PHI Construction Limited v Insight Plumbing (NZ) Limited
[2021] NZHC 793
•14 April 2021
IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY
I TE KŌTI MATUA O AOTEAROA TĀMAKI MAKAURAU ROHE
CIV-2019-404-2790
[2021] NZHC 793
UNDER section 290 of the Companies Act 1993 IN THE MATTER
of setting aside a statutory demand
BETWEEN
PHI CONSTRUCTION LIMITED
Applicant
AND
INSIGHT PLUMBING (NZ) LIMITED
Respondent
Hearing: On the papers Appearances:
W McCartney for the applicant
C Patterson and E Grove for the respondent
Judgment:
14 April 2021
JUDGMENT OF ASSOCIATE JUDGE JOHNSTON
This judgment was delivered by me on 14 April 2021 at 4.00 pm, pursuant to r 11.5 of the High Court Rules
Registrar/Deputy Registrar Date:
PHI CONSTRUCTION LIMITED v INSIGHT PLUMBING (NZ) LIMITED [2021] NZHC 793 [14 April 2021]
[1] In my judgment dated 5 August 2020 I set aside a statutory demand dated 5 December 2019 served by the respondent, Insight Plumbing (NZ) Ltd (Insight), on the applicant, PHI Construction Ltd (PHI).
[2] In a joint memorandum dated 10 August 2020, counsel raised with me what they described as an error in my judgment, and consented to a recall of the same so that the error could be addressed.
[3]Here is how counsel addressed the issue in their memorandum:
2.At paragraph 39 of the Judgment, His Honour recorded that, in respect of the Wellpark and Curran Street payment claims that were emailed by the Respondent to the Applicant on 1 May 2019:
[39] As Mr Peat for PHI submits, that at least raises a question of whether, mistakenly or otherwise, these forms have been added to the purported copies of the claims emailed by Insight to PHI that are in evidence.”.
3.It appears that there has been a misapprehension of, or miscommunication of, Counsel for the Applicant’s submissions in relation to the ‘Wellpark Avenue’ and ‘Curran Street’ payment claims (identified at paragraph [27(E)] and [27(F)] of the Judgment).
4.The submission (concerning the possibility of an after-the-fact inadvertent or incorrect inclusion of a notice form) was intended to be in respect of the notice form that originally accompanied the statutory demand, rather than those which were included with the payment claims emailed on 1 May 2019.
5.The Applicant accepts that, in respect of the ‘Wellpark Avenue’ and ‘Curren Street’ payment claims sent by email on 1 May, they included the notice forms as produced by Mr Durrant as exhibits to his affidavit.
6.To clarify, the Applicant’s position in respect of the ‘Wellpark Avenue’ and ‘Curren Street’ payment claim is that there is no money owing under either claim, and the statutory demand in respect of those claims should therefore be set aside: see paragraphs 11(a) and 11(b) of the Applicant’s written synopsis of submissions.
7.Counsel respectfully seek, by consent, that to the extent there has been a miscommunication of and/or misapprehension as to the Applicant’s submission in relating to the ‘Wellpark Avenue; and ‘Curran Street’ payment claims, and that has impacted upon the contents of the judgment, the Judgment be recalled and to the extent considered necessary by His Honour if at all, corrected.
[Footnote omitted]
[4] Regrettably, for some reason, counsel’s joint memorandum was not referred to me until 18 November 2020. On receipt I directed the Registrar to arrange a teleconference with counsel. This took place on 23 November 2020. Having discussed the matter with counsel, I issued a minute identifying the sole issue as being whether the circumstances would justify a recall.
[5] During the course of the conference counsel informed me that whilst the statutory demand was for a total of $115,864.32 the issue they were raising affected only $8,774.20.
[6] In relation to this I observed that “… on any view, it would be uneconomic for these two commercial entities to pursue an appeal or a resumed hearing”. Having said that, it should be acknowledged that there is also a costs issue to be resolved and that may be affected by how the issue described above is dealt with.
[7] I invited counsel to come back by memorandum — joint or otherwise — by close of business on 30 November 2020 to let me have their views as to the most practical approach.
[8] I did not receive any further memorandum or memoranda from counsel until February this year. In their memoranda, counsel both informed me that they had been unable to reach any agreement, and the course that both seem to be suggesting was a hearing on the papers in relation to whether or not I should recall my original judgment.
[9]I issued a short minute on 12 February 2021 in the following terms directing:
(a)by 26 February 2021 the respondent is to file submissions in regard to the recall issue;
(b)by 5 March 2021 the applicant is to reply.
[10]Counsel have both filed submissions accordingly.
[11]Recall is governed by r 11.9 of the High Court Rules 2016.
[12] Counsel both referred me to Horowhenua County v Nash (No. 2) where Wild CJ said:1
Generally speaking, a judgment once delivered must stand for better or worse subject, of course, to appeal. Were it otherwise there would be great inconvenience and uncertainty. There are, I think, three categories of cases in which a judgment not perfected may be recalled — first, where since the hearing there has been an amendment to a relevant statute or regulation or a new judicial decision of relevant and high authority; secondly, where counsel have failed to direct the court’s attention to a legislative provision or authoritative decision of plain relevance; and thirdly, where for some other very special reason justice requires that the judgment be recalled.
[13] In Erwood v Maxted the Court of Appeal adopted the Horowhenua County v Nash approach, adding that, absent any accidental slip or omission, the principles outlined by Wild CJ will be applied strictly, and that applications that simply put in issue the Court’s factual or legal conclusions do not fall within the rule.2
[14] I do not consider that this case falls into any of the three categories identified in Horowhenua County v Nash.3 There has been no change in the applicable law. Counsel have not failed to direct the Court’s attention to any applicable law. What counsel agreed in their joint memorandum is that I had misunderstood one aspect of the applicant’s case, and therefore determined that aspect of the case on a wrong apprehension as to the argument. I have not gone back to the file to determine for myself whether or not counsel’s joint conclusion in that regard is correct, but, for the purposes of this judgment, I accept that it is.
[15] Whilst that may well give rise to an appeal point, the existence of an arguable appeal point is not a special reason falling within the third category of case identified in Horowhenua County v Nash.4 Nor, in my view, does the fact that counsel jointly consent to a recall of the judgment alter the position.
[16] The small amount remaining in dispute also cannot be seen as a “very special reason” necessitating a recall, particularly given that the recall of a judgment is a significant step.
1 Horowhenua County v Nash (No. 2) [1968] NZLR 632 at 633.
2 Erwood v Maxted [2010] NZCA 93, (2010) 20 PRNZ 466 at [23].
3 Above, n 1.
4 Above, n 1.
[17] As Mr McCartney submits, this case falls far more readily into the category of applications identified in Erwood v Maxted which seek to relitigate matters already considered, or to challenge substantive findings of fact or law.5
[18] My view is that the judgment must stand, and that if, as counsel both submit (and I accept for present purposes), it contains an error then the only proper method of correction is appeal.
[19] Of course, that brings me right back to the point that I raised in my minute of 23 November 2020. If, as counsel say, the error relates to less than $9,000, then the recall of the judgment for the purpose of re-arguing and re-determining that issue, or an appeal, would appear on its face to be hopelessly uneconomic.
[20]As I also said in that minute, that may however be affected by costs.
[21] Given that I am not prepared to recall my original judgment, prima facie the applicant was wholly successful and would be entitled to costs on a 2B basis. However, with a view to assisting the parties to resolve this matter without expending further resources disproportionate to the amount that remains at stake, I decline at this stage to determine costs. Again, I invite counsel to take instructions and confer. I envisage that this might involve counsel arriving at a joint view as to the merits of the argument that they say I misunderstood, and then, on that basis, addressing the most appropriate costs outcome, either or both of which may demand a degree of compromise.
[22] If the outstanding matters cannot be resolved then at the request of either party I will determine costs on the papers having regard to the terms of my original judgment.
Associate Judge Johnston
Solicitors:
Duncan King Law, Auckland for applicant
Lateral Lawyers Ltd, Auckland for respondent
5 Erwood v Maxted, above n 2, at [23].
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