Scully v Holland
[2018] NZHC 3440
•20 December 2018
IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY
I TE KŌTI MATUA O AOTEAROA TĀMAKI MAKAURAU ROHE
CIV-2017-404-002724
[2018] NZHC 3440
BETWEEN ANTHONY JAMES SCULLY
Plaintiff
AND
MADELINE CAROL HOLLAND
Defendant
Hearing: 1 November 2018 Appearances:
Plaintiff in Person
A G Stuart for the Defendant
Judgment:
20 December 2018
JUDGMENT OF ASSOCIATE JUDGE SARGISSON
This judgment was delivered by me on 20 December 2018 at 3.30 p.m. pursuant to Rule 11.5 of the High Court Rules.
Registrar/Deputy Registrar Date.......................................
Solicitors / Counsel:
Webster Malcolm, Auckland A G Stuart, Auckland
SCULLY v HOLLAND [2018] NZHC 3440 [20 December 2018]
[1] Anthony Scully seeks summary judgment on his statement of claim against the defendant, Madeleine Holland.
[2] Mr Scully did not make the application for summary judgment until some months after the statement of claim was served on Ms Holland – and therefore requires the Court’s leave to make the application under r 12.4(2) of the High Court Rules 2016.
[3] Provided leave is granted, the key issues to be considered in the summary judgment application are whether the Court is able to be satisfied:
(a)Of the existence of a claimed oral contract between the parties for the provision and payment of services, and the particular terms of that contract.
(b)That Mr Scully did in fact provide services which he claims payment for, and what those services were; and that
(c)Ms Holland has no tenable defence to Mr Scully’s claim for such payment.
[4] Mr Scully has the onus. It is for him to satisfy the Court of the basis for his claim, and that there is no tenable defence to the claim.
[5] Ms Holland says Mr Scully’s claim is not appropriate for summary judgment, and it should be dealt with by defended action at trial in the ordinary way. She claims to have an arguable defence to liability on the entire claim, and therefore no obligation to pay Mr Scully anything at all.
Procedural and factual history
[6] On 13 November 2017 Mr Scully commenced this proceeding by statement of claim. He alleges Ms Holland failed to pay him for contracted services pursuant to an oral contract. He claims relief by way of damages of “$1,619,899 (inclusive of GST and interest at 12.9 per cent cumulative); punitive damages to the total sum of
$250,000; opportunity costs at a rate and for a period to be fixed by the Court; plus costs.”
[7] It is said in the statement of claim that the contract was negotiated between Mr Scully and Ms Holland in late 2012, and that the parties agreed he would be paid at the rate of $110 AUD an hour for 100 hours per month, in respect of work already performed over the previous 10 months; and for further services to be provided and invoiced by him, including any expenses incurred.
[8] Mr Scully claims that the existence of the alleged contract is confirmed in conversations recorded in subsequent texts and emails, and in a request from Ms Holland for a variation to the invoiced contract rate.
[9] On 11 July 2018, almost eight months after filing the statement of claim, Mr Scully filed the application for summary judgment on his statement of claim.
[10] The application for summary judgment seeks damages of “$1,714,379 (inclusive of GST and interest at 12.9 per cent cumulative); punitive damages to a total sum of $250,000; opportunity costs at a rate and for a period to be fixed by the Court; plus costs and disbursements.”1
[11] At a case management conference, on 14 August 2018, Associate Judge Smith noted that the application for summary judgment requires the leave of the Court under r 12.4(2), and he granted Mr Scully leave to amend his application for summary judgment to add an application for leave.
[12] On 22 August 2018 an application for leave was filed. Mr Scully omitted to file an affidavit in support, but indicated at the hearing before me, on 1 November 2018, that he would rely on two affidavits:
(a)The first, in support of summary judgment – filed on 11 July 2018.
1 The increased quantum sought in his summary judgment application is said to take account of the fact that he has added another full year of interest, and the ongoing fluctuation in exchange rates between the Australian and New Zealand dollars.
(b)The second – filed on 17 September 2018, in reply to Ms Holland’s affidavit, filed on 30 August 2018 in opposition to summary judgment.
[13] Ms Holland has not filed any documents in opposition to the leave application. Her counsel advises however her position is that if the Court is satisfied it should grant leave, she will abide that decision but nonetheless is strongly opposed to summary judgment.
The application for leave
[14] Notwithstanding the lack of any formal opposition to leave, the Court must satisfy itself that there is an appropriate case for granting leave. As the Court of Appeal noted in Stephens v Barron, the criteria for leave need to be addressed when dealing with the issue of whether such leave should be granted.2
The legal test for leave
[15] Rule 12.4(2) is silent as to the principles governing the Court’s discretion to grant leave. They are however to be found in the authorities. Factors relevant to the exercise of the discretion are whether the delay is satisfactorily explained; whether the merits of the applicant’s case are such that they deserve determination, by way of summary judgment, at a later time than ordinarily prescribed by the Rules; and whether there is any risk of a miscarriage of justice by granting leave.3
Analysis
[16] Notwithstanding that there is no formal opposition, the Court must still be satisfied that it is appropriate to exercise its discretion. I am not satisfied, for these brief reasons:
2 Stephens v Barron [2014] NZCA 82 at [13].
3 Tip Top Ice Cream Co Ltd v Polarland Ltd (2002) 7 NZBLC 103,564.
(a)Mr Scully has provided no explanation, in his leave application, for the delay in making the summary judgment application; and I decline to speculate on what the reasons for the delay might be.
(b)The merits of the summary judgment application, to the extent that they can be discerned, do not suggest determination of a “late summary judgment application” is warranted. In fact, the apparent merits of the application are far from clear, and must inevitably be determined at trial in the ordinary way. It is not possible to discern – taking the evidence as it stands – and the statement of claim itself (which lacks particularity) where the merits lie.
[17] Though there is no suggestion that there would be a risk of miscarriage of justice simply by granting leave, the appropriateness of granting leave is outweighed by the other factors.
[18] There are also procedural issues with Mr Scully’s application for summary judgment, which further support the denial of leave. Mr Scully has not complied with the technical requirements of r 12.4(5)(b), as he does not depose to his belief that the defendant has no defence to the claim. Nor does he expressly verify in his affidavit the contents of his statement of claim.
Merits of the application for summary judgment
[19] The principles applying to summary judgment are well settled. The onus is on the plaintiff to show that its case is unanswerable. To do so, the plaintiff’s pleadings must disclose a cause of action for which the Court is satisfied no defence exists.4 Ultimately, the Court must be left with no real doubt or uncertainty.5
[20] I am not satisfied that the Court is left with no real doubt or uncertainty. To illustrate this more fully, and why I must inevitably deny leave, I refer briefly to the following aspects of Mr Scully’s statement of claim and the evidence:
4 High Court Rules 2016, r 12.2(1).
5 Krukziener v Hanover Finance Ltd [2008] NZCA 187, [2010] NZAR 307 at [26].
(a)The statement of claim is poorly pleaded – it contains insufficient particulars of the terms of the oral contract relied upon and the damages sought to satisfy r 5.26.
(b)The claim appears to seek damages for indeterminate work undertaken prior to and after the alleged oral contract. It is unclear what that prior work consisted of and what work Mr Scully was purportedly contracted to do after the alleged oral contract was made. Moreover, there is potentially an issue relating to past consideration arising on the apparent facts of such an agreement;
(c)In relation to the various relief sought, the statement of claim lacks particularity:
(i)Damages for indeterminate work are claimed. Interest on the imprecise basis of “12.9% for an unspecified period” is claimed (one is left to assume there is interest calculated on an annual basis).
(ii)It omits any pleading that there was any contractual agreement for interest to apply in the event of late payment of invoices, or any other basis on which the claimed interest at 12.9% is said to have been incurred.
(iii)The relief sought also omits any reference to the basis on which the aggregate amount of damages claimed includes punitive damages, and more fundamentally, the basis on which punitive damages are available for breach of contract;6
[21] Even if the pleading were amended to deal with these shortcomings, there is insufficient evidence before the Court to show that Ms Holland’s claimed defence is untenable. Ms Holland disputes the existence of any oral contract made in 2012. She says in fact there was a written contract between the parties on broadly similar, but not
6 Paper Reclaim Ltd v Aotearoa International Ltd [2006] 3 NZLR 188 (CA) at [180] and [183].
identical terms to the oral contract claimed by Mr Scully, and critically, that the written contract was wholly conditional upon funds being released to her by third parties. She deposes that the written contract never became unconditional as she was not paid. In support, she has produced a copy of what is said to be the written contract dated 19 May 2013, which appears to contain the signature of Mr Scully, and lends some support for her contentions.
[22] Mr Scully himself appears to recognise the conflict in the parties’ positions. In a second set of submissions, filed on 29 October 2018, he submits that the document produced by Ms Holland is of no moment because “essential issues” for this Court to determine are whether Ms Holland’s character and credibility are brought into question. He contends there is enough evidential material about her conduct and dealings with others to show that her character and credibility are “brought into question”, and therefore her claims should not be believed.
[23] But it is trite that summary judgment is not usually a suitable forum for the determination of issues of witness credibility unless the position is demonstrably clear. The copy of the alleged contract Ms Holland has produced cannot be safely ignored without hearing further from the parties as to its authenticity.
[24] Further, while Mr Scully has invited the Court to refer to numerous emails, texts and documents as evidence of the existence of the oral contract – a number of which have been disclosed during the discovery process or produced with his submissions – these are not actually in evidence. Ms Holland is also entitled to a proper opportunity to respond to such documents. While I do not wish to be taken as making any definitive findings on the import of those documents, they appear not as clear-cut as Mr Scully submits; if anything, they highlight the existence of a real dispute between the parties.
[25] The above reasons are sufficient to illustrate that this case is simply not suitable for summary judgment.
[26] Mr Scully may eventually show that he has a valid claim against Ms Holland for breach of a contract for services, but on the pleadings and evidence presently before
the Court, the case patently does not support summary judgment. As I indicated to him at the hearing, his interests would be well served by seeking legal advice, particularly with respect to his pleadings.
Result
[27] In these circumstances, the application for leave must be refused. Even if I had granted leave, the application for summary judgment would inevitably have been declined.
[28] In accordance with the Court of Appeal’s decision in NZI v Philpott costs are reserved.7
[29] The case is to be allocated a further case management conference on a date to be fixed by the Registrar. If Mr Scully intends to amend his statement of claim as I have recommended, he is to file and serve an amended statement of claim at least 3 weeks prior to the conference.
Associate Judge Sargisson
7 NZI Bank Ltd v Philpott [1990] 2 NZLR 403 (CA).
2