Sax v Simpson
[2016] NZCA 3
•27 January 2016 at 11.30 am
| IN THE COURT OF APPEAL OF NEW ZEALAND |
| CA388/2015 [2016] NZCA 3 |
| BETWEEN | JANINE DAVINA SAX |
| AND | LUKE ANDREW SIMPSON LUKE ANDREW SIMPSON AND JANINE DAVINA SAX AS TRUSTEES OF THE LUKE AND JANINE SIMPSON FAMILY TRUST |
| Counsel: | Appellant in Person |
Judgment: (On the papers) | 27 January 2016 at 11.30 am |
JUDGMENT OF MILLER J
(Review of Registrar’s decision)
AThe applications to review the Registrar’s decision refusing to dispense with security for costs are dismissed.
BSecurity for costs in the sum of $5,880 must be paid into Court within 20 working days of the date of this decision.
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REASONS
Introduction
The appellant, Ms Sax, seeks review under s 7(2) of the Court of Appeal (Civil) Rules 2005 of two decisions of the Registrar dated 30 October 2015 and 2 November 2015 declining an application to dispense with security for costs.
Ms Sax’s substantive appeal is against the 26 June 2015 judgment of Brewer J concerning the use of a house purchased by the Luke and Janine Simpson Family Trust (the Trust).[1] Mr Simpson was successful in all his claims against Ms Sax and the Trust, and Ms Sax was successful in one of her claims against Mr Simpson. As the Judge concluded, however, there were “no winners” in the outcome.[2]
Background
[1]Simpson v Sax [2015] NZHC 1466, [2015] NZAR 1210.
[2]At [71].
The factual background to the proceedings between Mr Simpson and Ms Sax can be found in judgments of both this Court and the High Court. It suffices to say that, Mr Simpson and Ms Sax, having divorced in 2013, have an acrimonious relationship that has led to many Court proceedings between the two of them.
At issue in this proceeding is the occupation and upkeep of a house acquired by the Trust and used by Ms Sax and Mr Simpson as their matrimonial home before their separation. Justice Brewer made three orders in Mr Simpson’s favour. First, he found Mr Simpson was entitled to pursue Ms Sax for occupation rent for a period of 42 weeks during which she occupied the house and excluded him from exercising his right to occupy. That amounted to a sum of $9,450. Second, Brewer J ordered that the Trust pay Mr Simpson $7,168.73, being five per cent interest per annum for the period between 7 June 2013 (on which Mr Simpson had made demand for the repayment of a debt of $356,000 owed to him by the Trust) and 1 November 2013 (the date the debt was repaid to Mr Simpson). Third, the Judge found that Mr Simpson was entitled to be reimbursed $10,133.55 by the Trust for payments made towards the house’s maintenance and interest accrued on those sums.
Ms Sax’s counterclaim against Mr Simpson for occupation rent was also successful. Justice Brewer ordered Mr Simpson to pay Ms Sax $21,982.50 on the basis that he occupied the house to her exclusion for 97.7 weeks.[3]
[3]The two sums for occupation rent were offset against each other, with the result that Mr Simpson was directed to pay Ms Sax $12,532.50.
However, Brewer J rejected Ms Sax’s claim against Mr Simpson for loss of income, which she attributed to Mr Simpson intentionally inducing tenants she had arranged to live in the house to breach their contract. The Judge found Ms Sax failed to discharge her onus of proof on this ground.
Similarly, Brewer J was unconvinced by Ms Sax’s evidence regarding her claim for reimbursement for payments made to the Trust for the purpose of repair and maintenance of the house. He was not satisfied that Ms Sax had paid any of the amounts she had claimed.
Ms Sax appeals on the basis that Brewer J erred in fact and/or law in finding against her in the High Court. She claims that insufficient weight was given to the terms of the Trust Deed and the “real situation” of the parties, to Family Court orders, findings and claims and to Mr Simpson’s theft of documents necessary to prove her case, despite her drawing them to the Judge’s attention.
Security for costs and the Registrar’s decisions
On 14 July 2015 security for costs in the appeal was set at $5,880.
Ms Sax then applied to have security for costs dispensed with, stating that she had applied for legal aid on 24 July 2015. Rule 36(3) of the Court of Appeal (Civil) Rules 2005 (the Rules) applies to appeals in which the appellant has applied for, or been granted, legal aid at the time the appeal is brought, and provides such an appellant need not pay security for costs.
On 22 September 2015, the Registrar responded to Ms Sax’s application deferring consideration of the application in order to give Ms Sax time to provide documentary proof that a legal aid application had, in fact, been filed.
Ms Sax filed a memorandum in response on 28 September. She informed the Court that on 24 September 2015, the Legal Services Commissioner had “made the decision not to make a decision on legal aid” on the basis the form had been incorrectly filled out. She advised she had filed proceedings in the Legal Aid Tribunal challenging this decision. Ms Sax also submitted she had grounds for an order under r 35(6)(c) of the Rules on the basis she is impecunious.
On the basis of the letter from Legal Services filed by Ms Sax and communications from Legal Services, the Registrar found on 30 October 2015 that no legal aid application had in fact been filed and Ms Sax had not complied with r 36. The Registrar further concluded:
(a)the circumstances of the appeal are unexceptional and it raised no matters of public importance or significance;
(b)the merits of the appeal are weak;
(c)the benefits of pursuing the appeal are not outweighed by the costs; and
(d)there was insufficient evidence before her to ascertain Ms Sax’s true financial position, but that in any event impecuniosity alone did not warrant dispensation from the requirement to pay security for costs.
On 2 November 2015, after receiving correspondence from Ms Sax, the Registrar reconsidered relevant parts of her decision that were affected by an error as to the subject of the substantive appeal. Her overall decision remained unchanged.
On 3 November 2015, Ms Sax filed an application for a review of these decisions.
Principles to be applied
Before security may be dispensed with, there must be exceptional circumstances. The general test is that a dispensation should be made only if “it is right to require the respondent to defend the judgment under challenge without the usual protection as to costs provided by security.”[4] If a sensible and solvent litigant would not pursue the appeal, there is no basis for dispensing with security for costs.
[4]Reekie v Attorney-General [2014] NZSC 63, [2014] 1 NZLR 737 at [21].
Rule 36 creates an exception for appellants who have applied for or been granted legal aid at the time the appeal is brought. There is no requirement in those circumstances for the appellant to pay security, unless and until the application is declined.
Analysis
Ms Sax advances several arguments in support of her application for review. She also refers me to the grounds of her substantive appeal, the grounds of her appeal against the High Court’s cost judgment[5] and the grounds set out in her application for review filed with the Legal Aid Tribunal.
[5]Simpson v Sax [2015] NZHC 2686.
I have categorised Ms Sax’s grounds into groups and will deal with each in turn.
The Registrar made her decision by reference to a different decision to that appealed against
It is clear from the Registrar’s decision dated 2 November 2015 that the error as to the nature of the substantive appeal was corrected and the application was reconsidered in light of this. I am satisfied that the Registrar’s actions in this regard adequately addressed the problem.
The Registrar wrongly assessed the merits of the appeal
The Registrar assessed the merits of Ms Sax’s appeal against Brewer J’s as not strong. Ms Sax submits that this assessment was flawed because the Registrar had only “arbitrarily rehashed” the High Court judgment and failed to give due regard to submissions and grounds of appeal.
I agree with the Registrar that the merits of the appeal are weak. Ms Sax seeks to raise again many of the same arguments she made in the original proceedings against Mr Simpson. In my assessment, Ms Sax faces considerable difficulty in seeking to have the judgment of Brewer J overturned.
The Registrar’s conclusion as to public interest was arbitrary
I can discern no public interest in the appeal that would justify requiring the respondents to defend the judgment of Brewer J without the protection of security for costs.
The Registrar failed to consider Ms Sax’s action against the Legal Services Commissioner in her decision
Ms Sax contends that, contrary to the findings of the Registrar, she did file an application for legal aid, that the steps taken to challenge the decision of the Legal Services Commissioner are sufficient to prove this and that the information received to the contrary from Legal Services is therefore irrelevant and redundant.
The letter provided to the Registrar as evidence of an application for legal aid indicated that an application had not been made. Ms Sax claimed that the decision of the Legal Services Commissioner was due to the form being incorrectly completed. However, Legal Services has confirmed with the Registrar that a legal aid application has never been filed. The existence of proceedings against the Legal Services Commissioner does not change the inevitable conclusion on that matter.
I note that r 36 requires an application for legal aid to have been made or granted at the time an appeal is filed. Even if the application had been successfully filed, the form provided is dated after the appeal in this case was lodged.
I consider the Registrar made no error in concluding that Ms Sax has not complied with r 36.
The Registrar did not take into account Ms Sax’s financial position
Ms Sax submits that the Registrar was unclear in her approach to the impecuniosity ground of her application and that it appears information relevant to that ground was not considered or sought from Ms Sax.
I disagree. Ms Sax’s claim of impecuniosity as a ground for dispensation was, as the Registrar observed, unsupported by evidence. The Registrar was correct in her observation that impecuniosity does not in itself warrant an order dispensing with security.[6] The Registrar correctly determined that, in light of the other grounds of Ms Sax’s application, further information about impecuniosity would not be necessary.
[6]Reekie v Attorney-General, above n 4, at [20].
The submissions detailing the outstanding substantial costs orders against Ms Sax do not support her application. The rationale for security for costs is that a respondent should enjoy some degree of protection against the risk of non-payment of costs awarded should the appeal fail.[7]
[7]Houghton v Saunders [2015] NZCA 141 at [4].
I conclude the Registrar’s approach was correct in the circumstances.
The Registrar has pre-determined the outcome of Ms Sax’s subsequent application for dispensation of security for costs in a subsequent appeal
Ms Sax submits that the Registrar has predetermined the outcome of an application for a dispensation of security for costs in the appeal Ms Sax has filed against Brewer J’s costs judgment, filed 2 November 2015 (CA638/2015). I assume that this ground is based upon the Registrar’s error referred to at [20] above.
I express no view on this ground. If necessary, it can be addressed in any future reviews of the Registrar’s decision in that proceeding.
Result
I am satisfied that none of the grounds of review is meritorious. The Registrar’s decision was correct and, having considered the matter afresh, I have reached the same outcome.
The application to review the Registrar’s decision refusing to dispense with security for costs is dismissed.
Ms Sax is to pay the sum of $5,880 by way of security for costs within 20 working days of the date of this decision.
Solicitors:
Holland Beckett, Tauranga for Respondents
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