The approved question for which leave was granted was whether the High Court was wrong in all the circumstances of the case to order Mr Lee to provide security for costs without considering the merits of his claim.[2]
It is instructive to put Mr Lee’s claim and the procedural background to these proceedings in context.
In June 2010 Mr Lee applied for a pre-proceeding order for discovery. He then filed a statement of claim on 30 September 2011 citing himself as first plaintiff and his sister, Helen Heard, as second plaintiff. They brought the proceedings in their capacity as trustees of the estate of their late mother, Joyce Lee.[3]
[3]As trustees they should have been cited as one plaintiff.
The plaintiffs challenge transactions pursuant to which their parents transferred shares in a plastic manufacturing business, High Duty Plastics Ltd (HDP) to their brother Gregory Lee. They allege that Gregory exercised undue influence over their parents and acted in breach of fiduciary duty. They say Gregory obtained an unconscionable bargain. They seek a variety of orders including setting aside the transfer and an account of profits.
The plaintiffs’ case is that the transactions in issue took place in August 2000. The defendants (Gregory Lee and Jane Lee) say the shares were transferred in 1997 as part of a family arrangement at that time.
On 6 December 2012 Associate Judge Christiansen struck out the plaintiffs’ claims on limitation grounds.[4] On review Collins J upheld that decision.[5] However, it was reversed on appeal by this Court and the proceedings were reinstated on 4 November 2015.[6]
[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.
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AGLC
Lee v Lee [2019] NZCA 345
Case
[2019] NZCA 345
Decision Date
CaseChat Overview and Summary
The case of Lee v Lee involved an appeal against a decision of the High Court that required Mr Lee to provide security for costs. The High Court had ordered that Mr Lee provide security for costs in the sum of $75,000 in connection with a claim he brought on behalf of the estate of his late mother, Joyce Lee, against his brother, Gregory Lee, and Jane Lee, as trustees of the Leeroy Family Trust. The issue before the Court of Appeal was whether the High Court was wrong in all the circumstances of the case to order Mr Lee to provide security for costs without considering the merits of his claim. The plaintiffs' case was that Gregory exercised undue influence over their parents and acted in breach of fiduciary duty. They also say Gregory obtained an unconscionable bargain. They seek a variety of orders including setting aside the transfer and an account of profits. The Court found that an order for security is appropriate and dismissed the appeal. The plaintiffs in CIV-2010-463-430 are to provide security for costs in the sum of $75,000 to the satisfaction of the Registrar. In the event security is not provided by 16 August 2019 the proceeding will be stayed. The appellant must pay the respondents one set of costs for a standard appeal on a band A basis and usual disbursements.