Lakes International Golf Management Limited v Vincent

[2016] NZHC 1150

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

CIV 2013-404-3387 [2016] NZHC 1150

BETWEEN

LAKES INTERNATIONAL GOLF

MANAGEMENT LIMITED First Plaintiff

THE LAKES INTERNATIONAL GOLF COURSE LIMITED

Second Plaintiff

AND

HARTLEY CLENDON VINCENT Defendant

Hearing:	(on the papers)
Counsel:	C C Mansell and R W Ackroyd for Plaintiffs M J Fisher and H L Hui for Defendant
Judgment:	31 May 2016

JUDGMENT (NO. 3) OF HEATH J

This judgment was delivered by me on 31 May 2016 at 11.00am pursuant to

Rule 11.5 of the High Court Rules

Registrar/Deputy Registrar

Solicitors:

Martelli McKegg, Auckland Castle Brown, Newmarket Counsel:

M Fisher, Auckland

LAKES INTERNATIONAL GOLF MANAGEMENT LIMITED v VINCENT [2016] NZHC 1150 [31 May

2016]

The application

[1]      Mr Vincent applies for an order staying execution of a judgment pending appeal.1  The application is opposed.

Background

[2]      On 9 November 2015, I gave judgment (the liability judgment) on a claim by Lakes International Golf Management Ltd and The Lakes International Golf Course Ltd (the plaintiffs) in which declarations were sought as to the ability to recover historical levies from property owners on whose title a covenant was registered on or about 17 November 2003.2

[3]      On 3 December 2015, I finalised the form of a judgment to be sealed by the Registrar and awarded costs on a 2B basis, together with reasonable disbursements (the costs judgment) in favour of the plaintiffs.3   Judgment was subsequently sealed by the Registrar.  The amount payable under the liability judgment was $5070, plus interest. The costs awarded totalled $59,838.25.

[4]      An appeal against both judgments was filed in the Court of Appeal on or about 9 December 2015. The appeal is scheduled for hearing on 14 July 2016.

Satisfaction of the costs’ judgment

[5]      Initially, Mr Vincent had concerns about paying any part of the judgment sums.  However, on 30 March 2016, he paid the costs portion of the judgment.  That was done after his received an email dated 24 March 2016, from the solicitors for the plaintiffs, which stated: “We . . . deny your implication that the plaintiffs will be

unable to repay the costs judgement”.

1      Court of Appeal (Civil) Rules 2005, r 12, set out at para [11] below..

2      Lakes International Golf Management Ltd v Vincent [2015] NZHC 2771 (although the judgment was re-issued on 23 December 2015, its effective date remained 9 November 2015).

3      Lakes International Golf Management Ltd v Vincent [2015] NZHC 3040.

The amount payable under the liability judgment

[6]      The remaining amount to be paid is the judgment sum of $5070, plus interest. Surprisingly, that had not been offered at the time that the costs’ judgment was satisfied.

[7]      On 14 April 2016, the solicitors for the plaintiffs wrote to Mr Vincent’s solicitors  demanding  payment  of  that  sum.    On  16  April  2016,  Mr  Vincent’s solicitors sent an email dated 16 April 2016 in which they said:  “Please provide us with an undertaking on behalf of the respondents to repay the judgement debt in the event of the appeal succeeding”.  By email dated 27 April 2016, the solicitors for the plaintiffs declined to give the undertakings requested, noting that no application for stay had been made. The application for stay was filed on 29 April 2016.

[8]      On  11  May  2016,  the  solicitors  for  Mr  Vincent  wrote  to  the  plaintiffs’ solicitors confirming that the amount of $50704  was held in their trust account. Having regard to estimated costs and disbursements associated with the preparation and filing of the application for stay, they advised that the sum of $3232 could be paid on an undertaking not to enforce the judgment debt pending determination of the appeal, and in the event of the appeal succeeding, to repay that sum within 21

days.

[9]      The plaintiffs’ solicitors responded on 12 May 2016, confirming that they could hold the judgment debt in their trust account pending determination of the appeal and an undertaking that the judgment debt would be repaid within 21 days if the appeal were successful.  The solicitors for Mr Vincent declined that proposal.  It was then necessary for submissions to be filed by the plaintiffs, in opposition to the application for stay.

Should a stay be ordered?

[10]     Given the amount in issue, the parties have agreed that I should determine the application on the papers.

[11]     The application is brought under r 12 of the Court of Appeal (Civil) Rules

2005:

12   Stay of proceedings and execution

(1) None of the matters referred to in subclause (2) operate as—

(a)      a stay of a proceeding in which a decision was given; or

(b)      a stay of execution of that decision. (2) The matters are—

(a)      an application for leave to appeal; or

(b)      the giving of that leave; or

(c)      an appeal.

(3) Pending the determination of an application for leave to appeal or an appeal, the court appealed from or the Court may, on application,—

(a)       order a stay of the proceeding in which the decision was given or a stay of the execution of the decision; or

(b)      grant any interim relief.

(4) An order or a grant under subclause (3) may—

(a)        relate to execution of the whole or part of the decision or to a particular form of execution:

(b)       be subject to any conditions that the court appealed from or the Court thinks fit, including conditions relating to security for costs.

(5) If the court appealed from refuses to make an order under subclause (3), the Court may, on application, make an order under that subclause.

(6) If the court appealed from makes an order under subclause (3), the Court may, on application, vary or rescind that order.

(7) The Court may, at any time, vary or rescind an order made by it under this rule.

[12]     The criteria to be applied in determining whether to exercise the discretion were discussed in Keung v GBR Investment Ltd.5    Delivering the judgment of the Court of Appeal, Ellen France J said:

[11]      … In determining whether or not to grant a stay, the Court must weigh the factors “in the balance” between the successful litigant’s rights to the fruits of a judgment and “the need to preserve the position in case the appeal is successful”. Factors to be taken into account in this balancing exercise include:

(a) whether the appeal may be rendered nugatory by the lack of a stay; (b) the bona fides of the applicant as to the prosecution of the appeal; (c) whether the successful party will be injuriously affected by the stay; (d) the effect on third parties;

(e) the novelty and importance of questions involved; (f) the public interest in the proceeding; and

(g) the overall balance of convenience.

That list does not include the apparent strength of the appeal but that has been treated as an additional factor.

(footnotes omitted)

[13]     This is an unusual case.   I cannot think of any other in which I have been involved in which a judgment for costs of nearly $60,000 has been paid but a stay is sought in respect of a judgment debt of $5070, plus interest.   In the context of an appeal scheduled to be heard on 14 July 2016, (in less than two months’ time), the need for a stay has not been established.

[14]     In all the circumstances, I am not surprised that the solicitors declined to give an undertaking.  It would have been open for the solicitors acting for Mr Vincent to offer the possibility all of the judgment sum (including interest) being held by the plaintiffs’ solicitors in their trust account.   Even though it could be said that the amount involved is de minimis, interest was not factored into the equation.  The most recent proposal by the plaintiffs’ solicitors for the judgment sum to be held in their

trust account was eminently reasonable.6

[15]     None of the factors identified in Keung apply to justify a stay.  In my view,

the successful litigant’s rights to the fruits of a judgment prevail.

[16]     I have not taken into account the merits of the appeal as I do not have sufficient information about the grounds on which it is brought.

Result

[17]     In my view, a stay is not justified. The application is refused.

[18]     Costs are awarded in favour of the plaintiffs on the stay application, on a 2B

basis, together with reasonable disbursements.  Both are to be fixed by the Registrar.

P R Heath J

Delivered at 11.00am on 31 May 2016