Young v Ross

[2023] NZHC 750

IN THE HIGH COURT OF NEW ZEALAND NAPIER REGISTRY

I TE KŌTI MATUA O AOTEAROA AHURIRI ROHE

CIV-2022-441-059

[2023] NZHC 750

BETWEEN

PHILIP ROGER YOUNG

Applicant

AND

PHILIP NICHOLAS ROSS

Respondent

CIV-2022-441-060

BETWEEN

PROGRESSIVE ACCOUNTANTS LIMITED

Applicant

AND

PHILIP NICHOLAS ROSS

Respondent

On the papers:
Counsel:	P R Young in person for Applicants
Judgment:	5 April 2023

JUDGMENT (NO. 4) OF CHURCHMAN J [LEAVE TO APPEAL]

Introduction

[1]                 On 17 February 2023, I issued a decision (the decision) dismissing the applicants’ appeals against two decisions of the District Court at Napier striking out the applicants’ respective claims.1

1      Young v Ross [2023] NZHC 212.

YOUNG v ROSS (NO. 4) [2023] NZHC 750 [5 April 2023]

[2]                 The applicants now seek leave to appeal my decision to the Court of Appeal. Mr Young, on behalf of  both  himself  and  second  applicants,2  submits  there  are 10 grounds of appeal, said to give rise to 16 questions of law for determination by the Court of Appeal. The respondent opposes leave being granted. He says there is no merit in any of the issues the applicants wish to take on appeal.

[3]                 As this is an application for leave to bring a second appeal, the procedure set out in s 60 of the Senior Courts Act 2016 applies. This provides that the decision of the High Court on appeal from the District Court is final unless a party, on application to the High Court (or, if the High Court refuses leave, to the Court of Appeal) obtains leave to appeal the decision to the Court of Appeal.

[4]                 Leave for a second appeal is not lightly granted. Such leave requires the appeal to raise some question of law or fact capable of bona fide and serious argument involving some interest that is sufficiently important to outweigh the cost and delay of a further appeal.3 The Court of Appeal is not engaged in a second appeal in the general correction of error.4 Rather, the primary function of a second appeal is to clarify the law and determine whether it has been properly construed and applied by the Court below.5 It is not every alleged error of law that is of such importance as to justify further pursuit of litigation which has already been twice considered and ruled on by a Court.6 The test is restrictive. There must be sufficiently compelling reasons for a second appeal.7

Background

[5]                 As I noted in my decision, Mr Young and Mr Ross have had dealings going back more than 30 years.8 In February 1997, Mr Young brought defamation proceedings against Mr Ross in the High Court at Hamilton. These proceedings were

2      Gwyn J made directions granting the first applicant leave to represent the second applicant for the purposes of this application by minute dated 28 March 2023.

3      Waller v Hider [1998] 1 NZLR 412 (CA) at 413.

4      At 413.

5      At 413.

6      At 413.

7      See Parkins v Parkins [2022] NZHC 2257 at [5].

8      The following background is described in more detail in my decision in Young v Ross, above n 1, at [5]–[42].

terminated when a notice of discontinuance dated 4 September 2000 was filed in the High Court. Accompanying the notice of discontinuance was a memorandum containing four points of agreement (the agreement), including most relevantly here that “all publicity, including the Internet sites of the defendant, be stopped forthwith and forever.”

[6]                 There then occurred a number of subsequent events, including the first applicant being found guilty of professional misconduct and struck off the register of Chartered Accountants, and being adjudicated bankrupt in 2003. In 2018, an article about Mr Young was published on the Wiki site “RationalWiki.org”, referring to various events in which Mr Young had  been  involved  since  4  September  2000. Mr Young complained to the Standards Committee of the New Zealand Law Society alleging that Mr Ross had republished defamatory material and breached an order made during the defamation proceedings. On 17 July 2019, the Standards Committee determined that no further action was necessary or appropriate. On 6 August 2019, Mr Young reviewed the Standard Committee’s decision before the Legal Complaints Review Officer (LCRO), who confirmed  the  Standard  Committee’s  decision  on 30 April 2020.

[7]                 Mr Young then issued proceedings in the District Court, alleging breach of the agreement between himself and Mr Ross and challenging the decisions of the Standards Committee and LCRO. On the application of Mr Ross, on 18 November 2021 Judge Kelly struck out the proceedings. Mr Young consequently issued fresh proceedings in the name of the second applicant, a company through which he conducted an accountancy practice. These proceedings were based on substantially similar grounds. On 19 July 2022, Judge Kelly struck out these proceedings as well.

[8]                 On 17 February 2023, I dismissed the applicants’ appeals against both decisions, finding all of the causes of action had no prospect of success and were properly struck out.9 This is the decision from which the applicants now seek leave to bring a second appeal.

9 At [72].

Analysis – the applicant’s prospective grounds of appeal

[9]                 I will assess each of the applicants’ grounds in turn to determine whether any has merit either by itself or in combination with others amounting to sufficiently compelling reasons for a second appeal.10

First proposed point of appeal – bankruptcy of the first applicant

[10]              The applicants criticise the characterisation of the contractual right arising from the agreement accompanying the notice of discontinuance as a chose in action. The applicant says there was no chose in action which passed to the Official Assignee on the first applicant’s bankruptcy and thus the strike out decision, which was based on the “relatively narrow ground” that all of the first applicant’s property, including any choses in action, vested in the Official Assignee, means the first applicant was denied their day in court. The applicants suggest that since no choses in action existed in relation to the agreement, there are serious questions of law in relation to the relevance of both the bankruptcy and authorities cited.

[11]              The applicants do not accept that the contractual right the first applicant possessed under the signed agreement constituted in law a chose in action. This does not, however, alter the legal reality that this right was a chose in action, and that, by operation of the Insolvency Act as it existed at the time, such a chose in action vested by law in the Official Assignee on the first applicant’s bankruptcy. This being the case, the fact of the bankruptcy, as well as the cases cited, were clearly relevant, and their use does not give rise to a serious question of law as contended.

Second proposed point of appeal – use of prohibited publicity in current proceedings

[12]              The applicants claim that the agreement prohibited the respondent from referring to any matters relating to the 1997 defamation proceedings. However, as I stated in my decision, the matters about which the applicant appeared to be concerned are all matters of public record.11 As I found, it cannot be the case that the agreement

10     See Parkins v Parkins [2022] NZHC 2257 at [5].

11     Young v Ross, above n 1, at [53].

could preclude the respondent from referencing such matters, as the applicant contends.

[13]              The first question proposed for appeal under this head was answered in the substantive judgments. The reasoning behind that question did not require overruling precedent, as the applicant contends by his next question for appeal. Neither of the questions raised under this head therefore gives rise to a question of law for determination on appeal.

Third proposed point of appeal – prospective nature of the agreement

[14]              The applicants submit there is a serious question as to whether the agreement was by nature prospective, because it prohibited publicity “forthwith and forever”. However, this contention is misconceived. The applicants’ interpretation of the agreement, specifically that it would prohibit the respondent from referring to the first applicant in any forum both in relation to events that had already occurred as well as matters that had not yet occurred, is not an interpretation that can realistically be placed on the wording of the agreement. I accept the respondent’s submission on this point that something that did not exist at the date of the agreement could not be “stopped”. Such future matters that may arise were not captured by the agreement. The agreement clearly related to those matters that had already been the subject of the defamation proceedings. The prospective nature of the agreement is not a serious question of law for determination on appeal.

Fourth proposed point of appeal – conferring a benefit to a name, description or class

[15]              In the substantive proceedings, the first applicant sought to extend to the second applicant (who was not named as a contractual party to the agreement) a right of action conferred to the first applicant under the agreement. Section 12 of the CCLA provides a right of action in some cases to a non-party beneficiary of a contract “designated by name, description, or reference to a class”. I found, consistently with the Judge in the Court below, that it was apparent that the second applicant was not so designated and thus could not possibly acquire any rights under s 12 of the CCLA.12

12 At [71].

[16]              The applicant takes issue with this conclusion, now submitting that there is a question to be raised as to whether the phrase “all publicity” in the agreement refers to a group or class, and the phrase “the Internet sites of the defendant” provides a “specific description” so as to entitle the second applicant as a non-party beneficiary under the agreement to acquire rights under the agreement.

[17]              There is no basis for such a claim. I am satisfied the agreement does not designate the second applicant in any way and it is not possible to accept the applicant’s arguments that the second applicant could be so designated in the use of the terms “all publicity” and “the Internet sites of the defendant”. There is nothing in the applicant’s submissions on this point that gives rise to a serious question of law.

Fifth proposed point of appeal – did the second applicant need to exist to become a beneficiary?

[18]              There is no point of law capable of bona fide and serious argument under this head. Section 12(3) of the CCLA is prescriptive on this point. It is clear that s 12 applies whether or not the person said to be designated in the agreement is in existence when the agreement is made.

[19]              I understand the applicants to suggest that my judgment contradicts this clear legislative direction.   This argument, however, takes my comment out of context.     I stated:13

The notice of discontinuance could not possibly have imposed any obligation on [the respondent] in relation to [the second applicant] as that company did not even exist as at [the date the notice of discontinuance was filed].

This comment occurred in the context of determining whether the agreement by itself applied in respect of the second applicant. My analysis of the argument that the agreement applied in respect of the second applicant under s 12 of the CCLA by designating the second applicant in the terms of that provision occurred later, at [69]–

[71] of the judgment. As noted, I found that argument failed for the reason that it was “apparent” that the second applicant was not so designated, but not for the reason that

13 At [56].

it was not yet in existence at the time. Such reasoning would have been clearly wrong given the words of s 12(3), which set out the law clearly.

Sixth proposed point of appeal – does the second applicant have beneficial standing?

[20]   The applicants’ argument under this head appears to be that as the second applicant is a beneficiary of the promise as to non-publicity contained in the agreement, the respondent is not entitled to vary or discharge the obligation. Even accepting the second applicant may be such a beneficiary, it does not appear to be the case that there has been any such variation or discharge. As I found in my judgment, it cannot be the case that the respondent was prohibited under the agreement from referring to matters that are matters of public record. The proposed questions of law would not assist the applicant’s case.

Seventh proposed point of appeal – is the respondent’s alleged admission before the LCRO admissible?

[21]   The applicants submit the respondent’s admissions relating to an association with the RationalWiki blog on which certain posts about the first applicant appeared gives rise to a serious question of law as to the admissibility of such admissions in civil proceedings such as this. However, I am not satisfied there would be such a serious question of law here. As I found in my judgment: 14

[t]here is nothing in the Lawyers and Conveyancers Act that gives a person in [the first applicant’s] position a right to commence civil proceedings that are effectively a collateral challenge to the findings of the Standards Committee and the LCRO

[t]he Court has no jurisdiction to effectively reopen and reconsider the complaints already finally determined by the Standards Committee and LCRO.

[22]   The strike out decision was not predicated on the respondent’s responsibility for the post in question.

14     At [63]–[64].

Eighth proposed point of appeal – the relevance of Document D being a republication

[23]   Under this proposed ground of appeal, the applicants challenge the relevance of what is said to be my “claim” that Document D was a republication (for which the respondent could therefore not be held responsible). The applicants say the Judge never referred to Document E, which is said to show that any republication was just a restoration of the respondent’s original publication (which therefore is said to breach the agreement). The applicants say the relevance of Document D being a republication is a serious question of law, which must be answered firmly in the negative.

[24] However, this cannot be an issue capable of serious argument, as it was not material to either the decision by the Judge or my own decision on appeal. With reference to my decision, to suggest that the fact Document D was a republication was in any way a material aspect of my reasoning is a misconstruction of my judgment. The passage to which the applicant referred (and the only such occurrence in the judgment) was at [29] of my judgment, quoting the Judge in the District Court in the course of describing the strike out decision on appeal. It was clearly background information. My analysis and discussion of the appeals, in which I found that the appeals had no basis on other points, began only at [45].

[25]   Secondly, with reference to the use of this matter by the Judge, as I explicitly noted at [29] in describing the Judge’s conclusions, the Judge, with reference to the fact Document D was a republication, made the finding the respondent could not be responsible for a publication made by a third party “[a]though not required to”. As such, as I expressly stated, that comment was clearly obiter.

[26]   The relevance of whether a document is a republication or not is not a serious question for appeal in this case.

Ninth proposed point of appeal – a respondent’s legal costs

[27]   The ninth proposed point of appeal seeks to raise a number of questions as to costs. However, none of the questions proposed raises any such serious question of law. Indeed, the first two questions can be dealt with in the application for costs for this matter, and are simply resolved. The next question in fact simply restates the

applicants’ case in making this application for leave to appeal. The final question under this head appears to raise a fresh question for determination entirely, but one that is not necessary for determination in this matter, for reasons I now explain in terms of the tenth proposed point of appeal.

Tenth proposed point of appeal – are damages to the applicants claimable?

[28]   This final point of appeal can be disposed of shortly. The applicants appear to be confused as to the function and meaning of ss 38-45 of the CCLA, which, as the respondent rightly points out, are aimed at a situation when a party has either repudiated a contract or threatens to do so. As all decisions to this point relating to these proceedings have found, the agreement does not bear the interpretation for which the applicants contend, and the applicants do not possess any right which they could enforce. Moreover, there is no evidence the respondent has cancelled the contract. Apart from being an apparently fresh point not necessary for determination here, relief under the provisions the applicants refer to here would in any case be unavailable.

Conclusion

[29]   I find that none of the proposed points of appeal raised by the applicants in their application for leave to bring a second appeal against my decision has any merit either individually or collectively. I am satisfied none of the grounds raises a question of law or fact capable of bona fide and serious argument sufficiently important to outweigh the cost and delay of a further appeal.

Result

[30]The application for leave to bring a second appeal is dismissed.

Costs

[31]   The parties have agreed the matter should be characterised as 2B for the purposes of costs. I see no reason to depart from this classification. As the successful party in relation to this application, the respondent is entitled to costs on a 2B basis. The respondent is to file a schedule for sealing.

Churchman J

Solicitors:

Cathedral Lane Law, Napier for Respondent cc:           P R Young