Virtual Spectator Ltd v Rothlander
[2016] NZHC 499
•30 March 2016
IN THE HIGH COURT OF NEW ZEALAND
AUCKLAND REGISTRY
CIV-2011-404-858
[2016] NZHC 499
BETWEEN VIRTUAL SPECTATOR LIMITED
Plaintiff
AND
STEPHAN MARK ROTHLANDER AND
ANN ELIZABETH CONBOY
Defendants
Hearing: 2 and 3 March 2016 Appearances:
H M McKee for Defendants in support K P McDonald for Plaintiff to oppose
Judgment:
30 March 2016
JUDGMENT OF ASSOCIATE JUDGE R M BELL
This judgment was delivered by me on 30 March 2016 at 4:00pm
pursuant to Rule 11.5 of the High Court Rules
…………………………………………………….
Registrar/Deputy Registrar
Solicitors:
Glaister Ennor, Auckland, for Plaintiff
Kevin McDonald & Associates, Auckland, for Defendants
VIRTUAL SPECTATOR LIMITED v ROTHLANDER AND CONBOY [2016] NZHC 499 [30 March 2016]
[1] The defendants apply to remove caveat 8591429.1 lodged by Virtual Spectator International Ltd against the title to their Auckland home and for an order suppressing information that might identify them. They say that it is now clear that the caveator does not have a caveatable interest in the property, it delayed in issuing any court proceedings to uphold the interest claimed in the caveat and it agreed to withdraw the caveat.
[2] Virtual Spectator International Ltd employed Mr Rothlander as chief operating officer from June 2003 to March 2010. It alleged that he embezzled its money. On 5 November 2010 it lodged a caveat against the defendants’ home claiming this interest:
An equitable interest in the land comprised in the composite computer register NA116C/838 (the land) as beneficiary of an implied trust created on or about 1 May 2010 arising as a result of a breach of duty owed to the caveator (as employer) by Stephan Mark Rothlander acting in a fiduciary capacity as employee by the conversion and application of monies belonging to the caveator for the benefit of the registered proprietors, Stephan Mark Rothlander and Ann Elizabeth Conboy, by applying such monies towards their interest in and/or directly or indirectly benefiting the interest of the registered proprietors in the freehold of the land.
[3] In early 2011 Virtual Spectator International Ltd applied for an order that the caveat not lapse. On 24 February 2011, Associate Judge Doogue made an interim order that the caveat not lapse. On 31 March 2011 he made a further order staying proceedings until further order of the court and reserving leave to Virtual Spectator International Ltd to have the matter re-listed if necessary.
[4] The background to the stay order is that the police had laid criminal charges against Mr Rothlander and another employee, Mr Bruno Jardim. Mr Rothlander sought the stay of any civil proceedings until his criminal proceedings had been determined so as to preserve his fair trial rights under the New Zealand Bill of Rights Act 1990. The criminal trial took place in the Auckland District Court in August and September 2013. The trial judge made rulings under s 347 of the Crimes Act 1961 withdrawing all but one of the charges against Mr Rothlander. On the remaining charge the jury acquitted Mr Rothlander.
[5] In 2012 a number of associated companies, including Virtual Spectator International Ltd, were amalgamated under Part 13 of the Companies Act 1993. The new amalgamated company is Virtual Spectator Ltd, which has succeeded to all the rights of Virtual Spectator International Ltd. The new company is accordingly substituted for the old as plaintiff.
[6] Mr Rothlander and his wife filed the present application on 24 November 2015. Between the end of the jury trial and August 2015, neither side did anything in relation to the caveat. There was no application to lift the stay. Virtual Spectator Ltd did not issue any civil proceedings against Mr Rothlander in respect of the alleged embezzlement or to uphold the interest it claimed in the caveat.
[7] The defendants contend that as a result of correspondence passing between lawyers in September 2015 there was an agreement that the caveat should be removed. In the meantime, Virtual Spectator Ltd has uplifted records from the police. It now wishes to start a civil proceeding against Mr Rothlander to uphold the substantive interest claimed in the caveat and to obtain other relief against Mr Rothlander.
Principles on applications to remove caveats
[8] Subject to what I say in [10] below, in applications to remove caveats under s 143 of the Land Transfer Act 1952, the caveator has the onus of showing a reasonably arguable case for the interest claimed. The interest must come within s 137(1) of the Act. A personal or contractual right is not enough: the caveator must show an entitlement to a beneficial interest in the land in the caveat. Something more than a potential interest is required. Caveat applications are summary and therefore not suited for deciding disputed questions of fact. On the other hand, the court is not required to accept uncritically as raising a dispute of fact which calls for further investigation, every statement in an affidavit however equivocal, lacking in precision, inconsistent with undisputed contemporary documents or other statements by the same deponent, or inherently improbable in itself it may be. For a caveat to be removed, it must be patently clear that the caveat cannot stand because there was no ground for lodging it at the time it was lodged or because any such ground no longer exists. The court has a residual discretion not to uphold a caveat but that is exercised cautiously,
as when the caveat could serve no useful purpose or alternative safeguards are available.
[9] To establish a reasonably arguable case there must be evidence tending to prove the facts relied on. Assertion, whether in pleadings or affidavit, is not enough. The evidence need not be as extensive as that given in a hearing on the substantive merits. It may be circumstantial. But if there is no evidence to prove the facts contended for, the caveator will not have made out a reasonably arguable case for those facts.
[10] As a qualification to the reasonably arguable standard, where there are allegations of fraud or other reprehensible conduct, it is necessary to show a prima facie case. In Schmidt v Pepper New Zealand (Custodians) Ltd, the Court of Appeal said:1
Allegations of fraud or dishonesty are very serious. They must be pleaded with care and particularity. As the authors of Bullen & Leake & Jacobs Precedence of Pleadings emphasise, counsel must not draft any originating process or pleading containing any allegation of fraud unless they have reasonably credible material which, as it stands, establishes a prima facie case of fraud – that is, material of such a character which would lead to the conclusion that serious allegations could properly be based upon it. Fraud cannot be left to be inferred from the facts – fraudulent conduct must be distinctly alleged and as distinctly proved. General allegations, however strong the words may appear to be, are insufficient to amount to a proper allegation of fraud.
See also Trustees Executors Ltd v Steve G Ltd, Paugra Holdings Ltd v Harvestfield Holdings Ltd and S v XYZ Ltd.2
[11] The defendants also submitted that delay by a caveator may provide grounds for removal under s 143. I deal with this aspect below at [62]- [67].
1 Schmidt v Pepper New Zealand (Custodians) Ltd [2012] NZCA 565 at [15].
2 Trustees Executors Ltd v Steve G Ltd [2013] NZHC 16 at [63]-[66], Paugra Holdings Ltd v Harvestfield Holdings Ltd [2013] NZHC 1297 at [78] (overturned on appeal, but not on this point
– Paugra Holdings Ltd v Harvestfield Holdings Ltd [2014] NZCA 164, (2014) 15 NZCPR 227 and S v XYZ Ltd [2016] NZHC 26 at [6].
The agreement to withdraw the caveat
[12] On 3 August 2015, the lawyers for the defendants wrote to the lawyer for Virtual Spectator Ltd regarding the caveat and inviting it to sign a withdrawal. Virtual Spectator Ltd’s lawyers replied by email on 4 September 2015. Relevant parts of the email said:
There is an issue between Virtual Spectator International Ltd (now Virtual Spectator Ltd “VSL”) Stephan Rothlander and Bruno Jardim regarding property owned by VSL seized held as evidence by the New Zealand Police.
Our client would be prepared to withdraw the caveat once Stephan Rothlander and Bruno Jardim have released the goods owned by VSL being held by the Police. It would appear that Gill Holland, acting Detective Sergeant, Financial Crime Unit, has previously been in contact with your client and Mr Jardim regarding this release. However as yet she has not received either authorisations.
Stephan Rothlander and Bruno Jardim both need to sign a letter addressed to the New Zealand Police, authorising release of the goods held to a representative of Virtual Spectator Ltd. Once the goods have been released we can arrange a withdrawal of the caveat.
[13] Gill Holland, the police officer, emailed Mr Rothlander, confirming that she had spoken to the lawyer for Virtual Spectator Ltd and confirmed to Mr Rothlander he had agreed to release the property taken from his home when he was arrested. Her email also stated that she was arranging to deposit all the property with Virtual Spectator’s lawyer. The lawyer was happy to accept her word. The same day, Mr Rothlander’s lawyers emailed Virtual Spectator’s lawyer, forwarding Ms Holland’s email and indicating that that was intended to record Mr Rothlander’s consent to the release of the goods to Virtual Spectator. While the defendants’ lawyers have sent a withdrawal of caveat to the lawyer for Virtual Spectator Ltd for signing, it has refused to withdraw the caveat. It has maintained its opposition until now.
[14] By way of background to that exchange of correspondence the police had executed a search warrant on Mr Rothlander’s home and had seized certain items alleged to belong to Virtual Spectator International Ltd. The police kept those items after the prosecution. While there is no direct evidence on the point, it is likely that the police would not have handed the items over to Virtual Spectator without being
assured that Mr Rothlander would not make any claim against them for not returning the items taken under the search warrant.
[15] The defendants say that with the delivery of the items by the police to the lawyers for Virtual Spectator Ltd, they met their obligation under an agreement reached with Virtual Spectator and it in turn was required to withdraw the caveat. It may be noted that the contract they allege was unilateral. It was to be performed by Mr Rothlander and Mr Jardim authorising release of the goods to Virtual Spectator. That performance constituted acceptance of the offer in the email of 4 September 2015.
[16] Opposing, Virtual Spectator Ltd says that it was not bound contractually. It did not promise to withdraw the caveat and there was no consideration for any such promise. It does however accept that it is bound by the actions of its lawyer, who was acting with authority.
[17] As to the absence of any contractual promise, Virtual Spectator Ltd promotes a literal approach to the interpretation of the email of 4 September 2015. It says that it does not show any contractual undertaking. The words “our client would be prepared” are no more than an indication of possible future intention and “we can arrange a withdrawal” is a statement of ability, not a statement of intention.
[18] These words must be read in context. It is a characteristic of New Zealand usage to soften words of commitment, as can be seen in this email. Such softened language should not disguise the fact that Virtual Spectator’s lawyer was proposing a definite arrangement that upon the goods being released to Virtual Spectator, the caveat would be withdrawn. The words did convey a clear commitment to withdraw the caveat upon release of the goods.
[19] As to absence of consideration, Virtual Spectator submitted that Mr Rothlander gave no consideration, because he had no right or interest in the goods taken from his home under the search warrant.
[20] “A practical benefit will qualify as consideration as well as the legal benefit of an enforceable promise.”3 Here there was a practical advantage to Virtual Spectator Ltd in Mr Rothlander giving his consent to the release of the goods to it. Difficulties in obtaining the return of the goods, which might otherwise have required court proceedings, were obviated by Mr Rothlander giving consent. In short, Mr Rothlander provided consideration for the promise to withdraw the caveat. It is, of course, not necessary to assess the sufficiency of the consideration.
[21] A matter that was not relied on at the hearing is that the email of 4 September referred to Bruno Jardim also consenting to the release. He had been convicted and had served a sentence of imprisonment. There is no evidence that he provided consent but in the event that appears not to have been necessary because Virtual Spectator obtained the return of the goods on the approval of Mr Rothlander alone.
[22] Accordingly, there was a binding contract for the withdrawal of the caveat which Virtual Spectator Ltd was required to carry out upon the goods being returned to it. The defendants are accordingly entitled to an order for removal of the caveat.
The embezzlement allegations against Mr Rothlander
[23] That finding is enough to decide the removal application. Virtual Spectator Ltd sought rulings on the remaining issues, in case it wished to take the matter further. For that it is necessary to set out more on the embezzlement allegations against Mr Rothlander.
[24] Virtual Spectator International Ltd’s business was creating 3D graphic software, including GPS tracking modules, for broadcasting sports events. At relevant times, its shareholders were overseas interests and its directors lived outside New Zealand. Mr Rothlander was the chief operating officer. There are differences whether he was the company’s senior executive, but it is not in dispute that he was a senior executive. Mr Jardim was the chief financial officer. There is evidence that Mr Jardim embezzled substantial funds. He submitted bogus invoices to the company for
3 Attorney-General for England and Wales v R [2002] 2 NZLR 91 (CA) at [51]. See also John Burrows, Jeremy Finn and Stephen Todd Law of Contract in New Zealand (5th ed, LexisNexis, Wellington, 2016) at [4.6.2(b)].
payment, when the services had not been provided and the invoicing entity was under his control. Another fraud was to divert payments to his own bank account by putting that number on the company’s invoices to its debtors. He is also alleged to have misused the company’s credit card for personal use.
[25] Virtual Spectator Ltd claims that Mr Rothlander was implicated in Mr Jardim’s frauds and also that he separately misappropriated company funds. Mr King, a director of Virtual Spectator Ltd, states that inquiries have shown that Mr Rothlander and his wife benefited from:4
(a)Fraudulent invoices presented and funds deceptively obtained under WebFX and Arclight letterhead for services which were either not provided and/or were within Mr Rothlander’s contractual responsibilities and already paid for;
(b)Knowing receipt - money laundering related to amounts received into the bank account of Mr Rothlander and his wife from funds illegally obtained by Mr Jardim and his wife;
(c)Funds obtained from “consulting services” used as a device to pay himself more monies than he was legally entitled from Virtual Spectator International Ltd as his contract prohibited such outside activities;
(d)Benefits obtained from interests in, whether direct, indirect or implied, in new companies established by or with his assistance for the purpose of misappropriating Virtual Spectator International Ltd’s intellectual property, clients and revenue;
(e)Additional holiday pay resulting from unauthorised increases in vacation time for Mr Rothlander and Mr Jardim from four weeks to eight weeks per year;
4 King affidavit, paragraph [10].
(f)Misuse of credit cards by coding personal expenses as business expenses (including their honeymoon);
(g)Personal cash advances and credit card purchases not repaid;
(h)Payments for services benefiting the Rothlander family and other benefits to them including funds deposits into their accounts; and
(i)Other unspecified personal benefits “yet to be discovered.”
[26] By itself Mr King’s affidavit is no more than assertion. It does not contain detailed evidence to support these allegations. Virtual Spectator Ltd has bolstered its case by exhibiting documents received from the police used in the investigation and prosecution of Mr Jardim and Mr Rothlander. The defendants object to those documents being admitted.
[27] For the hearing Virtual Spectator Ltd did not rely on all of Mr King’s allegations. In submissions, it outlined four heads of liability:
(a)Mr Rothlander fraudulently billed Virtual Spectator International Ltd a total of $35,952.00 between April 2004 and October 2008 by submitting fictitious invoices through his businesses, WebFX and Arclight.
(b)Between November 2005 and April 2010, Mr Jardim embezzled
$767,897 from Virtual Spectator International Ltd. Mr Rothlander gave him knowing assistance.
(c)Between August 2006 and November 2008, Mr Jardim made payments to Mr Rothlander totalling $73,296. These funds belonged in equity to Virtual Spectator International Ltd and Mr Rothlander is liable in knowing receipt.
(d)Between April 2007 and July 2008, Mr Rothlander fraudulently claimed $110,000 worth of personal expenses as business expenses from Virtual Spectator International Ltd.
[28] Virtual Spectator Ltd can however rely on those heads of liability only if it has put them in issue by appropriate pleading. That is particularly important in this case as three of the heads involve allegations of fraud or dishonesty.5 (The knowing receipt claim does not necessarily require proof of knowledge or may require no more than constructive knowledge).6 The Court of Appeal’s insistence in Schmidt v Pepper New Zealand (Custodians) Ltd7 on fraudulent conduct being distinctly alleged and distinctly proved applies here. Virtual Spectator Ltd has however only pleaded the first head of liability: both in its application in February 2011 that the caveat not lapse and in its notice of opposition to the removal application. In the absence of appropriate specific pleadings Mr Rothlander cannot be expected to answer the wide-ranging allegations against him. I am required to consider only the pleaded head of liability – for fictitious WebFX and Arclight invoices. For those, Virtual Spectator Ltd says that Mr Rothlander was dishonest: he arranged for the invoices to be paid knowing them to be false and that he had not done any of the work in the invoices.
[29] To establish a property claim Virtual Spectator Ltd says that Mr Rothlander breached a fiduciary duty to his employer. Mr Rothlander did not dispute that as a senior employee some of the duties he owed his employer were fiduciary in character and that he would arguably breach them if he used his position to obtain payments to which he was not entitled.8 Nor did he dispute that his employer would be able to claim the proceeds of any such breach of fiduciary duty.
[30] Virtual Spectator Ltd says that Mr Rothlander used funds he received to pay the mortgage on the caveated property and as a result it has an equitable interest in the
5 For the requirement to prove dishonesty in claims of knowing assistance, see Royal Brunei Airlines Sdn Bhd v Tan [1995] 2 AC 378 (PC).
6 See the discussion in Andrew Butler (ed) Equity and Trusts in New Zealand (2nd ed, Thomson Reuters, Wellington, 2009) at [18.4].
7 Schmidt v Pepper New Zealand (Custodians) Ltd, above n 1.
8 Mr Rothlander did not accept that all the allegations against him gave proprietary claims. In particular he said that the claims for using credit cards were personal only. Similarly any claims for knowing assistance would not give any proprietary claim, except to the extent that he received any benefits.
property. This aspect of its claim arises under the law of subrogation. Since the decision of the House of Lords in Banque Financière de la Cité v Parc (Battersea) Ltd, it has been routine to note the distinction between subrogation arising under contract and subrogation as an equitable remedy to reverse or prevent unjust enrichment.9 The claim in this case is based on unjust enrichment. Lord Hoffmann noted:10
But I think it should be recognised that one is here concerned with a restitutionary remedy and that the appropriate questions are therefore, first, whether the defendant would be enriched at the plaintiff's expense; secondly, whether such enrichment would be unjust; and thirdly, whether there are nevertheless reasons of policy for denying a remedy.
[31] In Boscawen v Bajwa, Millett LJ showed that subrogation is a restitutionary remedy directed at one particular form of enrichment, but is based on general principles that apply in other cases of enrichment:11
If the plaintiff succeeds in tracing his property, whether in its original or in some changed form, into the hands of the defendant, and overcomes any defences which are put forward on the defendant's behalf, he is entitled to a remedy. The remedy will be fashioned to the circumstances. The plaintiff will generally be entitled to a personal remedy; if he seeks a proprietary remedy he must usually prove that the property to which he lays claim is still in the ownership of the defendant. If he succeeds in doing this the court will treat the defendant as holding the property on a constructive trust for the plaintiff and will order the defendant to transfer it in specie to the plaintiff. But this is only one of the proprietary remedies which are available to a court of equity. If the plaintiff's money has been applied by the defendant, for example, not in the acquisition of a landed property but in its improvement, then the court may treat the land as charged with the payment to the plaintiff of a sum representing the amount by which the value of the defendant's land has been enhanced by the use of the plaintiff's money. And if the plaintiff's money has been used to discharge a mortgage on the defendant's land, then the court may achieve a similar result by treating the land as subject to a charge by way of subrogation in favour of the plaintiff.
[32] For its subrogation claim, Virtual Spectator Ltd needs to trace the payments Mr Rothlander received into mortgage payments. Mr Rothlander says that it cannot do so because his wife paid the mortgage, not funds from Virtual Spectator International Ltd.
9 Banque Financière de la Cité v Parc (Battersea) Ltd [1999] 1 AC 221 (HL). See also Menelaou v Bank of Cyprus [2015] UKSC 66, [2016] AC 176.
10 At 234.
11 Boscawen v Bajwa [1996] 1 WLR 328 (CA) at 334–335.
Procedural and evidential matters
[33] Before the merits of the fictitious invoices claims can be considered, it is necessary to deal with certain procedural and evidential matters.
[34] There was minor slippage by both sides in filing affidavits, but neither side has been prejudiced. I ruled in the hearing that I would read all affidavits, notwithstanding that some came in late.
Objection to Mr Rotherlander’s reply affidavit
[35] Virtual Spectator Ltd objected to paragraphs 34-54 of Mr Rothlander’s affidavit in reply of 19 February 2016 on the ground that their content was not confined to matters strictly in reply under r 9.76(1)(d)(ii) of the High Court Rules. When Virtual Spectator International Ltd applied to sustain the caveat in 2011, its affidavit evidence related amongst other things to its claims against Mr Rothlander for alleged fictitious Web FX and Arclight invoices. In his affidavit of 23 November 2015 in support of the removal application, Mr Rothlander did not address in detail the allegations made in the 2011 affidavits. On the other hand his reply affidavit did address those affidavits. Virtual Spectator Ltd submits that the time for Mr Rothlander to address those matters was in his first affidavit in support of the removal application, not in his reply affidavit. It complains that he has introduced new material in his reply affidavit to which it has not had the opportunity to reply.
[36] In his removal application, Mr Rothlander pleaded that the caveat can no longer be maintained as there were no valid grounds to do so. His case was that in light of the failure of the prosecution against him (as well as the agreement to withdraw the caveat and delay by Virtual Spectator), there is no longer a proper basis for the caveat to remain against the title. He did not set out in his initial application to show on the facts that he was not responsible for the embezzlement alleged by Virtual Spectator.
[37] In its notice of opposition of 11 December 2015, Virtual Spectator Ltd did put its fictitious invoices claims against Mr Rothlander in issue and its affidavit evidence
addressed that issue. The evidence addressed other matters, but they were not pleaded and accordingly do not matter.
[38] In his reply affidavit (at paragraphs [34]-[52]), Mr Rothlander addressed the affidavits sworn in support of the 2011 application. Paragraph [53] states a general conclusion. Paragraph [54] raises, for the first time, evidence as to his family’s difficulties in dealing with their home while the caveat remains on the title (inability to re-finance, inability to carry out renovations, inability to access equity in the property).
[39] I accept the submission for Mr Rothlander that when he first applied to remove the caveat at the end of 2015, his position was that Virtual Spectator Ltd could no longer seriously maintain the embezzlement allegations it had raised in 2011, given the failure of the criminal proceeding and the agreement to withdraw the caveat. He therefore did not address those issues at that stage. Once the notice of opposition came in, Virtual Spectator Ltd made it clear that it intended to rely on the affidavits filed in 2011 in support of its application to sustain the caveat.12 Its position was that it could still maintain the embezzlement allegations against Mr Rothlander. On that basis, Mr Rothlander was not required to address the 2011 affidavits in his initial application, but was entitled to do so in his reply affidavit, once Virtual Spectator had made it clear that it was still relying on those affidavits. I find therefore that paragraphs [34]-[52] of his second affidavit do not go beyond replying to the opposition affidavits, as they address matters which Virtual Spectator Ltd had put in issue. Paragraph [53] is in the nature of a submission and does not add anything. I disregard it. Paragraph [54] does raise new matters that may not be strictly in reply, but I admit it. The evidence is unsurprising and uncontroversial.
Mr Rothlander’s hearsay objection
[40] Mr Rothlander objects to documents that Virtual Spectator Ltd obtained from the police being put into evidence on the ground that they are inadmissible hearsay. The police material includes witness statements, exhibit lists, bank statements, copies of invoices, credit card records including expenses claims, and schedules of analyses
12 King affidavit, paragraph [19].
prepared by the police. The Rothlanders’ objection is to the witness statements. They are all formal written statements under s 162 of the Summary Proceedings Act 1957:
162 Formal written statements
(1) A formal written statement by any person is admissible as evidence for the purposes of a standard committal or at a committal hearing to the same extent as oral evidence to the same effect given at a committal hearing by that person.
(2)A formal written statement is either—
(a)a written statement—
(i)that purports to be signed by the person making the statement; and
(ii)that contains a statement at the end that everything in the statement is true to the best of that person's knowledge and belief, and that the person made the statement knowing that it might be admitted as evidence for the purposes of the standard committal or at a committal hearing and that he or she could be prosecuted for perjury if the statement is known by him or her to be false and is intended by him or her to mislead; and
(iii)that complies with subsections (3) and (4), if applicable; or
(b)a written statement that does not meet the requirements set out in paragraph (a) if all parties agree to that written statement being admitted as evidence.
(3) If a formal written statement under subsection (2)(a) is made by a person aged under 18 years, the statement must specify the age of that person.
(4) If a formal written statement under subsection (2)(a) is made by a person who cannot read it,—
(a)the statement must be read to that person before the person signs it; and
(b)the reader must attach to the statement a signed statement by that reader to the effect that the statement was read to the person and that the person to whom it was read appeared to understand its contents.
(5)Any document or object accompanying a formal written statement,
and referred to in that statement as an exhibit, must be treated as if it had been identified in Court and produced as an exhibit by the maker of the statement.
Each formal written statement was signed by their maker. All the statements contain the statement under s 162(2)(a)(ii).
[41] The hearsay objection is that the statements do not qualify under either limb in s 18(1) of the Evidence Act 2006:
(1)A hearsay statement is admissible in any proceeding if—
(a) the circumstances relating to the statement provide reasonable assurance that the statement is reliable; and
(b) either—
(i) the maker of the statement is unavailable as a witness; or
(ii) the Judge considers that undue expense or delay would be caused if the maker of the statement were required to be a witness.
(2)This section is subject to sections 20 and 22.
[42] The objection under s 18(1)(a) was that there was no reasonable assurance as to the reliability of the statements, because the statements cannot be tested in cross- examination. I do not accept that. The statements were made with the assistance of the police for the purpose of a prosecution on the basis that the statements would be used in evidence in the same way as oral evidence in a committal hearing. These circumstances provide reasonable assurance that care was taken to ensure that the statements were truthful.
[43] As to the second limb, I accept that undue expense and delay would be caused if the people making the statements were required to have given affidavits. Virtual Spectator Ltd has not shown that the makers of the statements are “unavailable as a witness” within s 16(2) of the Evidence Act. Some of them are apparently overseas. Some may be hard to trace now, but Virtual Spectator has not set out to establish the unavailability ground. Instead, it is necessary to have regard to the exigencies of a caveat application, which is run in a manner analogous to an interlocutory application. The court is concerned with whether the allegations in support of a caveatable interest are tenable (and in the case of fraud allegations, whether a prima facie case is shown)
but the court does not make final findings in favour of the substantive interest claimed. Virtual Spectator had limited time in which to prepare its evidence. It would be unnecessarily burdensome to require those who gave formal written statements under s 162 of the Summary Proceedings Act to swear fresh affidavit confirming what they had stated before. On this basis, the formal witness statements are admissible in this caveat application under s 18 of the Evidence Act. If necessary, I would also find the statements admissible under s 20 of the Evidence Act, in that I would apply the approach I took in Trustees Executors Ltd v Eden Holdings (2010) Ltd.13 While the witness statements may not be inadmissible for hearsay, the weight to be given to them is another matter.
The merits of the fictitious invoices claim
[44] There were three Web FX invoices to Virtual Spectator International Ltd totalling $14,420.00:
(a)Dated 12 April 2004 for $1,400.00 plus GST for 40 hours work at
$35.00 per hour between 20 and 31 March 2004.
(b)Dated 20 December 2004 for $6,160.00 plus GST for 325 hours of work at $35 per hour from September to December 2004.
(c)Dated 20 November 2005 for $5,915.00, apparently inclusive of GST. There was one charge for 56 hours work between 1 and 15 July 2005 for $3,640.00 and a second charge for work between 3 and 11 November 2002 for $2,275.00. The rate charged was at $65.00 per hour inclusive of GST.
[45] The work charged for is generally described as web site development and update work. Web FX was a business operated by Mr Rothlander. The address given on the invoices for Web FX is the Rothlanders’ home. The bank account into which payment is to be made has the account name A Conboy. The account number is the
13 Trustees Executors Ltd v Eden Holdings (2010) Ltd, HC Wanganui CIV-2010-483-101, 12 August 2010.
Rothlanders’. Two of the invoices have Mr Rothlander’s signature as approving payment. Virtual Spectator Ltd’s case is that Mr Rothlander could not have carried out the work and accordingly the invoices were bogus. He had used them to deceive the company.
[46] In her affidavit of February 2011 in support of the application to sustain the caveat, Ms Jones, accounts administrator, says that she was advised by other staff that the website and management development services allegedly provided to Virtual Spectator International Ltd by Web FX were not in act provided. The company employed someone to review, design and develop Virtual Spectator website work for which Mr Rothlander had billed, using Web FX. Ms Jones’ witness statement for the police prosecution referred to the Web FX invoices and confirmed that they had been paid to the account numbers on the invoices.
[47] Mr N S Scott is one of the staff identified by Ms Jones as saying that the work billed by Web FX was not carried out. Mr Scott also swore an affidavit in support of that application, but his affidavit is silent on that. Mr Scott provided a formal written statement to the police for the prosecution of Mr Jardim and Mr Rothlander. His statement is also silent on this matter.
[48] The other people identified by Ms Jones as saying that the work was not carried out have not sworn affidavits and did not provide formal written statements to the Police.
[49] In its challenge to the invoices, Virtual Spectator Ltd submitted that the invoices were implausible claims for moonlighting work by Mr Rothlander. Given that he was employed full-time by the company, he would not have enough time to do the work he charged for - for example, the 12 April 2004 invoice charged for 40 hours work between 20 and 31 March 2004. There were also inconsistencies in that the 2005 invoice charged for work in 2002, before Mr Rothlander began working for the company. The charge-out rate of $65.00 per hour (inclusive of GST) is higher than the rate of $35.00 per hour (plus GST) charged in the year before.
[50] Virtual Spectator Ltd tried to add weight to its case by referring to other alleged defalcations and misuse of credit cards to show that Mr Rothlander was generally unreliable and dishonest. That approach might be in order when the court comes to assess Mr Rothlander’s evidence, but it does not assist in working out whether Virtual Spectator Ltd has shown a prima facie case that the invoices were fictitious. Ms Jones’ evidence that the work in the invoices was not done is hearsay and of its nature unreliable. Those who might have corroborated her have not done so. The attack on the hours claimed in the invoices assumes that Mr Rothlander was charging for work he personally carried out, but no reason is given for that assumption. Taken in its entirety the evidence for Virtual Spectator Ltd does not show a prima facie case that the Web FX invoices were fictitious.
[51] As a cross-check, I refer to the decision under s 347 of the Crimes Act in the District Court. Mr Rothlander was charged under s 228 of that act with using the Web FX invoices dishonestly and without colour of right to obtain valuable consideration. Of course Mr Rothlander’s discharge on a criminal charge does not release him from civil liability. The standard of proof on criminal charges is higher than in civil, so that a criminal case may fail even though it may be proved to the civil standard. The matters going to liability may diverge. All the same a discharge under s 347 (or s 147 under the Criminal Procedure Act 2011) may be helpful as the judge gives reasons. Relevantly a common ground for withdrawing a charge is insufficiency of evidence. For this case there are common factual issues: whether the invoiced work was carried out, whether it was properly outsourced, whether payment was approved. In the criminal prosecution the Crown case was that Mr Rothlander was billing for work he did within the usual scope of his employment. There was evidence going the other way from two prosecution witnesses, Mr Mattman and Mr Grav. Mr Mattman’s evidence was that he had worked for Web FX on various projects, not all of them for Virtual Spectator. Mr Grav, a former chief financial officer of Virtual Spectator International Ltd, gave evidence of having received a Web FX invoice which he discussed with Mr Rothlander to verify who Web FX was and what the work was. Mr Grav was satisfied that at the relevant time there was no-one within the company who had the capacity, time and skills to do the website development work charged for and that Web FX had done the work outside normal hours. Mr Grav authorised payment of two of the invoices. An earlier accountant had authorised the first. Mr King, the
director, was not able to say that the invoicing was illegitimate. The judge held that in the absence of evidence a jury properly instructed could not convict Mr Rothlander on the Web FX charge.
[52] The absence of evidence in the criminal trial that the invoiced work was not carried out and the evidence that it was carried out and an accountant in the company checked that it was properly chargeable before approving payment does not run counter to my finding above that Virtual Spectator Ltd has not established a prima facie case that the Web FX invoices were fictitious. It is now more than ten years since the last of the invoices. Investigations into their authenticity began in 2010. It is not sensible to leave the caveat in place on the off-chance that evidence to support Virtual Spectator Ltd might come to light later.
The Arclight invoices
[53] There is a similar result with the Arclight invoices. There are three for a total of $21,532,50:
(a)Dated 13 August 2008 for 48 hours at $110.00 per hour plus GST -
$5940;
(b)Dated 9 September 2008 for 78 hours at the same rate - $9652.50;
(c)Dated 7 October 2008 for 48 hours at the same rate - $5940.00.
[54] Arclight Media Studios issued all the invoices, which charge for website design and development work. Arclight’s contact details on the invoices are “W Mattmann 7-26 Parnell Road, Parnell” and “ [email protected].” The bank account for payment is the Rothlanders’. The invoices are addressed to Virtual Spectator Ltd for the attention of Mr Rothlander. A signature on one of the invoices approving payment may be Mr Rothlander’s. Payments for the invoices all went to an account operated by Mr Rothlander. Again Virtual Spectator Ltd’s case is that Mr Rothlander could not have carried out the work and the invoices were fictitious. The only evidence that the work was not carried out is Ms Jones’ unsupported hearsay statement. Again Virtual
Spectator Ltd referred to the hours charged to say that Mr Rothlander could not have done the work while moonlighting. It also relied on its general attack on Mr Rothlander’s credibility.
[55] Again there is not enough evidence to show a prima facie case that the invoices were fictitious. As with the Web FX invoices, I cross-check that against the s 347 ruling in the criminal trial. Mr Rothlander was also charged under s 228 of the Crimes Act in respect of the Arclight invoices. The judge recorded the Crown case as alleging that if Mr Rothlander did the work, he did so in the course of his employment and could not charge for it independently. Arclight was said to be a business set up specifically to enable Mr Rothlander to deceive Virtual Spectator International Ltd so that it would not appreciate that it was paying its own employee for the work. The judge also recorded prosecution evidence given by Mr Mattmann that he and Mr Rothlander started the business as a way of making money outside normal employment. Mr Mattmann confirmed that the work had been done and that it was legitimate and necessary work. He had been in regular email communication with Virtual Spectator International Ltd while carrying out the work. Another witness recalled conversations about getting a consultant in to do the work but that it was decided that Mr Rothlander would do the work. She knew that Mr Rothlander was working at various times outside normal working hours on updating the company website. When interviewed by the police, Mr Rothlander had explained the work he had done. The Crown did not lead any evidence to suggest that the website development work was not authorised or that Mr Rothlander should have done the work in the normal course of business. There was accordingly no evidence upon which a properly directed jury could convict. The s 347 ruling does not give me any reason to alter my finding that Virtual Spectator Ltd has not shown a prima facie case on the Arclight invoices.
[56] The Web FX and Arclight invoices are the only acts of breach of fiduciary duty pleaded against Mr Rothlander. Virtual Spectator Ltd expressly pleaded that Mr Rothlander arranged payment of those invoices knowing them to be false. It was accordingly required to prove its case to a prima standard to sustain its caveat. It has not done so.
Tracing
[57] If it has a proprietary claim for the payments made under the invoices, Virtual Spectator Ltd says that the payments it made to Mr Rothlander for the invoices were used to pay the mortgage over the caveated property. Its case is circumstantial. That is understandable. There has been no discovery and until there is, it cannot show how the funds were applied. It is plausible that the money went to meet household commitments such as mortgage payments.
[58] The Rothlanders submitted that the claim to a caveatable interest failed because Virtual Spectator Ltd could not trace the payments for the Web FX and Arclight invoices to their mortgage payments. Mrs Rothlander worked for the bank that held the mortgage. Her salary was paid into their joint cheque account on the day before there was a deduction from that account for a transfer to another sub-account used for mortgage payments. Her salary paid the mortgage, not the invoice payments from Virtual Spectator Ltd. In a case where there are two claimants to a fund held in an active bank account, the rule in Clayton’s case applies. Re Diplock was cited:14
It might be suggested that the corollary of treating two claimants on a mixed fund as interested rateably should be that withdrawals out of the fund ought to be attributed rateably to the interests of both claimants. But in the case of an active banking account this would lead to the greatest difficulty and complication in practice and might in many cases raise questions incapable of solution. What then is to be done? In our opinion, the same rule as that applied in Clayton's case should be applied. This is really a rule of convenience based upon so-called presumed intention. It has been applied in the case of two beneficiaries whose trust money has been paid into a mixed banking account from which drawings were subsequently made, and, so far as we know, its application has not been adversely criticized (see per Fry J. in Hallett's case and per North J. in In re Stenning. In such a case both claimants are innocent, neither is in a fiduciary relation to the other, and if the mixed fund had not been drawn upon they would be entitled to rateable charges upon it. Exactly the same occurs where the claimants are not two beneficiaries but one beneficiary and one volunteer, and we think, accordingly, that the same principle should be adopted.
(Citations omitted)
[59] That principle is said to apply in cases where both claimants are innocent. The competing claimants here are Virtual Spectator Ltd and Mrs Rothlander. If
14 Re Diplock [1948] Ch 465 (CA) at 553-554.
Mr Rothlander were liable, it is arguable for Virtual Spectator Ltd that Mrs Rothlander is not as innocent as say a third party claimant, as in the Diplock case. In any event, the evidence shows only one case where that argument would work. A bank statement used in the prosecution shows that on 19 January 2005 Ms Conboy’s salary was paid into the joint account. That was enough to cover the mortgage payment. The next day
$5,930 from Virtual Spectator International Ltd was paid in and there was a transfer from the account for the loan repayment. If the order of deposits into the account were reversed, the Virtual Spectator money would have paid the mortgage instalment, not the salary. Other bank statements did not show the above principle applying.
[60] There are however two other cases where it can be seen that funds did not go towards mortgage payments. On 30 September 2008 $5,980 from Virtual Spectator International Ltd was paid into account in the name of Mr Rothlander “trading as Arclight”, which immediately before that date had a nil balance. On 3 October 2008
$5,384 was paid to a credit card account. A few days later $300 was transferred to the Rothlanders’ joint account. Virtual Spectator Ltd may have an arguable case that the
$300 went towards loan payments, but not the $5,384. Similarly $9,652 paid in on 22 October 2008 was part of the funds used to pay $9,900 to a credit card account on 28 October.
[61] Those cases aside, it is not possible to tell from bank statements in evidence whether other payments for Web FX and Arclight invoices were applied to meet mortgage instalments. Until there is full discovery it is arguable for Virtual Spectator Ltd that they were.
Delay
[62] The Rothlanders rely on delay by Virtual Spectator Ltd in starting a proceeding to establish the interest claimed in the caveat. Lapse of time may give grounds for finding that there is not a caveatable interest. If the cause of action to establish the interest has become barred under a limitation statute, or laches and other factors would lead a court to deny equitable relief such as specific performance, or delay amounting to want of prosecution under r 15.2 of the High Court Rules would give grounds to dismiss a proceeding, then the inability to sue would lead to a loss of a caveatable
interest. But the Rothlanders rely on another sort of delay. They invoke the discretionary power to remove a caveat under s 143 of the Land Transfer Act under which delay is a relevant consideration, even if a proceeding to sustain the interest cannot be dismissed because of time factors. In Varney v Anderson, where a caveating purchaser was suing for specific performance, the Court of Appeal said:15
Section 143(2) gives the Court power to "make such order in the premises … as to the Court seems meet". This in terms gives the Court a wide discretion. We have no doubt that the Judge was right in regarding delay as a relevant factor to be weighed in the exercise of that discretion... As to s 143 we think that Mr Dugdale correctly stated an established practice when he said that in the case of a caveat by a party claiming to be a purchaser the Court has always insisted on the diligent prosecution of specific performance proceedings as the price of preserving the caveat, citing Tapper v Lapwood and Merbank Corporation Ltd v Carter. Those were not delay cases but they accord with our view of the scope of the discretion under s 143.
And:16
It is true that delay is not necessarily a bar to specific performance…We think it fallacious, however, to convert the possibility of obtaining a specific performance decree into an invariable and automatic ground for preserving a caveat, no matter what the delay. It is reasonable, especially where there has been culpable and serious delay, that a party who has delayed to the prejudice of the registered proprietor should - or at least may - have to do so at the cost of the removal of his caveat. That may add a risk that a decree for specific performance will be ineffective, but it is a risk which the delaying caveator takes. There is insufficient reason for limiting the discretion given by s 143 by the rigid rule proposed by counsel for the appellant, just as, in our view, the correspondingly rigid rule proposed by counsel for the respondents should not be imported into the section.
(Citations omitted)
[63] On the facts in Varney, the court ordered that the caveat was not to be removed. As to the other cases cited for the Rothlanders, in Best of Luck Ltd v Ratapu the court used delay as a bolstering ground after having found that there was not a caveatable interest.17 In Paul v Paul in this court delay was one of a number of factors (including adverse findings against the caveator on reliability of evidence) for not finding a caveatable interest.18 The Court of Appeal found that the caveator’s evidence lacked a plausible narrative and indicated that the caveat procedure had been misused, without
15 Varney v Anderson [1988] 1 NZLR 478 (CA) at 479.
16 At 481.
17 Best of Luck Ltd v Ratapu (2011) 11 NZCPR 717 (HC) at [13].
18 Paul v Paul [2013] NZHC 3231 at [52].
relying on delay.19 In Deng v Lu the court had regard to delay in suing when assessing the bona fides of the caveator but found no lack of good faith.20 No case was cited where a caveat was removed on the sole ground of delay by the caveator.
[64] As was noted in Varney, it is standard practice when making an order sustaining a caveat to require the caveator to pursue a claim for the substantive interest with due diligence. Failure to follow that condition may provide grounds for removing the caveat. At the same time it also needs to be recognised that in other cases as a matter of practice caveats may remain on the title for long periods without any challenge. A caveat to protect an agreement to mortgage is a typical example. Under such arrangements there is no expectation that the caveator should take proceedings to enforce the interest claimed in the caveat. On removal applications it is accordingly necessary to check whether the interest claimed in the caveat is challenged and whether that requires the caveator to take proceedings.
[65] Superficially it may seem that there is some similarity between a failure to prosecute a proceeding under r 15.2 of the High Court Rules and delay in suing for the interest claimed in the caveat. Common factors may be extent of delay, explanation for delay and prejudice to the other side. But there is at least one significant difference. A plaintiff can restart a proceeding as of right if the new claim is within time.21 Accordingly orders dismissing a proceeding for want of prosecution are ordinarily only made if a new claim would be statute-barred. On the other hand under Varney a caveat may be removed even if a new proceeding would not be time-barred. While the substantive proceeding may be continued, the caveator cannot lodge a fresh caveat for the same interest as of right. Leave of the court is required.22 The exercise of the discretion to remove needs to take those differences into account.
[66] For this case, the Rothlanders say that the invoices in question go back to 2004- 2005 for Web FX and 2008 for Arclight. On Virtual Spectator Ltd’s case the alleged deceit was discovered only in August 2008. No proceeding has been started yet. The criminal charges were dismissed in September 2013. The delay is inordinate and
19 Paul v Paul [2014] NZCA 549 at [[26]-[28].
20 Deng v Lu [2015] NZHC 2585 at [45].
21 Birkett v James [1978] AC 297 (HL).
22 Land Transfer Act s 148.
inexcusable. The Rothlanders have been prejudiced because the caveat prevents them from accessing the equity in their property.
[67] There is a good explanation for Virtual Spectator Ltd not starting a proceeding after the order in February 2011 – by consent there was a stay on civil proceedings on matters relating to the criminal charges against Mr Rothlander. He had sought the stay. That distinguishes this case from the usual one where directions are given for proceedings to be taken. The dismissal of the criminal charges did not automatically lift the stay. A court order was required. Neither side did anything. In particular there is no evidence that the Rothlanders were concerned about the caveat on the title. They did not require Virtual Spectator Ltd to put up or shut up – until the correspondence of August and September 2015. Given that Virtual Spectator Ltd was not on notice that it should be taking steps, the case has aspects closer to those where a caveat remains on the title on an uncontested basis. On the Rothlanders’ side there is an element of acquiescence. That came to an end in September 2015, but that is the time from which delay should be measured.23 Since then Virtual Spectator Ltd has obtained records from the police and has instructed its lawyers to prepare proceedings. Some of its potential causes of action (for example, for credit card misuse, which came to light no later than 2008) may already be time-barred. The imminent expiry of other time limits ought to incentivise it to begin proceedings promptly. I was assured that preparation is well advanced. Given that instructions come from overseas and that the issues are not straightforward, I do not find that the time taken to file a proceeding is so unacceptable as to require removal of the caveat on the ground of delay. I record also that the parties agreed that the 2011 stay order should be set aside.
Name suppression
[68] The Rothlanders ask for suppression of information identifying Mr Rothlander because in his business as an independent contractor in the field of web development and information management systems there is a high degree of trust. Were it known that he is subject to the allegations made by Virtual Spectator Ltd in this proceeding, his relationship to his existing clients will be seriously damaged and his ability to
23 Virtual Spectator Ltd’s attempt to explain its inactivity up to 2015 assumes that it was required to take steps. The explanation is unconvincing, but not fatal to its case.
obtain work in his area of expertise will be drastically reduced. He also relies on a suppression order made in the District Court in the criminal proceeding against him. He submits that as Virtual Spectator Ltd has still to issue substantive proceedings against him, his suppression application should be treated as if the case were at a pre- trial phase of an ordinary civil proceeding.
[69]In McIntosh v Fisk the Court of Appeal said:24
The principle of open justice requires that all aspects of proceedings, both civil and criminal, are conducted in public. It extends to the identification of parties to litigation. Accordingly, a litigant seeking confidentiality in the nature of a name suppression order must show the interests of justice displace the presumption favouring publication. The threshold is high because any suppression order necessarily derogates from the principle of open justice and the right to freedom of expression.
[70] The open justice principle the Court of Appeal referred to is general and, as such, it is vulnerable to incursions by arguments that it should not apply in the particular circumstances of a case. An added reason why the threshold is high is the risk that the principle will be eroded because of ad hoc decisions based on particular circumstances without sufficient regard to the principle.
[71] Virtual Spectator Ltd’s allegations against Mr Rothlander are of misconduct as a wayward corporate fiduciary by abuse of trust and confidence. Invariably such allegations are damaging. But suppression orders are not routinely made in civil proceedings against alleged dishonest corporate fiduciaries. Experience shows that the interests of justice do not require suppression.
[72] Admitttedly, during the early stages of a proceeding, up until the substantive hearing stage, access to court files is regulated under Part 3 of the High Court Rules, especially rr 3.13 and 3.16. Of the matters to be considered under r 3.16, the principle of open justice does not have overriding importance but is balanced against other interests such as the orderly and fair administration of justice, the protection of confidentiality and privacy interests and the like. But once a case reaches the substantive hearing stage, under r 3.9, access is available to court files unless the court orders otherwise.
24 McIntosh v Fisk [2015] NZCA 247, [2015] NZAR 118 at [1].
[73] Mr Rothlander submits that in a caveat case the position is analogous. A caveat proceeding is interlocutory in nature, and the substantive issues at stake may be tested only at a later date. While there is something in that, it needs to be put into perspective. Virtual Spectator Ltd’s allegations against Mr Rothlander go to events that occurred eight years ago and more. When he was prosecuted, he was acquitted on the only charge left to the jury, with the trial judge dismissing the rest of the charges under s
347 for insufficient evidence. Similarly in this proceeding, the only pleaded allegations against Mr Rothlander failed. Any report of this proceeding would have to acknowledge that so far the allegations against Mr Rothlander have not been proved. Suppression was not sought in this proceeding until 2015, even though it started in 2011. There is no evidence of any harm arsing from the absence of a suppression order in the early stages. These circumstances do not create a compelling case for removing Mr Rothlander from the general run cases involving alleged wayward corporate fiduciaries.
[74] Mr Rothlander also relies on the suppression order made in the criminal proceeding. That, of course, is not binding on me. As to the effect of a suppression order made in a related criminal proceeding, there is the Court of Appeal’s decision in Jacks v Hastings District Council.25 In summary proceedings in the District Court, the appellant obtained a suppression order, but in a judicial review proceeding to set aside a warrant, the High Court had declined to make a suppression order. It is implicit in the decision in the Court of Appeal dismissing the appeal that the decision of the District Court in the criminal proceeding did not in any way fetter the discretion of the High Court in considering a suppression application.
[75] In this case, notwithstanding the order made in the criminal proceeding I am not persuaded that the matters raised by Mr Rothlander are strong enough to warrant displacing the normal principle of open justice. I decline to make any orders suppressing the identity of Mr Rothlander or his wife.
Outcome
25 Jacks v Hastings District Council [2005] NZAR 736 (CA).
[76] The caveat is to be removed because Virtual Spectator Ltd is contractually bound to do so. The date of removal is deferred to allow it consider whether to appeal and to seek interim relief. Aside from the contractual ground for removal, I would have ordered removal because Virtual Spectator Ltd had not proved to the requisite standard that it had the caveatable interest claimed in its pleadings. I would not have accepted the Rothlanders’ arguments based on absence of tracing or delay. The 2011 stay on proceedings is lifted. The removal of the caveat does not stand in the way of Virtual Spectator Ltd suing Mr Rothlander on any cause of action available to it. There will be no suppression of information identifying the Rothlanders.
[77]I make these orders:
(a)caveat 8591429.1 is to be removed with effect from 18 April 2016;
(b)the 2011 stay on proceedings no longer applies from the date of this decision;
(c)the Rothlanders’ application for suppression is dismissed;
(d)Virtual Spectator Ltd is to pay the Rothlanders’ costs on the application. If the parties cannot agree costs, memoranda may be filed;
(e)Leave is reserved to apply further.
………………………............
Associate Judge R M Bell
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