Smith v Smith

[2016] NZHC 1197

IN THE HIGH COURT OF NEW ZEALAND WHANGANUI REGISTRY

CIV-2016-443-000012 [2016] NZHC 1197

BETWEEN

ALISTER SMITH

Appellant

AND

NICOLA SMITH Respondent

Hearing:	1 June 2016
Appearances:	E J Unsworth for Appellant K A McKenzie for Respondent
Judgment:	3 June 2016

JUDGMENT OF DUNNINGHAM J

Note:  The names of the parties in this judgment are fictitious to preserve the

parties’ anonymity.

[1]      The Smiths’ nine year marriage ended in early 2013.  In November that year, Mrs  Smith  applied  to  the  Family  Court  at  Whanganui  for  orders  dividing  the couple’s relationship property.  She subsequently moved, with the couple’s son, to New Plymouth where she lives with her new partner.

[2]      In September 2014, she applied, under r 186 of the Family Court Rules, to have the proceedings transferred to New Plymouth.   For various reasons, that application was not dealt with for more than a year.   Eventually, Judge Sygrove

heard and determined the application on 14 December 2015.

SMITH v SMITH [2016] NZHC 1197 [3 June 2016]

[3]      He granted the application for transfer primarily on the basis of Mrs Smith’s affidavit evidence, which outlined that she suffered from multiple sclerosis which meant that driving or travelling to the Whanganui Court would be stressful and make her physically unwell, and that would hinder her ability to participate meaningfully in the proceedings.

[4]      Mr Smith appeals that decision on the following grounds:

(a)	the  Judge  erred  in  law  in  finding  that  cross-examination  of  the respondent was not necessary;
(b)	the  Judge  erred  in  law  in  finding  that  a  formal  application  to cross-examine the respondent was required;
(c)	the Judge erred in law in failing to properly apply the test for transfer of  proceedings  in  r  186  of  the  Family  Courts  Rules  2002  as
interpreted by case law;
(d)	the Judge erred in law and/or principle in his treatment of unsworn
evidence;
(e)	the Judge erred in law and/or principle in his treatment of untested
and disputed evidence.
[5]	All	grounds  of  appeal  are  opposed  by  the  respondent.     Her  lawyer,

Ms McKenzie, submits that the decisions made by the Judge in the course of case managing, and then hearing and determining the application, were decisions made in the exercise of his discretion and there was no error made by the Judge which warranted this Court revisiting his decision.

Right of appeal

[6]      Counsel for Mrs Smith pointed out that there was some divergence as to whether there is a right of appeal against interlocutory orders made in relationship property proceedings given that s 39 of the Property Relationships Act 1976 (which

governs the right to appeal) does not appear to cover interlocutory orders.  However, as was concluded by John Hansen J in E v E,1  the general right of appeal from the District Court under s 72 of the District Courts Act 1947, gives an automatic right of appeal on interlocutory matters to this Court.

[7]      That said, I also note the observations of Panckhurst J in Dorchester Finance Ltd v Christchurch Food Courts Ltd.2   In that case he reiterated the Court of Appeal’s observations  in  Association  of  Dispensing  Opticians  of  New Zealand  Inc  v  The Opticians Board,3  that rulings made as part of the trial conduct or management process, as opposed to rulings which have some substantive effect on rights and liabilities in issue, are not necessarily susceptible to appeal.   In the case before Panckhurst J, he observed:4

To  my  mind it  is  questionable whether the  direction  for transfer  of  the Auckland file is one which is properly susceptible of appeal.  It is very much of a case management character, rather than being an order affecting (much less deciding) rights.

[8]      Here, as the decision was made pursuant to an interlocutory application by one of the parties, I cannot say that the outcome falls into the category of a case management  direction  only,  and  I  therefore  proceed  to  consider  this  appeal. However, it reinforces the reservations I will go on to express, as to the evidential and procedural standards which the appellant submits should apply in this case.

The statutory framework

[9]      The original application was brought under r 186.   That rule provides as follows:

A Court or Registrar may order that proceedings in Court be transferred to another Court if the Court or, as the case requires, the Registrar is satisfied that the proceedings can be more conveniently or fairly dealt with in that other Court.

1      E v E [2005] NZFLR 806.

2      Dorchester Finance Ltd v Christchurch Food Courts Ltd HC Auckland CIV-2005-404-6193

6 April 2006.

3      Association of Dispensing Opticians of New Zealand Inc v The Opticians Board [2000] 1 NZLR

158 (CA) at [36].

4      Dorchester Finance Ltd v Christchurch Food Courts Ltd, above n 2, at [19].

[10]     This rule needs to be read in light of the purpose of the rules set out at r 3 which provides:

(1) The purpose of these rules is to make it possible for proceedings in

Family Courts to be dealt with-

(a)  as fairly, inexpensively, simply, and speedily as is consistent with justice; and

(b) in such a way as to avoid unnecessary formality; and

(c)  in harmony with the purpose and spirit of the Family Law Acts under which the proceedings arise.

What happened in the lead up to hearing the application?

[11]     In  September  2014,  Mrs  Smith  filed  her  application  to  transfer  the proceedings to New Plymouth, along with a supporting affidavit.   Her evidence stated that she suffered from multiple sclerosis, which is a progressive disease of the central nervous system that affects movement, sensation and body functions, and she explained that the adverse effects of the disease are exacerbated by stress.   In her case, she says stress results in pain and severe numbness of her hands and legs.  This makes driving to a stressful event such as a Court hearing very difficult.  She says that until she moved in with her new partner, she was in receipt of an invalid’s benefit because of her illness.  She also says that she is:

Very worried that having to travel to Wanganui for Court proceedings will not only make me physically unwell but will also mean that I am not able to participate fully in the proceedings or participate in a way that will ensure that I am not disadvantaged by my medical condition.

[12]     Her affidavit attached a letter from her doctor which confirms that she suffers from multiple sclerosis.   It sets out the effects that Mrs Smith has advised she experiences and concludes with his comment that “I consider that medically, there should  be  serious  consideration  given  to  holding  the  Court  proceedings  in New Plymouth”.

[13]     She also points out that she will have childcare difficulties in caring for the

couple’s son if the proceedings are heard in Whanganui.

[14]     Mr Smith filed a notice of opposition, but did not file his affidavit evidence in support of that notice of opposition until 20 December 2014.  Mrs Smith notes that this was in contravention of r 230A of the Family Court Rules.   It was also in contravention of the directions of Judge Sygrove, dated 1 December 2014, which required him to file his affidavit in support of his notice of opposition within seven days, and noting that if he did not do so, “the matter would be dealt with on the papers that have been filed to date”.

[15]     Mr Smith’s affidavit evidence cast doubt on Mrs Smith’s claims that her

multiple sclerosis would impact on her ability to travel to Whanganui.  He said:

When Nicola was living with me she had her own car and regularly drove out of the city to Palmerston North and Wellington …  I believe she has her own car in New Plymouth and drives it regularly.  As Nicola is not working she could drive at a speed that best suits her and rest if and when required.

[16]     In support of his stance that it was more convenient for the proceedings to remain in Whanganui, he says “the property that is in question in the proceedings is in Wanganui …  Any expert witnesses that will be called at the hearing will be from Wanganui”, so it would be “more convenient for the proceedings to remain here to prevent unnecessary costs being incurred by witnesses who would be required to travel if the proceedings were transferred to New Plymouth”.  He expressed a view that “the personal decision by Nicola to move away from Wanganui should not be at my expense”, and, “I would need to take time off work to attend Court.  Nicola does not work so does not have that potential disruption to her life”.  He also suggested that Mrs Smith’s new partner could drive her down to Whanganui as he, too, had a young son in Whanganui whom he travels to see.

[17]     The application for transfer did not get set down for hearing at that stage. Instead, there was a settlement conference arranged for 8 July 2015 in which the parties and their lawyers participated.  The matter did not settle at that conference and   it   was   adjourned   to   a   further   settlement   conference   scheduled   for

14 December 2015.

[18]     On 16 November 2015, Mrs Smith filed a memorandum seeking vacation of the conference on the basis that some of the additional information that had been

sought from Mr Smith had not been provided.  Furthermore, the information that had been provided did not advance matters from Mrs Smith’s perspective.   In the circumstances, she thought it would not be productive to reconvene a settlement conference, but rather, the matter should progress to hearing.  At the same time she asked that the interlocutory application for transfer of the proceedings was determined, proposing that it “be dealt with on the papers, following written submissions by counsel”.

[19]     A response to that memorandum was sought from Mr Smith’s lawyer.   He explained that he was not able to get instructions immediately because he understood that Mr Smith was in hospital.  Finally, on 27 November 2015, Mr Unsworth was able to get instructions.  He said that his client “has accepted that the JSC can be vacated”, but “he is to get back to me early next week re the change of venue application.   I expect that it will continue to be opposed and I will let you know about that next week”.  He concluded by saying “I’ll get submissions to you as soon as possible”.

[20]    Judge Sygrove then issued a minute which recorded that the settlement conference scheduled for 14 December 2015 was vacated but “matter to remain allocated 14 December 2015 at which I will hear submissions from counsel on the issue   of   transfer   of   proceedings.      Written   submissions   to   be   filed   by

10 December 2015”.     That  minute  was  sent  out  to  the  parties  on  Monday,

30 November 2015.

[21]     Three days later, on 3 December 2015, Mr Unsworth filed a memorandum noting  that  submissions  would  be  heard  on  14 December  2015  but  seeking  a direction that Mrs Smith be made available for cross-examination at the hearing as his client disputed portions of her evidence and wanted it tested at the hearing.

[22]     Mrs Smith’s lawyer filed a memorandum opposing the request to have the

applicant made available for cross-examination.  While she acknowledged that there was jurisdiction to require a deponent to be available for cross-examination,5  she

5      Relying on the decision of the Family Court in A M U v A M R FC Auckland FAM-2008-004-

163, 7 October 2011.

said in that case the request to have the applicant available for cross-examination was made before the matter was set down for hearing.  Here:

Despite having ample opportunity to do so … the respondent did not request that  the  applicant  be  made  available  for  cross-examination  before  the direction was issued.

She also noted that the respondent

has  been  in  possession  of  the  applicant’s  affidavit  in  support  of  her application to transfer proceedings since early October 2014 and, other than filing his affidavit in response in December 2014, has taken no further steps to dispute the evidence contained in Mrs Smith’s affidavit nor sought to file a further affidavit.

[23]     On 11 December 2015, Judge Sygrove confirmed, via the Deputy Registrar,

that the matter would proceed on Monday as a “submissions hearing”.

[24]     From  Mr  Smith’s  perspective  this  did  not  dispose  of  his  request  to cross-examine the respondent and he again, at the hearing on 14 December 2015, sought a definitive ruling from Judge Sygrove as to the cross-examination request. Judge Sygrove refused the request.

First ground of appeal

The Judge erred in law in finding that cross-examination of the respondent was not necessary

[25]     This  somewhat  convoluted  background to  the  application  has  necessarily been set out in some detail (although not in the minute detail in which it was traversed by counsel), in order to provide context for the first ground of appeal raised by Mr Smith.

[26]     His lawyer argued that:

(a)       there is jurisdiction to require a deponent to be made available for cross-examination, as was the approach adopted in A M U v A M R;

(b)the applicable law is that set out in s 84(1) of the Evidence Act 2006 which   enshrines   the   usual   position   that   any   witness   may  be cross-examined; and

(c)      the general  right  to  cross-examine a witness  is also  supported  by s 27(1) of the New Zealand Bill of Rights Act 1990 which enshrines a litigant’s right to observance of the principles of natural justice.

[27]     In this case, Mr Unsworth submits that Mr Smith was “not afforded his right to observance of the principles of natural justice, namely the opportunity to test the respondent’s evidence through cross-examination”.  Furthermore, he says the Court did not consider his client’s request when he first made it, but delayed it to the hearing on 14 December 2015.   He submitted “by delaying addressing the issue, Judge Sygrove effectively pre-determined the outcome.  There was never going to be cross-examination”.   Furthermore, the reason given by Judge Sygrove for refusing the appellant’s request, namely because Mrs Smith’s medical condition “is what it

is”, was in error.6   He says Mr Smith challenged the effects that Mrs Smith claimed

to be suffering as a result of her condition and, because Judge Sygrove failed to identify “the factual issues in contention and that they could be resolved through cross-examination”, he erred in law in finding that cross-examination was not necessary.

Discussion

[28]     The Family Court Rules do not address the issue of when cross-examination of deponents will be allowed in the context of hearing an interlocutory application. While r 169 provides a procedure for parties seeking to cross-examine a deponent who has sworn an affidavit, I accept, as the commentary in Brookers Family Procedure states, that r 169 relates to the final hearing and there is no right to serve a r  169  notice  in  respect  of  an  affidavit  intended  to  be  used  in  an  interlocutory

application.7

6      Smith v Smith [2015] NZFC 10783 at [15].

7      Patrick Mahoney (ed) Brookers Family Law – Family Procedure (online looseleaf ed, Thomson

Reuters) at FC 169.01.

[29]     Part 4 of the Family Court Rules, which expressly deals with interlocutory matters, provides no procedure for requiring deponents for cross-examination.  The only provision in the Family Court Rules which deals with evidence in interlocutory matters is r 224 which provides:

No affidavit need be filed with an application in the first instance, but the Judge or Registrar may direct evidence to be given in any manner the Judge or Registrar thinks fit.

[30]     In  both  the  High  Court  and  the  District  Court,  leave  is  required  to cross-examine  on  affidavits  in  interlocutory  proceedings.8     Furthermore,  the District Court Rules require there to be “special circumstances” for a Judge to order a  person  who  has  sworn  an  affidavit  in  support  of,  or  in  opposition  to,  an interlocutory application, to attend for cross-examination.

[31]     Given the purpose of the Family Court Rules set out in [10] above, I do not consider that cross-examination should be permitted on interlocutory applications any more freely than in the District Court.

[32]     I accept that cross-examination has all the benefits for which Mr Unsworth contends.   However, affording the right to cross-examine also extends hearings, makes them more confrontational and adversarial, and increases the cost and delay in the proceedings. A Family Court Judge, in dealing with the request to cross-examine a deponent, whether made formally or informally, must exercise a discretion under r 224 as to whether, in the interests of justice, cross-examination should be allowed, taking into account the detriment that may have in terms of conducting the proceedings speedily and inexpensively.

[33]     Relevant  to  the  consideration  of  such  requests  is  whether  the  matter  in dispute  affects  the  substantive  rights  of  the  party  as  opposed  to  affecting  the procedure to be adopted through which those substantive rights will be determined.

[34]     In this case, I consider the application involved a procedural issue.  While the outcome of the application would cause some inconvenience and/or unfairness to

one  party  or  the  other,  it  would  not  determine  their  substantive  rights  in  the

8      High Court Rules, r 7.28 and District Court Rules, r 7.21.

proceedings.  Furthermore, the observance of the principles of natural justice which Mr Unsworth contends so strongly for, must be proportionate to the issues at stake. It does not automatically direct a right to cross-examine witnesses on any contested matter.   The requirement of natural justice can be met through a hierarchy of processes, dependent on the issues at stake.  These may range from a right to provide a written response, through to participation in a full hearing where evidence is tested through cross-examination.

[35]     I consider that  it  was  entirely open  to  the Judge,  in  the exercise  of  his discretion, to limit the right of audience to a submissions hearing only.   I do not consider that he ignored the respondent’s request for a cross-examination until the date of hearing.  It is clear that his response he issued on 11 December 2015 to the parties’ memoranda was that:

(a)       he   determined   a   hearing   was   required,   rather   than   accepting

Mrs Smith’s proposal that the matter be dealt with on the papers; and

(b)      he  rejected  Mr  Smith’s  request  to  cross-examine  Mrs Smith,  by

reiterating it would be a “submissions hearing”.

[36]     The Judge’s comment that the medical evidence “is what it is” was also unexceptional.   It was accepted by Mr Unsworth that Mrs Smith did suffer from multiple sclerosis and this is what the Judge was referring to.  The fact that Mr Smith considered Mrs Smith could travel in a way which was less stressful was already apparent from his affidavits.

[37]     As  was  said  in  T  v  Jones,9   “In  all  litigation  the  procedures  must  be proportionate  to  the  occasion”.    The  Judge’s  decision  to  reject  the  request  to cross-examine Mrs Smith was a proportionate procedural decision on this occasion. The appeal on this ground is dismissed.

Second ground of appeal

The Judge erred in law in finding that a formal application to cross-examine the respondent was required

[38]     Mr    Unsworth    submitted    that    the    Judge    wrongly    refused    the cross-examination request based on the absence of a formal application.  However, having regard to the decision, it was the belated nature of the application which was more  relevant.     The  Judge  said  “there  has  been  no  formal  application  to cross-examine her in regard to [her medical condition] on a prior occasion”.

[39]     I do not consider that this statement amounts to a finding that a formal application to cross-examine the respondent was required.   The Judge clearly considered Mr Smith’s informal application and declined it.  He pointed out that one of the reasons for not granting the application was that no “prior” application had been made, the request to cross-examine only having occurred after the matter had been allocated a submissions only hearing.   This reflected a submission made by Mrs Smith that the lateness of the request was a factor in favour of declining it.

[40]     For these reasons I find there was no error and this ground of appeal is dismissed.

Third ground of appeal

The  Judge  erred  in  law  in  failing  to  properly  apply  the  test  for  transfer  of proceedings in r 186 of the Family Courts Rules 2002, as interpreted by case law

[41]     There was no dispute as to the relevant legal test for transfer of proceedings under r 186 of the Family Court Rules.  That rule empowers a Court to order that proceedings be transferred to another Court if the Court is satisfied that the proceedings can be more conveniently or fairly dealt with in that other Court.

[42]     As the Court of Appeal accepted in Consumer Council v Pest Free Service

Ltd, the question:10

must be determined by a process of balancing the factors that are relevant to the consideration of convenience and in the same way evaluating the matters relevant to fairness and then arriving at an overall just decision thereon.

[43]     Similarly, in Richardson v Richardson,11 considering the similar provision in the Family Proceedings Rules 1981, it was held that:12

Both the balance of convenience and the balance of fairness must be considered and, where necessary, balanced against each other.

[44]     Mr Unsworth submitted that case law required the Court to:

(a)      identify the factors relevant to the considerations of convenience and fairness on both sides;

(b)determine  the  relative  weight  to  be  applied  to  those  factors  and balance them against each other; and

(c)      arrive  at  an  overall  just  decision  based  on  the  outcome  of  the balancing exercise and, if necessary, a further balancing exercise between competing considerations of convenience and fairness.

[45]     His criticism of Judge Sygrove’s decision was that it:

merely selectively restates the various submissions of counsel and then appends a ruling at the conclusion.   His decision does not identify the weighting he gave to the various advantages and disadvantages of transfer identified by counsel, nor is there is any express balancing of the opposing factors reflected in his decision.  Nor, finally, a balancing of his conclusions on the consideration of convenience and on the consideration of fairness, against each other.

[46]     Ms McKenzie, in response, said it is clear that the Judge considered the various submissions made by counsel, accepting some and rejecting others, which, in itself, comprised the balancing exercise required.   He addressed both the issue of convenience  and  the issue of  fairness  and  it  is  implicit  in  his  decision  that  he considered that the issue of fairness did reach the required threshold to satisfy him

that the proceedings could be more fairly dealt with in New Plymouth.

11     Richardson v Richardson (1989) 5 NZFLR 436.

12     At 438.

[47]     I have no doubt that, looked at holistically, the Judge fully appreciated the relevant legal test.  It is clear from his conclusions on the issue of convenience that he considered Mrs Smith had not discharged the onus, as there were factors pointing either way on that count.   However, on the issue of fairness, he accepted that the difficulties Mrs Smith would experience in having to travel to New Plymouth did discharge the onus which, as described in the Consumer Council case, “is not to be

regarded as an especially difficult onus to discharge”.13   In Richardson, the factors of

fairness and convenience only needed to be balanced against each other “where necessary”.  Here, where the factor of convenience did not point strongly either way, but the factor of fairness did, I consider there was then no need to conduct an express balancing exercise.

[48]     Again, I do not consider there was any error by the Judge on this count and this ground of appeal is unsuccessful.

Fourth ground of appeal

The Judge erred in law and/or principle in his treatment of unsworn evidence

[49]     Mr Unsworth was critical of the weight the Judge put on the unsworn letter from Dr Peter Rich which was annexed to the respondent’s affidavit, saying that it was a hearsay statement which did not “provide a straight answer as to whether the respondent would be disadvantaged by the proceedings remaining in Wanganui”.  He also considered the decision relied in part on “unsworn evidence offered by counsel for  the  respondent”,  citing  the  example  of  Mrs  Smith’s  lawyer  explaining  that Mrs Smith moved to New Plymouth because she did not have a circle of friends in Whanganui and therefore did not have any support.

[50]     Ms McKenzie in reply pointed out that Mrs Smith’s affidavit did refer to the support  that  she  gained  from  her  partner  in  New  Plymouth,  so  there  was  an evidential basis for this conclusion.   Furthermore, the letter from Dr Rich simply endorsed the evidence of Mrs Smith, and it was her affidavit evidence which the

Judge primarily relied on.

13     Consumer Council v Pest Free Service Ltd, above n 10, at 18.

[51]     Again, I do not consider the Judge was in error in the weight he placed on this evidence.  It is clear from his decision that he relied on Mrs Smith’s evidence and the only weight he placed on the doctor’s letter was that it “confirmed that she had that condition and it is clearly a factor that I need to take into account”.  Having regard to the purpose of the Family Court Rules, and the fact the only weight placed on the doctor’s letter was that it confirmed her medical condition, I do not consider the Judge erred in law or principle in his treatment of unsworn evidence.

[52]     This ground of appeal also fails.

Fifth ground of appeal

The Judge erred in law and/or principle in his treatment of untested and disputed evidence

[53]     This ground is essentially an adjunct to the first ground.  The argument for Mr Smith is that because cross-examination was not allowed, the concerns he raised about the reliability of Mrs Smith’s assertions as to her ability to travel could not be tested.  While he accepts that the affidavit outlines her difficulties in driving, he says it does not dispose of her ability to travel to the hearing in some other way, including by bus or being driven by another party.  All that could have been tested through cross-examination.   However, Ms McKenzie points out that Mrs Smith does not simply refer in her affidavit to difficulties with driving but also with travelling generally, and there was no error in the Judge placing weight on that evidence.

[54]     Again, I consider that there was no general right to require the witnesses to be cross-examined  and,  in  the  ordinary  course  in  an  interlocutory  application, cross-examination is to be avoided where possible, in order to achieve the purpose of the Family Court Rules.  This is particularly the case where the matter at issue is procedural in nature and not determinative of the parties’ substantive rights.

[55]     I consider it was entirely open to the Judge to make his own assessment of the  evidence,  and  he  was  clearly  aware,  from  Mr  Smith’s  own  affidavit,  that Mr Smith contested some of Mrs Smith’s claims.

[56]     This ground of appeal also fails.

Conclusion

[57]     All  grounds  of  appeal  fail.     The  Family  Court  Judge’s  decision  on

Mrs Smith’s application for transfer of the proceedings is upheld.

[58]     It will be clear from my conclusions on each ground that the points raised on appeal did not take sufficient regard of the purpose of the Family Court Rules and the requirement that the procedure to be adopted needed to be proportionate to the substance of the matter being litigated.  It is to be hoped that a more pragmatic and efficient approach is adopted in the resolution of the substantive issues.

[59]     Mrs Smith seeks costs.  I consider this is a case where it is appropriate for costs to follow the event.  I expect costs to be agreed on a 2B basis.  If costs cannot be agreed, I reserve the right for the parties to file memoranda on costs, limited to five pages.  The respondent’s memorandum is to be filed within 20 working days of this decision and the appellant’s within 25 working days.

[60]     In the event I need to determine costs, I will do so on the papers, unless I

decide I need hear from counsel.

Solicitors

Horsley Chistie, Wanganui

Govett Quilliam, New Plymouth