Erwood v Glasgow Harley

[2006] NZCA 348

IN THE COURT OF APPEAL OF NEW ZEALAND

CA52/06

BETWEENROBERT ERWOOD

Applicant

ANDGLASGOW HARLEY

First Respondent

ANDRAYLEE PATRICIA HARLEY

Second Respondent

Hearing:4 December 2006

Court:O'Regan, Robertson and Gendall JJ

Counsel:A C Beck for Applicant

N A Till for First Respondent
J A Farmer QC for Second Respondent

Judgment:11 December 2006 at 3 pm

JUDGMENT OF THE COURT

A        The application for special leave to appeal out of time is dismissed.

B        We award costs to $750 to each of the respondents.

REASONS OF THE COURT

(Given by O’Regan J)

Introduction

[1]       This is an application for special leave to appeal against a decision of the High Court, Erwood v Glasgow Harley and Another HC AK CIV-2002-404-001663 15 December 2005 Harrison J.  Special leave is required because the appeal was not filed in time.  The last date for the filing of an appeal within time was 3 February 2006.  The application for special leave was filed on 16 March 2006.  The application is made under r 29(4) of the Court of Appeal (Civil) Rules 2005.  That rule provides that a party may apply for special leave to appeal out of time in accordance with Part 2 of the Rules if he or she wishes to have the period extended, in the event that the appeal period has expired. 

[2]       There are three grounds on which the application is based.  These are:

(a)       The delay has not caused prejudice to any other party;

(b)The delay was caused by Mr Erwood having to move out of Auckland, and being unable to instruct counsel in Wellington before the date on which the application for special leave was made;

(c)A serious injustice will have occurred if the consent order of Frater J dated 25 November 2003, which Mr Erwood sought to challenge in the High Court, is allowed to stand. 

Background to the decision of Harrison J

[3]       The decision of Harrison J needs to be placed in context.  He had before him an application by Mr Erwood for an order reviewing a decision by the Registrar of the High Court at Auckland refusing to accept for filing Mr Erwood’s application to recall and set aside consent orders.  From the decision of Harrison J, it is apparent that the objective of the application was to seek an order setting aside consent orders made by Frater J in earlier litigation between Mr Erwood and the respondents.  The consent orders were made after the applicant’s claim was settled at a judicial settlement conference at which Mr Erwood was represented by a litigation guardian and counsel representing the litigation guardian, but was not, himself, present.  The basis of the application was apparently that the appointment of the litigation guardian ought to have terminated prior to the settlement conference. 

[4]       Mr Erwood commenced High Court proceedings against the respondents in May 2002.  Glasgow Harley had been Mr Erwood’s solicitors, and Mrs Harley had been his counsel in litigation which arose from the loss sustained by Mr Erwood of a substantial amount which he invested through the Upper Hutt law firm Renshaw Edwards, which collapsed in 1992 (for greater detail, see Harley v McDonald [2002] 1 NZLR 1 (PC)).

[5]       On 21 May 2002, Harrison J made an ex parte order appointing Mr Minchin, an Auckland barrister, as Mr Erwood’s guardian ad litem on the ground that Mr Erwood was mentally disordered.

[6]       In December 2002 Mr Minchin applied for an order appointing another Auckland barrister, Mr Bambrook, as counsel assisting the Court under r 438A of the High Court Rules, which provides for the appointment by the Solicitor-General of a counsel to assist the Court if the Court so requests.  Harrison J declined to make such an appointment or make a request to the Solicitor-General, on the basis that r 438A does not provide jurisdiction for the Court to appoint a counsel to appear for a party and take a partisan role.  He also declined to make such an appointment in the Court’s inherent jurisdiction.  At the end of his judgment, Harrison J recorded that the guardian ad litem was willing to consider a method of resolution of the dispute other than by trial, for which the Judge commended him.  The Judge noted that in view of Mr Erwood’s difficulties, decisions about settlement would have to be made by Mr Minchin as guardian ad litem independently of Mr Erwood himself. 

[7]       When the matter became Harrison J again in September 2003, the Judge recorded in a minute that all counsel had agreed that the parties should participate in a judicial settlement conference under r 442 of the High Court Rules.  He noted that counsel for Mrs Harley had expressed concerns about the nature and extent of Mr Minchin’s authority to settle the claim, but that Mr Bambrook, as counsel for Mr Minchin, had provided “unconditional assurances” that he received instructions from Mr Minchin and that Mr Minchin had absolute authority to negotiate and settle all the terms of any agreement.

[8]       The settlement conference took place on 25 November 2003 before Frater J.  A further assurance was given at that conference by Mr Bambrook that decisions to be made at the conference would be made by Mr Minchin independently of Mr Erwood.  A settlement was reached at that conference, and the agreed outcome was recorded in consent orders made by Frater J on 25 November 2003.  The respondents agreed to pay Mr Erwood $45,000 without admission as to liability within 60 days of the order.  The $45,000 sum was free of any set-off or claim for unpaid costs owing to the respondents, and the respondent released and discharged all claims for unpaid fees owing to them by Mr Erwood.  It was agreed that Mr Erwood as plaintiff released and discharged the respondents in relation to his claim against them, and all other claims that he might or could have made, or which he could make against them arising from their retainer as his legal advisers.  The respondents made the payment of $45,000 on 23 January 2004.

[9]       In early December 2003, Mr Erwood personally filed an application to recall and set aside the consent order.  In a minute dated 9 December 2003, Harrison J directed that the Registry return these documents to Mr Erwood.  He did so because, in an earlier minute dated 20 June 2003, he had directed that documents filed by Mr Erwood personally should not be accepted by the Registry because Mr Erwood was being represented in the litigation by Mr Minchin as his guardian ad litem.

[10]     On 12 January 2004 Mr Minchin applied to the High Court for orders:

(a)Discharging him as litigation guardian in the proceedings against the respondents;

(b)Permitting Mr Erwood to be represented by himself or his counsel; and

(c)Recalling and setting aside the consent orders of 25 November 2003.

[11]     The matter became Frater J, and by a minute dated 16 February 2004 she made an order discharging Mr Minchin as litigation guardian.  She recorded that Mr Bambrook, as counsel for Mr Erwood, sought an order dismissing the application insofar as it related to points (b) and (c) above, and the Judge therefore dismissed those aspects of the application. 

[12]     Mr Erwood did not appeal against the decision of Frater J dismissing the recall application, though perhaps this is not surprising given that the Judge’s decision was made at the instigation of Mr Erwood’s counsel. 

[13]     Later in 2003 (probably in July of that year), Mr Erwood tried to file another application to set aside the consent order of 25 November 2003.  The Registrar of the High Court refused to accept the documents which Mr Erwood submitted for filing.  Mr Erwood made an application to review the Registrar’s which was dismissed by Harrison J: that is the decision against which Mr Erwood now wishes to appeal.  The precise nature of what was sought by Mr Erwood in the application which he tried to file at the High Court was not disclosed either to us or to the respondents, despite counsel for the respondents requesting a copy.  However, Mr Beck confirmed from the Bar that the application was, indeed, a further application to recall and set aside the consent orders of 25 November 2003.

Reasons for extension of time

[14]     As indicated above, the period within which an appeal to this Court against the decision of Harrison J of 15 December 2003 expired on 3 February 2006.  No appeal was filed within that time.  In an affidavit filed in this Court in support of the present application for extension of time, Mr Erwood gave the following reasons for his failure to appeal within time: he had had to leave Auckland pursuant to a direction made by MacKenzie J in separate proceedings relating to the death of his brother, there had been no decision extending his legal aid so he did not have counsel, he was homeless following his brother’s death, and he was only informed that no appeal had been filed two weeks before the date of his application to appeal out of time, so he had applied for leave on his own behalf.

[15]     In his application for leave to appeal on the same day, the applicant said that the delay was “caused by my having to move out of Auckland.  I have been unable to instruct counsel in Wellington to date”.

[16]     In his submissions in support of the application, counsel for the applicant, Mr Beck, gave this version of events:

In the High Court, the appellant was represented by counsel on legal aid.  He was always dissatisfied with the High Court decision, and instructed his lawyer to appeal.  He expected that an appeal would be filed in time.

No appeal was filed within the period prescribed by the Rules, nor was any application made for legal aid in order to pursue the appeal.  It is not clear why this was not done.  The appellant was occupied with other legal matters, and had to leave Auckland to attend them.  He only discovered the true state of affairs after the time for appealing had already expired.

When he discovered what had happened, the appellant immediately took steps to obtain leave to appeal out of time.

[17]     After written submissions had been filed, a further affidavit was filed by Mr Erwood.  In this affidavit, he said he was represented by counsel in the High Court on legal aid.  He instructed his lawyer to appeal.  He discovered only in March 2006 that no appeal had been filed.  He said there were some difficulties in obtaining legal aid for the appeal, but these have no bearing on the late filing of the appeal.

[18]     Finally, an affidavit was sworn by John Cox, an Auckland solicitor who was the solicitor instructed by the applicant in connection with the application to recall the consent orders was filed by the applicant on 27 November 2006.  Mr Cox deposed that, during December 2005 and January 2006, the applicant contacted him on a number of occasions and instructed him to lodge an appeal against the decision of Harrison J of 15 December 2005.  Mr Cox said he advised counsel that the applicant wished to appeal and left several messages for counsel.  He said that counsel eventually returned the applicant’s entire file to his offices on 7 February 2006, stating that he was no longer instructed.

[19]     There are a number of inconsistencies in the various versions of events outlined above.  No affidavit from the applicant’s counsel was filed, and a request by the respondents that privilege be waived so that enquires could be made with Mr Erwood’s counsel was refused.

Test to be applied

[20]     There are a number of authorities of this Court which make it clear that the ultimate test in determining applications of this kind is whether the granting of leave would meet the overall interests of justice: State Insurance Limited v Brooker (2001) 15 PRNZ 493 at [9].  The whole history of the matter is to be taken into account: Belling v Belling (1996) 9 PRNZ 469 at 471.  As this Court noted in Avery v No 2 Public Service Appeal Board [1973] 2 NZLR 86 at 91, the position of an intended applicant changes if he or she fails to file an appeal within the applicable time limit. In that event, the applicant’s status changes from a person who has a right to appeal regardless of the merits of the appeal to a person seeking an indulgence from the Court, which will be granted only if the interests of justice so demand.

Grounds

[21]     Mr Beck focused his submissions on two grounds.  These were:

(a)       The delay was not significant and no significant prejudice arose;

(b)       There is merit in the appeal. 

[22]     We will evaluate each of these in turn.

Delay

[23]     The delay in filing the appeal was about six weeks after the deadline for filing.  Mr Beck said there were a number of decisions of this Court where the Court had granted leave in circumstances where the delay had been caused by an error or omission on the part of a solicitor, and prompt action had been taken to rectify the position.  An example is Board of Governors of Wesley College v Richardson (2000) 15 PRNZ 490.  He said that the six week delay had not caused particular prejudice in this case. 

[24]     The reasons given by the applicant for the failure to file the appeal within time are inconsistent.  His initial explanation indicated that he had no lawyer acting for him, but his later explanation is that he instructed his lawyers and there was some failing on their part.  However the affidavit from Mr Cox indicates that counsel returned the file to Mr Cox on the basis that counsel was no longer instructed, which would appear to confirm Mr Erwood’s initial explanation that he had no lawyer acting for him.  In the absence of an affidavit from his counsel or a waiver of privilege to allow enquiries to be made with counsel, we are not prepared to make a finding that there was an error by counsel in not filing the appeal in time. 

[25]     Nevertheless, we accept Mr Beck’s submission that the delay is not inordinate in the present case, and that the applicant took steps reasonably promptly to rectify the position when it became clear to him that there had not been action taken to file an appeal.

[26]     We also accept that the six week delay does not, of itself, constitute a significant prejudice for the respondents, that is we do not see their position as being significantly worse as a result of an appeal being filed six weeks late when compared to the position they would be in if the appeal had been filed within time. 

Merits of the appeal

[27]     Mr Beck said it was seriously arguable that the decision of Harrison J was incorrect, and that Mr Erwood should have been permitted to file his application in the High Court.  We do not think it is necessary to make a finding about the merits of the appeal.  We will assume for the purposes of the present application that the appeal against the particular decision made by Harrison J (namely to decline to review the Registrar’s decision to refuse to accept for filing the applicant’s application to recall and set aside the order appointing his litigation guardian and consequently the consent order) is not hopeless.

Overall interest of justice

[28]     When considering the overall interest of justice, however, we cannot ignore the tortured history of this proceeding in the High Court and the multiplicity of applications which the applicant (or representatives on his behalf) have made or attempted to make since the consent order was made in November 2003: Belling v Belling.  An applicant cannot expect any indulgence from the Court to continue litigation which smacks of an abuse of process. 

[29]     Both Mr Till and Mr Farmer QC emphasised this aspect of the case to us.  Mr Till noted that Mr Erwood was, in effect, seeking to attack a decision initially made in June 2003 to the effect that he had no status to file documents personally because the rights and obligations of the plaintiff in the litigation had been vested in the litigation guardian.  He emphasised the importance to the respondents of the assurances given by the litigation guardian and counsel representing the litigation guardian both before and during the settlement conference to the effect that they had authority to reach a full and final settlement, and the reliance which was placed on those assurances by the respondents in settling the litigation and, subsequently, making the $45,000 payment required by the consent order.  He pointed to the fact that there have now been three applications (or attempts to make applications) to the High Court to set aside the consent order which were dismissed on 9 December 2003, 16 February 2004 and 15 December 2005 respectively.  Apparently an appeal was filed in relation to the first of these but subsequently abandoned.  He argued that the conduct of the applicant was vexatious.

[30]     Mr Farmer described the applicant’s conduct as representing “a willingness to manipulate the Court’s processes to his own end”.

[31]     These contentions were strongly resisted by Mr Beck.  He emphasised the importance of access to justice, and said the applicant ought to be able to pursue his appeal so that his access to the Courts is not unfairly restricted.

[32]     Despite Mr Beck’s forceful submissions in support of the application, we agree with the respondents that the repeated attempts at re-opening litigation which was settled and subject to consent orders three years ago smacks of abuse of the Court’s processes.  In those circumstances we can see no proper basis for the Court granting an indulgence to the applicant to continue litigation of that nature.  Having regard to the whole history of this litigation, we are not satisfied that the interest of justice would be served by the granting of the indulgence, and in those circumstances we are not prepared to extend the time for the filing of the proposed appeal.

Result

[33]     The application is declined.

[34]     We award costs to the respondents of $750 each.

Solicitors:
Peter Sara, Dunedin for Applicant
Raymond Donnelly, Christchurch for First Respondent
Russell McVeagh, Wellington for Second Respondent