Falanaiki v Fereti

[2015] NZHC 291

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

CIV 2014-404-1879 [2015] NZHC 291

BETWEEN

AUKUSO FALANAIKI, FIALELEI

NAITITI, KUATEMANE FERETI, LEO APOLONE SWANNEY, FITELI LEMAANA AND OLIVA PAPALII AS TRUSTEES OF THE FOUNTAINS OF LIVING WATER SUPPORT TRUST Plaintiffs

AND

LINCOLN FALEAUTO FERETI Defendant

Hearing:	(on the papers)
Counsel:	P J Wright and H E McQueen for Plaintiffs
Judgment:	26 February 2015

JUDGMENT OF HEATH J

This judgment was delivered by me on 26 February 2014 at 2.00pm pursuant to Rule

11.5 of the High Court Rules

Registrar/Deputy Registrar

Solicitors:
Andrew Seton Law Ltd, Auckland
Counsel:

P J Wright/H E McQueen, Auckland

FALANAIKI v FERETI [2015] NZHC 291 [26 February 2015]

Introduction

[1]      On 18 November 2014, summary judgment was entered against Mr Fereti in the  sum  of  $230,495.62  (inclusive  of  interest  and  costs).    A  without  notice application has now been made by the plaintiffs for an order that Mr Fereti attend for oral examination before the Court, so that his means of satisfying the judgment can be established.

[2]      I  thank  Ms  McQueen  for  her  helpful  memorandum  in  support  of  the application.

Legal principles

[1]      There is jurisdiction to make an examination order.  Rule 17.12(1)(b) enables such an application to be made by a judgment creditor at any time after judgment is sealed.   The application may seek an order requiring the examinee to attend the Court to be orally examined on oath about the standard issues to which r 17.12(3) refers and any additional issues that the Court considers necessary.1   There is power to order production of documents at the examination, and to impose conditions for the conduct of the examination.2     I am entitled to deal with the application on a without notice basis and without a hearing.3

[2]      An application may be made irrespective of whether a notice has been served under r 17.10.4   A notice under r 17.10 requires a party liable to pay a judgment to complete and serve on a judgment creditor a statement of specified receipts and payments, assets and liabilities, income and expenditure and means of satisfying the judgment.5

[3]      Notwithstanding the discretion reposed in the Court, once judgment has been entered the Court will generally make an order in favour of a judgment creditor who

needs to know against what assets the judgment can be enforced.6

1      High Court Rules, r 17.12(2).

2      Ibid, r 17.12(4).

3      Ibid, r 17.12(5).

4      Ibid, r 17.12(1).

5      Ibid, r 17.10(2).

6      Wiltshire Investments Ltd v Halstead (2010) 19 PRNZ 932 (HC) at para [14](a) and (b).

Analysis

[4]      I am satisfied that the plaintiffs have a judgment of this Court that they are entitled to enforce and that they need to know what assets are available against which judgment can be enforced.   Following entry of summary judgment on 18

November 2014, a letter of demand was sent to Mr Fereti claiming the judgment sum.  No response was received to that letter.

[5]      Although a Notice to Liable Party and Financial Statement was not served personally on Mr Fereti, that is not a bar to the making of an order.7   The failure to serve such a notice on a judgment debtor is a factor that is taken into account in the exercise of the discretion to make an examination order.  In this case, the Notice was attached to the door of Mr Fereti’s last known residence and sent by email to him, together with a text message drawing his attention to the fact that step had been taken.  I am satisfied that the judgment creditors have done everything possible to contact Mr Fereti to obtain payment of the judgment sum.

[6]      There is no reason why the judgment creditors should not be entitled to examine on the standard issues to which r 17.12(3)(a) refers.   Nor is there any difficulty in requiring a completed financial statement in Form E2 of the High Court Rules to be produced at the examination, together with bank statements, current financial statements and other documents relevant to Mr Fereti’s financial position. My only concern was with the production of bank statements in the name of a company, 17iGroup Ltd.  On reflection, I consider they are relevant to Mr Fereti’s ability to access funds from that source.

[7]      I have considered the draft order for examination.   I am satisfied that the orders set out in para 3 of the draft should be made.   I am also satisfied that the notice to defendant set out in para 4 of the draft order complies with r 17.12(6) of the

High Court Rules.

7      High Court Rules, r 17.12(1).

Result

[8]      I make an order in terms of the draft submitted by counsel for the plaintiffs.8

[9]      Costs are sought on the application.  As the plaintiffs have been successful and Mr Fereti has taken no steps to respond to the judgment, I award costs in favour of the plaintiffs on a 2B basis, together with reasonable disbursements.  Both costs

and disbursements are to be fixed by the Registrar.

P R Heath J

Delivered at 2.00pm on 26 February 2015

8      I draw counsel’s attention to the incorrect heading on the first page of the order, which refers to “substituted service” rather than “examination”. That is plainly a slip and can be changed when the order is submitted for sealing to the Registrar.