Scargeta v ASB Bank Limited - [2024] NZCA 347

IN THE COURT OF APPEAL OF NEW ZEALAND

I TE KŌTI PĪRA O AOTEAROA

CA575/2023
[2024] NZCA 347

BETWEEN	ELLIOT SGARGETTA Appellant
AND	ASB BANK LIMITED First Respondent
AND	ANDREW JOHN HAWKES AND VIVIAN JUDITH FATUPAITO AS RECIEVERS OF EVERGREEN LODGE LIMITED AND REMARKABLES LODGE LIMITED Second Respondent

Court:	Cooke and Collins JJ
Counsel:	Appellant in person A E Simkiss and J J K Spring for First Respondent No appearance for Second Respondent
Judgment: (On the papers)	29 July 2024 at 10.30am

JUDGMENT OF THE COURT

AThe application for an extension of time to file the case on appeal and apply for a fixture is granted. The case on appeal and application for a fixture should be filed within 20 working days.
BThe application for an extension of time to review the Deputy Registrar’s decision not to dispense with security for costs is granted. We direct the review of the Deputy Registrar’s decision to be heard separately from this application, on the papers. Timetabling directions are set out in [40] of this judgment.

____________________________________________________________________

REASONS OF THE COURT

(Given by Collins J)

Introduction

Mr Sgargetta applies for an extension of time to file his case on appeal and to apply for a fixture. He also seeks an extension of time to review the decision not to dispense with security for costs.

Background

In 2017, ASB Bank Ltd (ASB) sought summary judgment against Mr Sgargetta in reliance on an unlimited deed of guarantee and indemnity Mr Sgargetta had given in respect of loans made by ASB to Sleep Overs Ltd (Sleep Overs), a company of which Mr Sgargetta was the director. In the High Court, Woodhouse J granted summary judgment for the sum of $598,340.15,[1] which was upheld by this Court in 2021.[2]
[1]ASB Bank Ltd v Sgargetta [2017] NZHC 3097 at [65(a)].
[2]Sgargetta v ASB Bank Ltd [2021] NZCA 459 at [67].
Mr Sgargetta then brought further proceedings against ASB and the receivers of Sleep Overs in the High Court.[3] These proceedings are the current decision Mr Sgargetta seeks leave to appeal. There were three causes of action:
(a)that ASB breached its statutory duty under s 176(1)(c) of the Property Law Act 2007 to obtain the best price reasonably obtainable;[4]
(b)that ASB was, before and during the lending, aware of Sleep Overs’ syndication business model and its plans to acquire, redevelop, and sell the secured property, and it was therefore obliged to assist with or not block Sleep Overs’ plans to syndicate the secured properties;[5] and
(c)that ASB was liable for the alleged breach by the receivers of their duty under s 19 of the Receiverships Act 1993 to obtain the best price reasonably obtainable.[6]
[3]Sgargetta v ASB Bank Ltd [2023] NZHC 2413.
[4]At [37].
[5]At [69].
[6]At [68].
The proceedings were struck out by Associate Judge Gardiner. She found that the first and third causes of action were to be struck out as an abuse of process of the Court, as Mr Sgargetta sought to…

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.

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Details

Case: [2024] NZCA 347
Decision Date: 29 July 2024 at 10.30am

CaseChat Overview and Summary

In the Court of Appeal of New Zealand, Mr. Elliot Sgargetta appealed against ASB Bank Limited, seeking an extension of time to file his case on appeal and to apply for a fixture. He also sought an extension of time to review the decision not to dispense with security for costs. The case was initially filed in the High Court where ASB Bank Ltd had obtained summary judgment against Mr. Sgargetta. The High Court proceedings involved claims against ASB Bank Ltd and the receivers of Sleep Overs, which were struck out as an abuse of process and not disclosing a tenable cause of action. The legal issues were whether an extension of time should be granted to Mr. Sgargetta for filing his case on appeal and to review the Deputy Registrar’s decision on security for costs, and whether the interests of justice would be served by granting such extensions.

The Court of Appeal considered the principles in Almond v Read and the factors to be considered when granting an extension of time, including the length of delay, reasons for delay, conduct of the parties, and the significance of the issues. Mr. Sgargetta argued that delays were due to conflicts of interest with ASB Bank and a lack of legal aid. ASB Bank opposed the extension, arguing the appeal lacked merit and was an abuse of process. The Court found that while the appeal did not appear to have obvious merit, the interests of justice favoured granting the extension of time to file the case on appeal and to review the security for costs decision. The Court granted the application for an extension of time, directing that the case on appeal and application for a fixture be filed within 20 working days, and that the review of the Deputy Registrar’s decision be heard separately on the papers.

Orders