Harrison v Harrison - [2016] NZHC 2027

IN THE HIGH COURT OF NEW ZEALAND IN BANKRUPTCY
CHRISTCHURCH REGISTRY

CIV-2016-409-000400 [2016] NZHC 2027

IN THE MATTER of the Insolvency Act 2006

AND

IN THE MATTER

of the bankruptcy of ANGELA JANICE HARRISON

BETWEEN

GRAEME ROSS HARRISON AND ADRIENNE HARRISON

Judgment Creditors

AND

ANGELA JANICE HARRISON Judgment Debtor

Hearing: 22 August 2016

Appearances:

R O Parmenter for Judgment Creditors/Respondents
Ms A J Harrison, Judgment Debtor/Applicant, self represented

Judgment:

30 August 2016

JUDGMENT OF ASSOCIATE JUDGE MATTHEWS

Introduction

[1] On 27 April 2016 the High Court ordered that the applicant (Ms Harrison)

pay to the respondents (the trustees of the Valerie Geard Trust) costs in the sum of

$12,749.90. The order was duly sealed by the Court. [2] Ms Harrison has not paid any part of this sum.
[3] On 25 May 2016 the trustees issued a bankruptcy notice to Ms Harrison in relation to this order. The bankruptcy notice was served on Ms Harrison on 28 June in accordance with an order for substituted service made by the Court on 17 June.
On 12 July 2016 Ms Harrison applied for an order setting aside the bankruptcy

HARRISON v HARRISON [2016] NZHC 2027 [30 August 2016]

notice. She also applied for an order adjourning the bankruptcy proceeding to enable her to seek legal aid. Further, she applied for an order for a case stated under Part 21 of the High Court Rules on questions of law and fact on the basis that the law was not correctly applied in a judgment in an Auckland proceeding CIV-2016-404-162, a judgment of Faire J dated 27 April 2016.1 Finally, Ms Harrison applied for an order under r 7.51 of the High Court Rules to rescind the judgment of Faire J on the basis that judgment was entered by default, was fraudulently and improperly obtained, and provides no legal foundation for a bankruptcy action as it was obtained by illegality.

[4] On 18 July the Court issued a minute in which time for compliance with the bankruptcy notice was extended until further order of the Court, and a fixture date for hearing the application was allocated.2 Ms Harrison was given an opportunity to file further affidavit evidence if she wished to do so, and the Court referred to her wish to seek legal aid, expressing an expectation that she would apply forthwith. The Court noted that in the event Ms Harrison instructed a solicitor, on legal aid, and that solicitor could not reasonably be ready for the hearing on the allocated date (22 August 2016) a memorandum should be filed and referred to an Associate Judge
for consideration. This did not occur, and Ms Harrison represents herself on her application.

[5] The two orders sought in relation to the judgment of Faire J concern a proceeding in the Auckland Registry of the High Court. Prior to now, Ms Harrison has not taken any formal steps in relation to that judgment, either as she now suggests in her application, or by way of appealing. The…

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 Harrison v Harrison

Details

AGLC: Harrison v Harrison [2016] NZHC 2027
Case: [2016] NZHC 2027
Decision Date: 30 August 2016

CaseChat Overview and Summary

In the High Court of New Zealand, Associate Judge Matthews considered an application by Angela Janice Harrison to set aside a bankruptcy notice issued by the trustees of the Valerie Geard Trust. The trustees had previously obtained a judgment against Ms Harrison for unpaid costs in a separate proceeding, and the bankruptcy notice was issued in relation to this order. Ms Harrison argued that the bankruptcy notice was an abuse of process and sought to rescind the judgment on various grounds, including alleged fraud and improper conduct by the trustees. The court examined whether Ms Harrison had a valid cross-claim against the trustees, which could potentially satisfy the requirements for setting aside the bankruptcy notice.

The court found that Ms Harrison had not provided sufficient evidence to establish a genuine cross-claim against the trustees. Her criticisms of the trustees and the earlier judgment were not substantiated and did not constitute a valid cross-claim. The court further held that it was not its function to review the merits of the earlier judgment, as that could have been done through an appeal. The court also rejected Ms Harrison's argument that the invocation of bankruptcy proceedings was disproportionate to the unpaid costs. The court found that Ms Harrison had failed to demonstrate any basis to set aside the bankruptcy notice and dismissed the application. The court ordered Ms Harrison to pay costs to the trustees on a 2B basis, including disbursements for air and taxi travel. The time for Ms Harrison to comply with the bankruptcy notice was extended briefly to allow her an opportunity to pay the sum demanded.

The court's decision highlights the limited grounds on which a bankruptcy notice can be set aside, emphasizing the need for a valid cross-claim against the creditor. The court also underscored the finality of judgments and the importance of adhering to the established legal process for challenging judgments, such as through appeal. The outcome underscores the consequences of failing to comply with a court's judgment, including the potential for bankruptcy proceedings to be initiated against the judgment debtor.

Orders