Mulholland v Mulholland - [2023] NZHC 1692

IN THE HIGH COURT OF NEW ZEALAND TAURANGA REGISTRY

I TE KŌTI MATUA O AOTEAROA TAURANGA MOANA ROHE

CIV-2022-470-111

[2023] NZHC 1692

BETWEEN
VICKY-LEE MULHOLLAND

Applicant

AND

BRENT EDWARD MULHOLLAND

First Respondent

ELE HOLDINGS LIMITED

Second Respondent

Hearing: 27 March 2023

Appearances:

W Hofer for the Applicant

R Gordon for the First Respondent

Judgment:

4 July 2023

JUDGMENT OF ASSOCIATE JUDGE SUSSOCK

This judgment was delivered by me on 4 July 2023 at 12 pm pursuant to r 11.5 of the High Court Rules

Registrar/Deputy Registrar

Solicitors:
Tompkins Wake, Hamilton
MinterEllisonRuddWatts, Wellington

MULHOLLAND v MULHOLLAND [2023] NZHC 1692 [4 July 2023]

Introduction

[1] The plaintiff, Vicky-Lee Mulholland (Vicky), seeks leave to apply for summary judgment on liability only against the first defendant, Brent Mulholland (Brent), in respect of certain aspects of her second cause of action.

[2] The plaintiff requires leave as her application for summary judgment was filed together with her amended claim rather than at the same time as the original statement of claim.1

[3] Vicky’s proposed summary judgment application seeks judgment under s 174(1) of the Companies Act 1993 that the affairs of the second defendant, ELE Holdings Ltd (EHL), are being conducted in such a way as to be oppressive, unfairly discriminatory or unfairly prejudicial to her. Such a claim is not ordinarily amenable to summary judgment. However for six out of seven of her grounds, Vicky relies on s 175 of the Companies Act which deems a failure to comply with certain provisions in the Companies Act to be unfairly prejudicial conduct. Regarding the seventh ground, Vicky submits there is no factual dispute and so the Court will be in as good a position on summary judgment as in the substantive claim.

[4] At the hearing, Vicky’s counsel said that Vicky would not proceed with the remaining aspects of her claim if she were successful on her summary application, so only a quantum hearing would then be required.

[5]Vicky submits the application for leave ought to be granted because:

(a)if there has been a delay in filing the application for summary judgment, it is not a delay with which the court needs to be concerned or it can be satisfactorily explained;

(b)the merits of her application are strong as the application for summary judgment “in the main” relates to conduct by Brent deemed to be

1 High Court Rules 2016, r 12.4(2).

oppressive, unfairly discriminatory, or unfairly prejudicial for the purposes of s 174 of the Companies Act 1993;

(c)there is no risk of a miscarriage of justice to the respondents in granting leave as the respondents are in the same position as they were when the proceedings were initially commenced: no fixture has been set down, no case management has occurred and the parties have not taken any steps; and

(d)if leave is not granted, the risk of a miscarriage of justice to Vicky is high.

[6] Counsel for Brent submits that the delay in bringing the summary…

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.

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Details

Case: [2023] NZHC 1692
Decision Date: 4 July 2023

CaseChat Overview and Summary

Vicky Mulholland applied for leave to bring an out of time application for summary judgment against Brent Mulholland and ELE Holdings Ltd. Vicky sought leave as her application for summary judgment was filed together with her amended claim rather than at the same time as the original statement of claim. Vicky submitted that her application for leave ought to be granted because there was no risk of a miscarriage of justice to the respondents in granting leave. In response, Brent submitted that the delay in bringing the summary judgment application could not be satisfactorily explained and that the merits of Vicky’s application were not strong. Brent submitted that it was not in the interests of justice to grant leave as it will add significant cost and delay to the proceeding. The Court held that the delay in this case was relatively short and did not prejudice the defendant significantly as no statement of defence had yet been required to be filed. In respect of the merits, the Court held that the plaintiff’s application for leave pleaded as follows in respect of the merits: the applicant has carved out of the statement of claim and inserted into the application issues it considers are amenable to summary judgment; in the main, the issues are matters of the second respondent’s documentary records or facts following correspondence between solicitors where there is no factual dispute or arguable defence that the conduct complained of fits within s 175(k) or s 174 of the Act. The Court held that the merits of the proposed summary judgment application do not have a sufficient prospect of success because to establish whether the matters fall within the deeming provisions will require determination of disputed issues of fact. In addition, questions remain as to whether, even if the facts could be established, the conduct would fall within the deeming provisions. For the remaining ground based on Deloittes’ valuation, Brent clearly has a reasonably arguable defence. The Court held that the plaintiff’s application for leave to proceed with the summary judgment application is declined. The respondent has succeeded and so is entitled to costs. My preliminary view is that costs ought to be awarded on a 2B basis. I ask the parties to confer and only if agreement cannot be reached to file memoranda of no more than five pages excluding schedules, on behalf of the respondent within 20 working days of this judgment and the applicant a further 10 working days.

Orders