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Mason v Dodd

Mason v Dodd

Case [2020] NZHC 1508 30 June 2020

Breach of Contract

Breach of Duty of Care

Standard of Care

Causation

Professional Negligence

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IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

I TE KŌTI MATUA O AOTEAROA TĀMAKI MAKAURAU ROHE

CIV-2019-404-936

[2020] NZHC 1508

BETWEEN
ALEXANDER CHARLES MASON

Plaintiff

AND

PAUL MORLEY DODD

Defendant

Hearing: 18 May 2020

Counsel:

G J Thwaite and W S Kim for plaintiff

S Hunter QC and S T Coupe for defendant

Judgment:

30 June 2020

JUDGMENT OF KATZ J

This judgment was delivered by me on 30 June 2020 at 4:00pm Pursuant to Rule 11.5 High Court Rules

Registrar/Deputy Registrar

Solicitors: Gilbert Walker, Auckland

Counsel:G J Thwaite, Abraham Lincoln Chambers, Auckland S Hunter QC, Shortland Chambers, Auckland

MASON v DODD [2020] NZHC 1508 [30 June 2020]

Introduction

[1] Alexander Mason claims that Paul Dodd, his former accountant, gave him incorrect advice in 1994 about setting up a family trust (the Mamari Trust) and transferring his assets to it. Mr Dodd is alleged to have given Mr Mason further incorrect advice and/or failed to correct his earlier advice in 2013 when a second trust (the Mamari (No 2) Trust) was established.

[2] Mr Mason and his wife, Wendy Mason, were trustees of both trusts. In 2019 they were both removed as trustees by this Court.1 In Mrs Mason’s case this was due to her incapacity, as a result of dementia. In Mr Mason’s case, Fitzgerald J found that he displayed a fundamental lack of understanding of the role and duties of a trustee, instead believing that he was entitled to do “whatever he likes with trust assets”. Her Honour observed that “a person who does not accept or believe in the very concept of the trust of which they are a trustee is the antithesis of who ought to be a trustee.” Fitzgerald J found that Mr Mason’s deep hostility to his co-trustees and two of the beneficiaries of the trust meant that he was no longer able to discharge his duties as a trustee in a fair and impartial manner. Mr Mason’s hostility had resulted in significant dysfunction in the operation of the trusts and an unsustainable dissipation of trust assets, including large sums spent on legal fees.2

[3] Mr Mason alleges in this proceeding that Mr Dodd was negligent, and also in breach of contract, in not advising him of the possibility that he could lose control of the two trusts. He seeks summary judgment in respect of liability on all causes of action, with a separate trial to follow later on quantum issues.

Summary judgment applications – the law

[4] The Court may give judgment on any cause of action if satisfied that Mr Dodd has no defence to that cause of action.3 The words “no defence” have been interpreted

1      Triezenberg v Mason [2019] NZHC 14, (2019) 5 NZTR 29-001.
2      Triezenberg v Mason [2019] NZHC 14, (2019) 5 NZTR 29-001 at [125]–[130].
3      High Court Rules 2016, r 12.2.

to mean “no bona fide defence, no reasonable ground of defence, no fairly arguable defence”.4 The summary judgment procedure exists to:5

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 Mason v Dodd

Details

AGLC: Mason v Dodd [2020] NZHC 1508
Case: [2020] NZHC 1508
Decision Date: 30 June 2020

CaseChat Overview and Summary

In the High Court of New Zealand, Alexander Mason filed a lawsuit against his former accountant, Paul Dodd, alleging that Dodd gave him incorrect advice in 1994 regarding the establishment of a family trust, the Mamari Trust, and the transfer of his assets into it. Mason further alleges that Dodd provided incorrect advice and/or failed to correct his earlier advice in 2013 when a second trust, the Mamari (No 2) Trust, was established. Mason and his wife, Wendy Mason, were trustees of both trusts. In 2019, they were removed as trustees by the court, with Wendy's removal due to her incapacity as a result of dementia, and Alexander's removal due to his fundamental lack of understanding of the role and duties of a trustee.

Mason seeks summary judgment in respect of liability on all causes of action, with a separate trial to follow later on quantum issues. The court was required to decide whether Dodd's advice was negligent and/or in breach of contract, and whether there was any loss caused by such advice. The court reasoned that the appropriate standard of care is determined objectively, with reference to the standards of a reasonable person in the position of the defendant at the relevant time. The court found that the allegations were not suitable for summary determination, as they involved disputes in relation to both factual issues and the relevant standard of care to be applied. The court also found that there were complex issues regarding causation and limitation that would require full particularisation and comprehensive legal submissions. As a result, the application for summary judgment was dismissed, and Dodd was awarded costs as the successful party.

Orders