Reid v Castleton-Reid - [2016] NZHC 1609

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

CIV-2015-404-003009 [2016] NZHC 1609

BETWEEN
ROSS RONAYNE REID

Plaintiff

AND

BARRY ROSS LAURENCE CASTLETON-REID Defendant

Hearing: 4 July 2016

Appearances:

Ms S Abdale for Plaintiff
Ms Matthew for Defendant

Judgment:

18 July 2016

JUDGMENT OF ASSOCIATE JUDGE J P DOOGUE

This judgment was delivered by me on
18.07.16 at 3 p.m., pursuant to

Rule 11.5 of the High Court Rules.

Registrar/Deputy Registrar

Date……………

REID v CASTLETON-REID [2016] NZHC 1609 [18 July 2016]

[1] This matter comes before the court for determination of the defendant’s

application seeking an order for security for costs against the plaintiff pursuant to r

5.45 of the High Court Rules.

Background

[2] The plaintiff was at one time a wealthy man, having been the proprietor, together with his brother, Emslie, of a housebuilding firm that was reasonably well known in Auckland called “Reidbuilt Homes Ltd”. It would now appear that he does not have much money at all. He has been living in Australia for approximately nine years.

[3] The defendant is the adopted son of the plaintiff and his late wife, Esme. Following the death of Esme, the defendant received in terms of her will two properties in Verbena Road, in Birkenhead, Auckland. One of the properties was the former matrimonial home which the parties have referred to by the name they gave to it, “the castle”. The other property was an apartment also in Verbena Road. As well, the defendant was the residuary beneficiary under the estate of his late mother, Esme.

[4] During her lifetime, Esme acquired substantial property from the Hallmark Trust, which the plaintiff and his brother Emslie established for the benefit of their wives and families in or about 1986. In 2007, following the sale of a commercial property, the trustees paid a capital distribution to Esme of approximately
$1,800,000. That sum was initially paid into a bank account of the plaintiff and was then eventually transferred into a joint account of Esme and the plaintiff. In April 2008, the plaintiff and Esme transferred $1,750,000 into a term deposit account where it remained until after Esme’s death.

[5] In March or April 2009, the plaintiff requested the defendant to open a shareholding account with Craigs Investment Partners (“shareholding account”). The account would be held in the defendant’s name but the plaintiff was to have management rights which would enable him to carry out share transactions. It seems

that the plaintiff may also have requested the defendant to open an account with ASB

bank under similar conditions (“ASB account”).

[6] There were a number of key transactions which were carried out in relation to these two accounts. On 2 April 2009, the day after the term deposit had matured, the plaintiff transferred $1,700,000 to the shareholding account. Additionally, the plaintiff transferred approximately $477,000, derived from the sale of shares that had been held in Esme’s name, into the shareholding account on 8 July 2008. Therefore, in excess of $2.2 million in…

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 Reid v Castleton-Reid

Details

AGLC: Reid v Castleton-Reid [2016] NZHC 1609
Case: [2016] NZHC 1609
Decision Date: 18 July 2016

CaseChat Overview and Summary

The defendant in this case sought an order for security for costs against the plaintiff, who is legally aided. The defendant argued that the plaintiff was residing overseas and that there was reason to believe that the plaintiff would be unable to pay costs if his claim was unsuccessful. The plaintiff's brother had offered to financially support the case, including meeting any costs orders. The court found that there was jurisdiction to make an order for security for costs under either of the grounds set out in rr 5.45(1)(a)(i) or 5.45(1)(b) of the High Court Rules. However, because the plaintiff is legally aided, no order for costs can be made against him in a civil proceeding unless the court is satisfied that there are exceptional circumstances. The court found that there were no exceptional circumstances in this case, as the plaintiff's claim was not so obviously doomed to fail that it would be unreasonable for the plaintiff to continue with it. The court also found that the plaintiff's impecuniosity was not caused by the defendant, and that the offer by the plaintiff's brother to pay any costs order that might be made against the plaintiff was not a sufficient reason to dispense with security for costs. The court declined the defendant's application for an order for security for costs, and ordered that costs follow the event.

Orders