Carter Holt Harvey Limited v McKernan CA275/96 [1997] NZCA 314 (14 July 1997)

Last Updated: 28 January 2019

IN THE COURT OF APPEAL OF NEW ZEALAND CA 275/96

BETWEEN CARTER HOLT HARVEY LIMITED Appellant

AND TODD AARON McKERNAN First Respondent

AND ANDREW JAMES O'NEIL Second Respondent

Coram: Richardson P Thomas J Tipping J

Hearing: 14 July 1997

Counsel: A R Galbraith, QC for Appellant

Respondents excused from appearance

Date of

_{Minute: 14 July 1997}

_{MINUTE OF THE COURT}

This application for conditional leave to appeal to Her Majesty in Council

from the judgment of this court of 21 May 1997 was adjourned today with a view to a further and wider hearing before a court of five Judges.

In the High Court Master Venning dismissed an application for summary judgment based on contracts of guarantee. The issue for the Master was whether the appellant could rely on contracts of guarantee granted by the respondents to John

Edmond Ltd, after that company amalgamated with the appellant, in respect of advances made after the date of amalgamation. The Master decided that it could not.

When the appeal was set down for hearing in this court it was not suggested by counsel that the issues were of continuing and wider significance warranting consideration by a court of five, and it was set down before three Judges in the Civil Appeal Division. It seems, too, that there was no suggestion at the hearing of the appeal that the case had wider significance, making it desirable to reschedule it for argument before a court of five. Rather, it was argued and dealt with in the judgment as a matter of construction of the particular contracts of guarantee and of the relevant amalgamation provisions of the Companies Act 1993.

It is accepted by the appellant that leave to appeal to Her Majesty in Council is not as of right under Rule 2(a) and it relies on Rule 2(b). In that regard it is

submitted that in two respects the decision is of potentially wider significance: the first is that the simpler procedures under the 1993 legislation have led to many amalgamations and the decision is likely to have a significant impact on the New Zealand commercial community; the second is that the reasoning in the judgment of this court would appear to extend beyond contracts of guarantee to other commercial contracts that did not provide for assignability.

Clearly it is desirable that their Lordships should have available the reasoning of New Zealand Judges on the wider arguments to be advanced. Mr Galbraith accepted that the appropriate course would be to invite counsel for the respondents and, if they agreed, the High Court, to which the matter has been remitted following dismissal of the appeal against the refusal of summary judgment, to enter judgment in favour of the respondents or state a question of law, either of which would allow for the wider issues to come before this court and be heard by five Judges.

_notice.

The appeal is accordingly adjourned sine die, to be brought on on 7 days

Solicitors:

Harman & Co, Christchurch, for appellant

Lane Neave Ronaldson, Christchurch, for respondents.