Lau v New Zealand Home Bonds Limited

[2015] NZHC 3023

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

CIV-2015-404-002322 [2015] NZHC 3023

BETWEEN

AUGUSTINE LAU

Applicant

AND

NEW ZEALAND HOME BONDS LIMITED

Respondent

Hearing:	30 November 2015
Appearances:	A Lau (Self-represented Applicant) in Person S M Thompson for the Respondent D T Broadmore for the Non-Party, Buddle Findlay
Judgment:	2 December 2015

JUDGMENT OF EDWARDS J

This judgment was delivered by Justice Edwards on 2 December 2015 at 4.00 pm, pursuant to

r 11.5 of the High Court Rules

Registrar/Deputy Registrar
Date:

Counsel:     D M Lester, Christchurch

S M Thompson, Auckland

Solicitors:    GCA Lawyers, Christchurch

Buddle Findlay, Auckland

Copy To:     A Lau, Auckland

LAU v NZ HOME BONDS LIMITED [2015] NZHC 3023 [2 December 2015]

[1]      Mr Lau seeks an order requiring Buddle Findlay to disclose a correspondence file and Westpac Bank to disclose a bank statement.  He says he requires disclosure so as to be able to advance his arguments in support of his application to remove a caveat and in opposition to the application for security for costs.  A half day hearing has been allocated for both applications next Monday, 7 December 2015.

[2]      New  Zealand  Home  Bonds  Ltd  (NZHB)  opposes  the  application  on  the grounds that the documents sought by Mr Lau relate to payments made by NZHB in relation to a bond.  NZHB says that any issue regarding the fact of the payment made is res judicata having been the basis upon which the decisions of this Court and the Court of Appeal in Sim v New Zealand Home Bonds Ltd (Sim cases) were made.1

NZHB  therefore  says  that  the  documents  are  not  relevant  to  an  issue  in  the

proceeding and are therefore not discoverable.

[3]      Mr Broadmore appeared for Buddle Findlay having only received a copy of the application last Friday, 27 November 2015.  He supported NZHB’s opposition to the application, and raised further grounds in opposition relating to the broad scope of the documents sought, the cost and time in locating them, the fact that relevant documents   are   likely   to   belong   to   Buddle   Findlay’s   clients   rather   than Buddle Findlay, or may otherwise be privileged.  Mr Broadmore seeks an order for non-party costs should a discovery order be made against Buddle Findlay.  He points out that there may be a risk in recovering such costs.

[4]      Although Mr Lau also sought orders against Westpac Bank, it appears that he has not served the application on Westpac Bank nor taken any other steps to notify

Westpac of the documents he requires.

1      Sim v New Zealand Home Bonds Limited (2009) 10 NZCPR 747 (HC) [High Court Decision]; Sim v New Zealand Home Bonds Ltd [2010] NZCA 192, (2010) 11 NZCPR 530 [Court of Appeal Decision].

[5]      Mr Lau is the ex-husband of Ms Sim.  Ms Sim is the registered proprietor of a property in Royal Oak, Auckland.   Mr Lau is not a registered proprietor of that property.   NZHB has a caveat over that property which was registered in 2004 to secure reimbursement of a sum payable under a bond pursuant to an agreement between Ms Sim and NZHB dated 18 August 2004.  Mr Lau has applied to remove that caveat.

[6]      NZHB sought reimbursement from Ms Sim.  The liability to pay that sum has been confirmed by this Court and the Court of Appeal in the Sim cases.   Those judgments     record     that     payments     were     made     by     the     bondholders (Winsun Developments Ltd) and its assignees to extend the duration of the bond, and payment of the bond itself was also made by NZHB to Hanover Finance Ltd (the final assignee of the bond).2

[7]      Mr Lau confirmed that the documents he seeks from Buddle Findlay and from Westpac relate to proof that these payments were made.  He intends to argue that  NZHB  does  not  have  an  interest  sufficient  to  sustain  the  caveat  because, amongst other things, these payments were not made.

Non-party discovery orders

[8]      Applications for non-party discovery are made pursuant to r 8.21.  That rule applies if it appears to a Judge that a person who is not a party to a proceeding may be or may have been in control of one or more documents or a group of documents that the person would have had to discover if the person were a party to the proceeding.   A Judge may order a person to file an affidavit stating whether the documents are or have been in the person’s control and if they are in their control,

produce them for inspection.

2 High Court Decision, above n 1 at [1]; and Court of Appeal Decision at [3], [12], and [28].

[9]      Rule 8.21(3) provides that an application must be made on notice to the person  (i.e.  the  non-party).    This  rule  precludes  any  order  being  made  against Westpac Bank as it has not been served with the application.

Buddle Findlay file

[10]     Mr Lau seeks orders requiring Buddle Findlay to produce a file relating to the NZHB matter so  that  he can  see correspondence on  that  file in  relation  to  the payment of the bond.  Buddle Findlay acted for Hanover Finance Ltd at the relevant time.   Mr Lau remains highly suspicious about whether payment of the bond was received given Hanover Finance Ltd went into liquidation soon after payment was made.

[11]     However, there is evidence before the Court of the payment being made. Mr Rudkin is a director of NZHB.  He has sworn an affidavit in opposition to the caveat lapsing and in support of NZHB’s security for costs application.  He attaches an affidavit of Mr Paul Miller sworn 12 May 2008 in the District Court proceedings commenced by NZHB against Ms Sim to recover the bond.  That affidavit attaches a Westpac Bank payment confirmation document which shows a transfer of $44,000 from NZHB’s account to the trust account of Buddle Findlay on 7 February 2008.

[12]     Mr Lau had not had an opportunity to review this payment confirmation prior to the hearing but when shown it during the hearing said that he would want further information before accepting it as adequate proof of payment.

[13]     I do not consider an order requiring Buddle Findlay to disclose its file to Mr Lau is warranted in this case.   Mr Lau has not persuaded me that there is a reasonable basis to challenge the confirmation document as adequate evidence of payment of the bond on 7 February 2008.  Mr Lau’s argument that the payment has not been made faces considerable hurdles given this evidence and the reference to the payments being made in the Sim cases.  He has been unable to point to any new evidence  or  raise  any  matter  which  suggests  that  there  may  be  documents  in existence proving that payment of the bond was not made.

[14]     I also take into account the time and cost to Buddle Findlay in locating the documents and the fact that there may be a risk in recovering those costs from Mr Lau.   The fact that much of the information sought by Mr Lau is likely to be privileged or to be confidential information belonging to Buddle Findlay’s clients for which consent to release would need to be sought also weighs against the making of the order sought.

[15]     For  these  reasons,  I  decline  to  make  the  application  sought  against

Buddle Findlay.

Westpac Bank statement

[16]     Mr Lau  also sought a  certified  copy of the Westpac Bank  statement  for

NZHB’s account from 1 January 2007 to 31 March 2008.

[17]     Mr  Lau  has  sworn  an  affidavit  which  annexes  a  redacted  copy  of  the Westpac Bank statement.  He says that this bank statement was originally provided by NZHB as proof that payments made to maintain the bond were made.

[18]     Mr Lau is not satisfied with the copy of this bank statement.  Whilst the date on the first page of the document annexed (page two of seven) has a date range of

7 September to  5  October 2007  and  a barcode,  the  subsequent  two  pages  have “page 7 of 8” on the bottom and do not contain any barcode.   They also do not contain  a date  reference.   The final  page  of the document  (page  six  of seven) specifies a date range of 7 December 2007 to 7 January 2008 and also contains a barcode.   Mr Lau is deeply suspicious about the validity of this statement.   He submits that NZHB may have altered, inserted, or erased the important proof of payment from Hanover Finance Ltd.

[19]     I  accept  that  the  presentation  of  the  bank  statement  pages  Mr  Lau  has annexed to his affidavit, if originally disclosed like that, raises some queries about the proof of payment.   The pages he annexes do not appear to be from the same statement,  and  there  are  gaps  in  the  dates  presented  on  them.     This  has understandably fuelled Mr Lau’s suspicions about whether these payments have in

fact been made.   Those suspicions may be allayed, at least in some respects, by NZHB producing complete copies of the relevant bank statements (appropriately redacted) showing when these payments  were  made.    It  will  certainly be  more difficult for Mr Lau to argue this point should those full bank statements evidencing the payments be disclosed in evidence prior to the hearing next week.

[20]     However,  I do not consider Mr Lau’s concerns warrant an order against NZHB  (or Westpac Bank,  had  it  been  served)  requiring disclosure of  the bank statement.  There is no evidence suggesting that the bank statement sought would prove that  the payments  had  not  been  made,  as  Mr  Lau  contends.   Again,  the

references in the Sim cases suggest the contrary is the correct position.3

[21]     I  therefore  decline  to  make  an  order  requiring  disclosure  of  the  bank statements.

Result

[22]     The application for non-party discovery is dismissed.

Edwards J

3 High Court Decision, above n 1 at [1]; and Court of Appeal Decision at [3], [12], and [28].