Siddiqui v Siddiqui
[2022] NZCA 44
•9 March 2022 at 9.30 am
| IN THE COURT OF APPEAL OF NEW ZEALAND I TE KŌTI PĪRA O AOTEAROA |
| CA376/2021 [2022] NZCA 44 |
| BETWEEN | ASHISH SIDDIQUI AND YASHIKA SIDDIQUI |
| AND | AMIN AZHAR SIDDIQUI AND USHA AMIN SIDDIQUI |
| Counsel: | G D Stringer and R Rao for Appellants |
Judgment: | 9 March 2022 at 9.30 am |
JUDGMENT OF GILBERT J
The High Court order staying execution of the costs judgment pending appeal is rescinded.
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REASONS
This is an application to rescind an order made in the High Court staying execution of a costs judgment pending determination of an appeal against the substantive judgment.[1]
[1]Siddiqui v Siddiqui [2021] NZHC 2822 [Costs stay judgment].
The case concerns a family dispute over the beneficial ownership of a residential property in Manurewa, Auckland purchased in May 2006. The respondents are the parents of the first-named appellant and the second-named appellant is his wife. The appellants held legal title to the property, but the respondents claimed it was held on a constructive trust for them.
The respondents commenced their proceedings in the High Court in 2018. The appellants resisted the claim and filed a counterclaim seeking judgment against the respondents for various sums. The proceeding was heard over seven days in August 2019 and December 2020. In a careful and comprehensive judgment delivered on 28 May 2021, Paul Davison J found in favour of the respondents.[2] The Judge ordered the appellants to transfer legal title to the respondents forthwith when called upon on the basis that the respondents would pay the appellants the amount owing on the mortgage together with the sum of $92,852, described in the judgment as the adjustment sum.[3]
[2]Siddiqui v Siddiqui [2021] NZHC 1234, (2021) 22 NZCPR 342 [Substantive judgment].
[3]At [176(b)].
The Judge subsequently ordered the appellants to pay costs and disbursements to the respondents totalling $79,210.[4] These costs were calculated on the standard category 2, band B basis. There is no appeal against the costs judgment.
[4]Siddiqui v Siddiqui [2021] NZHC 2270 [Costs judgment].
The appellants have filed an appeal against the substantive judgment. They accept in their written submissions that it is “untenable to dispute” the Judge’s finding that the property was held on trust for the respondents. However, they seek judgment on appeal in respect of their set-offs/cross claims and an order granting a share in the equity in the property.
The appellants applied for a stay of execution of the substantive judgment pending determination of their appeal. This was declined by the Judge in a judgment delivered on 15 October 2021.[5] The Judge was particularly concerned that if a stay was granted, this could impede the respondents’ ability (given their ages and circumstances) to obtain mortgage finance and thus secure title to the property. In that event, the whole purpose of their claim in the proceedings would be frustrated.[6]
[5]Siddiqui v Siddiqui [2021] NZHC 2776 [Stay of execution judgment].
[6]At [25].
The appellants also applied for a stay of execution of the costs judgment pending determination of the appeal against the substantive judgment. The Judge granted that application for reasons set out in his decision delivered on 21 October 2021.[7] It is this stay that the present application is concerned with.
[7]Costs stay judgment, above n 1.
The Judge observed that the principal reason for declining to stay execution of the substantive judgment (referred to at [6] above) did not apply to the costs judgment.[8] While there was no appeal against the costs judgment, the Judge considered it was:[9]
so closely connected with the outcome of the appeal against the substantive judgment that it would be inappropriate to treat it separately and enforce it prior to determination of the appeal.
[8]At [28].
[9]At [29].
The Judge understood that the appeal included a challenge to his determination that the appellants held the property on trust for the respondents.[10] Success on the appeal in respect of the appellants’ set-offs and cross claims could also require further financial adjustments to be made.[11]
[10]At [29].
[11]At [29].
The Judge recognised that the respondents wished to offset the costs awarded against the settlement sum, but he considered this was largely a matter of financial convenience.[12] The Judge noted that the respondents had received a grant of legal aid for their legal costs for the High Court trial and would be required to repay Legal Services in due course. However, the Judge understood there was no pressing obligation to do so and this was unlikely to arise until after the appeal had been determined.[13]
[12]At [30].
[13]At [30].
The Judge considered that while the appellants’ appeal rights would not be rendered nugatory if a stay was not granted, the preferable course was to defer payment of any adjustments until the appeal had been finally determined.[14]
[14]At [31] and [32].
I hesitate to depart from the conclusion reached by the Judge, particularly given he has had the carriage of this matter for some time and is intimately familiar with all the details. However, for the reasons set out below, I am persuaded that the stay should be rescinded. In particular, it appears the Judge misapprehended the scope of the appeal against his substantive judgment and the financial consequences of the stay for the respondents.
The starting point is that the respondents, as the successful party, are entitled to the fruits of the judgment, including costs. As the Judge accepted, a stay of execution is not required to secure the appellants’ appeal rights. There is no suggestion that their right of appeal will be rendered nugatory unless a stay is granted.[15] These factors normally would point strongly against a stay.
[15]Keung v GBR Investment Ltd [2010] NZCA 396, [2012] NZAR 17 at [11] citing Dymocks Franchise Systems (NSW) Pty Ltd v Bilgola Enterprises Ltd (1999) 13 PRNZ 48 (HC) at [9].
Contrary to the Judge’s understanding, the appellants do not challenge his finding that the property was held by the appellants on trust for the respondents. In these circumstances, irrespective of the outcome of the appeal, it is unlikely the costs judgment in favour of the respondents will be overturned.
I agree with Ms Cooper QC that payment of the costs judgment is more than just a matter of financial convenience for the respondents. To the extent it would offset the amount they have to borrow from the bank to effect settlement, it will significantly reduce the immediate financial burden on them. Further, Ms Cooper advises that the respondents were partly funded by legal aid in the High Court proceedings and are required to repay that debt. Interest at the rate of five per cent per annum will start to accrue on 17 May 2022. Contrary to the Judge’s understanding, the respondents will be detrimentally affected if the costs judgment is stayed. It is not merely a matter of financial inconvenience.
It is generally not possible to make any assessment of the prospects of the appeal succeeding in the context of an application such as this. However, the appellants would appear to face significant hurdles on appeal because they will have to overcome the fully reasoned factual findings made by the learned Judge. That will be no easy task. This Court will not lightly interfere with those findings.
For these reasons, I consider there is no sufficient justification to depart from the normal rule that a successful party is entitled to the fruits of its judgment notwithstanding that a genuine and bona fide appeal has been lodged.
Result
The High Court order staying execution of the costs judgment pending appeal is rescinded.
Solicitors:
Inder Lynch Solicitors, Auckland for Appellants
Heimsath Alexander, Auckland for Respondents
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