Waterhouse v Contractors Bonding Ltd
[2013] NZCA 151
•14 May 2013
| For a Court ready (fee required) version please follow this link |
| IN THE COURT OF APPEAL OF NEW ZEALAND |
| CA542/2012 [2013] NZCA 151 |
| BETWEEN GODFREY WATERHOUSE |
| AND ROBERT JOHN WATERHOUSE |
| AND CONTRACTORS BONDING LIMITED |
| Hearing: 8 April 2013 |
| Court: O’Regan P, Wild and White JJ |
| Counsel: S Grant for First and Second Appellants |
| Judgment: 14 May 2013 at 2.30 pm |
JUDGMENT OF THE COURT
AThe application by the respondent, Contractors Bonding Limited, to strike out the notice of appeal by the second appellant, Robert John Waterhouse, is dismissed.
BThere is no order for costs.
____________________________________________________________________
REASONS OF THE COURT
(Given by White J)
Contractors Bonding Ltd (CBL) applies for an order striking out the appeal by Robert John Waterhouse (RJW) against a decision of Potter J in the High Court at Auckland commercial list on 3 August 2012 granting CBL summary judgment in respect of RJW’s claims against it.[1]
[1] Waterhouse v Contractors Bonding Ltd [2012] NZHC 566.
RJW and his father Godfrey Waterhouse (GW), both residents of the State of Georgia in the United States, are plaintiffs in commercial list proceedings against CBL, a New Zealand-based underwriter, operating internationally. They are claiming damages of NZD 4.5 million for alleged wrongdoing arising out of a contract between CBL and Phoenix Brokers Inc (Phoenix), a company registered in Georgia, owned and operated by GW and the employer of RJW. The contract was to underwrite liability insurance for taxi operators (known as livery insurance) in Georgia in respect of policies issued by Phoenix as brokers.
CBL filed an interlocutory application for summary judgment against GW and RJW and, alternatively, for orders striking out their claims on the grounds that the Georgia limitation statute applied, and that any liability was to Phoenix only, neither GW nor RJW having personally suffered any actionable damage. Potter J rejected the limitation ground, the application to strike out the proceeding and the application for summary judgment in respect of the claim by GW, but granted the application for summary judgment in respect of RJW’s claim.[2]
[2] At [33].
Accepting that Potter J’s decision rejecting its applications to strike out the proceeding and to grant summary judgment in respect of GW’s claim is “an interlocutory decision”, CBL has applied to the High Court at Auckland for leave to appeal to this Court as required by s 24G(1) of the Judicature Act 1908. If the High Court refuses leave, CBL will be able to apply to this Court for leave under s 24G(2).
RJW, on the other hand, taking the view that Potter J’s decision to enter summary judgment for CBL in respect of his claim is not “an interlocutory decision”, has simply filed a notice of appeal in this Court against that part of the judgment without first seeking leave to appeal.
CBL’s application to strike out RJW’s appeal to this Court is made on the grounds that Potter J’s grant of summary judgment is “an interlocutory decision” against which leave to appeal is required under s 24G(1) and, as no leave has been sought or obtained, this Court has no jurisdiction to hear and determine RJW’s appeal.
RJW opposes the application on the grounds that the entry of summary judgment in favour of CBL was not “an interlocutory decision” under s 24G(1) and, as he therefore has a right of appeal to this Court without the need to obtain leave, this Court does have jurisdiction to hear his appeal. If RJW is wrong and leave is required, he will not be able to pursue his appeal now unless the High Court is prepared to allow him further time to seek leave as the time prescribed for him to do so has expired.[3]
[3] Judicature Act 1908, s 24G(1); and Hudson v Wylie (1994) 7 PRNZ 545 (CA).
The parties agree that the outcome of the strike out application depends on the interpretation of the expression “an interlocutory decision” in s 24G which applies to proceedings in the Auckland High Court commercial list and which provides:
24G Restriction of right of appeal from interlocutory decisions
(1)No appeal shall lie from an interlocutory decision of the High Court in respect of any proceeding entered on a commercial list unless leave to appeal to the Court of Appeal is given by the High Court on application made within 7 days of the decision being given or within such further time as the High Court may allow.
(2)If the High Court refuses leave to appeal from any such interlocutory decision, the Court of Appeal may grant that leave on application made to the Court of Appeal within 21 days of the refusal of leave by the High Court.
For CBL, Mr Harrison QC submits that Potter J’s decision to enter summary judgment for CBL in respect of RJW’s claim against it was “an interlocutory decision” under s 24G(1) because:
(a)it was granted on an interlocutory application for summary judgment under r 12.4(1) and 4(4)(a) of the High Court Rules;
(b)the formal Court order is an interlocutory order;
(c)to look at the nature and effect of the outcome of the application, rather than the form of the application, would mean that a decision determining a defence application for summary judgment would be categorised as “an interlocutory decision” if the Court declined the application, but not if it granted the application and indeed, as in the present case, part of the same decision would be interlocutory and part not;
(d)in other respects under the High Court Rules the distinction drawn between what is interlocutory and what is not (and is therefore “final”) is determined by reference to the nature of the procedural step or stage which brings the matter before the Court for adjudication;
(e)the leave restriction imposed by s 24G(1) supports the overall purpose in making provision for commercial lists;[4]
(f)it is well settled that a judgment granting an application to strike out a claim is an interlocutory (rather than a final) judgment, which equally results in an interlocutory order;[5]
(g)the same principle and approach has been applied in relation to both successful and unsuccessful applications for summary judgment;[6] and
(h)it should be followed in respect of cases on the commercial list.[7]
[4]Meates v Taylor (1992) 5 PRNZ 524 (CA) at 526; and Clear Communications Ltd v Attorney‑General (1998) 12 PRNZ 287 (CA) at 289.
[5]Matthews Corporation Ltd v Edward Lumley & Sons (NZ) Ltd (1994) 7 PRNZ 591 (CA) at 596–598; and Scottwood Charitable Trust v Bank of New Zealand [2002] 2 NZLR 305 (CA) at [19]–[24].
[6]Re Fidow [1991] 2 NZLR 602 (HC) at 603–606; and Juno Group Holdings Ltd v Oakley (1994) 7 PRNZ 573 (HC) at 575–576.
[7]Opotiki Packaging & Coolstore Ltd v Opotiki Fruitgrowers Co-operative Ltd (in rec) (1998) 12 PRNZ 663 (HC) at 664.
For the following reasons, which reflect in large part the submissions of Ms Grant for GW and RJW, we do not accept the submissions for CBL.
First, the starting point is to recognise that but for the fact that the proceeding is on the commercial list and therefore subject to s 24G(1), there would be no question that RJW has a right of appeal to this Court without leave against Potter J’s summary judgment decision, whether that decision is described as interlocutory or final. This is because:
(a)the Supreme Court has held in Siemer v Heron[8] that s 66 of the Judicature Act gives an appeal as of right against interlocutory decisions of all kinds made in the High Court unless that Act itself or a rule or order made pursuant to it creates a restriction;
(b)decisions of this Court drawing distinctions between different categories of interlocutory rulings, including Winstone Pulp International Ltd v Attorney-General,[9] which involved s 24G, have been overruled by the Supreme Court;[10] and
(c)apart from s 24G(1), there is no provision in the Judicature Act or in any rules or order made pursuant to it requiring leave to be obtained to bring an appeal against any High Court interlocutory decision, including a grant or refusal of summary judgment whether by a Judge or an Associate Judge.[11]
[8] Siemer v Heron [2011] NZSC 133, [2012] 1 NZLR 309 at [31].
[9] Winstone Pulp International Ltd v Attorney-General (1999) 13 PRNZ 593 (CA).
[10] Siemer v Heron at [23]–[31].
[11]For the jurisdiction and powers of an Associate Judge to hear and determine applications for summary judgment, see s 26I(1)(a) of the Judicature Act and r 7.36 of the High Court Rules; and compare Samoilov v Burley (2007) 18 PRNZ 535 (CA) at [6]. For the right to appeal to this Court against a summary judgment decision of an Associate Judge, see s 26P(2) of the Judicature Act.
In particular, since the Court of Appeal (Civil) Rules 1997 there has been no provision equivalent to r 27(1) of the Court of Appeal Rules 1955 imposing different time periods for bringing appeals from High Court interlocutory judgments and final judgments. Since the 1997 Rules there has been a standard period for bringing all appeals that may be brought as of right.[12] This means that the previous decisions interpreting the expression “any interlocutory judgment or order” in r 27(1) of the 1955 Rules, relied on by CBL in the present appeal,[13] are no longer directly in point. We consider whether the reasoning in those decisions should nonetheless be accepted and applied to the interpretation of s 24G(1) later.[14]
[12]Court of Appeal (Civil) Rules 1997, r 5; and now the Court of Appeal (Civil) Rules 2005, r 29(1)(a): 20 working days.
[13] See above at [9(f)–(g)].
[14] Below at [24]–[34].
Second, it is clear from the text and purpose of s 24G(1) that Parliament did intend to create a restriction in respect of the otherwise general right to appeal available under s 66 of the Judicature Act. The restriction involved imposing a leave requirement for interlocutory decisions of the High Court in respect of any proceeding entered on a commercial list. At the same time, as s 24G(1) recognises, there is no leave requirement for commercial list decisions other than those categorised as “interlocutory”. The leave requirement does not apply to all decisions in proceedings entered on the commercial list.
The imposition of a leave requirement of this nature was consistent with the purpose of the commercial list which was established in 1986 to enable commercial cases to be resolved more expeditiously than other litigation.[15] Categories of cases eligible for entry on the commercial list were defined, commercial list judges were appointed and the High Court was empowered to give directions for the speedy and inexpensive determination of the real questions between the parties in the proceedings, even if the directions were inconsistent with the High Court Rules.[16] In this context the purpose of s 24G was to secure the expeditious completion of the interlocutory stages of a case and so minimise delays in its ultimate disposition.[17] The ready availability of a general right of appeal from commercial list interlocutory decisions was seen as potentially frustrating the objective of the commercial list, hence the requirement for leave to appeal.
[15] Judicature Act, s 24A.
[16] Sections 24B, 24C and 24D.
[17]Meates v Taylor; Ernst & Young v Benchmark Jewellery Co Ltd (in liq) (1993) 7 PRNZ 13 (CA) at 14; and Clear Communications Ltd v Attorney-General. See also Practice Note (Commercial List) [1995] 3 NZLR 198.
This Court has made it clear that leave in respect of an interlocutory commercial list matter will not be granted as a matter of course, but only where the particular circumstances clearly warrant incurring the further delay that would be involved.[18] The circumstances cannot be categorised, but as a generalisation the case must be such as to create, if not injustice, at least real detriment if not corrected, or raise an important question of law or touch on a matter of general or public importance. An error of fact or law is not enough. This approach has led to leave being granted in respect of decisions declining to strike out a proceeding,[19] fixing security for costs,[20] removing a case from the commercial list[21] and striking out a proceeding,[22] but declined in respect of other decisions striking out a counterclaim[23] and refusing to order security for costs.[24] The oral decision of this Court in Clear Communications Ltd v Attorney-General did not address the question whether the High Court decision declining the strike out application was an interlocutory decision requiring leave because leave to appeal had been sought in time under s 24G(1).
[18]Meates v Taylor at 526; Ernst & Young v Benchmark Jewellery Co Ltd (in liq); and Clear Communications Ltd v Attorney-General at 289.
[19] Geotherm Energy Ltd v Electricity Corporation of New Zealand Ltd (1991) 4 PRNZ 231 (CA).
[20] Meates v Taylor.
[21] Clear Communications Ltd v Attorney-General.
[22]Opotoki Packing & Coolstore Ltd v Opotoki Fruitgrowers Co-operative Ltd (in rec).
[23] Clear Communications Ltd v Attorney-General.
[24] Ernst & Young v Benchmark Jewellery Co Ltd.
Third, as a matter of principle, a High Court decision, including one made on an interlocutory application, that constitutes a final disposition of the rights of the parties would not ordinarily be considered to be an interlocutory decision. A decision determining the rights of the parties and bringing a proceeding or claim to an end, in whole or in part, is a final decision in that respect as far as the parties are concerned, whether or not there has been a full hearing on the merits. It is a final judgment of the High Court against which, in the absence of any other restriction,[25] the unsuccessful party would expect to have a general right of appeal to this Court. On the other hand, a High Court interlocutory decision is ordinarily understood to be a decision made in the course of a proceeding leading to or facilitating the hearing of the claim and its ultimate disposition following the hearing.[26] An interlocutory decision would not normally be understood as one that finally determines the rights of the parties and brings the proceeding to an end.
[25] Osborne v Auckland City Council [2012] NZCA 199, (2012) 21 PRNZ 76.
[26]Compare High Court Rules definition of “interlocutory order” in r 1.3 of the High Court Rules: see below at [21].
The distinction in principle between interlocutory and final decisions is well‑established in several other jurisdictions, including Australia, where in the context of similar rules courts have accepted that the nature of the outcome rather than the form of the application should determine the issue.[27]
[27]Carr v Finance Corporation of Australia Ltd (No 1) (1981) 147 CLR 246 (HCA) at 248 and 256; Bienstein v Bienstein [2003] HCA 17, (2003) 195 ALR 225 at [25]; Forest Glen Wood Products Ltd v British Columbia (Minister of Forests) [2008] BCCA 480; Haron bin Mohamed Zaid v Central Securities (Holdings) BHD [1983] 1 AC 16 (PC); and Minister of Agriculture, Food and Forestry v Alte Leipziger Versicherung AG [2000] IESC 13, [2000] 4 IR 32.
Fourth, this distinction in principle between interlocutory decisions that do not constitute a final disposition of the rights of the parties and a final decision that does, should apply to cases on the commercial list because it is consistent with the purpose of the list. Leave to appeal should be required for interlocutory decisions in proceedings on the commercial list that do not finally dispose of the proceeding or claim because appeals against such decisions will almost inevitably delay the hearing of the proceeding and its ultimate disposition. A final decision, on the other hand, that has in fact resulted in the ultimate disposition of the case on the commercial list should give rise to a right of appeal without the need for leave. That right should arise whether the final decision follows an interlocutory application or a full merits hearing. When in practical terms the outcome is the same because the proceeding or claim is brought to an end by the decision, there is no basis in principle for drawing a distinction between the two.
There is no reason to be discerned from the Judicature Act itself to suggest a different approach. The expression “interlocutory decision” is not defined in the Act, but the expression “Interlocutory application” is defined in s 2:
Interlocutory application—
(a)Means any application to the Court in any civil proceedings or criminal proceedings or intended civil proceedings or intended criminal proceedings for an order or a direction relating to a matter of procedure or, in the case of civil proceedings, for some relief ancillary to that claimed in a pleading; and
(b) Includes an application for a new trial; and
(c)Includes an application to review an order made, or a direction given, on any application to which paragraph (a) or paragraph (b) of this definition applies: ...
This definition suggests that an interlocutory application is one limited to “a matter of procedure” or “some relief ancillary to that claimed in a pleading” and would include an application for summary judgment, but does not determine the meaning of the expression “interlocutory decision” in s 24G.
Nor in our view does the definition of “interlocutory order” in r 1.3 of the High Court Rules determine the matter one way or the other, at least in respect of a grant of summary judgment. The definition reads:
interlocutory order—
(a)means an order or a direction of the court that—
(i)is made or given for the purposes of a proceeding or an intended proceeding; and
(ii)concerns a matter of procedure or grants some relief ancillary to that claimed in a pleading; and
(b)includes—
(i)an order for a new trial; and
(ii)an order striking out the whole or part of a pleading; and
(iii)an order varying or rescinding an interlocutory order.
In particular, we do not agree with Mr Harrison’s submission that because para (b) is “inclusive” and therefore not “exhaustive” it is apt to include not only “an order striking out the whole or part of a pleading” but also a decision granting summary judgment. In our view this is a definition where para (a) defines the scope of the expression explicitly and para (b) extends the scope of the definition to cover orders that would not ordinarily be within the scope of the para (a) definition.[28] In this way the whole definition is exhaustive and there is no basis for extending it beyond paragraph (b). The need for the express inclusion of the three types of order, especially (ii), which would otherwise be a final order bringing the proceeding to an end, in whole or in part, means that they would not otherwise be within the definition. Indeed, as this Court pointed out in Uttinger v Baycity New Zealand,[29] the express inclusion of (ii) reflects the historical position rather than logic. A grant of summary judgment is therefore not an “interlocutory order” within the definition.
[28]JF Burrows and RI Carter Statute Law in New Zealand (4th ed, LexisNexis, Wellington, 2009) at 419–421.
[29] Uttinger v Baycity New Zealand (2008) 19 PRNZ 54 (CA) at [9].
Fifth, while there is support for Mr Harrison’s submissions from the reasoning in the decisions relating to the interpretation of the expression “any interlocutory judgment or order” in r 27(1) of the Court of Appeal Rules 1955, we do not consider that reasoning should now be used to affect the interpretation of the similar expression in s 24G(1) which arises in a different context.
The relevant decisions in this Court culminating in Matthews Corporation Ltd v Edward Lumley & Sons (NZ) Ltd and Scottwood Charitable Trust v Bank of New Zealand[30] related to r 27(1) of the Court of Appeal Rules 1955 and rr 2(a) and 2(b) of the New Zealand (Appeals to the Privy Council) Order 1910 and the Privy Council (Judicial Committee) Rules Notice 1973 respectively. As already noted,[31] the former rule prescribed different time periods for bringing appeals to this Court from High Court interlocutory judgments and final judgments. The latter rules permitted appeals to the Privy Council as of right from final judgments of this Court, while leave was required for appeals against interlocutory judgments. In both decisions of this Court it was held that an order striking out a proceeding was an interlocutory decision in respect of which leave was required.[32] In both decisions this Court recognised that there were two lines of authority on the issue in England and in New Zealand based on whether it was the nature of the application or the nature of the order which was determinative. Both decisions recognised that the issue was open to argument as a matter of logic, but concluded that it was settled by precedent in New Zealand.
[30]Matthews Corporation Ltd v Edward Lumley & Sons (NZ) Ltd, above n 5; and Scottwood Charitable Trust v Bank of New Zealand, above n 5.
[31] Above at [12].
[32]In Matthews on the ground that the statement of claim disclosed no reasonable cause of action and was also vexatious and an abuse of process and in Scottwood for want of prosecution.
In Matthews there was a divergence of opinion. In the leading judgment for the majority, McKay J, after referring to the two lines of authority relating to the interpretation of the Court of Appeal and Privy Council Rules in force at the time, concluded that:[33]
It should therefore be regarded as settled in New Zealand that an order striking out a proceeding is not a final judgment but an interlocutory one. That is so for the purposes of the Privy Council Rules, and it must be so also for the purposes of r 27 of the Court of Appeal Rules. There is no valid reason for making a distinction and to do so would only add unnecessary confusion. It follows that the appeal was filed out of time, and should be dismissed.
[33] At 597.
McKay J then referred to the minority view of Fisher J and said:[34]
If the matter were free from precedent, there would be much to be said for the view of Fisher J that the slate should be wiped clean and a fresh start made. He would hold, contrary to the above conclusion, that for present purposes all judgments and orders are final if they purport finally to determine the substantive rights of the parties, and are interlocutory if they leave substantive rights to be determined at a future hearing. This has a greater logical appeal, and accords with Lord Alverstone’s test in Bozson and with the Privy Council’s acceptance of it in Haron bin Mohammed Zaid.
Unfortunately, the matter is not free from precedent. The logical solution proposed by Fisher J would involve rejecting Lord Esher’s test in Salaman, and the decisions of this Court in Re Chase (No 2), and South Pacific Mfg Co Ltd. It would also involve rejecting the decision of the English Court of Appeal in Hunt v Allied Bakeries which was treated as correct by the Privy Council in Strathmore Group Ltd v Fraser. The problem could, however, be readily remedied by the Rules Committee.
[34] At 598.
In his dissenting decision Fisher J pointed out first that the question was all about the distinction between “final orders” and “interlocutory orders” and their equivalents and not about the applications which gave rise to them. After referring to the authorities summarised by McKay J, Fisher J said:[35]
Putting it at its very highest, therefore, one could not say that the authorities provide any clear preference for the final application approach. If anything I think that the indications are to the contrary. For my part I would prefer to go back to the legislation for the answer. The quest is for the implied intent of those who framed the relevant rights of appeal. There is a common thread running through r 2 of the New Zealand (Appeals to the Privy Council) Order 1910, s 71A of the District Courts Act 1947 and r 27 of the Court of Appeal Rules 1955: appeals from interlocutory decisions are to be more circumscribed than appeals from final decisions, whether by allowing appeals only by leave or by reducing the time for appeal.
The reasons for circumscribing interlocutory orders in that way are not hard to discern. First, there is the importance of the result to the parties. If a decision does not finally determine the substantive rights of the parties, they live to fight another day. To lose the interlocutory battle is not to lose the substantive war. Conversely, if the decision finally disposes of the substantive rights of the parties the outcome is critical to them. Subject to monetary minimums, the latter justifies appeals as of right and more time within which to consider one.
A second factor is the difficulty there would be in justifying a limitation upon appeal rights in circumstances where the distinction between a final and an interlocutory order turns upon a purely arbitrary choice in the procedural vehicle by which the issue had come before the Court. The question whether the facts pleaded in a plaintiff's statement of claim constitute a good cause of action in law can be argued in the context of either a preliminary application to strike out or in the context of a substantive trial. The same applies to many other substantive issues which might be argued as preliminary questions before trial, as one of the early segments in a split trial, or as part of a single comprehensive trial. A party should not be deprived of a right of appeal solely because a trial is divided into parts. As was pointed out in Strathmore (at p 388; pp 428, 429), the purpose of these preliminary applications is to save time and money, not to deprive a party of an opportunity to appeal as of right nor, one might add, to have ample time within which to decide whether to appeal. The parties should not be discouraged from pursuing cheap and expeditious procedures by the fear that in doing so they might be prejudicing appeal rights.
Thirdly, decisions which do not finally determine the substantive rights of the parties are normally subsumed in the final judgment and are therefore indirectly appealable if they have affected the substantive outcome. This too is justification for circumscribing appeals from interlocutory decisions. The converse applies if the decision finally determines substantive rights. If there is to be an appeal at all in those circumstances, it must be an appeal against that decision.
Fourthly, there is the risk that the unqualified right to appeal from every interlocutory order might produce unacceptable delay in the action as a whole, especially if full time limits are allowed. Many interlocutory matters of a procedural and ancillary nature may arise during the life cycle of an action. The delays produced by appeals on such matters can be cumulative. The converse is true if the decision finally determines the substantive rights of the parties. In the latter case little is lost if full appeal rights with full time limits are afforded.
[35] At 602–603.
Fisher J concluded:[36]
At least if freed from precedent, I would therefore allow the appeal rights and time limits appropriate to final judgments in such cases as well. Perhaps that particular class of order is now so heavily encrusted with precedent that it is too late to resurrect it. However, for myself, I would wipe the slate clean and start afresh. I would hold that for present purposes all judgments and orders are final if they purport finally to determine the substantive rights of the parties. They are interlocutory only if they leave the relevant substantive rights to be determined at a future hearing.
[36] At 604.
The judgment of Casey J read:[37]
I acknowledge the logic of the view expressed in the judgment to be delivered by Fisher J, that all judgments and orders are final if they purport finally to determine the substantive rights of the parties. However, I am in agreement with McKay J that settled precedent should be followed, leading to the conclusion that the present order is an interlocutory one and is out of time. I agree with the reasoning and conclusions in his judgment and would dismiss the appeal.
[37] At 592.
In Scottwood this Court followed the majority in Matthews. Anderson J, delivering the judgment of this Court, said:[38]
Nor is there a single logical indication for classification. As this judgment has already indicated there may be different yet reasonable views on the sense or connotations of the word “final”. A judgment may finally determine a proceeding by finally determining substantive right[s] issues on their merits; or it may finally determine the proceeding without having adjudicated upon the substantive merits. Settled precedent is no less a touchstone of a judicial system than perceived logic.
[38] Scottwood Charitable Trust v Bank of New Zealand, above n 5, at [22].
We do not consider that the reasoning in these decisions, which were concerned with the interpretation of the expression “interlocutory decision” in rules which no longer exist, should determine the meaning of the expression in the different context of appeals from commercial list decisions. It appears to us that the decisions in Matthews and Scottwood were developed at a time when this Court was concerned to limit appeals as of right, especially appeals to the Privy Council. As the Supreme Court has made clear in Siemer v Heron, however, general rights of appeal should not be read down to limit appeals, and categories of interlocutory decisions are to be avoided.[39] Appeals to the Supreme Court are now governed by the provisions of s 13(4) of the Supreme Court Act 2003 which precludes appeals against orders made by this Court on “interlocutory applications”.
[39] Siemer v Heron, above n 8, at [30]–[31].
In our view, applying the approach of this Court in R v Chilton,[40] the reasoning of the majority in Matthews and this Court in Scottwood should no longer be accepted as correct and should not be followed. The reasoning reflected a rigid adherence to precedent, leading to an erroneous outcome which should not be perpetuated, especially as it was reached in the particular context of rules that no longer exist. As the majority in Matthews recognised, the reasoning of Fisher J, based on logic, would in the absence of precedent have been preferred. We agree that the reasoning of Fisher J is compelling. Indeed in our view the four reasons he gives for circumscribing interlocutory orders are convincing and should be accepted in order to overcome what has been described as an anomalous outcome.[41]
[40] R v Chilton [2006] 2 NZLR 341 (CA) at [83]–[90].
[41]Andrew Beck “Litigation” [2002] NZLJ 17 at 19; and Andrew Beck “Litigation” [2008] NZLJ 451 at 451.
In the context of appeals from the commercial list, the expression “interlocutory decision” in s 24G should therefore be given a meaning that accords with principle and logic. Parties whose proceedings are on the commercial list should be able to determine without difficulty whether they have a right of appeal or must obtain leave. For them the focus should be on the substance of the decision and not on the form of the application. A decision is final and not interlocutory if it constitutes a final disposition of the rights of the parties in the proceeding, whether or not there has been consideration of the substantive merits. In the context of commercial list cases, consistency between New Zealand and Australia is also a desirable outcome.[42]
[42]Dominion Rent A Car Ltd v Budget Rent A Car Systems (1970) Ltd [1987] 2 NZLR 395 (CA) at 407; and Attorney-General v Dreux Holdings Ltd (1996) 7 TCLR 617 (CA) at 627–628; and see John Farrar “Closer Economic Relations and Harmonisation of Law Between Australia and New Zealand” in P A Joseph (ed) Essays on the Constitution (Brookers, Wellington, 1995) at 158.
Adopting this approach, a decision granting summary judgment for a plaintiff or a defendant is a final decision because it determines the claim and brings the proceeding to an end. It is not in fact an interlocutory decision, even although it is made after an interlocutory application has been filed.
We recognise that in Re Fidow,[43] Thomas J, in an oral judgment in the High Court, took a different view in deciding that a summary judgment was an interlocutory judgment. But that was in the context of an application for leave to appeal to this Court under r 27 of the Court of Appeal Rules 1955 and was influenced by the line of authority that led subsequently to the majority decision in Matthews. Furthermore, the approach adopted by Thomas J was expressly not endorsed by this Court on appeal[44] and was not followed by Master Williams QC in Central Acceptance Ltd v Autohelp and Towage Ltd.[45]
[43] Re Fidow, above n 6.
[44]Fidow v Registered Securities Ltd (in liq) (1991) 3 PRNZ 235 (CA) at 238.
[45] Central Acceptance Ltd v Autohelp and Towage Ltd (1991) 4 PRNZ 179 (HC).
In Central Acceptance Ltd Master Williams QC decided that when summary judgment was entered it was entered in respect of a claim in the statement of claim and was not a judgment entered on the notice of interlocutory application. The application was simply the vehicle by which the plaintiff sought to obtain the judgment. The entry of summary judgment finally disposed of the matter between the parties and necessarily put an end to the litigation. The judgment was therefore a final one for the purposes of r 27 of the Court of Appeal Rules 1955. In reaching this conclusion Master Williams QC noted that it was consistent with the views of the textbook writers on the subject and the rules relating to summary judgments.[46]
[46] At 184–188.
We do not accept Mr Harrision’s submission that the decision in Central Acceptance Ltd should be distinguished on the grounds that it is inconsistent with the decision in Matthews and involved a defendant’s interlocutory application for summary judgment against a plaintiff where there was no statement of defence. In CBL’s case summary judgment was entered against RJW on the basis of CBL’s positive defences of limitation and lack of standing pleaded in its statement of defence.[47] Potter J’s judgment finally disposed of the claim between RJW and CBL.
[47] Waterhouse v Contractors Bonding Ltd, above n 1, at [27]–[32], holding at [105]–[106].
Finally, the fact that in terms of s 66 of the Judicature Act RJW has a right of appeal, unrestricted by s 24G, against Potter J’s entry of summary judgment in favour of CBL (a final decision) while CBL may appeal only with leave against Potter J’s refusal to grant summary judgment in respect of GW’s claim (an interlocutory decision)[48] does not produce an unjustifiable outcome as Mr Harrison submitted. On the contrary, the difference in outcome is in accordance with principle and the different nature of the two decisions: one a final disposition of RJW’s claim, the other not a final disposition of CBL’s defence to GW’s claim.[49]
[48] Juno Group Holdings Ltd v Oakley, above n 6.
[49]Andrew Beck Summary Judgment Procedure (Butterworths, Wellington, 1988) at 101.
Contrary to Mr Harrison’s submissions, we do not consider that CBL is prejudiced by this outcome. It is entitled to pursue its application for leave to appeal, which in the circumstances of this case, where RJW is pursuing his right of appeal, is likely to be granted either by the High Court or this Court in order to enable the two appeals to be heard together. Furthermore, even if leave were not granted, CBL would be able to pursue its summary judgment arguments again at the substantive hearing of GW’s claim.
Result
Accordingly, the application by CBL to strike out the notice of appeal by RJW is dismissed.
As CBL was entitled to apply to strike out RJW’s appeal on the basis of this Court’s decisions in Matthews and Scottwood, there should in the circumstances be no order for costs.
Solicitors:
Harmos Horton Lusk Ltd, Auckland for Appellants
Fortune Manning, Auckland for Respondent
12
7
0