Houghton v Saunders - [2019] NZHC 2318

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 2318

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: 12 September 2019

Counsel:

C R Carruthers QC and P A B Mills for plaintiff

D J Cooper for first defendants (except Mr Magill and Ms Withers)

T C Weston QC for Mr Magill B D Gray QC for Ms Withers

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

Judgment:

13 September 2019

RESERVED JUDGMENT OF DOBSON J

[Stay]

HOUGHTON v SAUNDERS [2019] NZHC 2318 [13 September 2019]

[1] I convened a further call of this proceeding to respond to developments since my judgment of 15 August 2019.1 There has been continued non-compliance by the plaintiff with my orders for security for costs, provision of pleadings for individual claimants, provision of further affidavits of documents and a measure of non- compliance with timetable directions for service of briefs of evidence for claimants whose claims are to be advanced at the stage two hearing.

[2] On 30 August 2019, the defendants filed a memorandum seeking directions that, given the extent of non-compliance by the claimants, the stage two hearing in November 2019 be limited to the stage two claim brought by Mr Houghton.

[3] On 2 September 2019, the plaintiff lodged a notice of appeal against all elements of my 15 August 2019 judgment. The appeal includes challenges to:

· my ruling that components of the evidence of Mr Houston, an economic expert to be called for the claimants, be excluded on the basis that he opined on matters not within the scope of the untrue statement in the prospectus;

· my order for those claimants wishing to be heard at stage two being required to provide further affidavits of documents;

· my direction that there needs to be a pleading of material individual circumstances of each of the claimants to be heard at stage two; and

· orders I made for alternative forms of security for costs, pending the plaintiff being able belatedly to comply with orders made in my judgment of 14 June 2019 setting the quantum of security for stage two at
$1.65 million, which was to be provided by 12 July 2019.2

[4] No application for stay was made in respect of any of the orders in my 15 August 2019 judgment. At the outset of the current hearing, Mr Carruthers QC suggested that consideration of a stay should be unnecessary as developments could

1 Houghton v Saunders [2019] NZHC 2007.
2 Houghton v Saunders [2019] NZHC 1362.

await the outcome of the appeal, which has been granted priority for hearing on 9 October 2019. After clarifying with him 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 Houghton v Saunders

Details

AGLC: Houghton v Saunders [2019] NZHC 2318
Case: [2019] NZHC 2318
Decision Date: 13 September 2019

CaseChat Overview and Summary

The High Court of New Zealand, Wellington Registry, considered the case of Houghton v Saunders and others, which involves a class action lawsuit initiated by Eric Meserve Houghton against multiple defendants. The lawsuit revolves around allegations of misleading statements in a prospectus related to an investment scheme. The court was tasked with addressing several legal issues, including the defendants' request for a stay of certain orders, the plaintiff's non-compliance with security for costs and other procedural orders, and the defendants' application for costs orders against the plaintiff and his litigation funder.

The court examined the plaintiff's continued non-compliance with security for costs and other procedural orders, which raised concerns about the defendants' ability to adequately prepare for the upcoming stage two hearing. The court also considered the plaintiff's appeal against specific elements of the earlier judgment, which could potentially impact the defendants' preparation for the stage two hearing. In light of these issues, the court made orders for the plaintiff to select a limited number of claimants whose claims would be heard at the stage two hearing and to provide individual pleadings and further discovery affidavits by specified deadlines. The court deferred the deadline for the provision of individual pleadings until after the Court of Appeal's decision on the appeal related to this issue.

Furthermore, the court granted a stay on the order requiring further discovery affidavits, subject to the outcome of the appeal, and provided for the service of required pleadings and affidavits to the defendants after the Court of Appeal's decision. The court also considered the defendants' application for costs orders against the plaintiff and his litigation funder for three interlocutory steps in which the defendants had succeeded. The court directed the plaintiff's solicitors to provide a memorandum in opposition to the quantum of costs sought and to the application for costs orders to be made personally against the litigation funder and his representative.

The court's decision aimed to balance the need for procedural compliance and adequate preparation for the stage two hearing with the defendants' concerns about the plaintiff's non-compliance and the potential impact on their defence. The court also addressed the issue of costs orders to ensure that the defendants were fairly compensated for their successful interlocutory applications.

Orders