Grabowski v Jaffari - [2013] NZHC 3417

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

CIV-2012-404-892 [2013] NZHC 3417

BETWEEN LIVIA GRABOWSKI Judgment Creditor

ANDMEHDI JAFFARI AND TRACY JAFFARI
Judgment Debtor

Hearing: 9 December 2013

Counsel: M T Hutchings and B M K Pamatatau for Judgment Creditor
C S Henry for Judgment Debtors

Judgment: 17 December 2013

JUDGMENT OF RODNEY HANSEN J

This judgment was delivered by me on 17 December 2013 at 2.00 p.m., pursuant to Rule 11.5 of the High Court Rules.

Registrar/Deputy Registrar

Date: ………………………….

Solicitors: Malcolm Whilock, Auckland
Barter and Company Ltd, Auckland

Counsel: M T Hutchings, mhutchings@wentworthchambers.com.au

GRABOWSKI v JAFFARI AND JAFFARI [2013] NZHC 3417 [17 December 2013]

Introduction

[1] On 15 July 2011, in the District Court of New South Wales, Mrs Grabowski, as executrix of the estate of her mother (the late Ms Eleanor Cato), obtained judgment against the judgment debtors for $A186,480.83 (the liability judgment). On 18 August 2011, judgment was entered against the judgment debtors for the costs of the proceedings amounting to $A73,077.37 (the costs judgment).

[2] The liability judgment was registered in this Court under the Reciprocal Enforcement of Judgments Act 1934 (the Act). The notice of registration inadvertently attached the later or costs judgment. This has now been rectified and the judgment creditor applies to register the costs judgment. For their part, the judgment debtors apply to set aside the liability judgment and resist registration of the costs judgment on the ground that the liability judgment was obtained by fraud in terms of s 6(1)(d) of the Act.

[3] It is accepted that the critical issue is whether the substantive judgment was obtained by fraud. If it was, the registration of the liability judgment must be set aside and registration of the costs judgment declined. If the judgment debtors fail to show that the liability judgment was obtained by fraud, they accept that they cannot resist registration of the costs judgment and would have no grounds to apply to set the liability judgment aside.

Factual background

[4] Ms Cato was a successful businesswoman. She and Ms Grabowski ran a successful engineering business in New South Wales. Unfortunately, as Judge Gibb, the trial Judge, said in her judgment, Ms Cato was also a smoker. In her final years she battled with emphysema.

[5] Ms Cato had a lifelong interest in alternative healing therapies. During the last year of her life she enlisted the assistance of Mr Jaffari who describes himself as a leech therapist. A little over a year before she died, on 30 October 2008, Ms Cato paid Mr and Mrs Jaffari $A50,000 for the purpose of funding a marketing DVD to

promote Mr Jaffari’s practice. A further payment of $A100,000 was paid on 1 April

2008.

[6] After her mother’s death, Ms Grabowski sought to recover the money as a loan. The Jaffaris responded that the two payments were gifts not loans. In the alternative, and if it were to be held that the payments were loans, the Jaffaris claimed they were either…

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 Grabowski v Jaffari

Details

AGLC: Grabowski v Jaffari [2013] NZHC 3417
Case: [2013] NZHC 3417
Decision Date: 17 December 2013

CaseChat Overview and Summary

In the High Court of New Zealand, Livia Grabowski, as executrix of the estate of her deceased mother, Ms. Eleanor Cato, sought to register a liability judgment obtained against the Jaffaris in the District Court of New South Wales. The Jaffaris opposed the registration of both the liability and costs judgments, contending that the liability judgment was procured through fraud under section 6(1)(d) of the Reciprocal Enforcement of Judgments Act 1934. The court was tasked with determining whether the judgment was obtained fraudulently and, consequently, whether the registration should be set aside.

The court meticulously examined various arguments posited by the Jaffaris. These included the timing of the letter of demand sent by Grabowski’s solicitors, the absence of any mention of the debt in Cato’s will, alleged perjured testimony by Grabowski, and the acceptance of untested affidavit evidence by the trial judge. Additionally, the Jaffaris critiqued the trial judge's conduct, suggesting bias. The court found these arguments to be without merit, affirming the trial judge's credibility assessments and procedural rulings.

Rodney Hansen J held that the Jaffaris failed to demonstrate that the judgment was obtained by fraud. The judge found Grabowski's evidence to be honest and reliable, whereas the Jaffaris' testimonies were deemed unreliable and contradictory. The court also dismissed the allegations of bias against the trial judge, noting that her conduct was appropriate and fair. The court ultimately concluded that the judgment debtor's application to set aside the liability judgment was without foundation, and granted leave to register the costs judgment.

The court ordered that the application to set aside the liability judgment be refused and that leave be granted for the registration of the costs judgment. Notice of this registration could be served on the Jaffaris' counsel, with any subsequent application to set aside the registration to be made within five days of such notice. Costs were reserved, with directions for the parties to file memoranda on the issue if an agreement could not be reached.

Orders