Schmidt v Legal Services Commissioner - [2022] NZCA 363

IN THE COURT OF APPEAL OF NEW ZEALAND

I TE KŌTI PĪRA O AOTEAROA

CA129/2022
[2022] NZCA 363

BETWEEN	TAYLOR JADE SCHMIDT Applicant
AND	LEGAL SERVICES COMMISSIONER Respondent

Court:	Clifford and Katz JJ
Counsel:	A J Woodhouse for Applicant L M Hansen for Respondent
Judgment: (On the papers)	8 August 2022 at 11.30 am

JUDGMENT OF THE COURT

AThe application for leave to appeal is declined.
BThere is no order as to costs.

____________________________________________________________________

REASONS OF THE COURT

(Given by Clifford J)

Introduction

This is an application by Taylor Schmidt for leave to appeal a decision of Grice J in the High Court at Wellington.[1]

Background

[1]Schmidt v The Legal Services Commissioner [2022] NZHC 200 [Grice J decision].

There is an extensive background to this application but, for our purposes, the following summary is sufficient.
Ms Schmidt and her former partner Anthony Schmidt commenced proceedings in 2011 in the High Court against Ebada Property Investments Ltd and Brian Garrity. In general terms they alleged breach of equitable obligations in connection with the sale of properties said by the Schmidts to be held by Ebada and Mr Garrity on trust for them. The events in question dated back to 2005 and 2006. An application for legal aid was made by the Schmidts in 2012. In 2017 legal aid was granted and a hearing before Venning J then took place. The Schmidts based their claim on five causes of action: breach of express trust; breach of institutional constructive trust; knowing assistance/knowing receipt; breach of fiduciary duty; and undue influence. After a seven-day hearing, Venning J dismissed all the claims the Schmidts had made.
In doing so Venning J described the core of the dispute in the following way:[2]
[1] Anthony Schmidt and Brian Garrity were formerly good friends. In 2005 and 2006 trusts associated with Mr Schmidt and his partner, Taylor Schmidt, transferred properties at Kaiaua Road and Bell Road to Ebada Property Investments Limited (Ebada), a company owned and controlled by Mr Garrity. The properties were subsequently sold to third parties. Ebada sold Bell Road and the mortgagee sold Kaiaua Road.
[2] Mr and Ms Schmidt say that Ebada held the properties on trust and dealt with them in breach of trust. Ebada and Mr Garrity deny there was any trust.
[2]Schmidt v Ebada Property Investments Ltd [2019] NZHC 3548 [Venning J decision].
Central to the Judge’s decision were his credibility findings. These may be found at [84] to [111] of the decision. The following two paragraphs summarise the Judge’s assessment:
[84] Unfortunately, I found Mr Schmidt, Ms Schmidt, and Mr Garrity all to be unsatisfactory and unreliable witnesses to a greater or lesser degree.
…
[110] While not a ringing endorsement of Mr Garrity, I did not find him to be as evasive and untruthful when giving evidence on the major issues in the case as Mr and Ms Schmidt. On the important issues where there is a direct conflict, namely the basis upon which the properties were…

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: [2022] NZCA 363
Decision Date: 8 August 2022 at 11.30 am

CaseChat Overview and Summary

The case of Schmidt v Legal Services Commissioner involves an application by Taylor Jade Schmidt for leave to appeal a decision of Grice J in the High Court at Wellington. Ms Schmidt sought leave to appeal Grice J's decision that she was not entitled to legal aid for a second appeal against a previous decision of Venning J. Venning J had dismissed all claims made by the Schmidts against Ebada Property Investments Ltd and Brian Garrity in a case relating to the sale of properties held by Ebada on trust for the Schmidts. Ms Schmidt had unsuccessfully appealed Venning J's decision, and her application for legal aid to appeal Grice J's decision was declined by the Legal Services Commissioner. Ms Schmidt further appealed that decision, but was again unsuccessful before the Legal Aid Tribunal and the High Court.

The legal issues in this case revolve around the criteria for granting leave to appeal a decision of the High Court on a question of law, and the principles that apply in assessing the prospects of success for an appeal. The central issue is whether Ms Schmidt's appeal involves a matter of general or public importance, or whether a miscarriage of justice may have occurred or may occur unless the appeal is heard. The Court must also consider whether the Tribunal and Grice J erred in their assessments of the prospects of success for Ms Schmidt's appeal.

The Court found that the appeal did not involve a matter of general or public importance, nor did it meet the criteria for a miscarriage of justice. The Court was satisfied that the Commissioner's decision to decline legal aid was neither manifestly unreasonable nor wrong in law. The Court also found that Grice J had correctly assessed the arguments made by Ms Schmidt, and had not erred in her conclusions. The Court therefore declined Ms Schmidt's application for leave to appeal Grice J's decision.

In summary, the Court found that Ms Schmidt's appeal did not meet the criteria for leave to appeal a decision of the High Court on a question of law. The Court was satisfied that the Commissioner and Grice J had correctly assessed the prospects of success for Ms Schmidt's appeal, and had not erred in their decisions. The application for leave to appeal was therefore declined, and there was no order as to costs.

Orders