Hook v Callaghan Innovation
[2024] NZHC 2240
•9 August 2024
IN THE HIGH COURT OF NEW ZEALAND WELLINGTON REGISTRY
I TE KŌTI MATUA O AOTEAROA TE WHANGANUI-A-TARA ROHE
CIV-2024-485-000243
[2024] NZHC 2240
BETWEEN CHRISTOPHER RUSSELL HOOK
Appellant
AND
CALLAGHAN INNOVATION
Respondent
Hearing: 6 August 2024 (via VMR) Counsel:
Appellant in person
C R Langstone for Respondent
Judgment:
9 August 2024
JUDGMENT OF LA HOOD J
Appeal against a decision to strike out a claim in negligence
[1] Mr Hook appeals against a District Court decision striking out his negligence claim against Callaghan Innovation (Callaghan).1
[2] Mr Hook, the second plaintiff, is the director of the first plaintiff, Surface Micro-Guard Ltd (SMG). Callaghan is a Crown agency that, among other things,2 administered a loan grant scheme to support businesses performing research and development to supplement shortfalls in private funding attributed to the COVID- 19 pandemic.
1 Surface Micro-Guard Ltd v Callaghan Innovation [2024] NZDC 7314 [Decision on appeal].
2 Callaghan’s primary objective, as set out in s 13 of the Callaghan Innovation Act 2012, is to “support science and technology-based innovation and its commercialisation by businesses, primarily in the manufacturing sector and services sector, in order to improve their growth and competitiveness.”
HOOK v CALLAGHAN INNOVATION [2024] NZHC 2240 [9 August 2024]
Background
[3] This case is one of a myriad of proceedings Mr Hook has commenced in association with the same underlying dispute. Five such proceedings have been struck out and the fourth and fifth led to orders under s 213 of the District Court Act 2016 restraining Mr Hook and any company in which he is a director from commencing related proceedings for a five-year period.3
[4] In a decision dated 29 July 2024, Radich J upheld the District Court’s order striking out the fourth and fifth proceedings and restraining orders under s 213 of the District Court Act. It is convenient to adopt Radich J’s summary of the related proceedings:4
The five proceedings
The first proceeding
[5] Cross Slot IP Ltd designs and manufactures agricultural machinery. The machinery includes “opener technologies” (designed to sow seeds into untilled soils) and the “machines” or “frames” that support and operate the opener technologies in the field. Cross Slot IP’s directors are Dr Christopher Baker, the second respondent, and Noel Ullrich, the third respondent.
[6] In February 2019, Cross Slot IP entered into a heads of agreement with Surface Micro-Guard Ltd. Mr Hook is Surface Micro-Guard’s director. Under the heads of agreement, a new company, Cross Slot Europe Ltd was established and was licensed to distribute Cross Slot IP’s opener technologies and to manufacture and distribute its machines and frames in the United Kingdom, Europe and the Commonwealth of Independent States.
[7] Mr Hook sought to give effect to the terms of the heads of agreement through the operation, by him, of Cross Slot Europe. He did so from the Ukraine, where he still lives.
[8] On 28 March 2021, Cross Slot IP cancelled Cross Slot Europe’s licence. It believed that Cross Slot Europe had used its access to Cross Slot IP’s intellectual property and machinery to arrange the manufacture and distribution of Cross Slot IP’s opener technologies and that, in doing so, it had repudiated the heads of agreement.
[9] Mr Hook’s position is that it is Cross Slot IP which has repudiated the heads of agreement and that it acted unlawfully in cancelling Cross Slot Europe’s licence.
3 Hook v Scott [2023] NZDC 2299 (upheld on appeal in Hook v Scott [2024] NZHC 2071 [High Court decision]).
4 High Court decision, above n 3.
[10] This is the claim that is at the heart of all of the proceedings that I come on to describe. To pursue the claim, Mr Hook caused Cross Slot Europe, as plaintiff, to bring a proceeding in the District Court against Cross Slot IP, as defendant. However, Cross Slot IP applied for security for costs against Cross Slot Europe and sought a stay of proceedings until costs were paid. Security of $40,000 was ordered and the proceedings were stayed until it was paid.5 It was not paid.
The second and third proceedings
[11] Instead of paying the security for costs or appealing the decision in which they were ordered, Mr Hook brought two new proceedings. The first was brought in his own name against Cross Slot IP and the second was brought in the name of Surface Micro-Guard against Cross Slot IP. Both proceedings related to the same claim – that Cross Slot IP had repudiated the heads of agreement and that it had acted unlawfully in cancelling Cross Slot Europe’s licence.
[12] Cross Slot IP applied for security for costs in both of these proceedings. Again, security of $40,000 was ordered and the proceedings were stayed until they were paid.6
[13] Because the three sets of proceedings pursued the same underlying claim, the new security for costs order was made on a concurrent basis in the sense that, if the single sum of $40,000 was paid into Court, it would be accepted as security for all of the three proceedings which would then be consolidated and continue.
[14] Again, security was not paid. Neither were the costs awards made against the plaintiffs as a result of their unsuccessful opposition to the applications for security. Neither of the security for costs decisions were appealed. Accordingly, the District Court Judge made an order on 20 April 2023, by consent, that each of the three proceedings would be struck out unless:
(a)the plaintiffs filed applications for leave to appeal by 26 May 2023; or
(b)the plaintiffs paid the security for costs by that date.
[15] Applications were not filed and security was not paid so the proceedings were all struck out on 2 June 2023.
[16] Having referred, in the judgment under appeal, to the order striking out the proceedings, the Judge went on to say this:7
Disconcertingly, when Mr Hook made submissions at a hearing before me on 7 October 2022, in opposition to the security for costs orders, he informed me that if he was thwarted from bringing proceedings because of the security for costs orders, he
5 Cross Slot Europe Ltd v Cross Slot IP Ltd [2022] NZDC 12274.
6 Surface Micro-Guard Ltd v Cross Slot IP Ltd and Hook v Cross Slot IP Ltd [2022] NZDC 21209.
7 Hook v Scott, above n 3, at [21].
would simply discontinue proceedings and bring his claims in other litigation where he had not been ordered to pay security.
The fourth and fifth proceedings
[17] That is what Mr Hook did. He brought two further proceedings; the proceedings that are the subject of the judgment under appeal.
[18] He brought one proceeding in the name of Surface Micro-Guard against Dr Baker and Mr Ullrich (the directors of Cross Slot IP). And he brought the other proceeding in his own name against Dr Baker and against Mark Scott.
[19] Mr Scott’s involvement in all of this is indirect. He is a director of Untill Ltd, which holds a licence to manufacture and distribute Cross Slot products. It is difficult to discern the basis for the claim against Mr Scott. Neither Mr Scott nor Untill were parties to the heads of agreement or licensing agreement between Cross Slot IP and Surface Micro-Guard. Mr Hook’s position is that Mr Scott, as a director of Untill, ought to have known about the heads of agreement between Cross Slot IP and Surface Micro-Guard but Untill acted in a way that was at odds with it.
[20] The Judge struck out the claim against Mr Scott on the basis that he had no involvement with the fundamental allegations in the proceeding and that he owed no fiduciary duty to Mr Hook or any of his companies. Moreover, the claim against Mr Scott was seen by the Judge as an abuse of process in that it endeavoured to litigate issues already determined.8 The order striking out the claim against Mr Scott is not the subject of an appeal.
These proceedings
[5] The appeal is brought by Mr Hook alone and not SMG. Mr Hook explained at the hearing that this was to avoid the legal costs of instructing a lawyer to represent the company in the High Court in accordance with the rule that a company must be represented by counsel in litigation save in exceptional circumstances.9 Counsel for the respondent, Mr Langstone, made the point that the relevant agreement was between Cross Slot IP Ltd (CSIP) and SMG not Mr Hook, which he submits adds a further impediment to Mr Hook’s appeal. I will return to this issue below.10
[6] Mr Hook and SMG commenced proceedings in the District Court against Callaghan on 29 August 2023, claiming that Callaghan was negligent in granting a loan to CSIP in August 2020 under its loan scheme, of $309,569.15 (excl. GST).
8 At [46]–[54].
9 Commissioner of Inland Revenue v Chesterfields Preschools Ltd [2013] NZCA 53, [2013] 2 NZLR 679 at [34].
10 I note that Mr Hook agreed for SMG to be removed as a party in the appeal determined by Radich J: Hook v Scott, above n 3, at [33].
Mr Hook claimed that CSIP did not qualify for the loan, and that he informed Callaghan of CSIP’s ineligibility in correspondence from 8 December 2020 onwards. Mr Hook claimed that Callaghan taking no action to have the loan funds repaid caused CSIP to cancel its licensing agreement with Cross Slot Europe (CSE) and thereby caused loss to Mr Hook and SMG.
[7] Mr Hook and SMG sought summary judgment against Callaghan on the basis it had no arguable defence. In turn, Callaghan sought summary judgment, or strike- out, on the basis that the plaintiffs’ claim disclosed no reasonably arguable cause of action, or alternatively, security for costs.11
The District Court decision
[8] Judge Kelly struck out Mr Hook’s claims as disclosing no reasonably arguable cause of action. The Judge held that even if Callaghan owed a duty of care to the plaintiffs, it could not reasonably be argued that the loss suffered by the plaintiffs resulted from Callaghan’s provision of a loan to CSIP.12 The Judge noted that the underlying dispute as to CSIP’s cancellation of the licence agreement between CSE and CSIP had already been struck out in the first three sets of proceedings.13 Having been restrained from bringing further proceedings against CSIP, the plaintiffs sought to recover alleged losses through proceedings against Callaghan which the Judge held, “is an abuse of process and one which contains an element of impropriety given that the real dispute the plaintiffs have is, at best, with CSIP”.
[9] Even putting the dispute between the plaintiffs and CSIP to one side, the Judge held that Callaghan could not owe a duty of care to the plaintiffs when administering a loan to a third party, CSIP.14 The Judge held:
[36] Callaghan’s relationship is with CSIP and not the plaintiffs. It is not seriously arguable that Callaghan had to consider how loans might affect other parties contracting with applicants for the loan. There is no authority for such a proposition.
11 Decision on appeal, above n 1, at [1].
12 At [29].
13 At [29].
14 At [35].
[10] Moreover, even if there was sufficient proximity between the parties to establish a duty of care, the Judge considered it would be unreasonable and contrary to the public policy of the loan scheme to impose such a duty. It would expose Callaghan to indeterminate liability and potentially unlimited claims related to loan grants in circumstances where Callaghan was acting to support businesses during the pandemic.15
[11] The Judge also held that it could not be argued that Callaghan could have foreseen the plaintiffs might suffer loss as a consequence of granting the loan to CSIP, noting that the plaintiffs had failed to plead how CSIP’s purported decision to cancel the licensing agreement with CSE was caused by the loan to CSIP months earlier, or how the failure to cancel that loan impacted a separate commercial decision by CSIP.
[12] The Judge noted there was no merit in Mr Hook’s challenge to the affidavit evidence of Callaghan coming from its current Chief Executive when he was not Chief Executive at the time of the relevant events,16 and that Mr Hook’s attempt to join CSIP and Mr Baker as co-defendants was precluded by the s 213 restraining order against him.17
Submissions on appeal
[13] On appeal, Mr Hook submits that the District Court decision is “seriously flawed” in that it is not of an impartial judge or based on the facts. Mr Hook in essence submits:
(a)The District Court Judge was biased and intentionally punitive. The District Court decision is “seemingly structured to protect the reputation of Callaghan, the Government and the R & D loan scheme” and relies on Judge Rowe’s decision of 27 October 2023 without consideration of the plaintiff’s deposed evidence.
15 At [37].
16 At [30]–[31]. The Judge held that the fact Mr Korn was not Chief Executive at the time of the events pleaded did not preclude him giving evidence on behalf of Callaghan and noted that Mr Hook had similarly filed affidavit evidence from its New Zealand based director who had relied on Mr Hook’s assistance, as the director had no personal knowledge of the relevant matters.
17 At [32]–[33].
(b)The affidavit of Callaghan’s Chief Executive, Mr Korn, is alleged to contain a number of false and/or misleading statements and have caused the Judge to make the wrong decision. Mr Korn was not at Callaghan at the relevant time, and the person whom he mainly dealt with at Callaghan, Ms Burleigh, ought to have provided an affidavit.
(c)Mr Langstone’s oral submissions in the District Court were false and/or misleading in material respects and have caused the Judge to reach the wrong decision.
(d)Ultimately, Callaghan was negligent in funding CSIP, as its application was not processed in compliance with the Ministerial Direction dated
26 June 2020 under which Callaghan was administering the loan scheme. Callaghan was negligent in failing to recall the loan offer or take action against CSIP after Mr Hook provided them with evidence that the loan was wrongfully obtained, and it did not do so because that would amount to an admission of negligence and be a breach of the terms and conditions of Callaghan’s professional indemnity insurance policy.
(e)In relation to causation, Mr Hook submits, “the Court ought to agree that a person with knowledge of the facts would conclude that CSIP would not have cancelled the CSE license at the time or in the manner that it did if the funding had been recalled as recommended.”
[14] Callaghan’s position is that Judge Kelly was correct to strike out Mr Hook’s claim for the reasons articulated in his judgment and the appeal should be dismissed accordingly.
Approach on appeal
[15] This is an appeal against an order of the District Court striking out a pleading under r 15.1 of the District Court Rules. There is a general right of appeal,18 which is
18 District Court Act 2016, s 124.
to proceed by way of a rehearing.19 The onus is on the appellant to satisfy the appeal court that it should differ from the decision that is under appeal.20 After hearing the appeal I may make any decision I think should have been made, or direct the District Court to rehear the proceeding or consider and determine any particular matter.21
Assessment
The allegation of bias
[16] The test for recusal on the grounds of apparent bias is whether a fair-minded lay observer might reasonably apprehend that the judge might not bring an impartial mind to the resolution of the question the judge is required to decide.22 The test requires an apprehension of a real, not remote, possibility of bias.23
[17] Mr Hook makes serious allegations of bias. I consider these allegations are clearly unfounded and, as Mr Langston submitted, Mr Hook appears to misunderstand the law of bias. Mr Hook fails to point to any tangible evidence or persuasive narrative based on the timeline of the proceedings or conduct of the hearing, to support his allegation.
[18] At Mr Hook’s request, a full transcript of the oral hearing before Judge Kelly has been prepared. Mr Hook submitted that comments made by the Judge during the hearing support his claim of bias. This included where Judge Kelly said he considered it prudent to reserve his decision rather than give an oral judgment but gave no indication about how he was going to decide. Clearly, this comment could not lead a fair-minded lay observer to apprehend bias. Having reviewed the transcript of the hearing, it provides no evidence to support a claim of actual or apparent bias.
19 Section 127.
20 Austin, Nichols & Co Inc v Stichting Lodestar [2007] NZSC 103, [2008] 2 NZLR 141 at [4].
21 District Court Act, s 128.
22 Saxmere Company Ltd v Wool Board Disestablishment Company Ltd [2009] NZSC 72, [2010] 1 NZLR 35 at [89] and [127]; and Muir v Commissioner of Inland Revenue [2007] NZCA 334, [2007] 3 NZLR 495.
23 At [4].
[19]Other matters that Mr Hook submitted support actual or apparent bias were:
(a)Judge Kelly had delivered a judgment unfavourable to Mr Hook on a security for costs application in a related proceeding (the first proceeding against CSIP).24
(b)The District Court registry failed to reply to his email request that the hearing before Judge Kelly be adjourned to allow his appeal on the related proceedings to be determined and to provide him with the name of the Judge assigned to hear the case.
(c)Judge Kelly’s judgment supported a claim of bias as the Judge rejected Mr Hook’s argument about the propriety/sufficiency of Mr Korn’s affidavit, and failed to give proper weight to the affidavit evidence filed on behalf of Mr Hook by the New Zealand based director of SGM.
(d)Judge Kelly’s decision to award close to indemnity costs (which Mr Hook has not appealed) on the basis that Mr Hook’s claim was hopeless from its inception and an abuse of process.25 The Judge held that, having been restrained from bringing proceedings against CSIP, seeking to recover losses suffered due to the cancellation of the contract with CSIP through a claim against Callaghan was an abuse of process. The Judge was satisfied that the proceedings were brought to circumvent the orders made in the related proceedings.26
[20] None of these matters either individually or cumulatively support a claim of actual or apparent bias. It is trite to say that rejection of Mr Hook’s arguments about the propriety or quality of the evidence, and acceptance of Callaghan’s arguments on costs cannot be grounds for bias. This was simply part of the normal judicial function.
[21] To the extent that Mr Hook’s argument is based on Judge Kelly’s prior involvement in the related proceeding, Mr Hook accepts that on its own this would be
24 Cross Slot Europe Ltd v Cross Slot IP Ltd, above n 5.
25 Surface Micro-Guard Limited v Callaghan Innovation [2024] NZDC 10085 at [32].
26 At [26]–[32].
insufficient to support a claim of actual or apparent bias. 27 Mr Hook’s reliance on the registry’s failure to respond to his request for an adjournment and for the name of the presiding Judge, implies that Judge Kelly may have assigned himself to the case for the purpose of ensuring that Mr Hook’s case was struck out. There is simply no evidence to support such a serious allegation. There is nothing to suggest that Judge Kelly’s assignment to, or hearing of, this case involved anything other than the proper exercise of his judicial function. Hearing the prior proceedings and this case involved no more than the Judge carrying out his function of impartially deciding cases assigned to him in accordance with the law.
[22]This ground of appeal fails.
Whether the Judge erred in striking out the claim as untenable as a matter of law
[23] There is nothing in Mr Hook’s submissions that have persuaded me that the Judge erred. The proper approach to strike out involving novel claims has been recently discussed by the Supreme Court in Smith v Fonterra Co-operative Group Ltd:28
[83] These authorities articulate what are long-established principles: a measured approach to strike out is appropriate where a claim—whether in negligence, nuisance or otherwise—is novel, but at least founded on seriously arguable non-trivial harm. That is so even if attribution to individual respondents remains difficult. In such a case, the common law should lean towards receipt of the claim, and full evaluation based on evidence and argument at trial, over pre-emptive elimination.
[84] Such an approach is consistent with fully informed access to civil justice by those who have a tenable case that they have been harmed, and who will otherwise go without remedy based on a pre-emptive evaluation only. And, as was observed in [Couch v Attorney-General], a refusal to strike out a cause of action “says little about its eventual merit”. That is to say, it is not a commentary on whether or not the claim will ultimately succeed.
[85] Pre-emptive elimination is only appropriate where it can be said that whatever the facts proved, or arguments and policy considerations advanced at trial, a case is bound to fail.
(footnotes omitted)
27 See, for example, Māori Trustee v King [2017] NZHC 1083 where no issue of bias arose from the Judge’s assignment to, and hearing of, a property dispute when the defendant had been convicted and sentenced to preventive detention in an earlier criminal trial the Judge had presided over.
28 Smith v Fonterra Co-operative Group Ltd [2024] NZSC 5, [2024] NZRMA 202.
[24] I consider this is a situation where it can be said that whatever the facts proved, or arguments and policy considerations advanced at trial, the case is bound to fail. In my view, the Judge was correct to conclude that the pleaded claim in negligence was untenable for the following reasons:
(a)The Judge applied the well-established New Zealand test for determining a duty of care, as summarised by the Court of Appeal in Smith v Fonterra Co-operative Group Ltd:29
[96] The duty of care as pleaded is a novel one. That, as the Judge recognised, requires the court to undertake a two- stage proximity and policy inquiry in order to decide whether it would be just, fair and reasonable to recognise the duty. At the first stage, the court considers whether the claimed harm was a reasonably foreseeable consequence of the alleged wrongdoer’s actions and also considers the degree of proximity between the alleged wrongdoer and the claimant. At the second stage, the court considers matters external to the parties, namely the effect imposition of the claimed duty would have on society and the law generally. Resolution of the second stage depends ultimately on judicial conceptions of desirable policy.
(b)It could hardly be reasonably foreseeable that Callaghan’s act of granting a loan to CSIP to support their research and development funding during the pandemic could cause harm to third parties that have contractual relationships with CSIP. If anything, the reverse would be more likely – that CSIP’s demise due to lack of funding may harm those with whom they have existing contractual relationships. It is even more untenable to suggest that the likelihood of harm to third parties such as the plaintiffs should have been foreseen when Callaghan had no knowledge of the type of relationship CSIP had with the plaintiffs at the time the loan was approved and provided. Moreover, there was simply no relationship, and no other temporal or physical proximity between the plaintiffs and Callaghan.30
29 Smith v Fonterra Co-operative Group Ltd [2021] NZCA 552, [2022] 2 NZLR 284, [2022] NZRMA 65. Although the Court of Appeal’s decision was overturned in the Supreme Court, it does not appear that this summary of the law was called into question.
30 At [101]–[103].
(c)I agree with the Judge that even if this analysis of foreseeability and proximity is incorrect, the claim must fail at the second stage of the test. It would be unreasonable and contrary to public policy to impose a duty of care in the circumstances. As the Judge noted, it would expose Callaghan, and other entities in an analogous position, to indeterminate liability and potentially unlimited claims related to loan grants designed to support businesses during a pandemic. The chilling effect of such wide-ranging liability would clearly be contrary to the public interest purpose of such grants.
(d)I accept Mr Langstone’s submission, noted above, that there is a further impediment to the claim given the appeal is advanced solely by Mr Hook, who was not a party to the heads of agreement or licensing agreement. Imposing a duty that extends not just to third parties with a contractual relationship with Callaghan but also to any directors or shareholders of any such third parties would place an even more unreasonable burden on Callaghan.
(e)Even if this is a case where a novel duty of care should be recognised, the Judge’s conclusions on causation were sound. There are no pleaded facts, or other evidential basis, capable of proving that the provision of the loan caused CSIP to cancel its licence agreement with CSE and thereby caused loss to Mr Hook or SGM. Mr Hook says that the documentary evidence he has provided about his dispute with CSIP between December 2020 and March 2021 and the timing of the provision of the loan lead to the inference that the licence was cancelled because of the loan. However, the correspondence relating to cancellation of the licence clearly demonstrates that there was a commercial dispute about the direction of the business unrelated to the advancement of the loan. Moreover, there is no pleading as to the nature or quantum of any loss to Mr Hook.
(f)Mr Hook relies on the neighbourhood principle established in the seminal House of Lords case of Donoghue v Stevenson,31 and submits that the New Zealand courts have been prepared to allow the law of negligence to expand into new fields. While that is clearly correct as a general proposition, there are simply no public policy or other considerations that favour recognition of a duty of care in this case.
(g)Mr Hook’s submissions misapprehend the law of negligence. He effectively submits that if Callaghan has negligently granted CSIP’s application for a loan by misapplying the criteria, this must amount to the tort of negligence. Although that may be true if the Court was considering what lay people may understand the word “negligence” to mean (as equivalent to incompetent), that is not how the tort of negligence works. Whether or not Callaghan has incompetently applied the grant criteria and assessed the loan application (which it denies) is irrelevant to Mr Hook’s claim in the absence of a tenable basis for the other elements of the tort.
(h)Mr Hook’s concerns that Mr Korn’s evidence was misleading or improper is unsustainable. There is nothing improper about a Chief Executive giving affidavit evidence on behalf of a Crown agency based on the agency’s records. Whether or not there were errors in the affidavit evidence is only relevant to the extent they may have led the Judge to make a material error of fact.
(i)The closest thing to a material error of fact that Mr Hook can identify is the Judge’s assumption that the loan was granted shortly after it was applied for in August 2020, when the evidence appears to be that the funds were not advanced until November 2020.32 However, I consider this was not material to the Judge’s reasoning, or indeed my reasoning on appeal. Even assuming the existence of a duty of care, there cannot be a tenable basis to allege a breach of that duty or causation as a result
31 Donoghue v Stevenson [1932] AC 562, [1932] All ER Rep 1 (HL).
32 Decision on appeal, above n 1, at [38].
of any such breach whether the loan was advanced in August or November. There is an email between Mr Hook and Dr Baker that indicates Mr Hook was aware of the basis on which CSIP was applying for the loan in July 2020 without Mr Hook raising any concern that this basis was somehow improper or misleading. And, when the loan was advanced in November 2020, Mr Hook said in an email to Dr Baker that this was “good news”. If Mr Hook could not foresee in November 2020 that the loan would lead to CSIP’s cancellation of CSE’s licence (it would hardly be “good news” if he had foreseen this), there can be no possible basis for alleging that Callaghan should have done so.
(j)Mr Hook candidly acknowledged during oral argument that he would have had no concern about Callaghan providing the loan to CSIP at the time (and as just noted his own emails indicate he had no such concern) or later if CSIP had not cancelled CSE’s licence. This tends to support Judge Kelly’s finding that Mr Hook is using this proceeding to circumvent the orders restraining him from brining proceedings in relation to cancellation of the licence. As noted in those proceedings, Mr Hook has openly stated that “if he was thwarted from bringing proceedings because of security for costs orders, he would simply discontinue proceedings and bring his claims in other litigation where he had not been ordered to pay security.”33
(k)Finally, I deal with the allegation that Mr Langstone “misled” Judge Kelly about certain matters during his oral submissions and/or that Judge Kelly relied on these misleading statements. My review of the transcript of the hearing indicates that counsel made appropriate submissions in support of Callaghan’s case. Even if those submissions contained factual errors (which is not accepted by Mr Langstone), the question for me on appeal is not the propriety of counsel’s conduct but whether as a result of counsel’s submissions Judge Kelly has made material errors of fact that have led to a wrong decision. I am not
33 Hook v Scott, above n 3, at [21].
persuaded that any such errors were made, or that Judge Kelly’s decision was wrong.
Result
[25]For these reasons, the appeal is dismissed.
Costs
[26] Callaghan seeks indemnity or increased costs. I direct Callaghan to file costs submissions (limited to five pages) within 10 working days of delivery of this decision and Mr Hook is to file submissions in reply (limited to five pages) five working days thereafter. I will then determine costs on the papers.
La Hood J
Solicitors:
Fee Langstone, Auckland for Respondent
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