McNab v Matthews

[2014] NZHC 580

IN THE HIGH COURT OF NEW ZEALAND TIMARU REGISTRY

CIV 2014-476-0011 [2014] NZHC 580

BETWEEN  GORDON WALLACE CAMERON McNAB & ORS

Applicants

ANDASSOCIATE JUDGE MATTHEWS & ORS

Respondents

CIV 2014-476-0011

BETWEEN  GABRIELLE PAULETTE MATHIESEN

& ANOR Plaintiffs

ANDASSOCIATE JUDGE MATTHEWS Defendant

CIV 2014-476-0012

BETWEEN  STUART GRAEME SPURR Plaintiff

ANDASSOCIATE JUDGE MATTHEWS & ORS

Defendant

Hearing:                   19 March 2014

Counsel:                  G W C McNab, in person, on behalf of all applicants

A R McRae for Respondents, in opposition

Judgment:                26 March 2014

JUDGMENT OF HEATH J

This judgment was delivered by me on 26 March 2014 at 2.15pm pursuant to Rule 11.5 of the High

Court Rules

Registrar/Deputy Registrar

GORDON WALLACE CAMERON McNAB & ORS v ASSOCIATE JUDGE MATTHEWS & ORS [2014] NZHC 580 [26 March 2014]

The applications

[1]      On 17 March 2014, Mr McNab purported to make an application to the Chief Justice and Chief High Court Judge for a direction that the High Court immediately complete the process of hearing two applications for habeas corpus, filed on 26 and

28 February 2014 respectively.  Mr McNab contended that the two applications had been determined without a “hearing”.

[2]      The application of 26 February 2014 was made on behalf of Ms Mathiesen, a Norwegian citizen.   She alleges that she has been “detained” as a result of her adjudication in bankruptcy.   Ms Mathiesen was (wrongly, she submits) adjudged bankrupt by this Court on 11 June 2013.  The order was made by Associate Judge Matthews, on the application of Ms Mathiesen’s former husband.  It is submitted that the order ought not to have been made because Ms Mathiesen does not have a New Zealand domicile and, in any event, a person cannot be adjudged bankrupt on the application of a spouse.   Ms Mathiesen claims that she has been “detained” as a result of the order of adjudication because she is unable to travel overseas without the  consent  of  the  Official Assignee.    That  being  so,  she  contends  that  she  is “detained” within the borders of New Zealand.

[3]      The application of 28 February 2014 was brought by Mr Spurr.  Save for his citizenship, he is in a similar position to Ms Mathiesen.   Mr Spurr was adjudged bankrupt on 30 April 2013, also by Associate Judge Matthews.  It is submitted that the order was wrongly made because of irregularities in the documents filed in support of the bankruptcy application.  While Mr Spurr is a New Zealand citizen, the same complaint about “detention” is made; namely that he cannot travel overseas to attend to personal business as a result of the order of adjudication.

[4]      On 28 February 2014, Mander J dismissed each application on the papers, in identical terms:1

(a)       On the application relating to Ms Mathiesen, Mander J said:

1      McNab and Mathiesen v Matthews HC Timaru CIV-2014-476-0011, 28 February 2014 and

Spurr v Matthews HC Timaru CIV-2014-476-0012, 28 February 2014.

[2]       The application represents a challenge to the decision of this Court adjudicating Ms Mathiesen bankrupt on 11 June 2013, as such it represents an illegitimate collateral attack on that adjudication.  An application for the issue of a writ of habeas corpus is not the appropriate procedure to consider the legitimacy of a bankruptcy adjudication.  There are processes provided for in the Insolvency Act, including application for discharge or annulment, which are available to Ms Mathiesen if it is considered that the bankruptcy adjudication was determined on an erroneous basis.

(b)      On Mr Spurr’s application, the Judge said:

[2]       The application represents a challenge to the decision of this Court adjudicating Mr Spurr bankrupt on 30 April 2013, as such it represents an illegitimate collateral attack on that adjudication.   An application for the issue of a writ of habeas corpus is not the appropriate procedure to consider the legitimacy of a bankruptcy adjudication.  There are processes provided for in the Insolvency Act, including application for discharge or annulment, which  are  available  to  Mr  Spurr  if  it is  considered  that  the  bankruptcy adjudication was determined on an erroneous basis.

The writ of habeas corpus

[5]      Sections 7 and 9 of the Habeas Corpus Act 2001 (the Act) state:2

7   Manner of application for writ

(1)   An application for a writ of habeas corpus must be made to the High Court by originating application in the manner provided by the High Court Rules.

(2)   Despite subsection (1), nothing in that subsection excludes the inherent jurisdiction of the High Court to hear and to make an order on an oral application at any time in circumstances of unusual urgency.

(3)   Despite subsection (1), the provisions of any High Court Rule providing for directions by the Court before the hearing, or affecting the hearing, of an originating application or empowering the Court to convene a conference of the parties to an originating application do not apply to an application.

(4)   No applicant may be disqualified for lack of capacity or standing. (5)   In a proceeding for a writ of habeas corpus—

(a)       No party to the proceeding is entitled to general or special discovery of the documents of any other party to the proceeding or to an order for security for costs; and

(b)       the High Court Rules concerning discovery and inspection of documents and security for costs do not apply.

2      The italicised words in s 9(1) were added by an amendment to the Act, with effect from 30

March 2013. See also, New Zealand Law Commission Habeas Corpus: Refining the Procedure
(NZLC R 100, 2007) at paras 8–10.

(6)   No fee is payable to the High Court for filing any document in respect of an application.

(7)   Section 51E of the Judicature Act 1908 does not apply in respect of the form and manner of any application made under this Act.

…

9   Urgency

(1)    An application for a writ of habeas corpus must be given precedence over all other matters before the High Court unless a Judge of that Court considers that the circumstances require otherwise.

(2)   Judges and employees of the Ministry for Courts must ensure that every application,  including  any  interlocutory  application,  is  disposed  of  as  a matter of priority and urgency.

(3)    The Registrar must allocate a date for the inter partes hearing of an application that is no later than 3 working days after the date on which the application is filed.

(Emphasis added)

[6]      The High Court must “hear” an application for the issue of a writ of habeas corpus.3  A “hearing” is required to enable the Court to inquire into the legitimacy of an alleged detention.  Further, no “applicant may be disqualified for lack of capacity or standing”.4   A liberal approach to standing is required because a detained person not be able to file documents.   In  addition, urgency is  to be accorded to such applications.5    The need for a prompt inquiry into an alleged loss of liberty is self evident.

[7]      The need for a liberal approach to standing and the requirement of urgency illustrate the constitutional importance of the remedy.  The writ has ancient origins and has evolved to ensure that the legality of a person’s detention can be resolved promptly.  The original name of the writ, habeas corpus ad subjiciendum, broadly translates as a requirement that the person who is detaining another bring him or her

before  the  Court,  so  that  it  may  inquire  into  the  justification  for  the  claimed

3      Habeas Corpus Act 2001, s 7(2) and (3).  See also s 9(3) and Kim v Prison Manager, Mount Eden  Corrections  Facility  [2012] NZSC 121, [2013] 2 NZLR 589 at para [49] (per William Young J).

4      Ibid, s 7(4).

5      Ibid, s 9(1) and (3).

detention.  As early as the thirteenth century, the name “habeas corpus” was coined for the application.6

[8]      Contrary to a submission made by Mr McNab before me, one of the purposes of the Act was to abolish writs of habeas corpus other than the writ of habeas corpus ad subjiciendum”.7     The sole basis for jurisdiction is that form of the writ. Nevertheless, it is clear that Parliament’s decision to confirm the remedy in a statute was not intended to dilute its efficacy.8

[9]      In an endeavour to ensure that every form of detention can be subjected to Court review through issue of the writ, the term “detention” is broadly defined, by s 3 of the Act:

Detention includes every form of restraint of liberty of the person.

[10]     An example of the breadth of the remedy can be found in the child abduction case of Jones v Skelton, in which the writ issued to require a person believed to have abducted the child to bring him before the Court.9

Was a “hearing” required on the 26 and 28 February 2014 applications?

[11]     The importance of the writ has been seriously undermined in recent years by applications for orders in circumstances where the writ was never meant to run. Such applications have tended to waste valuable Court time (and, on occasion, to interfere with the rights of other litigants to have their cases heard promptly) because they are not of a type that require priority over other business of the Courts.  Plainly, the remedy is unavailable if a person is free to go about his or her daily business in New Zealand and there is no person who can “release” that person from a form of incarceration.

[12]     The difficulty for a Judge is that once a purported application is made, s 9(1)

and  (3)  of  the Act10   applies.   A “hearing”  must  be held  and  it  must  be  given

6      New Zealand Law Commission Habeas Corpus Procedure (NZLC R 44, 1997) at para 3.

7      Habeas Corpus Act 2001, s 5(d).

8      New Zealand Law Commission, Habeas Corpus Procedure, above n 6 at paras 15–18.

9      Jones v Skelton [2007] 2 NZLR 192 (HC and CA) and [2007] 2 NZLR 178 (SC).

10     Set out at para [5] above.

precedence   over   other   Court   business,   unless   a   Judge   considers   that   the circumstances require otherwise.  While it is often relatively straightforward to see whether there is any merit in an application, if a Judge were to form the view that there was not, a “hearing” must still be held.11

[13]     On  occasion,  because  of  the  plainly  inappropriate  nature  of  the  remedy sought  (as  disclosed  in  an  applicant’s  own  papers)  Judges  have  dismissed applications on the papers.  The question raised by Mr McNab’s application of 17

March 2014 is whether a hearing should have been held before Mander J dismissed each of the two earlier applications.

[14]     There is no specific judicial authority on the ability of the Court to dismiss a habeas corpus application on the papers.   The terms of s 9(3) of the Act, read in conjunction with observations made by the Court of Appeal in Jones v Skelton,12 suggest that a “hearing” is required. The length of that hearing, and the priority to be given to it in relation to other litigation with which the Court is dealing at that time, will be a question for a Judge to determine, in accordance with s 9(1).   In a case

where the application is seemingly hopeless, a short hearing by telephone should suffice.

[15]     The reason why there should be some form of “hearing” is to ensure that a Judge does  not  inadvertently misconceive  the  nature or purpose of the specific application.  The risk of that occurring is heightened when (as can often happen) a Judge is confronted with a raft of (sometimes incoherent) handwritten material from a lay litigant.   In this particular case, the Judge does seem to have overlooked the nuanced nature of Mr McNab’s application.13

[16]     In  those  circumstances,  I  consider  that  I  should  regard  dismissal  of  the habeas corpus applications on the papers as inappropriate, and formally proceed to deal afresh with each of them.14    For that reason, I set aside the orders made by

Mander J and reconsider the merits of the two applications.

11     Habeas Corpus Act 2001, s 9(3).

12     Jones v Skelton above n 7 at paras [34], [59] and [63].

13     See paras [24] and [25] below; compare with Mander J’s approach, set out at para [4] above.

14     Generally, in cases where there has been no proper “hearing”, this course may be taken.  See,

Analysis

(a)      The 19 March 2014 hearing

[17]     When Mr McNab’s most recent application was made on 17 March 2014, I had begun to hear a fraud case in the Timaru Registry of the Court.   That trial is scheduled to take about four months.

[18]     Recognising the urgency that must be afforded to applications of this type, I

asked the Registrar to allocate time at 9am on 19 March 2014 for the hearing.  Only

45 minutes were available.   In order to deal adequately with the applications, I advised  Mr  McNab  that  I would  proceed  on  the assumption  that  the  orders  of adjudication were wrongly made, so that I could consider whether, as a matter of law (on the best view of his case), the writ could issue.

[19]     I informed Mr McNab  that if, as a matter of law, the applications were arguable I would allocate further time to determine whether there were grounds on which an argument that the orders were wrongly made could be based.   If not, I would dismiss the applications, and leave the applicants to any appellate remedies they may have.

(b)      Assumptions

[20]     For the purposes of this judgment (though I have significant reservations about the correctness of all of Mr McNab’s arguments), I assume (without deciding the points) that:

(a)      The  order  of  adjudication  made  in  respect  of  Ms  Mathiesen  was wrongly made on the grounds either that she did not have a New Zealand domicile, or that there was no jurisdiction to make an order on the application of her husband.

(b)      In the case of Mr Spurr, that the alleged procedural irregularities were such as to require the Court not to make an order of adjudication.

generally, Brogden v Arnold [2003] NZAR 80 (HC) at para [12], applying R v Nakhla (No 2)

[1974] 1 NZLR 453 (CA) at 455–456 and Butterfield v R [1997] 3 NZLR 760 (HC) at 764.

(c)      Are Ms Mathiesen and Mr Spurr “detained”

[21]     The first question is whether either Ms Mathiesen or Mr Spurr have been “detained”,  for  the  purposes  of  the  Act.    This  question  has  been  considered previously, in the context of a more general challenge to the effect of a bankruptcy order.

[22]     In  Slavich  v  Official  Assignee,15    Andrews J   dealt  with  Mr  Slavich’s application for a writ of habeas corpus.  He sought to require the Official Assignee to withdraw an objection to his discharge from bankruptcy.  Andrews J held that there was no “detention”, saying:

[30]      Mr Slavich was not physically restrained. He has not been restricted in his movements, and he is free to retain counsel, should he wish. All that has happened to him is that the respondent has lodged a Notice of Objection to his being automatically discharged from bankruptcy. There is a statutory procedure available to him by which he can apply to the Court for discharge, and  thereby  challenge  the  respondent's  Notice.  Accordingly,  I  am  not satisfied that Mr Slavich is being “detained” by the respondent's notice of objection to his discharge from bankruptcy.

[23]     Mr  Slavich  appealed.     The  Court  of  Appeal  dismissed  his  appeal.16

Delivering the judgment of the Court, Chambers J said:

[2]  The point of an application for a writ of habeas corpus is “to challenge the legality of a person's detention”.  But Mr Slavich is not detained. He is free to go wherever he likes within New Zealand. So he does not get past first base.

…

[4]   If Mr Slavich wishes to be discharged from bankruptcy, he should be doing what Andrews J told him to do. That is, he should apply under s 108 of the Act for an order of discharge. He chose quite the wrong procedural route for what he wants to achieve. Applying for a writ of habeas corpus is not the right way to challenge a s 107(3) notice or to be discharged from bankruptcy, as Andrews J explained.

…

(footnotes omitted)

15     Slavich v Official Assignee HC Hamilton CIV 2010-419-246, 19 March 2010 (Andrews J).

16     Slavich v Official Assignee [2010] NZCA 117.

[24]     The Court of Appeal’s decision in Slavich is authority for the proposition that an order of adjudication in bankruptcy does not amount to any restraint on the movement of a person within New Zealand. Thus, the Act is not engaged.

[25]     The issues that arise on Ms Mathiesen’s and Mr Spurr’s applications are more nuanced.  Unlike Slavich, there is a challenge to the underlying validity of the order of adjudication.  Also, the alleged “detention” is premised on an inability to travel outside New Zealand without the consent of the Official Assignee.17

[26]     The first of those points is answered by a principle of high authority.   An order made by a Court of unlimited jurisdiction (such as the High Court of New Zealand) must be treated as valid until such time as it is set aside by a Court of competent jurisdiction.   That basic principle was explained by Lord Diplock, in

Isaacs v Robertson.18     Delivering the advice of the Privy Council, His Lordship

said:19

Their Lordships would, however, take this opportunity to point out that in relation to orders of a court of unlimited jurisdiction it is misleading to seek to draw distinctions between orders that are 'void' in the sense that they can be ignored with impunity by those persons to whom they are addressed, and orders that are ‘voidable’ and may be enforced unless and until they are set aside. Dicta that refer to the possibility of there being such a distinction between orders to which the descriptions ‘void’ and ‘voidable’ respectively have been applied can be found in the opinions given by the Judicial Committee of the Privy Council in Marsh v Marsh [1945] AC 271 at 284 and MacFoy v United Africa Co Ltd [1961] 3 All ER 1169, [1962] AC 152; but in neither of those appeals nor in any other case to which counsel has been able to refer their Lordships has any order of a court of unlimited jurisdiction been held to fall in a category of court orders that can simply be ignored because they are void ipso facto without there being any need for proceedings to have them set aside. The cases that are referred to in these dicta do not support the proposition that there is any category of orders of a court of unlimited jurisdiction of this kind; what they do support is the quite different proposition that there is a category of orders of such a court which a person affected by the order is entitled to apply to have set aside ex debito justitiae in the exercise of the inherent jurisdiction of the court without his needing to have recourse to the rules that deal expressly with proceedings to set aside orders for irregularity and give to the judge a discretion as to the order he will make. The judges in the cases that have drawn the distinction between the two types of orders have cautiously refrained from seeking to lay down a comprehensive definition of defects that bring an order into the category that attracts ex debito justitiae the right to have it set aside, save

17     Insolvency Act 2006, s 433(1)(f).

18     Isaacs v Robertson [1985] AC 97 (PC).

19     Ibid, at 102.

that specifically it includes orders that have been obtained in breach of rules of natural justice.

(Emphasis added)

[27]     The fact that Ms Mathiesen and Mr Spurr complain about the validity of the orders that have adjudged each of them bankrupt does not mean that the orders can be ignored, or treated as invalid.20  An application for annulment may be brought, on the grounds that the order should never have been made.21   Alternatively, an appeal

could be brought against the order.22    Even if (as I assume for the purpose of this

judgment) Ms Mathiesen and Mr Spurr have been adjudged bankrupt wrongfully, the orders subsist until such time as they are set aside, or annulments are granted.   In short, both Ms Mathiesen and Mr Spurr must accept the consequences of the orders that presently exist.

[28]     In Slavich, the Court of Appeal made the point that Mr Slavich was “free to go wherever [he liked] within New Zealand” and was not, therefore, “detained” for the purposes Act.23    While that proposition is indisputable, for a bankrupt person, freedom  of  movement  is  restrained,  so  far  as  overseas  travel  is  concerned. Ms Mathiesen wishes to return to Norway, and Mr Spurr to go to Australia; both for personal reasons.  Neither is prepared to seek permission from the Official Assignee

because they do not accept the validity of the bankruptcy order.  However, as I have already demonstrated, the orders of adjudication continue in effect (and are to be treated  as  validly  made)  unless  set  aside  under  the  processes  created  by  the Insolvency Act 2006.  If they were to seek permission, that could not prejudice any action they wish to take to challenge the relevant orders.  If they were wrongly made, they were wrongly made.

[29]     The undoubted legal position is that Ms Mathiesen and Mr Spurr are unable to leave New Zealand without the consent of the Official Assignee, for the duration of their respective bankruptcies.  If one (or both of them) were to do so, a criminal

offence would be committed.24   They may apply to the Official Assignee for consent.

20     Ibid, set out at para [26] above.

21     Insolvency Act 2006, s 309(1)(a).

22     Ibid, s 414.

23     Slavich v Official Assignee n 12, at para [2].

24     Insolvency Act 2006, s 433(1)(f).

If the Official Assignee were to refuse an application, a right of appeal exists against that decision to the High Court.25

[30]     Although Ms Mathiesen and Mr Spurr placed reliance on the right to leave New Zealand, as part of the freedom of movement guaranteed by s 18 of the New Zealand Bill of Rights Act 1990, the Insolvency Act restrictions take precedence as a matter of interpretation.26

[31]     The fundamental reason why the applications brought by Ms Mathiesen and Mr Spurr must fail is that they are not “detained”.  The most compelling evidence of a lack of “detention” is the ability of Ms Mathiesen and Mr Spurr to attend the hearing before me, without permission from anyone.  They also have the ability to seek permission to go overseas.  If good reasons can be advanced, there seems to be no reason why permission should not be granted (at least on conditions) by the Official Assignee.  He or she will be making a decision that is reviewable by this Court.

[32]     In my view, it is an abuse of the Act to apply for orders in circumstances such as these.  The Act was never intended to apply to cases of this type.  In the future, applicants who bring hopeless proceedings of this type must face the risk that costs will be ordered against them.27

[33]     It follows that the applications must be, and are, dismissed.

Additional observations

[34]     First, as I have now determined the original applications made on behalf of Ms Mathiesen and Mr Spurr, the Registrar is not able to receive any further application in respect of the detentions alleged to have occurred by reason of the

orders  of  adjudication.    The  Registrar  is  directed  not  to  accept  for  filing  any

25     Ibid, s 226.   Generally, see Murray v Official Assignee HC Hamilton B318/92, 9 September

1992 (Penlington J).

26     See, as to the priority to be afforded to the Insolvency Act provisions, ss 4 and 6 of the New

Zealand Bill of Rights Act 1990.

27     Habeas Corpus Act 2001, s 14(4).

application that falls within s 15(1) of the Act.  If in doubt, the Registrar shall refer any purported application to a Judge for direction.

[35]     Second, I directed that the applications be served only on the Crown.   Mr McRae appeared and made helpful submissions on the points with which I have dealt in this judgment.  I did not direct service on the three named respondents.  They are the Associate Judge who made the order, who is clearly protected from suit by judicial immunity; a Deputy Registrar of the High Court at Timaru, against whom no order could be made as she has detained nobody; and Mr Miller, a Court Manager in the South Island against whom no remedy could be sought for the same reason.  The fact none of those persons was detaining either of the applicants serves to re- emphasise the futility of the applications.

[36]     Third, while I have reached the same conclusion as Mander J, in respect of both applications, a right of appeal will lie against this decision.28   That is because I have dealt finally with issues raised in the applications.

[37]     Fourth, on 21 March 2014, after reservation of my judgment, Mr McNab filed  a  further application  seeking  a  “rehearing” on  the  grounds  that  I had  not allocated sufficient time to deal with the applications, in conformity with the obligation to give “precedence” to habeas corpus applications.   I dismissed that application as premature, on the basis that if any matters of fact remained extant for determination on which the applications might otherwise succeed, a further hearing would be held.  As it has transpired, it is not necessary for a further hearing as the applications must fail, as a matter of law.

Result

[38]     For those reasons:

(a)       Mr McNab’s application for a rehearing of the applications of 26 and

28 February 2014 is granted.

28     Ibid, s 16(1)(a).

(b)      The applications of 26 and 28 February 2014 are each dismissed.

P R Heath J

Delivered at 2.15pm on 26 March 2014

Solicitors:
Crown Solicitor, Timaru
Copy to:
G W C McNab