Mauger v Apatu [2013] NZCA 262 (26 June 2013)

Last Updated: 3 July 2013

IN THE COURT OF APPEAL OF NEW ZEALAND
CA10/2013 [2013] NZCA 262
BETWEEN	WINIPERE EVA MAUGER Applicant
AND	NATHAN WIRIHANA APATU, RENATA ROBIN APATU AND KATHERINE LOUISE BATES Respondents

Hearing:	13 May 2013 and 13 June 2013 (by telephone)
Court:	Arnold, Ellen France and Stevens JJ
Counsel:	D J O’Connor for Applicant N T Gray for Respondents
Judgment:	26 June 2013 at 11.30 am

JUDGMENT OF THE COURT

1. The application for an extension of time is granted. Timetabling directions are made as set out below at [23].
2. No order as to costs.

____________________________________________________________________

REASONS OF THE COURT

(Given by Ellen France J)

Introduction

[1] This is an application under r 29A of the Court of Appeal (Civil) Rules 2005 for an extension of time to appeal a decision of Williams J relating to costs.^[1] The costs award was made in the context of unsuccessful proceedings brought by the applicant, Mrs Mauger, and her brother, Ashley Apatu, relating to the disposition of the estate of the parties’ father, Wirihana Apatu, who died in 1970. The respondents were trustees and executors of their father’s estate.

Background

[2] The proceedings brought by Mrs Mauger and Ashley were filed in 2007. Their claims, variously brought against one or other or all of the respondents, were based on alleged breach of trust or fiduciary duty. Mrs Mauger also brought some claims individually. Some of her claims were abandoned. As we have foreshadowed, those remaining were dismissed by Williams J after trial in a judgment delivered on 10 May 2011.^[2]
[3] Subsequently, in the judgment delivered on 3 November 2011, Williams J granted an application for indemnity costs made by the respondents against Mrs Mauger and Ashley. Costs of $85,000 were awarded in favour of the respondents.^[3] The Judge also made an order that Mrs Mauger and Ashley were jointly liable to the respondents for these costs.
[4] When the costs award was not paid, the respondents successfully applied to bankrupt Ashley but were unsuccessful in their application to bankrupt Mrs Mauger for the outstanding debt. After various procedural skirmishes, in a judgment delivered on 6 December 2012, Associate Judge Gendall refused to make an order adjudicating Mrs Mauger bankrupt on the basis Mrs Mauger was able to pay her debts.^[4] The respondents have appealed against that decision to this Court. The case on appeal for that appeal has been filed but the matter does not have a fixture date.
[5] On 12 February 2013, Mrs Mauger filed an application for extension of time to appeal against the costs decision of Williams J. The application is opposed.

The application in issue

[6] The applicant accepts that the delay in this case is substantial, 14 months. The applicant explains the delay on the basis that she is an elderly woman (Mrs Mauger is in her 80s) and lacks cognitive ability.
[7] As to the merits of the appeal, the applicant says there is evidence to support her claim that she lacked mental capacity and was manipulated into filing the proceedings by her brother, Ashley. She also says that she was never independently advised.
[8] In advancing these submissions, Mrs Mauger relies on affidavits filed in the bankruptcy proceedings. The first of these affidavits is from Mrs Mauger who deposes she did not receive independent advice in respect of the proceedings before Williams J. The second of the affidavits is from Mrs Mauger’s daughter, Cecile. Cecile explains that, in September 2007, her mother suffered a serious head injury in a motor vehicle accident. She says Mrs Mauger’s capabilities and reasoning have been severely impaired since the motor vehicle accident. Cecile’s affidavit also canvases aspects of the proceedings before Williams J.
[9] The third affidavit relied on is from Dr Anne Walsh, a psychiatrist. Dr Walsh’s evidence is that Mrs Mauger’s presentation and cognitive difficulties are consistent with the diagnosis of a frontal lobe syndrome, an impairment primarily involving the frontal lobes of the brain. Dr Walsh says that disability would have left Mrs Mauger “at a significant disadvantage” in relation to “assimilating and understanding the material involved in the civil litigation”.
[10] Finally, Mr O’Connor for Mrs Mauger submits that there is no prejudice to the respondents if an extension of time is granted. That is because this appeal can be dealt with at the same time as the respondents’ appeal against the bankruptcy decision.
[11] The respondents emphasise the length of the delay. As to the explanation for the delay, Mr Gray for the respondents submits that the evidence on which the applicant seeks to rely relating to her mental capacity is neither fresh nor cogent. The respondents also rely in part on Mrs Mauger’s responses in cross-examination in the substantive hearing before Williams J. In that context she was asked about her mental capacity and she said that she was of sound mind. Further, the respondents say that Dr Walsh’s evidence is limited because she does not confront matters such as Mrs Mauger’s evidence in the High Court.
[12] The respondents also submit that the proposed appeal has no merit. Mr Gray points out that it is not suggested that Williams J has erred in his approach. If Mrs Mauger has a remedy, it is not one against the respondents.
[13] Finally, it is submitted that the respondents are prejudiced at least to the extent that they incurred costs in pursuing the bankruptcy proceedings in reliance on the absence of any challenge to the costs decision.

Should the time for filing the appeal be extended?

[14] The test for whether an extension of time to appeal should be granted under r 29A is as expressed in My Noodle Ltd v Queenstown Lakes District Council in which this Court said there were a number of factors relevant to the decision including:^[5]

... the reasons for the delay, the length of the delay, the conduct of the parties and the extent of any prejudice caused by the delay: New Plymouth District Council v Waitara Leaseholders Assn Inc [2007] NZCA 80 at [22]. The overall test, however, is whether granting an extension would “meet the overall interests of justice”: Havanaco Ltd v Stewart [2005] NZCA 158; (2005) 17 PRNZ 622 (CA) at [5].

[15] We deal with each of the factors in turn.
[16] We agree with the respondent that the matters advanced by Mrs Mauger do not adequately explain the delay. The issues about her cognitive ability were not such as to prevent opposition to the bankruptcy proceeding. It may be that the decision to appeal was prompted by a suggestion made in the bankruptcy proceeding. We refer here to Associate Judge Gendall’s suggestion that if the arguments about the lack of independent representation had been advanced before Williams J a costs order may have been made only against Ashley “as the main instigator and driver” of the case.^[6] In making that observation, the Associate Judge also made it clear that this was “simply speculation at this point”.^[7]
[17] As to the length of the delay, in ordinary circumstances, an unexplained delay of the order involved in the present case would generally count strongly against a grant of an extension of time.
[18] We turn then to the merits of the proposed appeal. It appears that the applicant will seek leave to file new evidence from Dr Walsh and from Mrs Mauger’s daughter. Mr Gray has indicated that the respondents may wish to file evidence in response. Any new evidence so admitted may alter the factual position from that considered by Williams J although it is not necessarily axiomatic that it would follow that the Judge was wrong in awarding costs as he did. That said, it is difficult at this point to make an assessment of the merits of the proposed appeal.
[19] The factor weighing most heavily in favour of an extension of time is that the respondents’ appeal against the refusal to make Mrs Mauger bankrupt is to be heard in any event and that appeal will raise similar issues. The respondents dispute the extent to which the issues will be similar. However, the reality is that the central issue the applicant wishes to raise in the costs appeal, her mental capacity, will likely feature to some extent in the bankruptcy appeal. Further, both counsel agree that if the proposed appeal is to proceed then a new case on appeal will not be necessary. All that would be required is for the appellant to file a supplementary case. It seems to us that matter can be attended to and a hearing of the two appeals together sought promptly. In these circumstances, we are satisfied that there is no real prejudice to the respondents.
[20] When all of the matters are weighed in the balance, we are satisfied that the overall interests of justice favour granting an extension of time to appeal. We order accordingly.

Costs

[21] The applicant has succeeded and costs would normally follow the event. However, the applicant has been given an indulgence and the opposition to that course was reasonable. In these circumstances, costs should lie where they fall. We make no order as to costs.

Directions

[22] As we have noted, both parties have indicated they intend to seek leave to adduce new evidence. We make some timetabling directions in relation to those applications below. We interpolate here that we are concerned that the scope of the appeal, essentially a dispute between family members, will as a result expand unnecessarily with resultant cost and distress for all involved. In this context, it would be unfortunate if further costly litigation were to develop. The parties should strive to avoid that result.
[23] Any application to adduce new evidence on the appeal by the applicant is to be filed and served by 30 July 2013. Any application in response by the respondents is to be filed and served by 30 August 2013.

Postscript

[24] After the first hearing on this application we sought further information from Mr O’Connor about the conduct of the appeal. We were concerned about the possible need to consider the appointment of a litigation guardian given the issues raised about Mrs Mauger’s capacity. Mr O’Connor subsequently filed copies of enduring powers of attorney in favour of Cecile Mauger together with certificates of mental incapacity for Mrs Mauger which Dr Walsh completed under the prescribed forms 4 and 5 of the Protection of Personal and Property Rights (Enduring Powers of Attorney Forms) Regulations 2008. Mr O’Connor advised that Cecile Mauger has authority pursuant to the powers of attorney and the certificates of mental incapacity to instruct him on behalf of her mother. In these circumstances, no further action on our part appeared necessary.

Solicitors:
Lunn & Associates, Napier for Applicant
Sainsbury Logan & Williams, Napier for Respondents

---

^[1] Apatu v Apatu HC Napier CIV-2007-441-823, 3 November 2011.

^[2] Apatu v Apatu HC Napier CIV-2009-441-515, 10 May 2011.

^[3] Apatu v Apatu, above n 1. $41,000 of these costs were awarded in favour of Kenneth Apatu who is not a named party to the present proceedings in this Court.

^[4] Mauger v Apatu [2012] NZHC 3270.

^[5] My Noodle Ltd v Queenstown Lakes District Council [2009] NZCA 224, (2009) 19 PRNZ 518 at [19].

^[6] At [18].

^[7] At [18].