Hampton v Minter Ellison Rudd Watts

[2019] NZCA 159

IN THE COURT OF APPEAL OF NEW ZEALAND

I TE KŌTI PĪRA O AOTEAROA

 CA485/2018
 [2019] NZCA 159

BETWEEN	DAVID JOHN HAMPTON Applicant
AND	MINTER ELLISON RUDD WATTS First Respondent THE OFFICIAL ASSIGNEE Second Respondent COMMISSIONER OF INLAND REVENUE Third Respondent

Hearing:	13 May 2019
Court:	Brown, Gilbert and Collins JJ
Counsel:	Applicant in person S M Kinsler for Second and Third Respondents
Judgment:	15 May 2019 at 3.00 pm

JUDGMENT OF THE COURT

AThe application for an extension of time to apply to dispense with security for costs is granted.

BThe application for an extension of time to apply for a hearing date and file a case on appeal is granted.

____________________________________________________________________

REASONS OF THE COURT

(Given by Collins J)

Introduction

1. This judgment deals with two applications filed by Mr Hampton:

   (a)an extension of time to apply to dispense with security for costs;[1] and

   (b)an extension of time to apply for the allocation of a hearing date and file the case on appeal.[2]

Background

[1]Court of Appeal (Civil) Rules 2005, r 5(2).

[2]Rule 43.

1. On 5 June 2013, following an application from Minter Ellison Rudd Watts Mr Hampton was adjudged bankrupt.  The Commissioner of Inland Revenue (the Commissioner) was a supporting creditor.  Mr Hampton was due to be discharged from bankruptcy on 19 June 2017.  The Official Assignee however, lodged an objection to Mr Hampton automatically being discharged.  That application was determined in a judgment of the High Court dated 26 July 2018.[3]  Venning J ordered that Mr Hampton be discharged from bankruptcy, subject to a number of conditions that were designed to prevent him from controlling, or taking part, in the management of any company or business without the prior approval of the Court.[4]  Those conditions were directed to remain in place for four years.

   [3]Minter Ellison Rudd Watts v Hampton (A Bankrupt) [2018] NZHC 1866.

   [4]At [71].

2. On 21 August 2018, Mr Hampton filed a notice of appeal.  Security for costs was set at $6,600.  Mr Hampton sought, and was granted, an extension of time until 24 October 2018 to pay security for costs or apply for dispensation.  He did not meet that deadline.  Instead, on 31 October 2018, Mr Hampton notified the Registrar that he had been unable to raise the money required to pay the security for costs and that he accordingly sought a dispensation.  There was then further correspondence from Mr Hampton to the Registrar in which he said he suffered an eye infection but that he was preparing an affidavit and submissions.  He did not file those documents. 

3. On 23 November 2018, the Registrar notified Mr Hampton:

   (a)that the extension of time for paying security for costs or applying for dispensation had expired on 24 October 2018 and that Mr Hampton’s application of 31 October 2018 was out of time;

   (b)that the appeal was now deemed to be abandoned pursuant to r 43; and

   (c)that if Mr Hampton wished to pursue his appeal he would need to file an application under r 43 and an application for an extension of time to apply to dispense with security for costs.

4. On 3 December 2018, Mr Hampton filed the two applications that we have summarised at [1]. We are aware that he has also filed an application for a stay of proceedings. Nothing we say in this decision affects the stay application.

The application to extend time to apply to dispense with security for costs

1. Mr Hampton says he delayed paying security for costs and in applying for an extension of time for dispensation because he was awaiting a judgment in Commissioner of Inland Revenue v Chesterfields Preschools Ltd that was delivered on 26 February 2019.[5]  Mr Hampton is a shareholder in Chesterfields Preschools Ltd (CPL) through a family trust.  He hoped that CPL would provide him with money to pay the security for costs.  In its judgment however, the High Court granted the Commissioner’s application to have CPL placed in liquidation.[6]  Mr Hampton says he now wishes to explore alternative sources of funding or have this Court dispense with security for costs. 

   [5]Commissioner of Inland Revenue v Chesterfields Preschools Ltd (in interim liquidation) [2019] NZHC 272.

   [6]At [211].

2. In determining Mr Hampton’s application, we have applied the principles governing security for costs set out by the Supreme Court in Reekie v Attorney‑General.[7]

   [7]Reekie v Attorney-General [2014] NZSC 63, [2014] 1 NZLR 737 at [31]–[44].

3. In our assessment, the interests of justice require us to treat Mr Hampton’s application of 31 October 2018 as an extant application for an extension of time to dispense with security for costs.  Although the application of 31 October 2018 was technically out of time, we are satisfied the following three factors justify our approach:

   (a)Mr Hampton’s status

   Mr Hampton is a litigant in person.  Although he is familiar with court processes some latitude needs to be given to him because he does not have the benefit of legal advice.

   (b)Extent of default

   Mr Hampton’s default occurred when he waited a week before applying for dispensation from paying security for costs.  The delay of one week was not significant particularly, as it appears Mr Hampton was suffering an eye infection at the time.

   (c)       Absence of prejudice

   Mr Kinsler advised the Commissioner and the Official Assignee were abiding the Court’s decision and did not suggest either were prejudiced by Mr Hampton having a further opportunity to pursue his application for dispensation. 

4. For these reasons, we grant Mr Hampton’s application for an extension of time to apply for dispensation to pay security.

5. Mr Hampton assured us that he could file within 10 working days the materials he wishes to rely upon in support of his application to dispense with security.  He is therefore to file by 5.00 pm on 30 May 2019 any affidavits and submissions he wishes the Registrar to take into account when considering his application.

Application to extend time to apply for a hearing date and file the case on appeal

1. Mr Hampton was not able to take the necessary steps to apply for a hearing date and file the case on appeal until he could pay security for costs.

2. In view of the fact that the application to extend time to pursue the appeal is inextricably linked to the application for dispensation, we grant the application to extend time on the condition that if Mr Hampton’s application to dispense with security is granted, he must diligently take all steps to ensure that his appeal is able to be heard as soon as possible. 

Result

1. Mr Hampton’s applications for an extension of time to apply to dispense with security for costs and for an extension of time to apply for a hearing date and file the case on appeal are granted.  Mr Hampton is warned, however, that any further delays or breaches of the Court’s timetable are likely to result in his appeal being treated as having been abandoned.  We make no order for costs.

Solicitors:
Meredith Connell, Wellington for Second and Third Respondents