PETER-RICHARD PRESCOTT Intended AND ASB BANK LIMITED Intended
[2024] NZHC 2927
•8 October 2024
IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY
I TE KŌTI MATUA O AOTEAROA TĀMAKI MAKAURAU ROHE
CIV-2024-404-000867
[2024] NZHC 2927
BETWEEN PETER-RICHARD PRESCOTT
Intended Plaintiff
AND
ASB BANK LIMITED
Intended Defendant
Hearing: 8 October 2024 Appearances:
Intended Plaintiff in Person
B J Upton for Intended Defendant
Judgment:
8 October 2024
Reasons:
9 October 2024
REASONS FOR JUDGMENT OF VENNING J
[Interlocutory applications]
This judgment was delivered by me on 9 October 2024 at 2.30 pm, pursuant to Rule 11.5 of the High Court Rules.
Registrar/Deputy Registrar
Date……………
Solicitors: Simpson Grierson, Auckland Copy to: Intended Plaintiff
PRESCOTT v ASB BANK LTD [2024] NZHC 2927 [8 October 2024]
Introduction
[1] Peter-richard Prescott brought an application for pre-commencement discovery against the ASB Bank Limited (the Bank) under r 8.20 of the High Court Rules 2016. The Bank opposed the application and brought a cross-application seeking to strike out Mr Prescott’s application. It also filed a notice of opposition to Mr Prescott’s application.
[2] After hearing from Mr Upton and Mr Prescott I indicated both applications would be dismissed with one set of costs to the Bank. These are the reasons.
[3]Mr Prescott’s applications sought:
(a)copies of all correspondence written, electronic or other between the trustees of The Capricorn Trust (the Trust) and/or the Trust’s lawyers establishing that the ASB Bank Ltd correctly executed its duties under paragraph 4(b) of the loan agreement and took the next step and asked the trustees to execute a mortgage instrument in favour of the ASB Bank Ltd; and
(b)a copy of the mortgage instrument 7936904.2 (North Auckland Registry) as executed by the trustees of the Trust as per paragraph 4(b) of the loan agreement;
(c)a copy of the deed of power of attorney;
(d)all correspondence written electronic or other between the trustees of the Trust and the Trust’s lawyers establishing that the ASB Bank Ltd took the next step and asked the trustees to execute a valid deed of appointment of power of attorney in accordance with paragraph 5 of the loan agreement and all correspondence written electronic or other to support the ASB Bank’s certification establishing that it had authority that a power of attorney gives it to transfer the Trust’s property on its behalf.
[4]Mr Prescott went on to state in the application that:
6.Out of the abundance of caution the Trustees removed any existing power of attorney, actual or imaginary, by Deed of Revocation on the 28th April 2014. Please supply all documentation written, electronic or other establishing that the ASB Bank had the lawful authority to instruct the transferor representative Stuart Wyndham Evan and the transferee representative Lorain Sharon Booth as per the certification filed on 30 April 2014.
7.The contact details past or present for transferee representative Lorain Sharon Booth and transferor representative Stuart Wyndham Evan.
[5] Mr Prescott says there is a dispute over the legality of the sale of the property by the Bank. He intends to pursue proceedings as a trustee of the Trust which formerly owned the property. He intends to challenge the validity of the mortgage and the Bank’s actions regarding the sale. Mr Prescott says that without the documents it would be impossible to formulate the intended proceedings.
[6] The Bank’s application to strike out and opposition are pursued on two main grounds. First, Mr Prescott has no standing to pursue the relief he seeks. Second, in the event Mr Prescott has standing, at least since 2020 if not 2014, all documents and information that might be relevant to any claim the trustees of the Trust may seek to bring against ASB to challenge the validity of the mortgage and the Bank’s sale of the property have been provided to the Trust. The application is unnecessary.
Preliminary matter
[7] As discussed with Mr Upton there is a preliminary issue with the Bank’s application to strike out to the extent it relies on r 15.1. Rule 15.1 provides: “The court may strike out all or part of a pleading …”. Pleading is defined as a statement of claim, a statement of defence, a reply, and a counterclaim. There is no such document before the Court at this stage.
[8] Further, while r 15.1(3) refers to staying all or part of a proceeding, a proceeding is defined as “any application to the court for the exercise of the civil jurisdiction of the court other than an interlocutory application”. Mr Prescott’s application for pre-commencement discovery is an interlocutory application.
[9] The short point is that r 15.1 does not apply to Mr Prescott’s application for pre-commencement discovery as it is an interlocutory application.
[10] Mr Upton accepted the force of the above, noting that the application to strike out had been brought out of an excess of caution. The Bank relies on the same grounds to oppose Mr Prescott’s application for pre-commencement discovery.
Analysis
[11] The Court then focused on Mr Prescott’s application for pre-commencement discovery.
[12]Rule 8.20 provides:
(1)This rule applies if it appears to a Judge that—
(a)a person (the intending plaintiff) is or may be entitled to claim in the court relief against another person (the intended defendant) but that it is impossible or impracticable for the intending plaintiff to formulate the intending plaintiff’s claim without reference to 1 or more documents or a group of documents; and
(b)there are grounds to believe that the documents may be or may have been in the control of a person (the person) who may or may not be the intended defendant.
(2)The Judge may, on the application of the intending plaintiff made before any proceeding is brought, order the person—
(a)to file an affidavit stating—
(i)whether the documents are or have been in the person’s control; and
(ii)if they have been but are no longer in the person’s control, the person’s best knowledge and belief as to when the documents ceased to be in the person’s control and who now has control of them; and
(b)to serve the affidavit on the intending plaintiff; and
(c)if the documents are in the person’s control, to make those documents available for inspection, in accordance with rule 8.27, to the intending plaintiff.
…
(4)The Judge may not make an order under this rule unless satisfied that the order is necessary at the time when the order is made.
[13] Mr Prescott explained that he proposes to bring proceedings arguing that the Bank never had an executed deed of power of attorney so that the registration of a mortgage against the Trust’s property was invalid. However, the Bank has never suggested it held an executed deed of power of attorney. The Bank relies upon the terms of the loan agreement and other documentary records.
[14]While the Trust agreed in the loan agreement to:
5.irrevocably appoint us to be your attorney on your behalf, in your name and at your expense to complete and execute a mortgage instrument in favour of us over the Property and all deeds, agreements and other documents and do all other acts and things we may consider necessary or expedient to secure the due payment of all moneys outstanding under the Loan; …
it is the Bank’s position that it was never necessary for it to exercise the power under the loan agreement in cl 5 because Ms MacMillan as the mortgagor’s representative certified she had authority to act for the mortgagor, which at the time was Commercial Logistics Limited and Jacqueline Ann Aston, the then trustees of the Trust when lodging the mortgage for registration against the title.
[15] In short, as discussed with Mr Prescott during the hearing and as I understood he acknowledged, Mr Prescott’s application is primarily directed at seeking discovery from the Bank of a document which he says the Bank did not have and which the Bank accepts it did not have. On that basis there was no need for the application.
[16]Plainly, the orders sought by Mr Prescott are not necessary.
[17] In any event, although it is unnecessary to go further, I accept Mr Upton’s submission that Mr Prescott has no standing to bring the application. Mr Prescott was not a trustee of the Trust at the time the loan agreement was made and the mortgage registered in 2008, nor at the time of the sale of the property. At the relevant time the trustees were Commercial Logistics Ltd and Jacqueline Ann Aston. Any claim by the Trust must be brought by its trustee(s). Commercial Logistics Ltd has been removed from the Companies Register. Ms Aston has resigned.
[18] Mr Prescott has purported to appoint himself as a trustee, but at the time he was and remains an undischarged bankrupt. Section 96(2) of the Trusts Act 2019 confirms that an undischarged bankrupt is disqualified from being appointed as a trustee. While s 96(3) provides an undischarged bankrupt may be appointed trustee with the consent of the Court, no such consent has yet been obtained from the Court.
[19] Further, in any event, there is no need for the application as all the information to establish a claim based on the argument as Mr Prescott explained it, is available to Mr Prescott.
[20] I note that the Court’s observation that there is no need for the documentation for the claim to be prepared and pursued should not be taken as any suggestion that there would be any merit in such a claim.
Result
[21] For the above reasons the application by ASB Bank to strike out was dismissed and the application by Mr Prescott for pre-commencement discovery was also dismissed.
Costs
[22] The Bank was put to unnecessary expense to respond to the application for pre- commencement discovery. In the circumstances the Bank is to have costs on a 2B basis but limited to one interlocutory application. The costs should be calculated on the Bank’s opposition to Mr Prescott’s application rather than on its own unnecessary application to strike out.
Venning J
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