Gower v FTG Securities Ltd - [2020] NZHC 1105

IN THE HIGH COURT OF NEW ZEALAND CHRISTCHURCH REGISTRY

I TE KŌTI MATUA O AOTEAROA ŌTAUTAHI ROHE

CIV–2018–409–000229

[2020] NZHC 1105

UNDER s 34 of the Receiverships Act 1993

IN THE MATTER

of the receivership of Tuam Ventures Limited (in rec and in liq)

BETWEEN

COLIN ANTHONY GOWER and

STEPHEN JOHN TUBBS as receivers of Tuam Ventures Limited (in rec and in liq) Applicants

AND

FTG SECURITIES LIMITED

First Respondent

AND

ROBERT BRUCE WALKER as liquidator of Tuam Ventures Limited (in rec and in liq) Second Respondent

AND

BANK OF NEW ZEALAND

Third Respondent

AND

CROWN ASSET MANAGEMENT

Fourth Respondent

AND

B J HUNT

Fifth Respondent

Representation:
A J Forbes QC and H Weston for FTG Securities Ltd R P Coltman for Crown Asset Management Ltd
K M Paterson and A E Cao for Bank of New Zealand J Appleyard for C A L Gower and S J Tubbs

R B Walker in person

Judgment:

25 May 2020

(Determined on the papers)

GOWER v FTG SECURITIES LIMITED [2020] NZHC 1105 [25 May 2020]

JUDGMENT OF OSBORNE J

(on application for disqualification of lawyers)

[1] Robert Bruce Walker, the second respondent in this proceeding (sued as liquidator of Tuam Ventures Ltd (in rec and in liq) (Tuam Ventures)), applies for an order restraining named persons from acting in this proceeding or any other proceeding relating to the liquidation of Tuam Ventures. The named persons are two solicitors, Grant Smith and Clive Cousins, and their legal entity, NZ Legal Ltd (known as “Canterbury Legal”). Throughout this proceeding, which was commenced on 17 April 2018, Mr Smith has been the solicitor for FTG Securities Ltd (FTG), the first respondent in the proceeding.

Background

[2] This is one of four proceedings which have a close relationship, such that an order for their consolidation was made.

[3] There are five sets of parties appearing in the proceeding, all represented by solicitors except Mr Walker, who appears in person. On 21 October 2019, the consolidated proceedings were set down for hearing subsequently scheduled to commence on 18 May 2020. With the intervention of COVID-19 restrictions, the hearing was on 30 April 2020 rescheduled to commence on 8 June 2020 (four days reserved). The pre-hearing timetable was amended to include, amongst other directions, that Mr Walker file and serve his submissions in one of the related proceedings (the -511 proceeding) by 15 May 2020 and his submissions in this proceeding (the -229 proceeding) by 22 May 2020.

[4] All the proceedings require expeditious resolution. They concern significant contested funds in relation to which the receivers of Tuam Ventures filed the application for directions in this proceeding as long ago as April 2018.

Present application

[5] Mr Walker applies specifically for an order restraining Messrs Smith and Cousins and Canterbury Legal from acting in this proceeding, or any other proceeding

relating to the liquidation or receivership of Tuam Ventures. The notice of application is dated 15 May 2019 but it was not filed and served until 20 May…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

Continue reading Gower v FTG Securities Ltd

Details

AGLC: Gower v FTG Securities Ltd [2020] NZHC 1105
Case: [2020] NZHC 1105
Decision Date: 25 May 2020

CaseChat Overview and Summary

The case of Gower v FTG Securities Ltd involved Robert Bruce Walker, the liquidator of Tuam Ventures Limited, seeking an order to restrain solicitors Grant Smith, Clive Cousins, and their legal entity, NZ Legal Ltd, from acting in the proceeding. The application was brought against FTG Securities Ltd, represented by Grant Smith, who had been the solicitor for FTG throughout the proceeding. The matter was one of four related proceedings which had been consolidated. The proceedings required expeditious resolution due to the significant contested funds involved.

The substantive issue before the Court was whether the application to disqualify the solicitors was an abuse of process. The Court found that the application was an abuse of process due to the significant delay in bringing the application, which was brought just two weeks before a four-day hearing. The Court found that the application was made in bad faith and without adequate justification, and that it would prejudice FTG's right to choose its own representation. The Court also noted that the application was inappropriate as it sought to restrain the solicitors from acting in any other proceeding relating to the liquidation of Tuam Ventures, rather than just the proceeding in which the application was brought.

The Court dismissed the application and ordered Walker to pay the costs of the first respondent in opposing the application. The Court reserved the quantum of costs and disbursements, with the first respondent to file a memorandum in relation to quantum within 20 working days, and Walker to file a memorandum in reply within five working days thereafter. The Court also noted that it was tentatively of the view that the first respondent was entitled to increased costs under r 14.6(3)(b)(ii) on the basis that the application lacked merit. The Court reserved costs as between Walker and the other parties involved in the proceeding.

Orders