Fassler v Parry
[2012] NZHC 843
•30 April 2012
IN THE HIGH COURT OF NEW ZEALAND WANGANUI REGISTRY
CIV-2011-483-97 [2012] NZHC 843
BETWEEN MARKUS FASSLER Applicant
ANDRUSSELL JAMES PARRY Respondent
Hearing: On the papers
Counsel: J Waugh for the Applicant
H McDouall for the Respondent
Judgment: 30 April 2012
JUDGMENT OF CLIFFORD J
APPLICATION FOR LEAVE TO APPEAL TO THE COURT OF APPEAL
Introduction
[1] In my judgment of 4 November 2011 I allowed an appeal by the respondent, Mr Parry, against a decision of the District Court at Wanganui awarding the applicant, Mr Fassler, damages of $22,000 for the conversion by Mr Parry of beehives belonging to him, together with costs of $44,710.00.1 Mr Fassler now applies for leave to appeal my decision to the Court of Appeal pursuant to s 67 of the Judicature Act 1908.
Legal principles
[2] Where the High Court is not the Court of first instance, the Court of Appeal
may only hear a second appeal if leave is granted. The Court of Appeal’s decision in
Waller v Hider sets out the applicable principles.2 That is the appeal must raise some
1 Fassler v Parry DC Wanganui CIV-2009-0833-276, 15 March 2011.
2 Waller v Hider [1998] 1 NZLR 412 (CA) at 413; Snee v Snee [2000] NZFLR 120 at 125-126.
FASSLER V PARRY HC WANG CIV-2011-483-97 [30 April 2012]
question of law or fact capable of bona fide and serious argument in a case involving some interest, public or private, of sufficient importance to outweigh the cost and delay of the further appeal. When deciding whether to grant leave to appeal, the Court needs to be mindful that the Court of Appeal is not engaged in general error correction upon second appeal, but rather serves to clarify the law and determine whether it has been properly construed and applied in the High Court.
[3] Waller v Hider also confirmed that when the disputed matter is entirely or largely a question of fact, the task of the applicant under s 67 is harder. An issue of fact in a matter falling within the jurisdiction of an inferior Court will seldom be of public importance unless the amount at stake is very substantial or the decision reflects seriously on the conduct or character of the would-be appellant, or the judgment has special consequences (for example, bankruptcy) for the losing party.
[4] If the High Court refuses leave, an application for special leave may be made to the Court of Appeal.
Mr Fassler’s application
[5] For Mr Fassler, Mr Waugh submits that the appeal raises the following questions of law and fact that are capable of bona fide and serious argument:
(a) That I erred in fact and law in finding that Mr Fassler was required (and failed) to prove he had a right to immediate possession of his own property, as Mr Parry had accepted in his statement of defence and at trial in the District Court that Mr Fassler had an immediate right to possession. On that basis, that issue was neither raised in the District Court nor on appeal by either party.
(b)That I erred in fact in finding that Mr Parry did not have the intention to keep Mr Fassler’s property required by the tort of conversion. In doing so I disregarded clear oral and documentary evidence of Mr Parry’s intention presented to the District Court and the acceptance of that evidence by the District Court.
(c) That I erred in agreeing with the District Court’s assessment of damages, and in so doing I failed to take the opportunity to set precedent in terms of the assessment of the quantum of damages for conversion in New Zealand following Kuwait Airways Corporation.3
[6] In terms of private importance, Mr Fassler states that my reversal of the District Court decision has effectively destroyed his beekeeping business and, with that, his livelihood. In terms of public importance, the issue of whether an owner has an immediate right to possession in the absence of what Mr Waugh referred to as evidence of any contrary interest is of clear importance. The basis upon which I reached my decision also raises issues of public importance: in Mr Waugh’s submission, Mr Parry had from the outset conceded that Mr Fassler had a right of immediate possession. Therefore, for me to base my decision on a finding to the contrary is, in effect, unfair. Similarly it was unfair, Mr Waugh submitted, that I had reached my decision on the basis of affirmative defences not pleaded and evidence not heard or accepted in the District Court. There are, in effect, errors of law in my decision which raise issues of general importance.
Mr Parry’s response
[7] In opposing Mr Fassler’s application, Mr Parry argued:
(a) That he had not conceded in his pleading that Mr Fassler had an immediate right to possession of the beehives in question.
(b)That Justice Mallon’s decision of 17 August 2011,4 on his application to amend his statement of claim, allowed him to argue the substantive question of whether or not conversion had occurred.
(c) That in finding that conversion had not been established, I had not considered questions of law or fact that were not properly before me.
3 Kuwait Airways Corporation v Iraqi Airways Co (Nos 4 and 5) [2002] AC 883 (HL).
4 Parry v Fassler HC Wanganui CIV-2011-483-97, 17 August 2011.
Did I err in basing my judgment on whether Mr Fassler had an immediate right to possession of the beehives in question?
[8] As initially framed, Mr Parry’s appeal raised questions of liability only. That is, the contest was over the Judge’s assessment of damages. Prior to trial, however, Mr Parry successfully applied to amend his notice of appeal to include the following two additional grounds of appeal:5
His Honour erred in fact by finding that there was a conversion of the hives to the Appellant’s own use by finding that the Appellant’s visit to the Pohangina Valley Extraction plant occurred after the Trespass Order was served, where it was acknowledged to have occurred before that time.
His Honour erred in fact by finding that there was sufficient demand for the chattels and refusal to return the chattels demanded on which to base an action for conversion; not referring to the email of 14 May 2009 which demanded the Appellant not touch the hives, nor the efforts made by the Appellant to return the hives to the Respondent.
[9] In upholding Mr Parry’s application, over Mr Fassler’s opposition, Mallon J
observed:6
The amendments are opposed in part because counsel for Mr Fassler says that there was at no stage any real issue between the parties as to liability. It is said that Mr Parry’s only defence was that any person other than Mr Fassler could have had access to Mr Parry’s land to obtain Mr Fassler’s property. In my view, however, the statement of defence more broadly denied conversion, and specifically alleged that Mr Fassler had left the property in Mr Parry’s care and that Mr Fassler had “never asked or requested the return of his Hives.” It was therefore for Mr Fassler to prove that the elements of the tort were made out on the evidence. Counsel for Mr Fassler does not contend that the evidence presented at the District Court in support of his case would have been any different on the issues which Mr Parry now seeks to include on the appeal.
[10] I therefore approached this appeal by way of rehearing on the basis that it was for Mr Fassler to establish that the elements of the tort of conversion, including that of a right to immediate possession, were made out on the evidence. In that context, the following observations by the Chief Justice in Austin, Nichols & Co are of relevance, given some aspects of Mr Waugh’s submissions critical of my failure to
follow the approach taken in the District Court or to adopt its findings:7
5 Parry v Fassler HC Wanganui CIV-2011-483-97, 17 August 2011 at [9].
6 At [13].
7 Austin, Nichols & Co Inc v Stichting Lodestar [2007] NZSC 103; [2008] 2 NZLR 141 at [5].
The appeal court may or may not find the reasoning of the tribunal persuasive in its own terms. The tribunal may have had a particular advantage (such as technical expertise or the opportunity to assess the credibility of witnesses, where such assessment is important). In such a case the appeal court may rightly hesitate to conclude that findings of fact or fact and degree are wrong. It may take the view that it has no basis for rejecting the reasoning of the tribunal appealed from and that its decision should stand. But the extent of the consideration an appeal court exercising a general power of appeal gives to the decision appealed from is a matter for its judgment. An appeal court makes no error in approach simply because it pays little explicit attention to the reasons of the court or tribunal appealed from, if it comes to a different reasoned result. On general appeal, the appeal court has the responsibility of arriving at its own assessment of the merits of the case.
[11] As Mr Waugh correctly observes, and notwithstanding Justice Mallon’s observation that it was for Mr Fassler to establish the elements of the tort, in written submissions in support of Mr Parry’s appeal Mr McDouall did not raise the question of whether or not Mr Fassler had a right to immediate possession. Rather, I raised that issue with Mr Waugh at a relatively early stage of his oral submissions. As best as I recall matters, I did not understand Mr Waugh to object to my doing so. Rather, he responded on the basis that as the beehives belonged to Mr Fassler, and notwithstanding the arrangements between Mr Fassler and Mr Parry, Mr Fassler had an on-going right to immediate possession of the hives. Further, and again notwithstanding those arrangements, Mr Fassler could at any time have exercised that right. I am not persuaded, therefore, that it is seriously arguable I was wrong to consider the issue because it had not been raised by Mr Parry.
[12] Mr Waugh also submits I was wrong to consider the issue, and reach the conclusion I had, because Mr Parry had in fact always accepted that Mr Fassler had a right to immediate possession of the hives. Mr Waugh bases that argument on the pleadings.
[13] Paragraph 14 of the revised statement of claim reads, as had the original statement of claim:
The Defendant is detaining goods owned by the Plaintiff in such a way to
amount to an active denial of the Plaintiff’s right to immediate possession.
[14] On my reading, paragraph 14 contains three separate allegations:
(a) the defendant is detaining goods owned by the plaintiff;
(b) the plaintiff has a right to immediate possession of those goods; and
(c) the defendant is detaining the goods in such a way as to amount to an active denial of the plaintiff’s right to immediate possession.
[15] In response, paragraph 14 of the revised statement of defence – noting that more than a little unfortunately Mr Parry was at this stage acting for himself - reads:
I Disagree. The Plaintiff was only denied direct access to this Hives sited at Narnook. (Note Paragraph 10) He could have nominated anyone else to obtain possession of his Hives and goods etc at any time.
[16] In his original statement of defence, Mr Parry had responded:
I Disagree. The Plaintiff has never asked the Defendant for the return of his beehives.
[17] In my view neither version of that paragraph contains the concession Mr Fassler alleged. In particular, the revised statement of defence says, as Mr McDouall submitted, that it disagrees with paragraph 14 of the revised statement of claim. It does not say it “partially” agrees or disagrees: rather it is a complete denial to all the allegations in paragraph 14. It then proffers Mr Parry’s explanation that he had served the trespass notice to prevent Mr Fassler personally coming on to his property, rather than to deny him access to his beehives.
[18] Mr Waugh further submits that, pursuant to r 136(3) of the District Court Rules and r 5.48(3) of the High Court Rules, “an allegation not denied is treated as being admitted”, and as such no evidence was called or required in the District Court with regard to Mr Fassler’s right to immediate possession. However, the denial was to the whole of paragraph 14. Mr Waugh complains about the different allegations within that paragraph not being separately denied. As to that, I note that r 5.14(2) of the High Court Rules requires that each paragraph of a statement of claim must so far as possible be confined to a separate topic. So any deficiencies in Mr Parry’s pleaded response can partially fall at his feet, for not pleading the allegations separately.
[19] Mr Waugh next submits that Mr Fassler’s “ownership of the property and the fact that it was on Parry’s land was never disputed”. That was, I accept, correct. But, as pointed out at paragraph [26] of my judgment, “the tort of conversion depends upon a right to possession, not on title”.
[20] Mr Waugh also submitted that, as regards this question of immediate possession, Mr Parry at no point raised a relevant affirmative defence. I do not see this element of the tort as involving an affirmative defence. What I did say is that Mr Fassler had to establish, notwithstanding his action in placing the beehives on Mr Parry’s land and entering into the relevant arrangements, that he had a right to immediate possession of that property. That is not, in my view, a controversial proposition. Nor, in my view, does it give rise to the question of law suggested by Mr Waugh, namely that my judgment suggests that an owner of property must generally prove no “instrument” exists which might affect a right to immediate possession.
[21] Taken overall, therefore, I am not persuaded that the way in which I raised and dealt with the question of immediate possession provides a basis for a grant of leave to appeal to the Court of Appeal.
Did I err in finding that Mr Parry did not have the requisite intention to keep the beehives?
[22] This was a factual decision based on findings from evidence provided in the District Court.8 I was entitled to view the evidence differently from the District Court. I indicated that Mr Parry’s actions in entering into settlement discussions, and subsequently moving beehives to another of his properties so as to enable Mr Fassler to collect them, provided a basis for concluding that he did not have the requisite intention to keep the hives. In my view, it is clear from Austin, Nichols that no error is involved in that approach. On the contrary, I am required to come to my own
conclusions on the issues before me.
8 See Parry v Fassler HC Wanganui CIV-2011-483-97, 4 November 2011 at [35].
Did I err on my assessment of damages?
[23] On finding that the tort of conversion had not been established, I was not required to discuss damages. What I did do, in the (probably vain) hope of encouraging some reasonable settlement of this matter, was to indicate that, on the basis of the evidence available, I would not have differed from the quantum of damages found by the District Court. I can detect no error there. Mr Waugh’s reference to my failing to set precedent does not, for obvious reasons, persuade me otherwise.
Did I consider matters not properly before me?
[24] Taking Mr Waugh’s written submissions together with Mr Fassler’s affidavit in support, I think there are essentially three categories of material that it is contended that I had regard to that I should not have:
(a) in terms of the immediate possession issue, the terms of the contractual arrangements between Mr Parry and Mr Fassler;
(b)in terms of the question of necessary intent, various matters referred to at [33] of my judgment; and
(c) the matter I have already dealt with (see [20]), the question of affirmative defences.
[25] As regards my reference to the contractual arrangements between Mr Parry and Mr Fassler, those arrangements were in fact pleaded by Mr Fassler (amended statement of claim paragraphs 3 – 6) and were referred to in the District Court judgment at paragraphs [3], [16], [28] and [30]. I pointed out that “little or no attention was paid to the contractual arrangements in the District Court, or to the issue of whether Mr Fassler had a right to immediate possession”. This did not mean that I was not entitled to look at the evidence in the District Court to establish if such a right existed. In doing so, I disagreed with the District Court Judge’s conclusion that, because the claim was based on conversion, in these circumstances “it was not necessary for [him] to find the extent of the contractual arrangement between the
parties nor to imply conditions into the contract to give it meaning”. In my view, that is where the Judge erred: the terms of those contractual arrangements were central to the issue of Mr Fassler’s right to immediate possession. I do not see how that approach involves relevant error.
[26] As regards paragraph [33] of my judgment, I there refer to the following evidence, all of which was before the District Court:
(a) The meeting on 8 April 2009 with James Black: this meeting is referred to both in the briefs of evidence and affidavits of Mr Fassler and Mr Parry provided to the District Court.
(b)The attempts by Mr McCammon to broker a settlement between Mr Fassler and Mr Parry in April 2009, specifically referring to an email of 24 April that gave the appearance that Mr McCammon thought both parties had agreed to that proposal: this email is referred to on page 14 of Mr Parry’s affidavit of 28 September 2009 filed in support of his statement of defence, and is attached as annex 3.
(c) That Mr Parry had made an arrangement, in co-operation it would appear with local Police, for at least some of Mr Fassler’s hives to be able to be picked up: these attempts at arrangements with the Police are referred to in paragraph 11(c) of Mr Parry’s brief of evidence dated 23 April 2010 and on page 15 of Mr Parry’s affidavit of support of 28 September 2009.
(d)That Mr Fassler took back into his possession hives from Mr Parry’s Marton property prior to obtaining his prohibitory injunction: evidence of this was provided to the District Court, both in appendices attached to Mr Parry’ statement of defence and the brief of evidence of Heather Wilson (in support of Mr Fassler). Mr Fassler also
accepted this under cross-examination.9
9 See p 18 of the District Court transcript.
[27] As such Mr Fassler cannot maintain that the evidence relied on was not before the District Court and me.
Conclusion
[28] I am therefore satisfied that Mr Fassler has not established that he should have leave to appeal my decision to the Court of Appeal.
[29] Mr Fassler’s application for leave to appeal is dismissed. Mr Fassler may apply to the Court of Appeal for special leave. In that context I draw his and Mr Waugh’s attention to the recent discussion by the Court of Appeal of the principles of the tort of conversion in Glenmorgan Farm Ltd (in receivership and in liquidation) v New Zealand Bloodstock Leasing Ltd [2011] NZCA 672 at [25] and following.
“Clifford J”
Solicitors:
Horsley Christie, P O Box 655, Wanganui for the applicant ([email protected]) Jack Riddet Tripe, P O Box 5, Wanganui for the respondent([email protected])
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