Fullers Bay of Islands Limited v Northland Regional Council

IN THE COURT OF APPEAL OF NEW ZEALAND

CA210/00

BETWEEN	FULLERS BAY OF ISLANDS LIMITED
Appellant

AND	NORTHLAND REGIONAL COUNCIL
First Respondent

AND	OPUA FERRIES LIMITED
Second Respondent

CA211/00

BETWEEN	FULLERS BAY OF ISLANDS LIMITED
Appellant

AND	COMMERCE COMMISSION
First Respondent

AND	FAR NORTH MARITIME LIMITED
Second Respondent

Hearing:	1 February 2001
Coram:	Keith J Blanchard J McGrath J
Appearances:	W W Peters for Appellant R M Bell for Northland Regional Council J W Tizard for Opua Ferries Limited P D Woolley for Commerce Commission
Judgment:	8 February 2001

JUDGMENT OF THE COURT DELIVERED BY MCGRATH J

Opua Ferries Limited and the Commerce Commission apply for conditional leave to appeal to the Privy Council against a judgment of this Court delivered on 14 December 2000. In that judgment this Court allowed an appeal by Fullers Bay of Islands Limited (Fullers) against a judgment of the High Court (CP45/98 and CL23/98, Auckland, 11 September 2000, Robertson J) on a preliminary question, under R418 High Court Rules. The effect of this Court’s decision on the preliminary question, which Opua Ferries and the Commission wish to challenge, was to rule that Fullers’ operation of a second ferry on its service between Opua and Okiato Point in the Bay of Islands is in accordance with the terms of the Transport Services Licensing Act 1989 (the 1989 Act).
There are two sets of proceedings in the High Court which are directly the subject of this Court’s ruling. In the first (CP45/98) Opua Ferries seeks a declaration against the Northern Regional Council and Fullers that the terms in which it had registered the ferry service in question with the Council under the 1989 Act did not permit Fullers to operate a second ferry. This turns on whether the original registration of the service specified a departure each ten minutes or, rather, each twenty minutes, from each ramp. In the second proceeding (CL23/98) the Commerce Commission seeks a declaration against Fullers that it had entered into a lease with Far North Maritime Limited of a slipway and departure point at Opua for the purposes of the ferry service the effect of which was exclusionary and in breach of ss27 and 36 of the Commerce Act 1986 because it substantially lessened competition in the relevant market.
There are two separate additional proceedings, involving the same parties and concerning their dispute over the same service. These additional proceedings were not the subject of the R418 application. Because it has some relevance to the present application it will however later be necessary to touch on one of them.
Robertson J’s decision in favour of Opua Ferries Limited and the Commission on the preliminary question turned on his reading of a timetable and fare schedule of ferry services submitted by Fullers to the Council in January 1991 as part of its registration of an intention to operate the passenger service under the 1989 Act. However, contrary to that finding, the judgment of this Court construed the timetable as signifying a shuttle involving two crossing ferries, each leaving from opposite terminals every ten minutes. It is that interpretation which Opua Ferries and the Commission seek to challenge in their respective applications for conditional leave to appeal.
On behalf of Opua Ferries Mr Tizard submitted to us that an appeal lies as of right under R2(a) of the Order in Council of 1910.   Alternatively he seeks to bring the case within the discretionary provisions of R2(b).   The relevant provisions provide:
2. Subject to the provisions of these Rules, an Appeal shall lie-
(a)       As of right, from any final Judgment of the Court of Appeal where the matter in dispute on the Appeal amounts to or is of the value of [five thousand New Zealand dollars] or upwards, or where the Appeal involves, directly or indirectly, some claim or question to or respecting property or some civil right amounting to or of the value of [five thousand New Zealand dollars] or upwards; and
(b)       At the discretion of the Court of Appeal from any other Judgment of that Court, whether final or interlocutory, if, in the opinion of that Court, the question involved in the Appeal is one which by reason of its general or public importance or of the magnitude of the interests affected or for any other reason, ought to be submitted to His Majesty in Council for decision.
To show an appeal lies as of right Opua Ferries and the Commission must point first to a judgment that is final, and secondly to a matter in dispute, or alternatively a claim or question, having the requisite value. A final judgment is one that finally disposes of the parties’ rights in substantive terms. Mr Tizard for Opua Ferries contended, and we accept, that the answer to the preliminary question that was given by this Court finally determines whether Fullers had the right to operate a ferry service every ten minutes rather than twenty minutes from each departure point. Where it is sought to appeal from a decision on a separate question under R418 of the High Court Rules the Privy Council has made it clear that R2(a) is not to be interpreted in a way which would deprive a party of a right of appeal solely because the hearing is divided into two parts; (Strathmore Group Limited v Fraser [1992] 3 NZLR 385). The finality of the judgment is thus established in Opua Ferries’ declaratory judgment proceedings in relation to the 1989 Act (CP45/98 and CA210/00).
In relation to the Commerce Commission’s proceedings for a declaration of breach of the 1986 Act (CL23/98 and CA211/00) we initially doubted that the Court of Appeal’s judgment could be said to be final as it did not address issues of the anti‑competitive effect of Fullers’ lease or conduct. However it has been demonstrated to us that the judgment of this Court will stand in the way of any further steps in the Commerce Commission proceeding. That is because if the concurrent use of two ferries by Fullers on the service continues (and if this Court’s judgment stands it plainly will) there will be no scope in terms of operational feasibility for a competing service to function. In those circumstances it will not be the terms of the lease which have the exclusionary effect, but the fact that there is no room in operational terms for Opua Ferries to compete.
It is true, as Mr Peters pointed out, that Opua Ferries, for the present at least, remains licensed to conduct a competing service but we are nevertheless persuaded by Mr Tizard’s argument, with which Mr Woolley joined, that in practical terms this Court’s judgment finally disposes of the Commission’s proceeding. The requirement of finality is thus met in both proceedings that were subject of the appeal to this Court.
Turning to the second requirement of at least $5,000 in value, the Rule provides that it can be met in one of two ways. The first entails there being a matter in dispute on the appeal of a value of at least $5,000. Under this limb an indirect claim, even if of the requisite value, cannot suffice; (Re Bateman Television Ltd [1974] 2 NZLR 221,222). As neither of the proceedings in which the appeal was brought directly raises any question of measurable value this limb of R2(a) is not satisfied.
The second limb, however, is satisfied if the appeal indirectly involves a claim amounting to more than $5000. Here Mr Tizard relies on one of the current separate proceedings in which Opua Ferries claims damages of $907,295 against Fullers for its alleged Commerce Act breaches. On the material before us this claim is neither nebulous nor, as Mr Bell argued, speculative, although it is course yet to be proved. Mr Tizard argues that the Court of Appeal’s judgment indirectly disposes of this proceeding, which involves a claim of the requisite value, for the same reasons that it finally disposes of the Commerce Commission’s declaratory proceedings for breaches of the Commerce Act. We agree that is so and that Opua Ferries accordingly has established its right to appeal under R2(a).
We have not overlooked Mr Peters’ submission that parties to litigation should be aware of the dangers of a two part trial. However, as we have pointed out, the Privy Council has also made it clear that R2(a) is not to be interpreted in a way which would deprive a party of a right of appeal solely because a hearing is divided into two parts.
Once it is plain Opua Ferries is entitled to appeal it follows that the Commission should also have leave even if it is questionable whether in that context the value requirement is met. The Commission’s proceedings in practical terms are part of the same dispute as those of Opua Ferries and its appeal involves the same issue. Accordingly, under R2(b), we also grant its application.
Both the applications for conditional leave to appeal are accordingly granted.   Leave is granted on the following two conditions:
[a]          that within three months from 8 February 2001 the respondents, Opua Ferries Limited in CA210/00 and the Commerce Commission in CA211/00, each enter into good and sufficient security to the satisfaction of the Court in the amount of $2000;
[b]          that within the same period of three months the necessary steps respectively be taken by the respondents for the purpose of procuring the preparation of the record and the dispatch thereof to England.
The appellant has been unsuccessful in opposing leave and must pay costs in the total sum of $3,500 (to be shared by the respondents) together with any disbursements to be fixed if necessary by the Registrar.

Solicitors

Thomson Wilson, Whangarei for Appellant
Webb Ross Johnson, Whangarei, for Northland Regional council
Oakley Moran, Wellington for Opua Ferries Limited

[2001] NZCA 14

8 February 2001