Wiley v Morison Guildford and Associates Limited HC Wellington CP235/00

[2001] NZHC 1285

IN THE HIGH COURT OF NEW ZEALAND
WELLINGTON REGISTRY CP235/00

IN THE MATTER OF the Securities Act 1978

BETWEEN JULIA CLARE WILEY
Plaintiff

AND MORISON GUILDFORD & ASSOCIATES LIMITED
First Defendant

AND MICHAEL PHILLIP GUILDFORD
Second Defendant

AND ANDREW MORISON
Third Defendant

Date of hearing: 12 September 2001

Counsel: S J Brown for Plaintiff
S A Barker for Defendants

Judgment date: 18 December 2001

JUDGMENT OF MASTER J C A THOMSON

[1] The plaintiff issued interrogatories against the defendants. Some of the interrogatories were voluntarily answered. The defendants rely on R 284 to refuse to answer the remainder. I start by saying today it is accepted that nearly anything that is material may be interrogated upon. As Master Hansen (as he then was) said in Bank of New Zealand v Gardner (1990) 2PRNZ 278 at 281:

“The law with regard to interrogatories is now very sweeping. It is not permissible to ask the names of persons merely as being the witnesses whom the other party is going to call, and their names not forming any substantial part of the material facts; and I think we may go so far as to say that it is not permissible to ask what is mere evidence of the facts in dispute, but forms no part of the facts themselves. But with these exceptions it seems to me that pretty nearly everything that is material may now be asked. The right to interrogate is not confined to the facts directly in issue, but extends to any facts the existence or non-existence of which is relevant to the existence or non-existence of the facts in issue.”

[2] The relevant principles to be applied are set out in Dovey v Bank of New Zealand (High Court, Auckland M1045/94, 8 September 1997, Master Kennedy-Grant) as follows:

“(i) Interrogatories are to be seen as one of the means by which ‘the rules assist the parties in coming to a recognition of the proper issues and, through recognition, to a settlement of disputes’: Sunde v Meredith Connell & Co (High Court, Auckland, A1479/85, 19 September 1986, Barker J );

(ii) ‘The Court should err, if it is to err at all, on the side of allowing interrogatories; being too liberal rather than too conservative’: Re Securitibank (No 31) (1984) 1 PRNZ 514 at 517;

(iii) Answers to interrogatories must be specific and substantial, not perfunctory nor evasive, correct according to the knowledge, information and belief of the person giving them and, if it is not possible to answer the interrogatory with complete precision, a proper attempt must be made to answer it as accurately as possible: Henwood v Radio New Zealand Ltd (1993) 7 PRNZ 160;

(iv) Interrogatories are relevant not only where the answer will be conclusive on an issue but where it might tend to establish or disprove, or form a step in the establishing or disproving of, the allegations made: Shore v Thomas [1949] NZLR 690 at 695/6-10; Re Securitibank (No 31), ubi supra, and Bank of New Zealand v Gardner (1990) 2 PRNZ 278 at 283;

(v) Interrogatories must be necessary;

(vi) Interrogatories are oppressive if they are ‘contrary to the rules of justice or fair play and. . .burdensome or wrongful’: Elston v State Services Commission (No 2) [1979] 1 NZLR 210 at 215/40-42; Re Securitibank (No 31;

(vii) Interrogatories as to the contents of existing documents will not usually be permitted: Discovery and Interrogatories (2nd edition, 1990) p 167; Chan v Minister for Immigration and Ethnic Affairs (1983) 49 ALR 593 at 596.”

[3] The reason for allowing interrogatories in the first place was to break down the traditional behaviour (a product of the adversarial approach) of keeping one’s cards as close to the chest for as long as possible. For example one was not allowed to interrogate as to the names of witnesses. Technically that is still the law but witnesses names are disclosed anyway on the exchange of briefs of evidence before trial and now there would seem no point in disallowing such interrogatories.

[4] The first defendant has not provided any answers to the interrogatories because the second and third defendants say, as the name of the first defendant suggests that they are the principals of the Company and it has no answers separate to those of either of the second or third defendants. Therefore, any answers to interrogatories by the company would simply be a duplication of answers already provided by one of its principals. As to one interrogatory they altered their stance during the hearing and accepted, it should be answered by the first defendant.

[5] In summary, the defendants say many of the interrogatories are directed towards matters that are not in issue in the proceeding in that they relate to third parties and funds belonging to third parties (i.e. neither the plaintiff nor any defendant). Further, they contend that many of the balance of the interrogatories which are objected to pose either questions of law, or mixed questions of fact and law, and that is not permissible. Interrogatories aimed at ascertaining facts which are merely evidence of facts in issue are also not permissible. Interrogatories that request production of documents should they say not be allowed and as to that I agree.

[6] However, as to the earlier propositions, in my view if an interrogatory is relevant then the Court should, as Master Kennedy-Grant says, be too liberal rather than too conservative in deciding whether to allow it. It should not take a too technical approach or be overly concerned as to whether an interrogatory is or is not a mixed question of law and fact or whether it is aimed at ascertaining facts which are arguably merely evidence of facts in issue. Specifically, I do not uphold Mr Barker’s submission that interrogatories must be confined to matters raised in the pleadings. That is particularly so here because an application for summary judgment was filed but not proceeded with, but with the result that there have been affidavits filed by both parties which raise issues which are properly the subject of interrogatories.

[7] The second and third defendants have between then answered some of the interrogatories asked, I therefore deal with each interrogatory in turn:

•     Interrogatories 1 and 1.1 have been answered by the second defendant.

•     Interrogatories 2 and 3 - interrogatory 2 is amended to read, “Do you know who holds the Gideon Hedge Fund Trading Trust Deed. If so, identify the holder.” Interrogatory 3 is amended to read, “Before 1 January 2000 did the defendants and each of them know of the existence of an express trust known as “GHF Trading Trust” or “Gideon Hedge Fund Trading Trust?” The defendants are directed to answer these interrogatories as amended.

•     Interrogatory 4 - this interrogatory has been partly answered by the third defendant. To the extent that it asks for the production of a document (the Trust Deed) it is disallowed, and anyway was withdrawn.

•     Interrogatory 5.1 and 5.2 - the defendants having pleaded the existence of a trust known as the Gideon Hedge Fund Trading Trust and having answered 5.3 and 5.4, I direct they should answer 5.1 and 5.2

•     Interrogatories 5.3 and 5.4 have been answered.

•     Interrogatory 5.5. - this interrogatory requires production of a document and is disallowed and anyway is withdrawn by the plaintiffs.

•     Interrogatories 5.6 and 5.7 are far too wide and are disallowed.

•     Interrogatory 5.8 plaintiff applies to amend this interrogatory to read “Do the defendants know of any prospectus or investment statement issued by the defendants of the so-called entity, Gideon Hedge Fund Trading trust or Gideon Investments Pty Limited, or anyone else in respect of the same in respect of the so-called unit trust? This interrogatory as amended is directed to be answered by the defendants.

•     Interrogatory 6.1 answered by the third defendant.

•     Interrogatory 6.2 answered by the third defendant.

•     Interrogatory 6.3 disallowed. It seeks production of documents and anyway is withdrawn by the plaintiff.

•     Interrogatory 6.4 answered by second defendant.

•     Interrogatories 6.5, 6.5.1 and 6.5.2 disallowed. They seek production of documents. They are also too wide and therefore oppressive.

•     Interrogatories 6.6 and 6.6.1 require no answer.

•     Interrogatories 6.6.2, 6.6.3 and 6.6.4 - I direct these interrogatories be answered as being relevant.

•     Interrogatories 6.6.5, 6.6.6.1, 6.6.5.2 and 6.6.5.3 - I direct these interrogatories be answered as being relevant.

•     Interrogatory 6.6.6 and 6.6.7 - I direct these interrogatories be answered as being relevant.

•     Interrogatory 6.6.8 - answered by both second and third defendants.

•     Interrogatory 6.6.9 - I direct this interrogatory be answered as being relevant.

•     Interrogatory 6.6.10, 6.6.10.1, 6.6.10.2 and 6.6.10.3 - I direct these interrogatories be answered as being relevant.

•     Interrogatory 6.6.10.4 requires production of a document and is disallowed and anyway is withdrawn by the plaintiff.

•     Interrogatory 6.6.11 requires no answer.

•     Interrogatories 6.6.11.1, 6.6.11.2 and 6.6.11.3 are relevant and are directed to be answered.

•     Interrogatory 6.6.11.4 requires production of a document and is disallowed and anyway is withdrawn by the plaintiff.

•     Interrogatories 6.6.12 is directed to be answered as relevant.

•     Interrogatory 6.7 is directed to be answered as relevant.

•     Interrogatories 7, 8, 9, 9.1 and 9.2 have been answered by the second and third defendants.

•     Interrogatories 10, 10.1 and 11 are oppressive and are disallowed.

•     Interrogatory 12 - I understand the First defendant will answer these interrogatories. In any event the defendants are directed to answer.

•     Interrogatories 12.1, 12.2 and 12.3 - these interrogatories appear to be outside even a wide definition of relevancy and are disallowed.

•     Interrogatories 13, 13.1 would appear to be properly the subject of an application to admit facts and are disallowed.

•     Interrogatory 14 answered by second and third defendants.

•     Interrogatory 15. This interrogatory would also appear to be properly the subject of a notice to admit facts and is disallowed.

•     Interrogatories 16, 16.1, 17, 17.1, 18, 18.1, 19, 19.1, 20 and 20.1 - These interrogatories seek to examine the defendants as to their knowledge of the Acts referred to and the extent of compliance therewith. I do not consider these questions are a proper use of the interrogatory procedure and in any event are oppressive and are disallowed.

•     Interrogatories 21, 21.1, 21.2 and 21.3 have been answered by the second and third defendants.

•     Interrogatory 21.4 requires production of a document and is disallowed and anyway is withdrawn by the plaintiff.

•     Interrogatory 22 and interrogatory 22.1 are disallowed for the same reason as interrogatory 16 et seq are disallowed.

•     Interrogatory 23 and 23.1 answered by second and third defendants.

•     Interrogatory 23.2 requires production of a document and is disallowed and anyway is withdrawn by the plaintiff.

•     Interrogatory 23.3 (referred to by second and third defendants as 23.2) has been answered.

[8] Having completed this tedious and time consuming exercise, I reiterate what I said on a recent Chambers day that the new fad of seeking extensive answers to interrogatories which will in many cases be contested, has the capacity to bring the general duties of the Masters to a grinding halt. In my view the Rules Committee should give serious and urgent consideration to limiting interrogatories to say 10 maximum, particularly as the information sought will inevitably be made available when briefs of evidence are exchanged. That being so, it is hard to see that the routine issue of interrogatories achieves any purpose but add to the cost of litigation.

[9] Costs reserved.