Johnson v Johnson - [2023] NZHC 2277

IN THE HIGH COURT OF NEW ZEALAND WELLINGTON REGISTRY

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

CIV-2021-485-118

[2023] NZHC 2277

BETWEEN
MARIA BERNADETTE JOHNSON

Applicant in substantive proceeding; Respondent to order for examination

AND

CRAIG BRYAN JOHNSON

Respondent in substantive proceeding; Applicant for order for examination

Hearing: 27 June 2023

Counsel:

C M Stevens, T Mijatov and C M McCracken for Craig Johnson P F Dalkie for Maria Johnson

Judgment:

22 August 2023

JUDGMENT OF GWYN J

Introduction

[1] Maria Johnson, the respondent to the order for examination, owes a judgment debt to Craig Johnson, the applicant, of $1,133,651.38.1 Ms Johnson owes a further judgment debt to Mr Johnson and others, of $61,622.2

[2]Ms Johnson has failed to pay the debts referred to in [1].

[3] On 28 April 2023 Mr Johnson filed a without notice application for order of examination of Ms Johnson, pursuant to r 17.12 of the High Court Rules 2016 (Rules).

1 Pursuant to judgment in a Property (Relationships) Act 1976 proceeding between the parties (the PRA proceeding).
2 A 2022 costs judgment.

JOHNSON v JOHNSON [2023] NZHC 2277 [22 August 2023]

[4] On 11 May 2023 Associate Judge Skelton made an order for Ms Johnson’s examination, requiring her to attend at the High Court at 10 am on 27 June 2023.

Examination hearing

[5] Ms Johnson, represented by counsel Mr Dalkie, appeared at the examination hearing on 27 June 2023. Mr Johnson was represented by counsel, Mr Stevens, Mr Mijatov and Mr McCracken and Mr Johnson also appeared in person.

[6] The Registrar, Anne Murdoch Moar, has provided a report of the examination dated 29 June 2023.

[7] During the course of the hearing various categories of relevant information were identified as not having been provided by Ms Johnson. Mr Johnson has prepared a schedule of further information that he says ought to have been provided but was not. Some items on that schedule are disputed by Ms Johnson. They are considered in relation to the second question for ruling, discussed below.

Questions requiring ruling from a Judge

[8] During questioning at the examination hearing two matters arose on which the Registrar gave an opinion, but which now require a Judge’s ruling. The Registrar directed submissions to be filed addressing those two matters, together with orders to be made under rr 17.17 and 17.18.

Ruling one — time period

[9] The order included the “standard issues” set out in r 17.12(3), including the specification “the [preceding 52 weeks”.

[10]The order in relevant part said:

1…the Court orders that you attend at the High Court at Wellington, at the date and time specified below, to be examined as to your receipts and payments for the preceding 52 weeks, income, expenditure, assets, liabilities, and means of satisfying the judgment debts totalling $1,133,651.38, which is comprised of ….

2 You are also ordered to produce all evidence of your receipts and payments for the preceding 52 weeks, income, expenditure, assets, liabilities, and means of satisfying 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 Johnson v Johnson

Details

AGLC: Johnson v Johnson [2023] NZHC 2277
Case: [2023] NZHC 2277
Decision Date: 22 August 2023

CaseChat Overview and Summary

In Johnson v Johnson, the court was required to decide two primary issues related to an order for examination of Maria Bernadette Johnson (Ms Johnson) by Craig Bryan Johnson (Mr Johnson) under the High Court Rules 2016. The first issue concerned the interpretation of the phrase "preceding 52 weeks" in the order for examination. Mr Johnson argued that the phrase related to the date of the examination hearing (27 June 2023), while Ms Johnson contended that it related to the date the order was made (11 May 2023). The court found that a purposive approach and the practical application of the rule supported the interpretation that the 52-week period ran from the date of the examination, as this ensured the information obtained was as current as possible for enforcement purposes. The second issue was whether the order for examination required Ms Johnson to produce financial information about companies she wholly owned and directed. Mr Johnson argued that the information was necessary to determine the value of Ms Johnson's shares in the companies, while Ms Johnson claimed there was no power under the rules to order such production. The court concluded that the financial information was relevant to ascertain the value of Ms Johnson's shares, which were considered her personal assets for the purposes of the examination.

The court's reasoning was grounded in the purpose of the examination rules, which is to assist the entitled party in deciding the most appropriate enforcement process. By interpreting the 52-week period in relation to the examination date, the court ensured the information was current and relevant. Furthermore, the court found that the financial information of the companies was necessary to determine the value of Ms Johnson's shares, which were considered her personal assets. The court did not accept Ms Johnson's argument that the order for examination did not extend to the companies' financial information, as she was a 100 per cent shareholder of the companies, and the shares were her personal property. The court also rejected the argument that the information was sought for an ulterior purpose, finding that the primary purpose was to ascertain Ms Johnson's financial means.

Orders