Khan v Reid [2012] NZCA 210 (25 May 2012)

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Khan v Reid [2012] NZCA 210 (25 May 2012)

Last Updated: 30 May 2012

IN THE COURT OF APPEAL OF NEW ZEALAND

CA613/2010 [2012] NZCA 210

BETWEEN SHER AFZAL KHAN Appellant

AND KEITH WILLIAMS REID Respondent

Hearing: On the papers

Judgment: 25 May 2012 at 11 am

JUDGMENT OF WILD J:
REVIEW OF REGISTRAR’S DECISION AS TO DISPENSING WITH SECURITY FOR COSTS

1. The Registry is directed to close the file on this appeal.
   
2. The application to review the Acting Registrar’s decision refusing to dispense with security for costs is dismissed.

____________________________________________________________________

REASONS OF WILD J

[1] By memorandum filed on 16 May 2012 Mr Khan applied for a review by a Judge of the Acting Registrar’s decision refusing to dispense with security for the costs of this appeal. That application is pursuant to r 7(2) of the Court of Appeal (Civil) Rules 2005. Mr Khan had, by letter dated 14 April 2011, but received by the Court on 2 May 2011, applied to the Registrar to dispense with security.
[2] Mr Khan filed his appeal on 20 September 2010. It is against a judgment of Associate Judge Doogue given on 7 September 2010 adjudicating Mr Khan bankrupt.
[3] Security for costs was fixed at $5,560 on 20 September 2010. Not until 22 February 2011 did Mr Khan apply for the allocation of a hearing date. However, that was within the six months allowed by r 43(1). Mr Khan has not filed his Case on Appeal, so there has not been compliance with that other aspect of r 43(1). Thus, in terms of the Rules, this appeal is to be treated as having been abandoned on 20 March 2011 (six months after the appeal was brought). The consequence is that from that time on there was no longer any appeal in existence, and the 10 February 2012 decision of the Acting Registrar that Mr Khan has asked me to review is of no effect for that reason. That is an end of this matter.
[4] Nevertheless, and strictly unnecessarily and probably wrongly, I will proceed to review the Acting Registrar’s decision.
[5] Briefly, the Acting Registrar refused to dispense with security for costs for these reasons:

• (a) Mr Khan had not paid costs awarded against him in the High Court exceeding $15,000, so the need for security for the costs of this appeal was acute.
• (b) Although Mr Khan may be impecunious (at least in April 2011 he was a sickness beneficiary), impecuniosity alone is not a reason for dispensing with security.
• (c) There is nothing in this appeal of public importance or significance.

[6] As assembled in McGechan on Procedure at para CR35.03, relevant considerations in dispensing with security for costs include:

• (a) The circumstances of the appeal: the appellant must genuinely intend to pursue it and it must be arguable.
• (b) The significance of matters raised in the appeal, including any public interest in having those issues determined.
• (c) The merits of the appeal – whether it appears “to have any real legs”.
• (d) Whether the appellant’s appeal rights will be rendered nugatory if security is not waived.
• (e) Impecuniosity, although this is not itself a ground for waiver or reduction.

[7] I deal with each of these considerations in turn. First, whether Mr Khan genuinely intends to pursue the appeal. I have already made the point that the notice of appeal was filed as long ago as 20 September 2010. Now, 20 months later, the Court is still being asked to deal with security for costs. The appeal is nowhere being ready for hearing. There is a further, major, difficulty with Mr Khan’s ability to pursue this appeal. In December 2011 the Registry gave the respondent’s solicitor an opportunity to comment on Mr Khan’s application (made months earlier on 2 May 2011) to dispense with security for costs. In a letter dated 20 December 2011 to the Registrar, the respondent’s solicitor advised that this was the first he knew of the appeal – a notice of appeal had never been served on the respondent. Accordingly, he asserted that “the appeal is hopelessly out of time”. That was a reference to r 31 which provides that an appeal is brought only when, in addition to filing the notice of appeal with that Court’s Registry:

(b) A copy of the notice of appeal is served on every person who is a party to the proceeding in the Court appealed from.

[8] The respondent, Mr Reid, was certainly a party to the proceeding in the Court appealed from. He was the judgment creditor who applied successfully to have Mr Khan adjudicated bankrupt. Accordingly, if – as the respondent asserts – the notice of appeal was never served on the respondent, then Mr Khan has not yet brought an appeal.
[9] The second consideration is the significance of matters raised in the appeal. I agree with the Acting Registrar’s decision about this. The appeal is against a decision adjudicating Mr Khan bankrupt for non payment of a costs order made by the High Court. It is a private matter, devoid of any public or general interest.
[10] Thirdly, the merits of the appeal. I do not consider that any of the five grounds of appeal has any merit. I need only refer to two. The first is that Associate Judge Doogue had no jurisdiction. That is simply wrong. He did. The second is that “there is a counterclaim against the creditor (Mr Reid)”. The Associate Judge disposed of that ground by pointing out that Allan J had struck out Mr Khan’s counterclaim in the course of deciding Mr Khan’s negligence proceeding against Mr Reid.
[11] Fourth is whether Mr Khan’s appeal rights will be rendered nugatory if security is not waived. There is only Mr Khan’s bald assertion: “I have been on special sickness benefit therefore unable to pay the cost”. I am prepared to accept that, and that inability to give security will render Mr Khan’s appeal rights nugatory. However, that must be weighed against my assessment that those appeal rights are meritless.
[12] Lastly, there is impecuniosity. I need say nothing more to what I have already just said about this consideration.
[13] I summarise:

• (a) Mr Khan has not brought any appeal, because he did not serve the notice of appeal on the respondent. As no appeal has ever properly been brought, questions of security for the costs of the appeal do not arise.
• (b) If (a) turns out not to be correct, and Mr Khan is able to prove service of the notice of appeal on the respondent, then the appeal was deemed abandoned on 20 March 2011 because Mr Khan had not filed the Case on Appeal: r 43(1). For that further reason, questions of security for the costs of the appeal do not arise.
• (c) In the unlikely event that (b) is not correct then, having reviewed the Acting Registrar’s decision refusing to dispense with security for costs, I uphold it. I do so primarily because the appeal is meritless – it has no “real legs”. I say “unlikely event” because there simply is no Case on Appeal on this Court’s file.

[14] For the reasons outlined in [13](a) and (b), I direct the Registry to close this appeal file.