Ortmann v United States of America
[2016] NZHC 522
•24 March 2016
IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY
CRI-2015-404-000429 [2016] NZHC 522
UNDER the Extradition Act 1999 IN THE MATTER
of an appeal on questions of law by way of case stated under s 68 of the Extradition Act 1999
BETWEEN
MATHIAS ORTMANN First Appellant
KIM DOTCOM Second Appellant
BRAM VAN DER KOLK Third Appellant
FINN HABIB BATATO Fourth Appellant
AND
THE UNITED STATES OF AMERICA Respondent
…/intituling cont
Hearing: 21-22 March 2016 Counsel:
GM Illingworth QC, PJK Spring and AK Hyde for First and
Third Appellants
RM Mansfield and SL Cogan for Second Appellant
J Bioletti for Fourth Appellant
JC Gordon QC, M Ruffin, F Sinclair and F Biggs for
RespondentJudgment:
24 March 2016
JUDGMENT OF ASHER J
This judgment was delivered by me on Thursday, 24 March 2016 at 11 am pursuant to r 11.5 of the High Court Rules.
Registrar/Deputy Registrar
ORTMANN v THE UNITED STATES OF AMERICA [2016] NZHC 522 [24 March 2016]
CIV-2015-404-001770
UNDER the Judicature Amendment Act 1972,
Part 30 of the High Court Rules and s 27(2)
of the New Zealand Bill of Rights Act 1990
BETWEEN KIM DOTCOM Plaintiff
ANDTHE UNITED STATES OF AMERICA First Defendant
THE DISTRICT COURT AT NORTH SHORE
Second Defendant
CIV-2015-404-001733
UNDER the Judicature Amendment Act 1972,
Part 30 of the High Court Rules and s 27(2)
of the New Zealand Bill of Rights Act 1990
BETWEEN MATHIAS ORTMANN First Plaintiff
BRAM VAN DER KOLK Second Plaintiff
FINN HABIB BATATO Third Plaintiff
ANDTHE UNITED STATES OF AMERICA First Defendant
THE DISTRICT COURT AT NORTH SHORE
Second Defendant
Introduction
[1] The United States of America (the USA) has obtained orders from the District Court that the appellants are all eligible for surrender under the Extradition Act 1999 (the Act) to that country on 13 counts, including alleged copyright infringement, money laundering, racketeering and wire fraud. The appellants have appealed that decision. The respondent also has filed appeals against aspects of the decision.
[2] Because the extradition process started on 13 January 2012, the Summary Proceedings Act 1957 rather than the Criminal Procedure Act 2011 applies to the procedure on appeal. This is common ground between all parties. Under Part 4 of the Summary Proceedings Act the appeal from the extradition decision is on the question of law only by way of case stated.1 Following the filing of the notices of appeal the District Court has settled and signed the cases stated for the appellants. There have also been appeals filed by the USA, and the District Court Judge has also settled and signed that case stated.
[3] Both the appellants and the respondent have applied to this Court under s 111 of the Summary Proceedings Act (which applies despite its subsequent repeal), for orders that the cases stated are sent back to the District Court Judge for amendment.
[4] Some of the complaints made about the cases have in essence concerned matters of form. After discussions with counsel it seems that these issues can be agreed, and I have issued a minute in that regard. However, there is a substantive issue that must be determined.
[5] The appellants’ cases stated have challenged the Judge’s procedural rulings and actions relating to stay applications that have been filed, and complaints about a lack of candour on the part of the USA. The USA submits that such collateral procedural issues cannot be raised on a case on appeal, but can be argued in judicial review proceedings. Indeed the appellants have filed judicial review proceedings in
which these issues are raised. The appellants argue, however, that despite this the
1 Summary Proceedings Act 1957, s 107.
procedural issues relating to the stay applications are properly raised in the case on appeal.
The relevant statutory provision
[6] The appellants’ right of appeal arises under s 68 and 69 of the Act (as at
30 June 2013). Section 68 provides:
68 Appeal on question of law only
(1) This section applies if a District Court determines under section 24 or
45 that a person is or is not eligible for surrender in relation to any offence or offences for which surrender is sought, and either party considers the determination erroneous in point of law.
(2) If this section applies, the party may appeal against the determination to the High Court on a question of law only.
…
[7] Section 69 of the Act at the relevant time applied the provisions of the Summary Proceedings Act relating to an appeal on a question of law by way of case stated. This is no longer the position and the Criminal Procedure Act applies with necessary modifications.2 The current s 68 still, at s 68(2), states that a party may appeal against “the determination to the High Court on a question of law only”.3
The respective positions of the parties
[8] It is the essential position of the USA that the statutory right of appeal in s 68 is intended to relate only to matters “determined” by the District Court under s 24 of the Act. Challenges collateral to the Court’s function under that section must be addressed by way of judicial review. Thus, it is submitted, those portions of the cases stated that relate to issues, and in particular to the Court’s actions in relation to the stay applications and issues of abuse of process, must proceed by way of judicial review.
[9] The appellants submit that this interpretation is too narrow, and that when s 68 is seen in the context of the whole Act, the right of appeal relates to any
2 Criminal Procedure Act 2011, s 69(1).
3 Extradition Act 1999, s 68(2).
question of law arising from the judgment and includes issues relating to the Court’s process and the fairness of the hearing, as well as the substantive determination of the extradition application.
Discussion
[10] Under s 68(1) the right to appeal arises in relation to a “determination”.
[11] Section 24 provides in relation to determination of eligibility for surrender:
24 Determination of eligibility for surrender
(1) Subject to section 23(4), if a person is brought before a court under this Part, the court must determine whether the person is eligible for surrender in relation to the offence or offences for which surrender is sought.
[12] The USA submits that s 24(1) plainly limits the determination which may be appealed under s 68 to the actual determination of whether the person is eligible for surrender, and does not extend to issues of process. However, the appellants rely on s 22(1)(a) of the then Act which provided:
22 Powers of court
(1) In proceedings under this Part, except as expressly provided in this Act or in regulations made under section 102,—
(a) The court has the same jurisdiction and powers, and must conduct the proceedings in the same manner, as if the proceedings were a committal hearing of an information for an indictable offence alleged to have been committed within the jurisdiction of New Zealand; and
[13] The same position is set out in the current s 22(1)(a) although adapted to the new Criminal Procedure Act committal hearing process.
[14] It is clear that at a committal hearing a District Court has an implied statutory power to prevent abuse of its processes.4 By virtue of s 22 the Court considering an extradition application can be assumed to have the jurisdiction and powers that a Court carrying out a committal hearing would have, which includes the right to
prevent an abuse of its process. It was observed by the Court of Appeal in
4 Siemer v Solicitor-General [2013] 3 NZLR 441 (SC) at [114].
Bujak v Republic of Poland that the District Court has a power under s 22 to prevent an abuse of its own processes by refusing to conduct a hearing to determine whether a person is eligible for surrender under the Act.5 It was held:6
The legislature has specifically provided that the s 24 hearing will be conducted on the same basis as a committal hearing, and that necessarily imports the same inherent powers on the part of the District Court.
[15] In Dotcom v United States of America the Supreme Court determined that a Court considering an extradition application has the same inherent powers to regulate its own procedures to prevent abuses of process as it does outside the extradition context.7 Glazebrook J stated (in the majority on this point):8
It seems to me to be axiomatic that the District Court must have the inherent power to ensure that there is a fair hearing. Indeed, there is a statutory acknowledgment of that position in s 22(1)(a) of the Extradition Act, which gives the courts the same jurisdiction and powers as if the proceedings were a committal hearing. It is also reinforced by the Bill of Rights and common law requirements for natural justice.
[16] The process issues which the appellants raised in the stay applications, and in relation to the proceedings generally, include whether the USA was in breach of its duty of candour in certifying and providing the record of case, whether there were breaches of natural justice under s 27 of the New Zealand Bill of Rights Act 1990, whether there was adequate time and notice to prepare for the hearing, and whether there was “double criminality”.
[17] The USA categorises these issues as “collateral”, and therefore not part of the determination that should be in the case on appeal. However, it would be surprising if Parliament, when it provided for an appeal procedure, intended matters of process to be considered by a different procedure (judicial review) than the substantive determinations relating directly to extradition. It is unlikely that Parliament would have intended there to be different pathways for challenges to the procedure by
which a determination had been reached, and the determination itself. It is the
5 Bujak v Republic of Poland [2007] NZCA 392, [2008] 2 NZLR 604.
6 At [31].
7 Dotcom v United States of America [2014] 1 NZLR 355 (SC) at [106] per McGrath and
Blanchard JJ and at [227] per William Young J.
8 At [309]. Glazebrook J and Elias CJ dissented as to whether the District Court had an inherent power to order discovery, but on the general point of principle that the District Court had all the powers necessary to ensure a fair hearing Glazebrook J was in the majority.
tendency in conducting ordinary appeals, that all decisions leading to the determination including those collateral to the substantive decision are heard in one appeal.9
[18] In considering what is properly in the case on appeal it is relevant that Judge Dawson in his substantive decision dealt in detail with stay applications over 143 paragraphs,10 and determined those applications, and also considered and determined
arguments relating to the duty of candour.11 Thus, physically these issues were part
of his determination. It would seem highly artificial for part of his judgment to be challenged by way of case stated appeal on a question of law, and part by way of judicial review.
[19] In Bujak v Republic of Poland, the Court of Appeal considered an appeal under the same historic provisions of the Act that apply to this case. In the appeal the Court had to consider whether a District Court in conducting an extradition hearing had jurisdiction to stay the proceeding for abuse of process. The Court of Appeal held that the question of delay was a justiciable issue and correctly before
it.12
[20] It had been argued in that case that s 8(1)(c) of the Act itself dealt with issues of delay, and this was the only proper foundation for a delay argument in the case.13
As the relevant treaty overrode s 8 in that particular case, it had to be taken to have overridden the inherent power based on abuse of process. That argument was rejected by the Court of Appeal, holding that where the power under s 8(1)(c) of the Act was excluded there was no reason to read down the inherent powers of the
District Court.14 The District Court could prevent an abuse of its own processes.
9 See Criminal Procedure Act 2011, s 232. See Black v Fulcher [1988] 1 NZLR 417 at 419-420 and the discussion in Anderson v R [2015] NZCA 518 at [48]–[58] and in particular [56]. For an example see Taueki v Police [2014] NZHC 3088 at [11]–[14].
10 United States of America v Dotcom DC North Shore CRI-2012-092-001647, 23 December 2015 at [437]–[579].
11 United States of America v Dotcom, above n 10, at [684]–[690].
12 Bujak v Republic of Poland, above n 5, at [4].
13 At [29].
[21] The Court proceeded to consider the appeal on the delay issue on its merits. What is significant is that the Court of Appeal had before it an appeal by way of a case stated.15 Both Panckhurst J in the High Court and the Court of Appeal appeared to have accepted that the process ground of appeal could be raised in the case stated. There was no suggestion that such a challenge could proceed only by way of judicial review.
[22] Thus it seems to me that not only the determination itself, but all matters of process involved in reaching that determination can be included in the case stated on appeal. The only limitation is that the points must be questions of law only.
[23] It may be that including the stay issues in the case on appeal creates demarcation difficulties with the judicial review proceedings that will need to be resolved later. I have not been taken through those judicial review proceedings, but it seems likely that there are grounds in those proceedings which may now overlap with the points raised in the case stated. However, the spectre of complications with the judicial review proceedings cannot influence the outcome of this application. The appeal procedure set out in s 68 of the Act is the primary appeal procedure, and if matters can be properly included in those proceedings, they should be. The complications in relation to the other proceedings will have to be worked through in due course.
Conclusion
[24] I conclude that the portions of the appellants’ cases on appeal which relate to abuse of process and duty of candour issues are properly in the cases on appeal and should not be excised.
Result
[25] The application by the USA to excise those portions of the cases on appeal which relate to abuse of process issues and duty of candour issues are dismissed.
[26] All other issues relating to the content of the cases on appeal are adjourned.
[27] I direct the parties to file a joint memorandum or memoranda outlining what progress has been made towards finalising the cases on appeal within 14 days of today’s date.
[28] As soon as a common position is reached on those matters of form I will, under s 111 of the Summary Proceedings Act, send the cases back to the District Court for amendment to reflect the proposed changes.
Costs
[29] I am not inviting submissions on costs. However, should any party wish to raise any issues as to costs, submissions should be filed within 14 days and any further submissions within a further seven days.
……………………………..
Asher J
Solicitors/Counsel:
Keegan Alexander, Auckland. Anderson Creagh Lai Ltd, Auckland. Crown Law, Wellington.
GM Illingworth QC, Auckland. JC Gordon QC, Auckland.
R Mansfield, Auckland. J Bioletti, Auckland.
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