Jeffs v Harris-Brunt

[2023] NZHC 3682

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

I TE KŌTI MATUA O AOTEAROA TĀMAKI MAKAURAU ROHE

CIV-2023-404-1555

[2023] NZHC 3682

UNDER

s 124 District Courts Act 1947 and r 20.4 High Court Rules 2016

BETWEEN

ANNA JEFFS

Appellant

AND

TRACEY HARRIS-BRUNT

Respondent

Hearing:

19 October 2023, updating memoranda received 4 and 11

December 2023

Appearances:

K E Hogan for Appellant Respondent in person

Judgment:

13 December 2023

JUDGMENT OF PETERS J

This judgment was delivered by Justice Peters on 13 December 2023 at 3 pm pursuant to r 11.5 of the High Court Rules

Registrar/Deputy Registrar

Date: ...................................

Solicitors:           Zhang Law, Auckland Counsel:       K E Hogan, Auckland

Copy for:           Respondent

JEFFS v HARRIS-BRUNT [2023] NZHC 3682 [13 December 2023]

Introduction

[1]    The appellant, Ms Jeffs, appeals against a decision of Judge McGuire of 9 June 2023, dismissing her application for security for costs.1 Ms Jeffs had sought security in the sum of $26,000 in proceedings brought against her by Ms Harris-Brunt, the respondent to this appeal.

[2]The appeal is opposed.

[3]    The appeal proceeds by way of rehearing and so is to be determined in accordance with the principles set out in Austin, Nichols & Co Inc v Stichting Lodestar.2 It is for Ms Jeffs to establish that the District Court decision is wrong and that I should reach a different conclusion.

District Court Rules 2014, r 5.48

[4]    Ms Jeffs’ application for security was made pursuant to District Court Rules 2014, r 5.48.

[5]    An applicant for security for costs must first establish one of the “threshold” grounds in r 5.48(1). If a threshold ground is established, the applicant must then persuade the Court that the circumstances are such that it should order the giving of security under r 5.48(2).3

[6]Rule 5.48 provides:

5.48     Power to make order for security for costs

(1)This rule applies if the court is satisfied, on the application of a defendant,—

(a)that a plaintiff—

(i)is resident outside New Zealand; or

(ii)is a corporation incorporated outside New Zealand; or

1      Harris-Brunt v Jeffs [2023] NZDC 11495.

2      Austin, Nichols & Co Inc v Stichting Lodestar [2007] NZSC 103, [2008] 2 NZLR 141.

3      McLachlan v MEL Network Ltd (2002) 16 PRNZ 747 (CA).

(iii)is, within the meaning of section 158 of the Companies Act 1955 or section 5 of the Companies Act 1993, as the case may be, a subsidiary of a corporation incorporated outside New Zealand; or

(b)that there is reason to believe that a plaintiff will be unable to pay the costs of the defendant if the plaintiff is unsuccessful in the plaintiff’s proceeding.

(2)When this rule applies, the court may, if it thinks fit in all the circumstances, order the giving of security for costs.

(3)An order under subclause (2)—

(a)must require the plaintiff or plaintiffs against whom the order is made to give security for costs in respect of the sum that the court considers sufficient—

(i)by paying that sum into court; or

(ii)by giving, to the satisfaction of the Registrar, security for that sum; and

(b)may stay the proceeding until the sum is paid or the security given, as the case may be.

(4)The court may treat a plaintiff as being resident out of New Zealand even though the plaintiff is temporarily resident in New Zealand.

(5)The court may make an order under subclause (2) even if the defendant has taken a step in the proceeding before applying for security.

(6)References in this rule to a plaintiff or defendant are references to the person (however described on the record) who, because of a document filed in the proceeding (for example, a counterclaim), is in the position of plaintiff or defendant.

Claim/defence

[7]    Ms Harris-Brunt commenced her proceeding in the District Court in August 2022. In her statement of claim, Ms Harris-Brunt alleges that in November 2016 she contracted, and subsequently paid, Ms Jeffs, a private investigator, to undertake various tasks for her. These included investigating Ms Harris-Brunt’s then husband; having a computer forensics specialist review his devices; and attending a hearing before the Family Court in January 2017 (“January 2017 hearing”) and providing an affidavit confirming what occurred at Court that day. It is important to record here that, at the January 2017 hearing,  orders  were  made  as  to  the  guardianship  of Ms Harris-Brunt’s child. Ms Harris-Brunt understood that the orders were to be short-

lived (a matter of weeks), and she contends that she was coerced into consenting to, or at least not opposing, the making of the orders.

[8]    Ms Harris-Brunt further alleges in her statement of claim that Ms Jeffs breached their agreement, including by failing to provide the computer specialist’s report (“specialist report”) and in failing:

… to ever provide an affidavit substantiating the conversation she witnessed of [lawyer for the child] coercing me into waiving guardianship of my [child] alleging “this would be temporary and [my child] would be back in my care in 3-5 weeks.”

[9]Ms Harris-Brunt seeks orders that Ms Jeffs provide the specialist report and:

14. ...

b) Provide an honest and accurate affidavit substantiating the conversation she witnessed of [lawyer for the child] coercing me into waiving guardianship of my [child] alleging “this would be temporary and [my child] would be back in my care in 3-5 weeks.” ...

[10]   In her statement of defence, Ms Jeffs pleads that Ms Harris-Brunt contracted Ms Jeffs’ company, Fox Private Investigators Ltd (“Fox”), to clone and investigate devices  provided  by  Ms  Harris-Brunt,  and   to   locate   a   family   member  of Ms Harris-Brunt’s then husband. Ms Jeffs also pleads that Ms Harris-Brunt asked her to attend the January 2017 hearing as a support person, which Ms Jeffs did, but that neither she nor Fox invoiced Ms Harris-Brunt for that attendance, and nor were they paid for the attendance.

[11]   Ms Jeffs also pleads that Fox provided the contracted services, and supplied the specialist report to Ms Harris-Brunt at or about the time it was received. However, Ms Jeffs denies agreeing to provide any affidavit, acknowledges that she has not provided an affidavit, and further states that “her opinion was and remains that [lawyer for the child] did not coerce the plaintiff into any action”.

[12]   At the time she filed her statement of defence, Ms Jeffs made the application for security for costs now in issue, and sought an order that the proceeding be stayed until security was given. Ms Harris-Brunt opposed the application, essentially on the

basis that it was an abuse of the process of the Court. Ms Harris-Brunt also filed an application for summary judgment which Judge Forrest dismissed on 14 April 2023, on the basis that the claim was not suitable for summary judgment.

District Court decision

[13]   Judge McGuire accepted that one of the threshold grounds in r 5.48(1) was established in that there is reason to believe that Ms Harris-Brunt will be unable to pay any award of costs that may be made in Ms Jeffs’ favour. Ms Harris-Brunt confirmed to me at the hearing of this appeal that this remains the position.

[14]   The threshold ground established, the Judge was required to decide whether the circumstances were such that he should order security for costs. Ultimately, the Judge declined to do so. The Judge considered that an order for security would stifle Ms Harris-Brunt’s claim and he noted that Ms Jeffs did not appear to deny that the parties had agreed she would provide an affidavit.

Recall

[15]   Counsel for Ms Jeffs, Ms Hogan, applied to the Judge to recall his decision on the ground that Ms Jeffs does deny agreeing to provide an affidavit as alleged, this denial being apparent in her statement of defence.

[16]   However, the Judge declined to recall his decision noting that a statement of defence is not evidence, and Ms Jeffs has not denied the allegation by way of an affidavit.

[17]   The Judge is correct in this respect. Ms Jeffs ought to have sworn an affidavit in support of her application for security for costs, clearly setting out her position. That said, Ms Hogan took me to information in Ms Harris-Brunt’s own affidavits which evidences Ms Jeffs’ position sufficiently for present purposes. Counsel should note, however, that most applications are required to be supported by affidavit evidence, and an application for security for costs is no exception.

Discussion

[18]   Ultimately, I have concluded that this is a case in which to require the giving of security, although in a vastly lesser sum than was sought at first instance. My reasons are these.

[19]   As the Judge said, if a threshold ground for the giving of security is established, as it is in this case, the Court will then consider the factors that count for and against the giving of security in the particular case at hand.

[20]   One of those, as the Judge identified, is that an order may stifle the plaintiff’s claim. In those circumstances, it is proper for the Court to consider the application for security as akin to an application to strike out.4

[21]   The issue of whether the specialist  report  was  or  has  been  provided  to  Ms Harris-Brunt should  be easily dealt with.  There should be some  evidence of  Ms Jeffs sending the report to Ms Harris-Brunt or the report should be able to be provided now if a copy still exists.

[22]   The critical matter is the order that Ms Harris-Brunt seeks as regards an affidavit from Ms Jeffs. Ms Jeffs cannot be compelled to swear an affidavit. However, if Ms Harris-Brunt requires evidence from Ms Jeffs apropos of an interlocutory application she wishes to make in a proceeding, or requires her evidence at trial, then there are avenues open to her to obtain Ms Jeffs’ viva voce evidence.

[23]   Not only does the Court not have power to compel a person to swear an affidavit, it certainly cannot compel a person to swear an affidavit or give evidence attesting to a state of affairs they do not believe to be true. It is clear from the information before me that Ms Harris-Brunt and Ms Jeffs have different recollections of Ms Harris-Brunt’s discussions with the lawyer for the child at the January 2017 hearing.   Ms Harris-Brunt’s recollection is that she was misled and coerced, and   Ms Jeffs’ recollection is different.

4      Deliu v Chapman [2020] NZHC 2100 at [5].

[24]   Given the matters referred to in preceding two paragraphs, there is no prospect of the Court making the order that Ms Harris-Brunt seeks and which is referred to at

[9] above.

[25]      It follows that Ms Jeffs should be protected for her costs, at the very least in defending that part of the proceeding, because it is doomed to fail.

[26]      As to quantum, I consider the sum of $6,000 by way of security is appropriate. I stay the proceeding until that sum is paid into Court or security is given to the satisfaction of the Registrar of the District Court.

Result

[27]I allow this appeal.

[28]The proceeding is stayed pending compliance with the order in [26] above.

Costs

[29]      I make no order as to costs on this appeal. As I have said, the Judge should have had the benefit of an affidavit from Ms Jeffs. The expense required by the appeal is largely the result of this omission. Moreover, and with respect to Ms Jeffs, there was never any prospect of Ms Harris-Brunt being required to provide security in the sum of $26,000.

Peters J