Official Assignee v Erwood - [2010] NZCA 362

IN THE COURT OF APPEAL OF NEW ZEALAND
CA260/2009
CA261/2009
[2010] NZCA 362
BETWEENTHE OFFICIAL ASSIGNEE

First Appellant
ANDRAYLEE PATRICIA HARLEY

Second Appellant

ANDROBERT JOHN ERWOOD

Respondent

Hearing:8 June 2010

Court:Hammond, O'Regan and Arnold JJ
Counsel:P R W Chisnall for First Appellant

C R Carruthers QC for Second Appellant
Mr Erwood in person
N Levy (Counsel assisting the Court)

Judgment:10 August 2010 at 2.30 pm

JUDGMENT OF THE COURT

A            The appeals are dismissed.
B            The Second Appellant must pay the Respondent’s usual disbursements.
____________________________________________________________________
REASONS OF THE COURT
(Given by O’Regan J)
Introduction
[1]        The Official Assignee and Mrs Harley appeal against a decision of Simon France J, in which he allowed an appeal against the decision of the Official Assignee to accept a proof of debt from Mrs Harley which included a claim for $109,811.68 plus interest for barrister’s fees said to be owing to her by Mr Erwood.[1]
[1]      Erwood v Official Assignee HC Wellington CIV-2008-442-449, 9 April 2009.
[2]        The essence of the dispute about the proof of debt was that Mr Erwood claimed that his obligation in respect of those fees (which were included in a bill to him from Glasgow Harley, the solicitors who instructed Mrs Harley to act on Mr Erwood’s behalf in the litigation for which the bill was rendered) was the subject of a settlement agreement under which Glasgow Harley and Mrs Harley agreed not to pursue Mr Erwood for the debt. Simon France J accepted that was so. Both the Official Assignee and Mrs Harley now contest that conclusion.
[3]        The resolution of the appeal requires us to consider in some detail the nature of the settlement agreement, the circumstances which led to its execution and the nature of the proceedings between Mrs Harley and Mr Erwood bearing on the disputed debt.
The settlement agreement
[4]        The settlement agreement was reflected in a consent order made by Frater J on 25 November 2003. At the time of the settlement, Mr Erwood was represented by a litigation guardian (Mr Minchen). The terms of Frater J’s order mirrored the terms of an agreement signed by Mr Erwood’s litigation guardian, counsel for Mrs Harley and counsel for Glasgow Harley. For present purposes the key terms are cls 1 and 2 which provide:
1.The Defendants [Glasgow Harley and Mrs Harley] are to pay to the Plaintiff [Mr Erwood] through his solicitors the sum of $45,000 (free of any set-off,

charge or other claim including any of the unpaid costs owing by the Plaintiff to the Second Defendant [Mrs Harley] as listed in the schedule marked D to this Order but without admissions as to liability within 60 days of this Order).
2.The claims and orders listed in the Schedule marked E to this Order and any claim that the First Defendant [Glasgow Harley] may have in respect of any fees or costs that may be owing to them are released and discharged.

[5] Schedule D was headed “Unpaid Costs Owing by Mr Erwood to…

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 Official Assignee v Erwood

Details

AGLC: Official Assignee v Erwood [2010] NZCA 362
Case: [2010] NZCA 362
Decision Date: 10 August 2010

CaseChat Overview and Summary

In the Court of Appeal of New Zealand, the Official Assignee and Mrs Harley appealed against a decision by Simon France J. The case, Erwood v Official Assignee, involved a dispute over a proof of debt from Mrs Harley, which included a claim for $109,811.68 plus interest for barrister’s fees allegedly owed to her by Mr Erwood. The appeal centred on whether the debt was subject to a settlement agreement under which Glasgow Harley and Mrs Harley agreed not to pursue Mr Erwood for the debt. Simon France J accepted that the settlement agreement applied, but the Official Assignee and Mrs Harley contested this conclusion.

The key legal issues revolved around the nature of the settlement agreement, the circumstances leading to its execution, and the proceedings between Mrs Harley and Mr Erwood concerning the disputed debt. The settlement agreement, reflected in a consent order made by Frater J on 25 November 2003, released and discharged certain claims and orders listed in schedules D and E. Schedule E referred to fees owing in respect of various proceedings, including CP22/98, a summary judgment application by Glasgow Harley for fees owing to them, which included fees owed to Mrs Harley. The appeal required determining whether the settlement preserved Mrs Harley's right to recover the costs she now claimed.

The Court concluded that the settlement agreement compromised the obligation of Mr Erwood to Glasgow Harley in respect of the fees for which summary judgment was granted as to liability in CP22/98. The consent order, which mirrored the terms of an agreement signed by Mr Erwood’s litigation guardian, counsel for Mrs Harley, and counsel for Glasgow Harley, released and discharged the obligation to pay those sums. The Court rejected the argument that Mrs Harley could claim the fees directly by obtaining an order in the cost revision review proceeding, CP120/00, finding it an untenable interpretation of the agreement and the consent order itself. The Court dismissed the appeals and ordered Mrs Harley to pay Mr Erwood’s usual disbursements.

Orders