Houghton v Saunders - [2019] NZHC 2906

IN THE HIGH COURT OF NEW ZEALAND WELLINGTON REGISTRY

I TE KŌTI MATUA O AOTEAROA TE WHANGANUI-A-TARA ROHE

CIV-2008-409-348

[2019] NZHC 2906

BETWEEN
ERIC MESERVE HOUGHTON

Plaintiff

AND

TIMOTHY ERNEST CORBETT SAUNDERS, SAMUEL JOHN MAGILL, JOHN MICHAEL FEENEY, CRAIG

EDGEWORTH HORROCKS, PETER DAVID HUNTER, PETER THOMAS and JOAN WITHERS
First Defendants

CREDIT SUISSE PRIVATE EQUITY INCORPORATED

Second Defendant

CREDIT SUISSE FIRST BOSTON ASIAN MERCHANT PARTNERS LP

Third Defendant

Hearing: 4 November 2019

Counsel:

C R Carruthers QC and P A B Mills for plaintiff

A R Galbraith QC, D J Cooper, S T Coupe and M C Harris for first defendants (except for separate representation noted below) T C Weston QC for Mr Magill

C L Broad for Mr Horrocks A E Ferguson for Ms Withers

J B M Smith QC, A S Olney and C J Curran for second and third defendants

Judgment:

7 November 2019

REASONS JUDGMENT OF DOBSON J

[Application for adjournment of stage two trial]

HOUGHTON v SAUNDERS [2019] NZHC 2906 [7 November 2019]

[1] On 25 October 2019, the plaintiff applied for an adjournment of the five week hearing of stage two of these proceedings, scheduled to commence on 4 November 2019. The application was opposed, and I heard argument from counsel throughout the morning of 4 November 2019 on their competing positions.

[2] The ground relied on for seeking the adjournment was the plaintiff’s recent application to the Supreme Court for leave to appeal a judgment of the Court of Appeal in which the plaintiff has been unsuccessful in challenging my interlocutory determination excluding parts of the evidence of the plaintiff’s economic expert, Mr Greg Houston. The plaintiff has also sought leave to appeal an earlier Court of Appeal judgment which upheld my refusal to strike out the defendants’ reliance on s 63 of the Securities Act 1978. However, Mr Carruthers QC accepted that the prospect of that second appeal did not afford grounds for an adjournment. It is being pursued now as a matter of efficiency.

[3] When I enquired of Mr Carruthers his proposals for timetabling the stage two hearing within the allocated fixture in the event that his application for an adjournment was dismissed, he advised that the hearing would not proceed as the claimants were not ready at this time to advance their stage two claims.

[4] Given the inevitability in those circumstances that an adjournment on some terms would follow, I advised counsel at 2.15pm on 4 November 2019 that the present hearing would be vacated and that stage two of the proceeding has to stand adjourned, initially, sine die. I indicated I would provide reasons for my decision and now do so.

The legal test

[5] Applications for adjournment of a trial are to be considered under r 10.2 of the High Court Rules 2016, which provides:

The Court may, before or at the trial, if it is in the interests of justice, postpone or adjourn the trial for any time, to any place, and upon any terms…

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 Houghton v Saunders

Details

AGLC: Houghton v Saunders [2019] NZHC 2906
Case: [2019] NZHC 2906
Decision Date: 7 November 2019

CaseChat Overview and Summary

In the High Court of New Zealand, Eric Meserve Houghton filed a lawsuit against Timothy Ernest Corbett Saunders, Samuel John Magill, John Michael Feeney, Craig Edgeworth Horrocks, Peter David Hunter, Peter Thomas, and Joan Withers, as well as Credit Suisse Private Equity Incorporated and Credit Suisse First Boston Asian Merchant Partners LP. The plaintiff sought compensation for losses incurred due to a false statement in a prospectus. The case was heard by Justice Dobson, who was tasked with determining whether an adjournment of the stage two trial should be granted. The plaintiff sought an adjournment based on a recent application to the Supreme Court for leave to appeal a Court of Appeal judgment that excluded parts of the evidence of the plaintiff's economic expert, Mr Greg Houston.

Justice Dobson considered the application for adjournment under the High Court Rules 2016, which allows for adjournments if it is in the interests of justice. The judge also considered the scope of the interests of justice, which include the interests of all parties involved and the general public interest in efficient use of court resources. The plaintiff's primary position was that revealing the false statement in a timely manner would have led to them reversing their investment decisions, and they sought compensation for the loss between the subscription price they paid for the shares and the price at which they later sold their shares.

The defendants argued that all other aspects of the stage two hearing could proceed and that they were ready for trial. However, the plaintiff's counsel indicated that the claimants were not ready to proceed with the stage two hearing, as they were relying on the potential admission of certain evidence that had been ruled inadmissible. The judge concluded that the potential consequences of the admissibility ruling were not sufficient to warrant an adjournment and that the claimants should have been prepared for trial on the alternative basis of loss that was currently applicable.

Justice Dobson decided to adjourn the hearing initially sine die, with the claimants required to pursue their application for leave to appeal to the Supreme Court with the utmost urgency. The defendants were awarded wasted costs, which were to be quantified and settled according to the court's directions.

Orders