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Memelink v Haines [2020] NZCA 205 (2 June 2020)

Last Updated: 12 June 2020

IN THE COURT OF APPEAL OF NEW ZEALAND

I TE KŌTI PĪRA O AOTEAROA
CA503/2019
[2020] NZCA 205



BETWEEN

HARRY MEMELINK AND LYNX TRUSTEES LIMITED AS TRUSTEES OF THE LINK TRUST NO 1
Appellants


AND

QUENTIN STOBART HAINES
First Respondent

BPE TRUSTEES (NO 1) LIMITED
Second Respondent

QUENTIN HAINES PROPERTIES LIMITED
Third Respondent

Court:

French and Collins JJ

Counsel:

D G O Livingston for Appellants
J P Dallas for Respondents

Judgment:
(On the papers)

2 June 2020 at 11 am


JUDGMENT OF THE COURT

  1. Harry Memelink and Lynx Trustees Ltd are removed as appellants and substituted with Roy Bassett-Burr.
  2. Quentin Stobart Haines is removed as first respondent.
  1. Within five working days Roy Bassett-Burr must either pay the filing fee or make an application for waiver.
  1. Within five working days Roy Bassett-Burr must either pay security for costs in the sum of $7,060 or make an application for dispensation of payment.
  2. The application to strike out the appeal is declined.
  3. The costs of the application to strike out are reserved.

____________________________________________________________________

REASONS OF THE COURT

(Given by French J)

Introduction

[1] On 27 September 2019 Mr Memelink filed a notice of appeal against a decision of Churchman J in the High Court. The decision had been issued on 30 August 2019.[1]
[2] In the decision, the Judge set aside five statutory demands served on Mr Haines and associated entities by Mr Memelink and Lynx Trustees Ltd as trustees of the Link Trust No 1. Mr Memelink and Lynx Trustees Ltd were both named as the respondent party in the High Court. The Judge also made an award of costs against the sole director and shareholder of Lynx Trustees Ltd, a Mr Bassett-Burr in his personal capacity on the grounds that the demands had been issued improperly and that Mr Bassett-Burr had failed to withdraw them when this was brought to his attention.
[3] In the notice of appeal, Mr Memelink stated he was filing the appeal in his capacity as a trustee of the Link Trust No 1. It was not entirely clear from the notice whether he was the sole appellant or whether he was also purporting to file the notice of appeal on behalf of Lynx Trustees Ltd as well as himself. It appears from subsequent communications that the latter was what was intended.
[4] Mr Memelink’s authority to file the appeal on behalf of Lynx Trustees Ltd was then challenged by the respondents. The company had ceased being a trustee of the Link Trust No 1 on 26 August 2019 and had been placed into liquidation on 10 September 2019, some 17 days before the appeal was filed. The liquidators advised this Court that they were not notified of the proposed appeal and did not consent to it.
[5] That development prompted Clifford J to suggest the respondents file an application for an order striking out the appeal. The strike out application was duly filed on 29 November 2019.
[6] It is that application to strike out which is the subject of this judgment.

Grounds of the strike out application

[7] The key grounds of the application are that:

Opposition to the strike out application

[8] After the application to strike out was filed, memoranda were filed by counsel Mr Livingston. The first memorandum dated 10 March 2020 listed the appellants as “Harry Memelink and Lynx Trustees Limited as Trustees of the Link Trust No. 1” and was signed by Mr Livingston as their counsel.[2] The second memorandum dated 27 April 2020 was signed by Mr Livingston as “Counsel for the Appellants/Trustees of the Link Trust No. 1”.
[9] In his memoranda, Mr Livingston contended that the liquidator’s permission to bring the appeal was not required. He also confirmed that Lynx Trustees Ltd was no longer a trustee of the Link Trust No 1, the company being replaced in August 2019 by a new trustee.
[10] Mr Livingston further informed the Court: “These proceedings are continued by the trustees of the Link Trust No. 1 and Mr Bassett-Burr in his personal capacity.” And that the appeal was solely concerned with the costs award made against Mr Bassett-Burr. As regards the grounds of the appeal, Mr Livingston summarised the main grounds which he described as reasonably arguable and therefore not susceptible to strike out. The main grounds identified were:
[11] As to the lack of progress in prosecuting the appeal, Mr Livingston pointed to the fact there is an extant review of the Registrar’s adverse decisions regarding security for costs and filing fees.

Our view

Who are the correct parties to this appeal?

[12] After reviewing the papers, we became concerned that the arguments regarding the naming of the appellants appeared to be misconceived.
[13] We therefore issued a minute advising our provisional view that the correct appellant was not the trustees of the Link Trust No 1 but rather Mr Bassett-Burr and only Mr Bassett-Burr. In our view, that appeared to follow from the fact the appeal was solely about the order awarding costs against him. The fact the order was made in proceedings to which he was not a named party did not alter that conclusion. To assist counsel, we referred them by way of an example to the decisions of this Court and the Privy Council in Harley v McDonald. Ms Harley was a barrister. A costs order against her personally was made by the High Court in proceedings entitled McDonald v FAI (NZ) General Insurance Co Ltd.[3] The appellant in the subsequent appeals against that costs was Ms Harley: Harley v McDonald.[4]
[14] The parties had not addressed that point in submissions. Nor had they addressed the related point that because the costs order against Mr Bassett-Burr was made in favour of BPE Trustees (No 1) Limited and Quentin Haines Properties Ltd, it was those two entities and those two entities only that should be the named respondents. Mr Haines should not be a respondent. He was not a beneficiary of the costs award.
[15] We invited submissions which the parties then filed. Counsel on both sides agreed with our provisional view. Mr Livingston suggested directions amending the parties to the appeal could be made under r 5 of the Court of Appeal (Civil) Rules 2005.
[16] In his submission, Mr Dallas for the respondents respectfully requested that we “make an obiter comment on any future application filed by Mr Bassett-Burr for leave to appeal out of time pursuant to Rule 16A” and that such an application be deemed res judicata.
[17] Rule 16A in the Court of Appeal (Civil) Rules states that where an application for leave to appeal is not bought within the specified time an application for an extension of that time may be filed. We assume that counsel in fact meant to refer to r 29A, which allows the Court to grant extensions of time in which to appeal. In so far as the submission appears to be based on the premise that a change of appellant would mean the filing of a fresh appeal, we consider that premise to be wrong. The appeal that was filed in time remains extant.
[18] One consequence that does flow from substituting a new appellant is that payment of filing fees and security for costs are required to be considered afresh. If waiver and dispensation are sought, it will be the means of Mr Bassett-Burr that will be relevant, not the trustees of the Link Trust No 1.
[19] Finally, as regards the merits of the appeal, on the face of them the grounds appear weak. On the other hand, on the limited information we have before us we do not consider they fall into the frivolous and vexatious category. We would therefore not strike out the appeal for that reason.

Outcome

[20] We make the following orders.
[21] Harry Memelink and Lynx Trustees Ltd are removed as appellants and substituted with Roy Bassett-Burr.
[22] Quentin Stobart Haines is removed as first respondent.
[23] Within five working days Roy Bassett-Burr must either pay the filing fee or make an application for waiver.
[24] Within five working days Roy Bassett-Burr must either pay security for costs in the sum of $7,060 or make an application for dispensation of payment.
[25] The application for an order striking out the appeal is declined.
[26] Although the respondents’ application to strike out the appeal has been unsuccessful, it would not have been necessary had Mr Memelink, and to a lesser extent his counsel, put their procedural house in order. We therefore consider that the most just outcome as regards costs is to reserve them.
[27] We make one final comment. The delay in this case is unacceptable. Further delay will not be tolerated. The appeal must be prosecuted diligently.






Solicitors:
Livingston & Livingston, Wellington for Appellants
jd Dallas — Lawyer, Wellington for Respondents


[1] Body Corporate 68792 v Memelink [2019] NZHC 2169.

[2] Mr Livingston signed the memorandum as “Counsel for the Respondent” but we assume this was in error, as he represents the appellants.

[3] McDonald v FAI (NZ) General Insurance Co Ltd 1 [1999] NZLR 583 (HC).

[4] Harley v McDonald [1999] NZCA 145; [1999] 3 NZLR 545 (CA); and Harley v McDonald [2001] UKPC 18, [2002] 1 NZLR 1.


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