Joden Finance Limited v Auckland District Court

[2020] NZHC 2853

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

I TE KŌTI MATUA O AOTEAROA TĀMAKI MAKAURAU ROHE

CIV-2020-404-001293

[2020] NZHC 2853

IN THE MATTER

Of an appeal against the decision of the Auckland District Court awarding Costs to the Second Respondent

BETWEEN

JODEN FINANCE LIMITED

Applicant

AND

THE AUCKLAND DISTRICT COURT

First Respondent

SANAHACHAI PRERSSILP

Second Respondent

On the papers:	At Auckland
Judgment:	30 October 2020

JUDGMENT OF POWELL J

[Non-legal representation and Security for costs]

This judgment was delivered by me on 30 October 2020 at 4 pm pursuant to R 11.5 of the High Court Rules

Registrar/Deputy Registrar Date:

JODEN FINANCE LIMITED v THE AUCKLAND DISTRICT COURT [2020] NZHC 2853 [30 October 2020]

[1]    The appellant, Joden Finance Limited (“Joden Finance”) has appealed a costs decision of Judge Harrison dated 21 July 2020. Joden Finance is currently represented by its sole director, John Murphy. Prior to the first call of the appeal the second respondent, Sanahachai Prersslip, filed a memorandum noting permission was required from the Court for Mr Murphy to represent Joden Finance in this appeal proceeding. Mr Prersslip also sought security for costs. In my Minute of 31 August 2020, I directed the parties to file submissions on these issues. Having received those submissions, I now set out my conclusions on the matters of non-legal representation and security for costs, before making directions regarding the future conduct of the proceedings.

Non-legal representation

[2]    Joden Finance, through Mr Murphy, has filed a memorandum seeking leave to be represented by Mr Murphy. Mr Murphy submits that the following factors, taken together, create exceptional circumstances that render it appropriate for Mr Murphy to represent the appellant in this appeal:

(a)Joden Finance is a ‘one-man company’ and as Mr Murphy is the sole director and shareholder, allowing him to represent the appellant company will not expose the assets of other shareholders to any risk;

(b)the proceeding has been characterised as a category two proceeding, indicating it is of average complexity and that Mr Murphy has the capacity to adequately represent the appellant company in this proceeding;

(c)Mr Murphy will be assisted in the background by an experienced lay litigant;

(d)Mr Murphy has previously represented Joden Finance in a successful claim for judicial review; and

(e)Joden Finance is experiencing financial hardship as a result of Covid- 19 and cannot afford to pay a lawyer.

Discussion

[3]    As Mr Murphy correctly noted the general position on non-legal representation is clear:1

(a)A corporation has no right to be represented in the conduct of a case in court except by a barrister or solicitor.2 However, courts have a residual discretion in “exceptional situations” to allow unqualified advocates to appear before them.3

(b)Apart from statutory exceptions, a corporation has no right to bring or carry on proceedings in Court except by a solicitor. This includes the filing of pleadings and other documents.4

[4]    Typically, the discretion to allow non-legal representation will be exercised in emergency circumstances where counsel is unavailable, or in straightforward matters where counsel is not needed by the court.5

[5]    As Mr Murphy has acknowledged neither of the above exceptions apply, and that in fact it appears the appeal may involve some relatively technical issues.6 Given these technical issues, I do not think this is an appropriate case for Mr Murphy to represent the appellant. I also do  not  find  financial  hardship,  as  asserted  by  Joden Finance, to be a factor capable of justifying non-legal representation. Not only is it not exceptional, but in any event Mr Murphy’s affidavit evidence does not in fact detail the extent of any financial hardship the appellant company may be facing. Taken together I am satisfied the general rule must apply, and Joden Finance is required to be represented by counsel on this appeal. For completeness I note that neither the support of an experienced lay litigant nor Mr Murphy’s prior success acting for

1      Re J G Mannix Limited [1984] 1 NZLR 309 (CA).

2 At [310].

3 At [314].

4 At [311].

5      Oceanic Palms Ltd v Kiwi Rail Ltd [2018] NZHC 679.

6      At this stage it appears that the costs appeal could engage issues as to the requirement to give reasons in a costs decision, and whether or not the substantive proceeding should be considered a test case and the implications this may have on the appropriate award of costs. On top of that the second respondent has indicated that they will apply to strike out the appeal in reliance on cl 16, sch 1 of the Motor Vehicle Sales Act 2003.

Joden Finance persuade me otherwise, while it is also difficult to see how taking   Mr Murphy represent the company reduces risk if he is unsuccessful and costs on the appeal are ultimately awarded against Joden Finance. Accordingly, leave for the appellant company to be represented by Mr Murphy is declined.

Security for costs

[6]    Security for costs are sought in accordance with r 20.13 of the High Court Rules 2016. This rule contains a presumption that security is required, providing that security for costs must be fixed by the Court unless the Judge considers that in the interests of justice no security is required. Exceptional circumstances will be necessary before security for costs will be waived, and impecuniosity alone will not be enough to justify a waiver. 7

[7]    Mr Murphy submitted on behalf of the company that security for costs should not be imposed as the appeal raises matters of public interest, and in any case the appellant company is unable to pay any security on account of impecuniosity. As noted there has been no detail provided by Joden Finance with regard to financial hardship, let alone impecuniosity, and the alleged matter of public interest, namely the question of whether costs decisions ought to be supported with reasons, is not of sufficient interest to justify a waiver of security. Accordingly, it is not in the interests of justice that security be waived.

[8]    I therefore fix security in the sum of $1,195.00 based on a half day hearing for the appeal.

Next steps

[9]    Joden Finance has also brought proceedings to judicially review the substantive District Court decision that led to the costs award the subject of this appeal. As both parties acknowledge, if the claim for review is successful this appeal will fall away. Accordingly, both parties are in agreement that it is appropriate to adjourn the appeal until the judicial review proceeding has been determined.

7      Reekie v Attorney-General [2014] NZSC 63, [2014] 1 NZLR 737.

Decision

[10]Leave for Mr Murphy to represent Joden Finance is declined.

[11]   The appeal is adjourned until the judicial review proceeding (CIV-2020-404- 1061) is determined.

[12]   Joden Finance is to pay security for costs in the sum of $1,195.00 within 10 working days of the determination of the judicial review proceeding.

Powell J