Sinclair v New Zealand Racing Board - [2015] NZHC 2067

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IN THE HIGH COURT OF NEW ZEALAND WELLINGTON REGISTRY

CIV 2015-485-090 [2015] NZHC 2067

BETWEEN
DIANE LESLEY SINCLAIR

Plaintiff

AND

NEW ZEALAND RACING BOARD Defendant

Hearing: 8 June 2015

Counsel:

J T Burley for Plaintiff
R J Gordon and J R Caldwell for Defendant

Judgment:

28 August 2015

JUDGMENT OF BROWN J

SINCLAIR v NZ RACING BOARD [2015] NZHC 2067 [28 August 2015]

Table of Contents

Paragraph No.

Introduction [1] Striking out principles [4] The pleadings [6] The statement of claim [6]
The strike out application [14] The nature of the claim [17] The statutory context [22] Subsequent clarification of confusion at the hearing [30] A point of factual dispute [40] Methodology for determining whether a duty of care exists [45]

Foreseeability [50]

Proximity [54] Australian decisions [56] English authority [61] A duty to protect others from a third party’s actions [69] The Board’s control over Mr Monk [73] The relationship between the Board and the plaintiff [79]

Policy considerations [92] Causation [99] Disposition [106]

Introduction

[1] The plaintiff, who described herself as a middle-aged, emotionally vulnerable, financially independent single woman,1 formed a friendship with Leicester Monk in early 2010, unaware that he was a fraudster and a problem gambler. Over a period of approximately one year2 he prevailed upon her to lend him a total of $141,080 in 86 separate transactions which it is alleged he spent in betting on horse races either by telephone or at various of the Board’s venues.

[2] The plaintiff sues the Board for reimbursement of the sum which she lent to Mr Monk, for damages for mental distress and for exemplary damages, contending that the Board was negligent in failing to exercise reasonable care by excluding Mr Monk from all types of betting in the knowledge that he was a problem gambler and had defrauded others to obtain funds to fund his gambling habit.

[3] The Board applies to strike out the plaintiff ’s claim on the ground that it discloses no reasonably arguable cause of action against it. While acknowledging that the single pleaded negligence cause of action is novel, the plaintiff resists the application, maintaining that her claim is reasonably arguable.

Striking out principles

[4] It is common ground that the following principles apply:3

(a) Pleaded facts, whether or not admitted, are assumed to be true;

(b)The cause of action must be clearly untenable, that is, it cannot succeed;

(c) The jurisdiction to strike out is to be exercised sparingly and only in clear cases;

1      Statement of claim para 79: see [8] below.
2      Between 22 March 2010 and 29 March 2011: Statement of claim para 12.
3      Attorney-General v Prince & Gardner [1998] 1 NZLR 262 (CA) at 267.

(d)That said, the jurisdiction is not excluded by the need to decide difficult questions of law, which may require extensive argument; and

(e) The Court should be slow to strike out claims in developing areas of law.

[5] Describing…

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: [2015] NZHC 2067
Decision Date: 28 August 2015

CaseChat Overview and Summary

The plaintiff, a middle-aged, emotionally vulnerable, financially independent single woman, lent the defendant, Leicester Monk, a total of $141,080 over a period of approximately one year. The plaintiff now sues the New Zealand Racing Board (the Board) for reimbursement of the sum which she lent to Mr Monk, for damages for mental distress and for exemplary damages. She contends that the Board was negligent in failing to exercise reasonable care by excluding Mr Monk from all types of betting in the knowledge that he was a problem gambler and had defrauded others to obtain funds to fund his gambling habit. The Board applies to strike out the plaintiff’s claim on the ground that it discloses no reasonably arguable cause of action against it. The Court considered the principles applicable to a strike out application, the pleadings, and the Board’s arguments. It concluded that the plaintiff’s claim was not reasonably arguable on the issue of the existence of a duty of care as pleaded or on the matter of causation. The Board’s application to strike out the claim was therefore granted.

Orders