Jorgensen v Horsup

[2016] NZHC 1815

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

CIV-2016-404-001809 [2016] NZHC 1815

BETWEEN

FINN BROGGER JORGENSEN, LUKE

NORMAN CRAWFORD, COLIN JAMES LUCAS

First Plaintiffs

COLIN JAMES LUCAS Second Plaintiff

AND

MATTHEW HORSUP First Defendant

WESTPAC BANKING CORPORATION Second Defendant

Hearing:	On the papers
Appearances:	P J Stevenson for Plaintiffs
Judgment:	5 August 2016

JUDGMENT OF PALMER J

This judgment is delivered by me on 5 August 2016 at 2.30 pm pursuant to r 11.5 of the High Court Rules.

..................................................... Registrar / Deputy Registrar

Counsel:

Penelope Stevenson, Barrister, Auckland

Solicitors:

Sellar Bone & Partners, Auckland

JORGENSEN & ORS v HORSUP & ANOR [2016] NZHC 1815 [5 August 2016]

Summary

[1]      I grant an urgent interim injunction preventing disbursement of funds paid in error.

Facts

[2]      Mr Colin Lucas, the second plaintiff, is the sole executor of the estate of Ms Marie Horsup.  The first plaintiffs are the partners in the law firm Sellar Bone and Partners.

[3]      Probate was granted on 25 February 2014.  Further distributions were made to the beneficiaries on 1 August 2016.  They were approved by Mr Lucas and paid from the Sellar Bone trust account.  The distribution to Mr Matthew Horsup, the first defendant, was to be $34,312.38.

[4]      However, in one of those slipups we all fear, an additional zero was inserted, by mistake, into the payment authority in the internet banking process.  Mr Horsup’s account with Westpac Banking Corporation, the second defendant, was mistakenly credited with $343,102.38 on 1 August 2016.

[5]      The mistake was discovered on 2 August 2016. Attempts made to contact Mr Horsup, including by letters of demand to both defendants, were not successful. Nothing has been heard from Mr Horsup.   The plaintiffs know nothing about him other than that he has a criminal record and, after his mother died, the house in which they were living tested positive for methamphetamine contamination.

Application

[6]      The plaintiffs wish to prevent the difference, between the amount credited and the amount that was supposed to be credited, from being withdrawn.   That amount is $308,790.00.

[7]      Pending further order of the Court, the plaintiffs apply under r 7.23 of the High Court Rules for an urgent interim injunction without notice on the following terms:

(a)      Restraining the first defendant from withdrawing and dealing with any part of the sum of $343,102.38 from bank account 03 0166 0851614

00 in the name of the first defendant, being a bank account administered by the second defendant.

(b)In  the  event  that  any  part  of  the  sum  of  $343,102.381   has  been withdrawn from bank account 03 0166 0851614 00, restraining the first defendant from dealing in or disposing with any part of that sum or in any way parting with possession of that sum other than to the plaintiffs.

(c)       Directing  that  the  sum  of  $308,790.00,  being  part  of  the  sum  of

$343,102.38 paid into the bank account 03 0166 0851614 00, in the name of the first defendant and administered by the second defendant, is the property of the plaintiffs.

(d)Directing that the second defendant transfer the sum of $308,790.00 from the bank account 03 0166 0851614 00, in the name of the first defendant and administered by the second defendant, to the plaintiffs.

[8]      Counsel have provided certification that the application complies with the High Court Rules (the Rules) and has been signed by counsel.  Counsel also advised that she is personally satisfied that the application and affirmation which are filed comply with the Rules, the order ought to be made and there is proper basis for seeking it.

Law

[9]      Rule 7.46 provides for interim injunctions without notice.  I am required to determine whether the application can properly be dealt with, without notice. To that

end I am required to be satisfied that:

1      In more slips, the application for the injunction uses the figure $343,103.28 in this paragraph and the next one.   I have corrected these errors here.   I suggest Sellar  Bone double check its documentation more carefully in future.

(a)       requiring  the  applicant  to  proceed  on  notice  would  cause  undue delay or prejudice to the applicant; or

(b)      the application affects only the applicant; or

(c)       the application relates to a routine matter; or

(d)      an enactment expressly permits the application to be made without serving notice of the application; or

(e)       the  interests  of  justice  require  the  application  to  be  determined without serving notice of the application.

[10]     If I do determine the application can be dealt with without notice, I may make the order sought, or another order I think just in the circumstances, or dismiss the application.   If I do not, I may give directions as to service and adjourn the determination of the application until it has been served.

[11]     In  considering  whether  to  grant  the  application  I  am  required  to  assess whether there is a serious question to be tried, weigh the competing interests and assess the balance of convenience.2   In doing so I must have regard to the adequacy of damages as a remedy available to the applicant.   My decision should be in the overall interests of justice.

Decision

[12]     On the basis of the application and supporting documentation I am satisfied that  requiring  the  applicant  to  proceed  on  notice  would  cause  undue  delay  or prejudice to the applicant.  I consider there is a serious question to be tried here.  The payment was made in error and is likely to be able to be recovered.  The plaintiffs’ pending statement of claim will plead unjust enrichment as a result of mistake.  They will seek an equitable remedy of a charge of all the assets of Mr Horsup, an order for repayment of the $308,790.00 and a declaration that the funds are held on trust for

the plaintiffs.3

[13]     I weigh the competing interests and the balance of convenience in favour of the plaintiffs.  Their substantive case is strong and they have pursued it with speed.

2      Klissers Farmhouse Bakeries Ltd v Harvest Bakeries Ltd [1985] 2 NZLR 129 (HC and CA).

3      Lipkin Gorman (a firm) v Karpnale Ltd  [1991] 3 WLR 10 (HL) and Liggett v Kensington [1993]

1 NZLR 257 (CA).

They have provided an undertaking as to damages.  They have made efforts to get a response from Mr Horsup to no avail.   There is nothing to suggest that requiring notice of the proceeding to be served on him would make any difference.  And it seems likely that damages would not be a sufficient remedy because, if Mr Horsup dissipates the funds he has been overpaid, there is no evidence it could be repaid. All in all, I consider it in the interests of justice to grant the application.

[14]     Accordingly,  I  grant  the  interim  injunction  on  the  terms  sought  by  the plaintiffs (and corrected by me) at paragraph [7] above.  I reserve leave for any of the plaintiffs or defendants to apply to vary or terminate the injunction on three working days notice.

..................................................................

Palmer J