Tourism Holdings Limited v Thorburn Consultants (NZ) Limited HC Auckland CIV 2009-404-8051

[2010] NZHC 984

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

CIV-2009-404-8051

BETWEEN  TOURISM HOLDINGS LIMITED Plaintiff

ANDTHORBURN CONSULTANTS (NZ) LIMITED

First Defendant

ANDAPG THOMPSON LIMITED Second Defendant

ANDAIR ACTION INSTALLATION LIMITED

Third Defendant

AND  PLASFAB INSTALLATIONS 1977

LIMITED

Fourth Defendant

Hearing:         17 June 2010

Appearances: R Butler for plaintiff

P Napier for first defendant
K Robinson for second defendant
K R Mendez for third defendant
A R Armstong for fourth defendant

Judgment:      23 June 2010 at 4 pm

JUDGMENT OF ASSOCIATE JUDGE DOOGUE

This judgment was delivered by me on

23.06.10 at 4 pm, pursuant to

Rule 11.5 of the High Court Rules.

Registrar/Deputy Registrar

Solicitors:

Date……………

Jones Fee, P O Box 1801, Auckland for plaintiff

Keegan Alexander, P O Box 999, Auckland for first defendant
McElroys, P O Box 835, Auckland for second defendant
Fortune Manning, P O Box 4138, Auckland - for third defendant

Young Hunter, P O Box 929, Christchurch –for fourth defendant

TOURISM HOLDINGS LIMITED V THORBURN CONSULTANTS (NZ) LIMITED AND ORS HC AK CIV-

2009-404-8051  23 June 2010

[1]      In this proceeding the second defendant has issued a cross-claim against the first defendant.  The second defendant no longer wishes to continue with the cross- claim and seeks to discontinue that claim.  The third defendant resists that step being taken.  Mr Napier for the first defendants referred me to r 15.20(4) which states:

If there is more than 1 defendant in a proceeding, a plaintiff may discontinue a proceeding against a particular defendant only with the consent of every other defendant or with the leave of the court. If the plaintiff files a notice of discontinuance under rule 15.19(1)(a), the consent of every other defendant must be in writing.

[2]      Ms Mendez says that the third defendant for whom she acts can oppose the discontinuance.    She pointed to what she said was an absence of prejudice on the part of the first defendant if it was not removed from the proceeding.   I understand that Ms Mendez submits that allowing the second defendant to discontinue against the first defendant would be inconsistent with the continued existence of the cross- claim which the third defendant has brought against the first defendant.   That particular claim is subject to an application for summary judgment, which the first defendant has filed against the third defendant.

[3]      Rule  15.20  does  not  explicitly  apply  to  a  case  like  this.     The  rule contemplates  that  “a  plaintiff”  may  discontinue  a  proceeding.    In  the  rules  a “plaintiff” is deemed to include a counter-claim plaintiff but that is as far as the rules go.  While the liability that a defendant seeks to base a cross claim on is a secondary one, in the sense that it only comes into existence if a plaintiff first successfully establishes liability against a defendant, the requirements of the rules are that the claim for relief be in the form of a statement of claim and the cross-claim defendant is required to file a statement of defence: r 4.21.  In that respect, the assimilation of the  procedures  would  suggest  that  a  substantially similar  approach  ought  to  be adopted where a cross “claimant” seeks to discontinue the cross claim.  In any event, there being no specific rule covering this contingency, the Court has the power to regulate its own procedure by analogy with rules “affecting any similar case”: r 1.6.

[4]      On the assumption that  the second  defendant  cannot discontinue without leave, the starting point ought to be that the cross-claimant should be able to make its

own choice as to whether or not it takes proceedings against any other party, including a co-defendant, and should not be compelled to continue in a proceeding that it does not wish to.  A party who wishes to oppose the discontinuance needs to show that there is some good reason why the defendant claimant should be prevented from doing so.

[5]      It is difficult to see what good reason there can be in this case.   It is not in a legal sense necessary for the third defendant to have the claim between the second defendant and first defendants remain in existence.   The claim only becomes of relevance in the event that liability is found against the second defendant who will then seek to pass part or all of that liability on by way of its cross-claim against the first defendant.  None of this affects the third defendant.  This is not one of those cases where a defendant can insist that another defendant remain in the proceeding so that a binding judgment can be obtained, as was the case in the exceptional circumstances of Mainzeal Corp Ltd v Contractors Bonding Ltd (1989) 2 PRNZ 47.

[6]      For these reasons, I grant leave to the second defendant to discontinue its claim against the first defendant.

J.P. Doogue

Associate Judge