Rabson v Shepherd
[2016] NZCA 283
•23 June 2016 at 2.30 pm
| IN THE COURT OF APPEAL OF NEW ZEALAND |
| CA51/2016 [2016] NZCA 283 |
| BETWEEN | MALCOLM EDWARD RABSON AND RICHARD JOHN CRESER AS TRUSTEES OF THE MALCOLM RABSON FAMILY TRUST |
| AND | IAN BRUCE SHEPHERD AND CHRISTINE MARGARET DUNPHY |
| Counsel: | Appellant R J Creser in person |
Judgment: (On the papers) | 23 June 2016 at 2.30 pm |
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JUDGMENT OF WILD J: REVIEW OF REGISTRAR’S DECISION
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The Deputy Registrar’s decision declining to dispense with security for the costs of this appeal is upheld.
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REASONS
By application filed on 14 April 2016, the appellant Mr Creser applies under r 7(2) of the Court of Appeal (Civil) Rules 2005 for review of the Deputy Registrar’s decision declining his application to dispense with security for the costs of this appeal. The decision is that of Deputy Registrar Ms Jacey McGrath, given on 6 April 2016.[1] It is a carefully reasoned decision.
[1]Rabson v Shepherd CA51/2016, Decision of Deputy Registrar McGrath on Security for Costs, 6 April 2016 [Deputy Registrar’s decision].
There is an initial question as to whether Mr Creser had standing to apply in his personal capacity to dispense with security, which is what he did. In her decision, Deputy Registrar McGrath noted this question about standing but assumed, for the purposes of her decision, that Mr Creser had the requisite standing.
I also raised the question of standing in minutes I issued in respect of this appeal on 6 May and 16 May 2016.[2] In the first of those minutes I stated:
[4] However, one thing is clear: Mr Creser does not have standing to appeal to this Court in his capacity as a trustee of the Malcolm Rabson Family Trust because he is not one. And that is the capacity in which he has purported to appeal.
[2]Rabson v Shepherd CA51/2016, 6 May 2016 (Minute of Wild J); Rabson v Shepherd CA51/2016, 16 May 2016 [Minute (No 2) of Wild J].
In my second minute, dated 16 May 2016, I said:
[4] If Mr Creser does wish to appeal to this Court in his personal capacity, then he will need to apply to be joined as a second appellant to the trustees’ appeal. I am not prepared to review the Deputy Registrar’s decision on Mr Creser’s application to dispense with security for the costs of an appeal brought in his personal capacity, when he has no such appeal before this Court. And there can be no doubt that Mr Creser “… seeks to proceed in [his] personal capacity in order to overturn the costs award and not the decision itself”. That is what Mr Creser stated to Deputy Registrar McGrath in the passage she quotes in [9] of her decision. The capacity in which Mr Creser seeks to appeal, and the scope of his appeal, are both directly relevant to the decision on security for the costs of the appeal, as Mr Creser has recognised in his correspondence with Deputy Registrar McGrath.
In a second memorandum he filed on 3 June 2016, Mr Creser sought:
A direction to the Registrar that the intitulement to these proceedings be amended to formally join Mr Creser in his personal capacity as a party to proceedings.
For the purposes of reviewing the Deputy Registrar’s decision, I also will assume Mr Creser has the requisite standing. I revert, in [14] below, to the direction Mr Creser seeks.
As sought by Mr Creser, I have reviewed Deputy Registrar McGrath’s decision. For the reasons she gives, I consider she was correct not to dispense with security. In particular, I note these points:
(a)The Deputy Registrar correctly identified the principles laid down by the Supreme Court in Reekie v Attorney-General, which she needed to apply. [3]
(b)She was not satisfied that Mr Creser was impecunious as he claimed, but put that consideration to one side because the application failed on the other considerations spelt out in Reekie.[4]
(c)She considered that the costs order Mr Creser seeks to challenge on this appeal “may quite sensibly follow a judgment against the trust’s interests, which relates to matters that occurred when [Mr Creser was] still a trustee”.[5]
(d)The Deputy Registrar also noted that the discretionary nature of a costs award means the threshold for success on appeal is high.[6]
(e)She saw little merit in the broad grounds of appeal contained in the notice of appeal, indeed she considered the appeal “lacks merit and may be vexatious”.[7]
(f)She considered the potential benefits to Mr Creser outweighed the potential costs of the appeal.[8]
(g)She saw no public interest in the appeal.[9]
[3]Reekie v Attorney-General [2014] NZSC 63, [2014] 1 NZLR 737.
[4]Deputy Registrar’s decision, above, n 1, at [23]–[24].
[5]At [28].
[6]At [28].
[7]At [33].
[8]At [36].
[9]At [37].
When I first looked at Mr Creser’s application for review, and at the appeal, I considered that Collins J may have mistakenly ordered Mr Creser to pay costs.[10] This view and the course of action I suggested to Mr Creser, are recorded in my two minutes. In my second minute, I invited a response from counsel for the respondents, Mr Howard Thompson.[11] Mr Thompson filed a memorandum on 18 May. The following are amongst the points Mr Thompson makes:
(a)Although Mr Creser advised Mr Thompson about three months before the trial that he had resigned as a trustee, he did not ask to be removed as a party and did not advise that he would abide the Court’s decision.
(b)In fact, Mr Creser fully supported Mr Rabson in the proceeding, giving evidence in support of the trustees’ defence and attending for much of the trial. He behaved as though he had an ongoing interest in the proceeding.
(c)There is no reason why Mr Creser should not have been made liable for costs up to the point he resigned as a trustee and “there is a case for saying that costs should simply follow the event in the ordinary way” because Mr Creser remained a party to the proceeding. Among the steps taken by the trustees before Mr Creser resigned was an unsuccessful defendants’ summary judgment application, in respect of which costs were reserved in the usual way.
(d)The appellants are in default of their obligations under r 43(1) and will require an extension of time under r 43(2) if they wish to pursue this appeal.
(e)If the appellants formally abandon the appeal, the respondents will not take any further steps against Mr Creser and will consent to a stay of the costs order against him.
[10]In Shepherd v Rabson [2015] NZHC 3137.
[11]Minute (No 2) of Wild J, above n 2, at [5(b)].
Paragraphs 19–27 of Mr Creser’s 3 June memorandum rather reinforce Mr Thompson’s submission that Mr Creser was substantially involved in the trial of this proceeding in the High Court. In paragraph 25 Mr Creser makes the point that the judgment under appeal “now imputes Mr Creser’s personal and professional reputation when acting as trustee, thus providing grounds to appeal in person”.
Further, in paragraph 28 of his 3 June memorandum, Mr Creser reiterates his claim that he is “a secured creditor of both Mr Rabson and the [Malcom Rabson Family Trust (MRFT)]” and, in paragraph 29, makes the point that the broader appeal that Mr Rabson is pursuing asserts that Collins J ignored the rights of MRFT’s other creditors in favour of the respondents.
All of these matters suggest that my initial impression that Collins J may have made a simple error in awarding costs against Mr Creser may have been wrong.
To summarise, for the reasons given by Deputy Registrar McGrath in her decision, and for the further reasons that have emerged from the memorandums filed since that decision, I am satisfied that it would not be “right to require the respondent[s] to defend the judgment under challenge without the usual protection as to costs provided by security”.[12]
[12]Reekie v Attorney-General, above n 3, at [21].
Accordingly, having reviewed the Deputy-Registrar’s decision, I uphold it. Security for the costs of this appeal in the sum of $6,600 must now be given, by Friday 15 July 2016.
If security is given as I have just directed, then I direct that Mr Creser be added as a second appellant and that further documents filed be intituled accordingly.
Solicitors:
McMahon Butterworth Thompson, Auckland for Respondent
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