circumstances I enter judgment as to liability and I

adjourn the issue as to quantum on these terms:

a)  If the plaintiff wishes to have a determination on the issue of quantum it is to file and serve an affidavit exhibiting the settlement agreement and supporting memorandum setting out any submissions on the issue whether or not the settlement enures for the benefit of the  defendant  in  terms  of  Gardiner  not  later  than

23 January 2012.   The plaintiff may if it wishes also file and serve an application seeking orders as to confidentiality, by 23 January 2014.1

b) The defendant may file any documents in opposition and    supporting    memorandum    not    later    than

7 February 2014.

c)  The  matter  is  to  be  listed  in  the  Miscellaneous companies List on 14 February 2014 at 11.45 a.m. for review  and  the  allocation  of  a  further  fixture  if required.

1 The reference to Gardiner is to be read in the context of the case law discussed at [9] to [11] of the interim judgment and in particular to Allison v KPMG Peat Marwick [2000] 1 NZLR 560 (CA).

[27]    For the avoidance of doubt this judgment is issued as an interim judgment only.

[28]    I  will  deal  with  costs  issues  when  I  issue  my  final judgment.

[3]     The parties have now filed additional affidavit evidence and supporting memoranda and I have heard from counsel at yesterday’s telephone conference.  The plaintiff’s evidence exhibits the settlement agreement referred to in the interim judgment and a recent further settlement agreement with another third party.   The effect is that there have been settlements between the plaintiff and third parties totalling $3.25 million.  Payment has been made pursuant to the first settlement and payment is anticipated shortly pursuant to the second.

[4]      I am satisfied that neither of the settlement agreements releases the first defendant  from  her  liability  to  the  plaintiff,  and  that  the  combined  settlement amounts do not fully satisfy the total amount of the plaintiff’s claim.   In these circumstances I am also satisfied that the plaintiff is entitled to a determination against the first defendant on the issue of quantum in the full amount of its claim.  I order:

[a]       The interim judgment as to liability stands.

[b]       Judgment is given as to quantum in the sum of $4,449,967.90.

[5]      In   giving   judgment   as   to   quantum,   I   note   the   plaintiff’s   earlier acknowledgement (properly given) that the full amount of the settlement sum cannot be enforced in respect of any sum that has been paid to the plaintiff by the third parties by way of settlement.

[6]      I turn  next  to  the  outstanding  issues  as  to  interest.    I stood  yesterday’s telephone conference down briefly at counsel’s joint request to allow them to take instructions.   Realistically, the plaintiff accepts that interest should be confined to interest on the sum of $1,199,967.90, being the difference between the sum for which I have entered judgment, and the amount that the plaintiff has received or anticipates  receiving  shortly  pursuant  to  the  settlements  with  the  third  parties.

Additionally, the parties are agreed that interest on that sum should run from the date of judgment until the date of payment at the rate of 5%, as provided for under High Court Rule 11.7 and s 87 Judicature Act 1908.  I order accordingly.

[7]      I reserve all issues of costs as counsel seek the opportunity to confer and to take instructions.   Counsel for the plaintiff points out that on the face of it the plaintiff has a prima facie entitlement to scale costs on a 2B basis but counsel for the first defendant has raised the question of whether in the Court’s overall discretion there should be a reduction in the amount of costs, having regard to the time and cost that first defendant has been put to in order to obtain discovery of the settlement agreement, file related memoranda and evidence, and attend to yesterday’s telephone conference. It is appropriate therefore that counsel do take the opportunity to confer and to seek instructions.

[8]      If agreement on costs is reached counsel are invited to file  a brief joint memorandum, failing which memoranda should be filed as follows:

[a]       Counsel for the plaintiff by 12 March 2014;

[b]       Counsel for the first defendant by 19 March 2014.

[9]      The remaining matter before me is the application that the plaintiff has filed seeking orders as to confidentiality.  I deal with this in a separate minute.

Remaining causes of action

[10]     There also remains for future resolution a third cause of action against the first defendant and the plaintiff’s claim against the second defendant who is represented by the same counsel as the first defendant.   Counsel advise that the parties would like a brief period to consider their respective positions in view of the summary judgment that has been entered against the first defendant before further directions are made.

[11]     In these circumstances, I defer making further directions and I adjourn the proceeding to the Chambers List on 21 March 2014 at 2.15 pm.   Counsel are requested to file and serve memoranda at least two working days prior to the Chambers hearing setting out their proposed directions relating to discovery, a timetable for any other necessary interlocutory steps, pre-trial directions, and the parties’ proposed forum for settlement discussions.   Alternatively (and preferably) counsel may file a joint memorandum one day prior to the Chambers hearing setting out the consent directions that they propose.

…………………………….

Associate Judge Sargisson