Siemer v Heron HC Auckland CIV 2010-404-6880

[2011] NZHC 223

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

CIV 2010-404-6880

BETWEEN  VINCENT ROSS SIEMER Appellant

ANDMICHAEL RICHARD HERON First Respondent

ANDRUSSELL VCVEAGH Second Respondent

ANDFORCE 1 SECURITY LIMITED Third Respondent

ANDSIONE TANAKI Fourth Respondent

AND  PIO SAMI

Fifth Respondent

Counsel:         Appellant in person

T L Clarke for First & Second Respondents
P F Wicks for Third, Fourth & Fifth Respondents

Judgment:      17 March 2011

JUDGMENT OF KEANE J

This judgment was delivered by Justice Keane on 17 March 2011 at 3pm pursuant to Rule 11.5 of the High Court Rules.

Registrar/ Deputy Registrar

Date:

Solicitors

Bell Gully, P.O. Box 4199, Auckland 1140.

Counsel

P F Wicks, P.O. Box 1614, Shortland Street, Auckland 1140.

Copy to

V R Siemer, 27 Clansman Terrace, Gulf Harbour, Auckland

VINCENT ROSS SIEMER V MICHAEL RICHARD HERON HC AK CIV 2010-404-6880 17 March 2011

[1]      An issue to be resolved before this appeal can be set down for hearing is, as I have said in my two recent minutes, whether Mr Siemer is obliged to pay security for costs on the appeal, as HCR 20.13(2) requires, or ought to be excused from doing so in 'the interests of justice'.

[2]      HCR 20.13(2) imposes a duty on the Judge conducting the case management relating to an appeal to fix security for costs 'unless the Judge considers that in the interests of justice no security is required'. Unless the Judge otherwise directs, the security to be given is to be half the daily recovery rate for the proceeding, as classified, multiplied by the number of half days required.[1]

[1] HCR 20.13; 4.14.

[3]      Any security fixed is to be paid within ten working days, unless the Judge otherwise directs;[2]  and where, as is the case here, the appeal is brought under the District Courts Act 1947, a failure to comply within the time stipulated results in the appeal being deemed abandoned under s 74 of that Act.

[2] HCR 20.13(4).

[4]      As I recorded in the second of my recent minutes, it is agreed that I should resolve this question without further hearing on the basis of the submissions that have since been filed by Mr Siemer and the respondents.

Context

[5]      In 2008 Mr Siemer brought an action in the District Court seeking damages from Russell McVeagh, solicitors, and one of its partners, Michael Heron and Force

1 Security Limited and two of its employees, alleging an assault for which each is actually  or  vicariously  liable,  as  a  result  of  which  he  suffered  distress  and humiliation.

[6]      On 6 November 2008 Mr Siemer was made bankrupt. That has not prevented him from pursuing his claim. The Official Assignee accepts that his claim is personal to him. On 11 November 2008, however, in a decision he recalled and re-issued on 4

December 2008, Judge Joyce QC ordered Mr Siemer to pay into Court $20,000

security for costs and stayed his claim until that payment was made. It remains stayed to this day.

[7]      On 3 December 2008 Mr Siemer appealed that decision to this Court. At a case conference on 27  March 2009 he was ordered to pay on the appeal $800 security for costs. He first had until 1 May 2009 to do so. That was extended to 29

May 2009. He did not comply with the order. The result was under s 74 of the

District Courts Act 1947 that his appeal was deemed to be abandoned.

[8]      Mr Siemer sought leave in this Court to appeal the order made to the Court of Appeal. On 29 March 2010 this Court declined him leave. The Judge doubted that there was jurisdiction, but said as well that if there were, he would decline leave. That Mr Siemer was a bankrupt did not mean that he lacked the means to meet the order made. In assessing the interests of justice the interests of the respondents were not to be ignored.

[9]      On 22 September 2010 Judge Harvey declined an application that Mr Siemer had by then made in the District Court, once again,  for an order rescinding or varying the $20,000 security for costs order. Fatal to that application, the Judge held, was that it should have been made within seven days of the order for review. Mr Siemer had delayed making that application for 18 months. He had chosen instead to appeal.

[10]     Also, Judge Harvey concluded, relying on the record in other cases in which Mr and Mrs Siemer were parties, Mr Siemer had, effectively, elected to be made bankrupt. He and his wife had shifted assets offshore to avoid exposure to claims in New Zealand. If Mr Siemer were unable to meet the order, that was his choice. Also, though Mr Siemer was bankrupt, there was no evidence that he was impecunious.

[11]     On 14 October 2010 Mr Siemer brought this second appeal, contending that on the review Judge Harvey had erred in fact and had discounted, unjustly, evidence from the Legal Services Agency as to the fact that he was impecunious. The Judge also, he contended, had made an untenable and unjust assessment of the merit of his underlying claim for damages.

[12]     At the first case conference in this Court on 9 November 2010, relating to this second appeal, the issue of security for costs once again arose. The Judge suggested that it be resolved after the Court of Appeal had decided whether to grant Mr Siemer leave to appeal to that Court the order for security made on the first appeal. Mr Siemer invited the Judge to disqualify himself.

[13]     Eventually, I conducted the two case conferences thus far relating to this second appeal, those on 7 December 2010 and 9 February 2011; and in between the two, on 14 December 2010, the Court of Appeal declined Mr Siemer's application for leave to appeal the order for security made on the first appeal.[3]

[3] Siemer v Heron [2010] NZCA 610.

[14]     The Court held that HCR 20.13(2) required this Court to fix security unless it considered, in the interests of justice, that no security was required. In assessing that the interests of the respondents had equally to be considered and 'an impecunious plaintiff must not be allowed to use his or her inability to pay costs as a means of

putting unfair pressure upon a defendant'.[4]

[4] At [16].

[15]     A bankrupt, the Court held, could still earn an income and $800 security for costs was within the sum that a bankrupt was able to earn or retain. There was no evidence, moreover, the Court held, as to Mr Siemer's means. There was nothing to suggest that the order made barred Mr Siemer from prosecuting his appeal because he lacked the means to meet it.

Appellant's submissions

[16]     Despite that decision, Mr Siemer contends on this second appeal that he ought, in the interests of justice, to be excused from having to make any payment by way of security for costs.

[17]     Whether  an  order  for  security for  costs  is  in  the  interests  of  justice,  he submits,  has  always  to  be  a  mandatory  consideration  under  HCR  20.13;  an

indispensable  consideration  that  arises,  in  any  event,  under  Article  14  of  the

International Covenant on Civil and Political Rights.

[18]     The $20,000 security for costs order, Mr Siemer contends, has barred him from pursuing his claim in the District Court; a claim with merit. As an undischarged bankrupt he is self evidently incapable of meeting that order. Any order for security for costs on any appeal from that order, he contends, heightens that bar and is equally unjust.

[19]     Mr Siemer relies on the fact that on this appeal he has the benefit of a fee waiver and that he has the benefit of legal aid in another matter. He contends that though he has not sought to pursue aid on this appeal, as he first intended to, that does not alter the reality that he is entitled to it. He relies also on the fact that in

Siemer v Stiassney[5]  the Court of Appeal, when permitting him to pursue an appeal,

held there was no point in then imposing a level of security for costs that prevented him from doing so.

[5] Siemer v Stiassney [2009] NZCA 624.

[20]     Security for  costs,  Mr  Siemer  contends,  is an  award  to  the respondents, though paid into Court, that assumes that the appeal that has yet to be heard lacks merit. Orders for security for costs are not made in every case, he contends, and therefore  the  practice  of  making  or  not  making  them  is  capable  of  being unacceptably discriminatory.

[21]     If, therefore, Mr Siemer submits, a lack of means does not justify security being dispensed with outright, the Judge must before imposing security conclude that the grounds for appeal are weak. Alternatively, he submits that a balancing exercise  is  required,  beyond  the  'interests  of  justice',  taking  into  account  any financial hardship on the defending party if security for costs is not imposed.

[22]     Mr Siemer contends that at the second case management conference, when I said that I would consider ordering him to pay security for costs, I had not then assessed the merit of his appeal. I had not read the transcript of the hearing before Judge Harvey that culminated in the decision under appeal.

Conclusions

[23]     There may be instances in which the 'interests of justice' call for the merit of an appellant's case to be assessed in that wider way. This is not one of them. The threshold question, the question that is decisive in this case, is whether, regardless of the merit of Mr Siemer's appeal, the usually mandatory order for security for costs is so beyond his means as to preclude him from pursuing his appeal.

[24]     As was the case on the first appeal, Mr Siemer has elected not to give any evidence as to what his actual means are. He relies, as he relied then, just on the fact of his bankruptcy. That, I conclude, consistent with the decisions taken on the first appeal, especially that in the Court of Appeal, cannot begin to suffice. The sum the respondents seek paid into Court by way of security, as was also said in those two decisions, lies within the means even of a bankrupt.

[25]     On this second appeal also, I am conscious of the other consideration that figured in those decisions on the first appeal; that any analysis of the interests of justice must include the interests of the respondents. They not unreasonably seek to avoid being put to the cost of responding to Mr Siemer's appeal without at least the security of the modest payment into Court that they seek.

[26]     I see no reason, in the interests of justice, therefore, to withhold from making the order for security for costs that HCR 20.13 ordinarily requires. There will be an order that Mr Siemer pay into Court by way of security for costs, $940 on account of the first and second respondents and $940 on account of the third and fourth respondents, in total $1,880.[6]

[6] HCR 14.4, 20.13(3), (4), Schedule Two.

[27]      If Mr Siemer does not pay that sum within 14 days of the date of the issue of this decision, s 74 of the District Courts Act 1947 will come into play. His appeal will be deemed to be abandoned. The respondents will not then be called upon to take any further step on this appeal.

[28]     If such a payment is made in terms of this order, I request the Registrar to set down a further telephone conference for the directions then still called for. There will

be no order as to costs.

P.J. Keane J