Ressels v Southern Response Earthquake Services Ltd [2023] NZCA 614 (4 December 2023)

Last Updated: 11 December 2023

IN THE COURT OF APPEAL OF NEW ZEALAND I TE KŌTI PĪRA O AOTEAROA

CA338/2023 [2023] NZCA 614

	BETWEEN	TREVOR STUART RESSELS Applicant
	AND	SOUTHERN RESPONSE EARTHQUAKE SERVICES LTD First Respondent JOHN ARTHUR SNEESBY Second Respondent

Court:	French and Katz JJ
Counsel:	G D R Shand for Applicant T C Weston KC for First Respondent
Judgment: (On the papers)	4 December 2023 at 3.30 pm

JUDGMENT OF THE COURT

1. The application for leave to appeal is declined.
2. There is no award of costs.

____________________________________________________________________

REASONS OF THE COURT

(Given by French J)

Introduction

• [1] Mr Ressels seeks leave to appeal a decision of Associate Judge Lester in which the Judge declined Mr Ressels’ applications involving joinder as a plaintiff in a representative capacity to existing proceedings.^[1]
• [2] For reasons we later explain, leave is required under s 56(5) of the Senior Courts Act 2016. Mr Ressels first sought leave to appeal from the High Court.^[2] This was refused, prompting Mr Ressels to seek leave from this Court.^[3]
• [3] The first respondent opposes leave being granted.

Background

• [4] The proceeding to which Mr Ressels wants to be joined was filed in July 2021 by a Mr Sneesby against the respondent Southern Response Earthquake Services Ltd.
• [5] Mr Sneesby’s proceeding concerns the cost of certain repairs to a residential property that suffered earthquake damage in the Christchurch earthquakes. He lodged a claim in respect of items not covered by Toka Tū Ake | the Earthquake Commission (out of scope items) with his private insurer AMI Insurance Ltd, now Southern Response.
• [6] In mid-2014, Southern Response assessed the cost of repairing the out of scope items as amounting to $29,588.70. Mr Sneesby accepted that figure in settlement of his claim.
• [7] Seven years later, he issued the proceedings at the heart of this case. The statement of claim alleges that Southern Response misled Mr Sneesby by providing a costs assessment that it knew did not allow for such matters as contingencies and general charges. With contingency and general charges included, the figure should, it is alleged, have been $39,382.56, resulting in a shortfall of some $9,793.86.
• [8] Not long after filing his proceeding, Mr Sneesby applied for leave to bring the claim as a representative plaintiff, on behalf of himself and numerous other homeowners insured with Southern Response alleged to have been similarly short paid. Their numbers were estimated at up to 9,500.
• [9] The application to sue in a representative capacity was declined by Associate Judge Lester.^[4] It was declined on the ground that Mr Sneesby’s own claim was meritless.^[5] In 2017, he had settled other earthquake-related litigation with Southern Response and had entered into what was described as a “robust and comprehensive full and final settlement agreement”^[6] which precluded “any further or other claim”.^[7] Implicit in the judgment is the fact that other homeowners had not signed settlement agreements in the same terms, meaning their cases would likely not be sufficiently similar to Mr Sneesby. Mr Sneesby sought to appeal this decision but leave to appeal was refused both by the High Court^[8] and this Court.^[9]
• [10] On 27 May 2022, Mr Ressels filed an application to be joined to the Sneesby proceeding as a second plaintiff. Subsequently on 26 July 2022, he filed an application seeking leave to sue as a representative, duplicating Mr Sneesby’s unsuccessful application. Mr Sneesby consented to the applications.
• [11] In declining both of Mr Ressels’ applications, the Judge held that the joinder application failed to satisfy the requirements of r 4.56 of the High Court Rules 2016.^[10] It followed that if Mr Ressels was unable to be joined to the Sneesby proceeding as a plaintiff, he was also unable to bring his claim in that proceeding in a representative capacity.^[11] It is this decision that Mr Ressels now seeks to appeal.
• [12] Before turning to address the application for leave to appeal, we note that despite filing an application for leave to appeal in both the High Court and this Court, Mr Shand argues on behalf of Mr Ressels that leave is not actually required. He submits that Mr Ressels has an appeal as of right by virtue of s 56(4) of the Senior Courts Act.
• [13] Section 56(4) states:

(4) Any party to any proceedings may appeal without leave to the Court of Appeal against any order or decision of the High Court—

(a) striking out or dismissing the whole or part of a proceeding, claim, or defence; or

(b) granting summary judgment.

• [14] According to Mr Shand, s 56(4) applies because the effect of the Judge’s decision is that it has brought Mr Ressels’ involvement in the Sneesby proceeding to an end. In our view this argument is untenable. The right conferred under s 56(4) is expressly limited to a party to a proceeding, which Mr Ressels is not. Further the proceeding has not been struck out or dismissed in whole or part, nor has summary judgment been granted.^[12] The proceeding still exists.
• [15] In our view there is no doubt that a joinder application is an interlocutory application and accordingly that the impugned decision was a decision made on an interlocutory application. That means by virtue of ss 56(3) and 56(5) that leave to appeal from either the High Court, or failing that, leave from this Court, is required.

Principles governing the application for leave

• [16] It is well established that applications for leave to appeal under s 56(5) are governed by a high threshold.^[13] The applicant must persuade the Court that the proposed appeal raises an issue/issues of sufficient importance that warrant the further delay and cost which the appeal process would cause.^[14] The reason for the high threshold is that the leave requirement was intended to act as a filter and reduce the volume of appeals involving interlocutory decisions.^[15]
• [17] Mr Shand relies on a recent High Court decision of Venning J in Simons v ANZ Bank which suggests a lower threshold should apply where leave is being sought to appeal a decision declining leave to bring a representative claim.^[16] As will become apparent, it is unnecessary for us to determine the correctness of that approach because regardless of whether the threshold is high or low, the outcome of this application would still be the same.

The proposed appeal grounds

• [18] Mr Shand’s central thesis is that the Judge’s decision is contrary to common sense, and the express objective of the High Court Rules which is to facilitate the just, speedy and inexpensive determination of proceedings.^[17] The effect of the decision has meant Mr Ressels having to commence separate proceedings which, it is argued, is an unnecessary and wasteful duplication causing delay, additional costs and the risk of different findings, as well as raising potential time limitation issues. More specifically, Mr Shand contends that either the Judge applied the wrong joinder rule or if he did identify the correct rule, he misinterpreted it. Either way, he submits, there was jurisdiction to grant joinder in the circumstances of this case and it should have been ordered.
• [19] As mentioned, the Judge held that the application for joinder as a second plaintiff was governed by r 4.56 of the High Court Rules.^[18] Mr Shand argues the correct rule was r 4.2.
• [20] Rule 4.2 which is contained in a part of the Rules headed “Parties” states:

4.2 Plaintiffs

(1) Persons may be joined jointly, severally, or in the alternative as plaintiffs,—

(a) if it is alleged that they have a right to relief in respect of, or arising out of, the same transaction, matter, event, instrument, document, series of documents, enactment, or bylaw; and

(b) if each of those persons brought a separate proceeding, a common question of law or fact would arise.

(2) On the application of a defendant, the court may, if it considers a joinder may prejudice or delay the hearing of a proceeding, order separate trials or make any order it thinks just.

• [21] In Mr Shand’s submission, Mr Ressels satisfies the pre-requisites to joinder under this rule. However, regardless of whether that is so or not, it is in our view beyond argument that this rule only applies when proceedings are first commenced, not afterwards.^[19] We agree with the Judge that when joinder is being sought after the proceeding has commenced, the applicant must bring themselves within a different rule contained in the subpart of the High Court Rules headed “Adjusting parties”, namely r 4.56.^[20]
• [22] Rule 4.56 reads:

4.56 Striking out and adding parties

(1) A Judge may, at any stage of a proceeding, order that—

(a) the name of a party be struck out as a plaintiff or defendant because the party was improperly or mistakenly joined; or

(b) the name of a person be added as a plaintiff or defendant because—

(i) the person ought to have been joined; or

(ii) the person’s presence before the court may be necessary to adjudicate on and settle all questions involved in the proceeding.

(2) An order does not require an application and may be made on terms the court considers just.

(3) Despite subclause (1)(b), no person may be added as a plaintiff without that person’s consent.

• [23] Mr Shand submits that Mr Ressels’ case also satisfies the criteria for joinder under r 4.56(1)(b). That is because, it is said, his claim has merit so he ought to be joined. It is also argued there are questions in the proceeding that will not be able to be answered if Mr Sneesby’s claim fails because of his 2017 settlement agreement. That in turn is said to mean that Mr Ressels’ presence is necessary within the terms of the rule because it will enable all questions in the proceeding to be adjudicated and settled, not only for Mr Sneesby but also the numerous other homeowners.
• [24] We do not consider this proposed ground of appeal to be reasonably arguable. Mr Ressels’ presence is plainly not necessary to enable all questions in Mr Sneesby’s claim to be resolved. As for claims by other homeowners, r 4.56 is only concerned with the proceeding as it stands. The proceeding as it stands does not include other homeowners.
• [25] Undaunted, Mr Shand proposes to argue that in any event jurisdiction to make the orders sought can be found in rr 1.2 and 1.6:

1.2 Objective

The objective of these rules is to secure the just, speedy, and inexpensive determination of any proceeding or interlocutory application.

...

1.6 Cases not provided for

(1) If any case arises for which no form of procedure is prescribed by any Act or rules or regulations or by these rules, the court must dispose of the case as nearly as may be practicable in accordance with the provisions of these rules affecting any similar case.

(2) If there are no such rules, it must be disposed of in the manner that the court thinks is best calculated to promote the objective of these rules (see rule 1.2).

• [26] In our view, it is not seriously arguable that these general rules whether viewed in combination or individually can confer jurisdiction to join a party when the requirements of the specific joinder rules are not satisfied.
• [27] Finally, Mr Shand wishes to argue on appeal that it was an error for the Judge to fail to address Mr Ressels’ application to bring a representative claim under r 4.24.
• [28] Rule 4.24 states:

4.24 Persons having same interest

One or more persons may sue or be sued on behalf of, or for the benefit of, all persons with the same interest in the subject matter of a proceeding—

(a) with the consent of the other persons who have the same interest; or

(b) as directed by the court on an application made by a party or intending party to the proceeding.

• [29] Mr Shand submits that Mr Ressels meets all the criteria under this rule to bring a representative claim. He further argues that in considering the application, the Judge should also have taken into account the public interest in holding Southern Response accountable, the past record of Southern Response, and issues of access to justice.
• [30] We accept that one of the purposes of representative proceedings is to facilitate access to justice.^[21] We also accept that the courts take a liberal approach to representative proceedings.^[22] However, a liberal approach cannot overcome the insuperable difficulty that faces Mr Ressels. Logically, if he is not able to become a party to the Sneesby proceedings there is no basis on which an order under r 4.24 could be made in that proceeding.
• [31] There is nothing of course preventing Mr Ressels from applying to sue in a representative capacity in the proceeding that we are told he has himself now filed. We infer the reason that step has not been taken may be because of time limitation issues. Why the Ressels proceeding was not filed earlier is unclear.
• [32] Having reached the view that none of the proposed grounds of appeal raises an arguable issue of law or fact, we have concluded that the application for leave to appeal should be declined.
• [33] Southern Response has not sought costs on the application and we therefore make no award of costs.

Outcome

• [34] The application for leave to appeal is declined.
• [35] There is no award of costs.

Solicitors:
Grant Shand, Auckland for Applicant
Buddle Findlay, Christchurch for First Respondent

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^[1] Sneesby v Southern Response Earthquake Services Ltd [2023] NZHC 246 [Ressels joinder judgment].

^[2] Sneesby v Southern Response Earthquake Services Ltd [2023] NZHC 1316 [Ressels leave judgment]. Leave was sought from the High Court pursuant to s 56(3) Senior Courts Act 2016.

^[3] Ressels leave judgment, above n 2, at [60].

^[4] Sneesby v Southern Response Earthquake Services Ltd [2022] NZHC 262 at [51].

^[5] At [45] and [50].

^[6] At [45].

^[7] At [32]. The 2014 settlement agreement, mentioned at [6] of this judgment, was also expressed to be in full and final settlement of the out of scope claims and could also have been relied on. The Judge preferred to rest the case on the 2017 settlement because it was expressed in fuller terms at [26], n 5.

^[8] Sneesby v Southern Response Earthquake Services Ltd [2022] NZHC 2100 at [28].

^[9] Sneesby v Southern Response Earthquake Services Ltd [2023] NZCA 206 at [41].

^[10] Ressels joinder judgment, above n 1, at [39].

^[11] At [40].

^[12] Dokad Trustees Ltd v Auckland Council [2022] NZCA 177 at [10].

^[13] Greendrake v District Court of New Zealand [2020] NZCA 122 at [6(a)].

^[14] Ngai Te Hapu Inc v Bay of Plenty Regional Council [2018] NZCA 291 at [17].

^[15] Dokad Trustees Ltd v Auckland Council, above n 12, at [10].

^[16] Simons v ANZ Bank New Zealand Ltd [2022] NZHC 2842 at [7].

^[17] High Court Rules 2016, r 1.2.

^[18] Ressels joinder judgment, above n 1, at [17].

^[19] Doug Andrews Heating and Ventilation Ltd v Dil [2012] NZHC 2534 at [16]; Mitchell v Attorney‑General [2016] NZHC 1737, [2016] NZAR 962 at [11]; and Smith v Noble Investments Ltd [2017] NZHC 477 at [25]–[27].

^[20] Ressels joinder judgment, above n 1, at [17].

^[21] Cridge v Studorp Ltd [2017] NZCA 376, (2017) 23 PRNZ 582 at [11(b)].

^[22] At [11(g)].