Havenleigh Global Services Limited v Henderson - [2015] NZHC 2703

IN THE HIGH COURT OF NEW ZEALAND CHRISTCHURCH REGISTRY

CIV 2010-409-000559 [2015] NZHC 2703

IN THE MATTER OF the Insolvency Act 2006

AND

IN THE MATTER OF

the bankruptcy of
DAVID IAN HENDERSON

BETWEEN

HAVENLEIGH GLOBAL SERVICES LIMITED AND FM CUSTODIANS LIMITED

Judgment Creditors (Substituted
Creditors)

AND

DAVID IAN HENDERSON Judgment Debtor

Hearing: 27 October 2015

Appearances:

J Foster and C R Vinnell for Official Assignee
D I Henderson (Bankrupt) in Person
T Cooley as counsel assisting the Court

Ruling:

3 November 2015

RULING (NO. 9) OF ASSOCIATE JUDGE OSBORNE
as to claim of privilege

HAVENLEIGH GLOBAL SERVICES LIMITED v HENDERSON [2015] NZHC 2703 [3 November 2015]

Introduction

[1] David Henderson, a bankrupt, is being publicly examined pursuant to s 295

Insolvency Act 2006.

[2] Ms Foster appears (with Mr Vinnell) as counsel for the Official Assignee. Ms Foster, in questioning Mr Henderson, has produced to Mr Henderson a copy of an email dated 16 January 2011 which Mr Henderson sent to Grant Smith, a lawyer with Canterbury Legal Services Limited (the email). Mr Smith had provided legal services to Mr Henderson and entities associated with him. Ms Foster, having put the email to Mr Henderson, asked him a series of questions in relation to its content. I also asked a number of questions. Later that day the examination was adjourned for some weeks to enable Mr Henderson to present his own further evidence. The examination was to resume on 27 October 2015.

[3] The email reads:

From: Dave Henderson

Date: Sunday, 16 January 2011 9.55 pm

To: Grant Smith

Grant

I wanted to start the year on something of a constructive step. I am keen to have a decent session with you as soon as it works for you. I want to give you a decent overview of our plans for the year and to strategies with you. I want to go over the following in a reasonable specific way:

1.Get an exact handle on the groups outstanding costs to you and to discuss realistic payment plans.

2.Get a list together of the litigation in train and likely litigation and some estimates and times attached to these. Maybe Eric can prepare something here. You and I can also discuss the merits of each action, have a heirachy (sic) and look at the returns.

3.Go over all the productive things we intend doing and any legal work that will flow from those.

There are a number of good opportunities we need to advance. And I haven’t forgotten your assurance to me that if I do go bankrupt then we would really have some fun. Talk soon,

Dave.

[4] Mr Henderson wrote the email to Mr Smith some six weeks after he had been adjudicated bankrupt.1

[5] In anticipation of the resumed hearing, Mr Henderson filed, as directed by the

Court, a brief of his further evidence.

[6] In his brief, Mr Henderson stated:

Ms Foster produced an email exchange between myself and my lawyer, Mr Smith. I consider that this…

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.

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Details

Case: [2015] NZHC 2703
Decision Date: 3 November 2015

CaseChat Overview and Summary

David Ian Henderson, a bankrupt, was being publicly examined under the Insolvency Act 2006. The Official Assignee, who appeared through Ms Foster, sought to examine Henderson regarding an email he sent to his lawyer, Grant Smith, six weeks after being declared bankrupt. Henderson claimed the email was privileged and subject to a quarantine order. The court had to decide whether the email was privileged, whether the privilege belonged to the Assignee, whether joint privilege applied, and whether the privilege should be disallowed. It also had to decide whether the email was subject to the quarantine order.

The court found that the email was privileged under section 54 of the Evidence Act 2006, as it was a confidential communication made for the purpose of Henderson obtaining legal services. The privilege in such communications vested in the Assignee because Henderson's property, including his legal affairs, vested in the Assignee upon bankruptcy. The court rejected Henderson's argument that joint privilege applied because the email related to associated entities. The court also found that there was a compelling case for disallowing the privilege under section 67 of the Evidence Act, but did not make a final determination. The court ruled that the quarantine order did not apply to the email as it did not relate to Henderson's compliance with the Insolvency Act or proceedings between him and the Assignee.

The court held that the Assignee was entitled to use the email in the examination, and that no further order was required. The examination of Henderson in relation to the email remained part of the record.

Orders