McConnor v Auckland Transport
[2024] NZHC 2290
•15 August 2024
IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY
I TE KŌTI MATUA O AOTEAROA TĀMAKI MAKAURAU ROHE
CIV-2023-404-2805
[2024] NZHC 2290
IN THE MATTER of the Judicial Review Procedure Act 2016, the New Zealand Bill of Rights Act 1990,
and an application by James John McConnor for reviewBETWEEN
JAMES JOHN MCCONNOR
Applicant
AND
AUCKLAND TRANSPORT
First respondent
BAYCORP (NZ) LIMITED
Second respondent
Hearing: 17 July 2024 Appearances:
Applicant in person
PMS McNamara and C J Ryan for first respondent J G Ussher and C Kim for second respondent
Date of judgment:
15 August 2024
JUDGMENT OF JAGOSE J
This judgment was delivered by me on 15 August 2024 at 3.00pm.
Pursuant to Rule 11.5 of the High Court Rules.
………………………… Registrar/Deputy Registrar
Solicitors:
Simpson Grierson, Auckland United Legal Ltd, Auckland
Copy to:
Applicant
MCCONNOR v AUCKLAND TRANSPORT [2024] NZHC 2290 [15 August 2024]
[1] The applicant, Mr McConnor, seeks judicial review of actions taken by the respondents — respectively, Auckland Transport and Baycorp — in relation to Auckland Transport’s issuance to him of a document styled an infringement notice, requiring his payment of a fine, and Baycorp’s subsequent actions on the unpaid sum.
Background
[2] The same circumstances underpin Mr McConnor’s issue of defamation proceedings against Auckland Transport and Baycorp, now consolidated in this Court.1 A judgment in that proceeding conveniently outlines the essential facts:2
On 15 October 2022, a vehicle registered in the name of the plaintiff, Mr McConnor, was driven in a bus lane on Mayoral Drive in Auckland. The first defendant, Auckland Transport (AT), issued an infringement notice to Mr McConnor for an offence under the Land Transport (Road User) Rule 2004 (LT Rule). Mr McConnor disputes the validity of the infringement notice and he has not paid the infringement fee of $150.
On 25 December 2022, AT electronically referred the infringement fee to its debt collection agent, the second defendant, Baycorp (NZ) Ltd (Baycorp). In early 2023, Baycorp sent communications to Mr McConnor demanding payment. Some of those communications were sent by an Australian company related to Baycorp, and part of the Baycorp Group of companies.
On 31 March 2023, AT followed the process in s 21 of the Summary Proceedings Act 1957 (SPA), to commence proceedings in the District Court by automated electronic means in respect of the alleged infringement offence.
Prior to commencing those last proceedings, Auckland Transport withdrew the infringement fee’s collection from Baycorp.
[3] In the present proceeding, in broad terms, Mr McConnor contends the document was deficient in failing to specify the statutory provisions alleged to have been infringed, and Auckland Transport’s subsequent reliance on it as if valid, including with Baycorp, was unlawful, irrational and procedurally improper (particularly in terms of the Summary Proceedings Act 1957 process). He says Auckland Transport breached natural justice. And he claims Baycorp has a public obligation not to publish unverified financial information. He says both Auckland Transport and Baycorp “acted ultra vires”. He seeks orders “quashing” the
1 McConnor v Auckland Transport HC Auckland CIV-2023-404-2690.
2 McConnor v Auckland Transport [2024] NZHC 1709 at [1]–[3].
document and directing Baycorp to delete all information about him from its databases and a declaration Auckland Transport and Baycorp acted unlawfully.
[4] For my determination now are Auckland Transport’s application for orders the proceeding be stayed pending Mr McConnor’s provision of security for costs, and Baycorp’s application for orders striking out Mr McConnor’s claim against Baycorp or striking out Baycorp as a party. Mr McConnor opposes both.
Applicable law
—security for costs
[5] Rule 5.45 of the High Court Rules 2016 permits me, if I think it is just in all the circumstances, to order the giving of security for costs, if I am satisfied on Auckland Transport’s application “there is reason to believe that [Mr McConnor] will be unable to pay the costs of [Auckland Transport] … if [Mr McConnor] is unsuccessful in [his] proceeding”. The purpose of the jurisdiction is to protect a defendant from the risk any award of costs to it is barren.3
[6]The Supreme Court has explained:4
The jurisdiction to require security poses something of a conundrum for the courts. The poorer the plaintiff, the more exposed the defendant is as to costs and the greater the apparent justification for security. But, as well, the poorer the plaintiff, the less likely it is that security will be able to be provided and thus the greater the risk of a worthy claim being stifled.
Accordingly, “[a]pplications for security for first instance proceedings call for careful consideration and judges are slow to make an order for security which will stifle a claim”.5 The ‘careful consideration’ is to identify “a case in which the claim has little chance of success”, to protect defendants “against being drawn into unjustified litigation, particularly where it is over-complicated and unnecessarily protracted”.6
[7]The following questions accordingly arise:
3 Skelton v Howcroft [2018] NZCA 140 at [20].
4 Reekie v Attorney-General [2014] NZSC 63, [2014] 1 NZLR 737 at [5].
5 At [6], referring to A S McLachlan Ltd v MEL Network Ltd (2002) 16 PRNZ 747 (CA).
6 A S McLachlan Ltd v MEL Network Ltd, above n 5, at [15]–[16].
(a)has Auckland Transport satisfied me Mr McConnor will be unable to pay its costs if he is unsuccessful in this proceeding? and, if so
(b)how should I exercise my discretion if to order the giving of security for costs?
(c)what amount should security for costs be fixed at? and
(d)should a stay be ordered?
The subsidiary questions are matters for my discretion, which “is not to be fettered by constructing principles from the facts of previous cases”.7 The general approach is to balance a defendant’s interest in being protected from a barren costs order with the plaintiff’s right of access to the court.8
[8] If the initial threshold is crossed, I am to make “an assessment in the round”,9 of what I think fit in all the circumstances, which generally will include:10
(a)the amount or nature of the relief claimed;
(b)the nature of the proceeding, including the complexity and novelty of its issues, and therefore the likely extent of interlocutories;
(c)the estimated duration of trial; and
(d)the probable costs payable if the plaintiff is unsuccessful and perhaps also the defendant’s estimated actual solicitor and client costs.
Any question of the proceeding’s merit goes to whether security for costs should be ordered at all, and may have some relevance for its quantum, but inquiry into merit at any depth at an early or interlocutory stage is impractical and undesirable and can only be impressionistic in proceedings of any complexity.11
7 Jindal v Liquidation Management Ltd [2023] NZCA 413 at [19], citing A S McLachlan Ltd v MEL Network Ltd, above n 5, at [13]—[14].
8 At [19], approving Clear White Investments Ltd v Otis Trustee Ltd [2016] NZHC 2837 at [4].
9 Red 9 Ltd v The Learning Ladder Ltd (in liq) [2021] NZCA 284, (2021) 25 PRNZ 780 at [30].
10 McNaughton v Miller [2022] NZCA 273 at [17].
11 At [18]–[19], citing Meates v Taylor (1992) 5 PRNZ 524 (CA) at 528; Lee v Lee [2019] NZCA 345 at [73]; Ngai Te Hapu Inc v Bay of Plenty Regional Council [2018] NZCA 291 at [21]; and A S McLachlan Ltd v MEL Network Ltd, above n 5, at [21].
—strike out
[9] An application to strike out all or part of a pleading — necessarily on grounds the pleading is in some manner abusive:12 an “improper use of [the court’s] machinery”;13 use of that process “for a purpose or in a way which is significantly different from [its] ordinary and proper use”14 — proceeds on the assumption the pleaded facts are true, and the impugned pleading so clearly untenable it cannot possibly succeed:15
[T]he jurisdiction is one to be exercised sparingly, and only in a clear case where the Court is satisfied it has the requisite material; but the fact that applications to strike out raise difficult questions of law, and require extensive argument does not exclude jurisdiction.
(citations omitted)
As such, the jurisdiction carries “a ‘heavy’ onus and … should be exercised only in exceptional circumstances”16 — “strike out is more concerned with what can and will be pleaded, rather than what has been pleaded.”17
[10] No different consideration arises if the application is to strike out a party as “improperly or mistakenly joined”:18 the orthodox test was if the claim ‘cannot possibly’ entitle the plaintiff to relief from the party seeking to be struck out;19 but
12 High Court Rules 2016, r 15.1(1); Southern Response Earthquake Services Ltd v Ross [2020] NZSC 126, [2021] 1 NZLR 117 at [41].
13 Simon Goulding, DB Casson and William Blake Odgers Odgers on Civil Court Actions (24th ed, Sweet & Maxwell, London, 1996) at [10.15] as cited in Commissioner of Inland Revenue v Chesterfields Preschools Ltd [2013] NZCA 53, [2013] 2 NZLR 679 at [87].
14 Te Wakaminenga o Nga Hapu Ki Waitangi v Waitangi National Trust Board [2023] NZCA 63 at [14], quoting Attorney-General v Barker [2000] 1 FLR 759 (QB) at 764.
15 Attorney-General v Prince & Gardner [1998] 1 NZLR 262 (CA) at 267 (citations omitted), endorsed in Carter Holt Harvey Ltd v Minister of Education [2016] NZSC 95, [2017] 1 NZLR 78 at [10].
16 White v Attorney-General [2021] NZCA 479 at [43], citing Williams v Spautz (1992) 174 CLR 509 (HCA) at 529 and Goldsmith v Sperrings Ltd [1977] 1 WLR 478 (CA) at 498. Similarly, SPAK (1996) Ltd v Leroy [2022] NZCA 564, (2022) 23 NZCPR 769 at [169]–[170], citing Burns v National Bank of New Zealand Ltd [2004] 3 NZLR 289 (CA) at [37], Attorney-General v Prince and Gardner [1998] 1 NZLR 262 (CA) at 267, Smith v Fonterra Co-Operative Group Ltd [2021] NZCA 552, [2022] 2 NZLR 284 at [38], Gartside v Sheffield, Young & Ellis [1983] NZLR 37 at 45 and Electricity Corporation Ltd v Geotherm Energy Ltd [1992] 2 NZLR 641.
17 Smith v Fonterra Co-operative Group Ltd [2024] NZSC 5 at [49], n 92, endorsing Couch v Attorney-General [2008] NZSC 45, [2008] 3 NZLR 725 at [123].
18 High Court Rules, r 4.56(1)(a).
19 McKendrick Glass Manufacturing Company Ltd v Wilkinson [1965] NZLR 717 (SC) at 718.
a broader approach may be justified for joinder if the proceeding only may impact a defendant’s rights.20
—judicial review
[11] Finally, judicial review is concerned with exercises, refusals to exercise or proposed or purported exercises of statutory (or otherwise public) power.21 ‘Statutory power’ is defined.22 ‘Public’ powers are those with public consequences,23 or relevant to the public interest,24 or irremediably affecting private rights and liabilities.25
[12] On judicial review, this Court assesses if the power is exercised “in accordance with law, fairly and reasonably”.26 If not, there is limited relief the Court may grant.27 ‘Fair’ and ‘reasonable’ are terms of art in judicial review, respectively broadly meaning procedurally regular and substantively rational. It is well recognised the right to natural justice in any case depends on the context: “[t]he question is what form of procedure is necessary to achieve justice without frustrating the apparent purpose of the legislation”.28 It is not a free-standing ground for review. Judicial review is not this Court’s boundless inquiry into a respondent’s conduct.
Discussion
—security for costs
[13] Mr McConnor did not respond to Auckland Transport’s request he evidence his ability to satisfy an adverse costs award. The present application followed.
20 Newhaven Waldorf Management Ltd v Allen [2015] NZCA 204 at [46].
21 Judicial Review Procedure Act 2016, s 4; Moncrief-Spittle v Regional Facilities Auckland Ltd
[2022] NZSC 138, [2022] 1 NZLR 459 at [39]–[49].
22 Section 5.
23 Wilson v White [2005] 1 NZLR 189 (CA) at [21].
24 Attorney-General v Problem Gambling Foundation of New Zealand [2016] NZCA 609, [2017] 2 NZLR 470 at [42].
25 Mercury Energy Ltd v Electricity Corporation of New Zealand Ltd [1994] 2 NZLR 385 (PC) at 388.
26 New Zealand Fishing Industry Association Inc v Minister of Agriculture and Fisheries [1988] 1 NZLR 544 (CA) at 552.
27 Judicial Review Procedure Act, ss 16–19.
28 Dotcom v United States of America [2014] NZSC 24, [2014] 1 NZLR 355 at [118]–[120].
[14] Mr McConnor (under his former surname, Dorbu) was adjudged bankrupt in 2010, on his failure to pay a judgment debt.29 On his unsuccessful appeal against penalty consequent on the New Zealand Lawyers and Conveyancers Disciplinary Tribunal’s findings of his professional misconduct, Mr McConnor advised this Court in 2012 of his “dire financial position” as then “a sickness beneficiary”.30 Mr McConnor more recently has contended to the Tribunal “his car grooming business
… supplements his unemployment benefit”.31 There, the Tribunal assessed these High Court proceedings, “whatever the rights and wrongs of the litigation”, illustrative of Mr McConnor’s “hubris and disproportionality …, both traits that concern us”.32 The Tribunal found he was “in tight financial circumstances”.33
[15] Observing Mr McConnor’s self-description as a company director, Auckland Transport also has evidenced his sole directorship of Frontier Technologies (NZ) Limited, to note neither he nor the company have any financing statements registered on the Personal Property Securities Register, and he owns no real property, residing instead at what appear to be rental properties. It observes a question of security for costs also arises in the defamation proceedings, which may add to his inability to pay costs if unsuccessful in both proceedings.
[16] Mr McConnor’s opposition does not respond to any of that evidence, resisting the application instead only on grounds going to my discretion. His supporting affidavit sworn 19 February 2024 confirms his $520 weekly residential rental but otherwise exclusively addresses the substance of his case.
[17] Mr McConnor’s recent unemployment benefit receipt is of some $400 per week, reduced rateably to cut off on gross weekly income of about $700 per week if so supplemented by his business, paid in principle to prioritise “people of working age
… to find and retain work”.34 Mr McConnor does not say if he also is in receipt of any accommodation supplement or other social security benefit.
29 Barfoot & Thompson Ltd v Dorbu HC Auckland CIV-2009-404-7639, 4 June 2010 at [27].
30 Dorbu v New Zealand Law Society [2012] NZHC 564 at [43].
31 McConnor v New Zealand Law Society [2024] NZLCDT 13 at [15].
32 At [31].
33 At [37].
34 Social Security Act 2018, ss 4, 20 and 65 and schs 2 and 4.
[18] Regardless, on any view of the matter, his established and uncontradicted “tight financial circumstances” give me reason to believe he will be unable to pay Auckland Transport’s costs if he is unsuccessful in this proceeding. He confirmed that inability in response to my direct question of him at hearing.
[19] I therefore turn to how I should exercise my discretion if to order security for costs. I am mindful Mr McConnor also said in response to my previous query he would not be able to give security for costs either, with the result this proceeding would end.
[20] Section 78B of the Summary Proceedings Act affords the orthodox course to challenge any irregularity in procedures leading to imposition of a fine under the Act’s s 21. As such, without exhausting that pathway, Mr McConnor’s application for judicial review may be an abuse of process.35 As the Tribunal apprehended, his claim accordingly is exactly the sort of unjustified ‘over-complicated and unnecessarily protracted’ litigation for which orders for security for costs are warranted in defendants’ interests. I will order he provide security for costs.
[21] I have identified at [3] above the nature of the proceeding and the relief sought by Mr McConnor. Comparable relief is available under s 78(B)(2), including resetting the infringement notice process and/or setting aside the fine. The claim in this Court is not complex or novel; interlocutories in judicial review proceedings generally are unexpected and in any event under the case management of a Judge.36 It would be unusual if Mr McConnor’s case was set down for more than a one-day hearing, and more likely only a half-day. A single case management conference likely would suffice to bring the matter to hearing. If Mr McConnor was unsuccessful, time allocation for calculation of costs payable to Auckland Transport would unlikely exceed 8.5 days, at daily rates of $1,590 (category 1) or $2,390 (category 2).
[22]Auckland Transport calculates category 2 costs would amount to some
$18,000, and seeks an order Mr McConnor provide security for costs in the amount of
35 Prescott v Police [2019] NZCA 380 at [18].
36 Judicial Review Procedure Act, s 14.
$15,000. It emphasises it is bound to act in a financially responsible manner,37 which includes securing the interests of its funding ratepayers.38
[23] By my calculation, category 1 costs would amount only to some $13,500. In circumstances of contended impoverishment, the sum of security should not be something approaching (let alone exceeding) an indemnity for prospective liability. A lesser security better balances interests of access to justice against those of injustice to defendants. But it remains justifiable access to justice, for which Mr McConnor’s claim may fall short if an abuse.
[24] To that end, Mr McConnor said he had pursued action under s 78B, but the Ministry of Justice advised him it was not available to him. I did not understand that response, when exercise of s 78B’s power is initiated by a defendant’s application to the District Court. Mr McConnor said he could provide his correspondence with the Ministry. My 17 July 2024 minute directed accordingly, requesting also any submission or response on the correspondence and s 78B’s availability.
[25] Mr McConnor since has provided that correspondence. Mr McConnor’s 21 September 2023 formal s 78B application was made on grounds he had not received a reminder notice, had asked for a hearing and contended for other procedural errors. By letter of 29 September 2023, a District Court Deputy Registrar declined his application because “the infringement reminder notice was sent to the address listed with the Motor Vehicle Register at the time”.
[26] Mr McConnor followed up with a further 9 October 2023 formal s 78B application, again on grounds he had not received a reminder notice, had asked for a hearing and contended for other procedural errors. By letter of 30 October 2023, a District Court Deputy Registrar declined his application because “[his] evidence did not prove that the Auckland Transport – Parking Services and Enforcement failed to action [his] request for a hearing”.
37 Local Government (Auckland Council) Act 2009, s 40.
38 Nelson Gambling Taskforce Inc v Nelson City Council HC Nelson CIV-2010-442-368, 16 December 2010 at [66].
[27] By letter of 1 November 2023, Mr McConnor sought further information from the Ministry of Justice, concluding:
If I do not receive this information by [8 November 2023], I will initiate judicial review proceedings against both the Ministry of Justice and Auckland Transport without any further communication.
No reply appears to have been made by the Ministry. In accompanying submission to me, Mr McConnor asserts his claim for judicial review of Auckland Transport’s and Baycorp’s actions should not be “stifled” by an order for security for costs.
[28] Auckland Transport correctly identifies Mr McConnor’s recourse in the first instance is by application under s 106F of the Summary Proceedings Act for review of the deputy registrars’ decisions. And it as correctly submits Mr McConnor’s circumvention of that challenge pathway by the present proceeding may be an abuse.39 Mr McConnor replies the s 78B process is “inadequate” to address his challenge to Auckland Transport’s process. But those all are questions for another day.
[29] For today, the issues raised reinforce the appropriateness of an order for security in the particular circumstances of Mr McConnor’s application for judicial review of Auckland Transport’s exercise of public power. Confronted directly with the intended statutory pathway for such challenges, Mr McConnor’s preference to proceed otherwise should not put the expense then to be incurred by Auckland Transport entirely at risk.
[30] I will order Mr McConnor pay security for costs on his present application. Noting such traditionally was in “modest” quantum,40 generally “to be fixed by reference to costs allowable for the first day of the hearing”,41 I will fix the sum payable at $2,500.
—strike out
[31] Mr McConnor’s claim against Baycorp asserts it failed its contended obligation “to test the veracity and integrity of communication it received from
39 Relying on Prescott v Police [2019] NZCA 380 at [18].
40 Reekie v Attorney-General, above n 4, at [7].
41 At [8(b)], referring to the Court of Appeal Amendment Rules 1939, r 5.
[Auckland Transport] prior to validating, publishing or acting on it”. He says that “is to ensure that the legal and financial information it provided to businesses in the public domain are truthful and accurate”, which he also asserts “is accordingly an exercise of power with important public consequences, and therefore a public decision reviewable in law”.
[32]Irrespective of contended consequences beyond Mr McConnor, as indicated at
[11] above, an organising principle for public powers susceptible to the supervisory jurisdiction of this Court is they be independent powers to regulate the affairs of others. Such description catches the extent to which non-public entities may be susceptible to judicial review.42 The focus is to distinguish ‘public’ or ‘governmental’ acts from those “any private citizen can perform”.43 That there may be public interest in an entity’s activities is insufficient.
[33] Mr McConnor does not contend for any such public power to be exercised by Baycorp. He cannot, because it has not exercised any such power susceptible to this Court’s supervision. His claim against Baycorp exactly is so clearly untenable it cannot possibly succeed and cannot possibly entitle him to relief against it. I will strike out the pleading against Baycorp and strike out Baycorp as a party as otherwise improperly retained.
Result
[34] Under r 15.1 of the High Court Rules, I strike out the pleading against Baycorp.
[35]Under r 4.56, I order Baycorp is struck out as second respondent.
[36]Under r 5.45(2), I order:
42 See, for example: Stininato v Auckland Boxing Association Inc [1978] 1 NZLR 1 (CA); Royal Australasian College of Surgeons v Phipps [1999] 3 NZLR 1 (CA); Velich v Body Corporate No 164980 (2005) 6 NZCPR 143 (CA). Although applicants in such cases may have contracted to be subject to powers exercised by such entities, those powers have independent foundation such that they cannot be adjusted exclusively between the applicant and the entity, justifying characterisation as ‘public’.
43 I Congreso del Partido [1983] 1 AC 244 (HL) at 267, and at 269 (citing trial judge [1978] QB 500 at 528) (albeit in exempting purely commercial transactions from application of the doctrine of sovereign immunity).
(a)Mr McConnor give security for costs in the amount of $2,500; and
(b)the proceeding is stayed until the sum of security is paid into court.
—Jagose J
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