KUMAR V LUCINA INVESTMENTS LIMITED HC AK CIV 2009-404-002118 [2009] NZHC 779 (9 July 2009)

IN THE HIGH COURT OF NEW ZEALAND
AUCKLAND REGISTRY
                                                                        CIV 2009-404-002118



                 BETWEEN                     RICHARD RAJESH KUMAR AND
                                             ANJILA DEVI
KUMAR
                                             Plaintiffs

                 AND                         LUCINA INVESTMENTS LIMITED
                                             Defendant


Hearing:         (On the Papers)

Appearances: A S R Kashyap for the Plaintiffs
             D J Chisholm for the Defendant

Judgment:        9 July 2009


                               JUDGMENT OF KEANE J
 
                              [Re Recall of Judgment]



                         This judgment was delivered by Justice Keane
 
                           on 9 July 2009 at 3.00 pm, pursuant to
                                 r 11.5 of the High Court Rules

                         Registrar/Deputy Registrar
                         Date:




Counsel:      D J Chisholm P O Box 2629 Shortland
Street Auckland 1140 for the Defendant

Solicitors:   A S R Kashyap P O Box 26596 Epsom Auckland 1344 for the Plaintiffs

Copy To:
     P H Nolan P O Box 4182 Shortland Street Auckland 1140

KUMAR V LUCINA INVESTMENTS LIMITED HC AK CIV 2009-404-002118 9 July 2009

[1]     In my decision, dated 4 May 2009, I declined Mr and Mrs Kumar declaratory
relief. I held that if they sold their property
at 66 Sunview Road, Glen Eden, their
three mortgagees were entitled to first call in priority to the proceeds of sale. They
were
not entitled, I held, under an agreement with the mortgagees, amongst them
Lucina, as third mortgagee, dated 27 November 2008, to
pay out only the first
mortgagee and to advance any surplus as vendor finance.


[2]     In that decision, I held also, Lucina was
entitled to indemnity costs as a result
of two terms in the mortgage; and that aspect of my decision has resulted in Mr and
Mrs Kumar
applying to me under r 11.9 to recall my judgment. They contend that
costs should lie where they fall because the mortgage terms
which I held entitled
Lucina to costs were deleted by a term loan agreement also executed by Mr and
Mrs Kumar as borrowers on 27
November 2008, Clause 12(a) of which had been
inserted in handwriting to say:

        Each party to bear their own costs save for
default and this agreement to be
        read together with the settlement agreement insofar as it applies to the
        parties
hereto.

[3]     Lucina opposes recall. The term agreement, it contends, was never entered
into. The clause relied on was inserted
unilaterally by Mr and Mrs Kumar. It was
rejected. Nor was that agreement pleaded by them when seeking declaratory relief.
They are
seeking to place their case on a new footing. In a telephone conference on
6 July 2009, counsel agreed that I am able to resolve
this issue on the papers. No
further fixture is called for.


Recall of judgment


[4]     Rule 11.9 enables me to recall my judgment
at any time before a formal
record of it is drawn up and sealed and as to that there is no issue. Judgment has still
to be sealed
formally. The issue is whether Mr and Mrs Kumar's reason for seeking
recall begins to suffice. This Court's ability to recall a judgment
is to be exercised
only in the exceptional case, and on the three narrowly expressed grounds identified
by Wild CJ in Horowhenua
County v Nash (No 2)  [1968] NZLR 632, 633:

        First, where since the hearing there has been an amendment to a relevant
        statute or regulation or a new judicial
decision of relevance and high

       authority; secondly, where Counsel have failed to direct the Court's attention
       to
a legislative provision or authoritative decision of plain relevance; and
       thirdly, where for some other very special reason
justice requires that the
       judgment be recalled.

[5]    The reason why these categories are as restrictive as they are, as
Wild CJ
explained immediately before setting them out, is this:

       Generally speaking, a judgment once delivered must stand
for better or
       worse subject, of course, to appeal. Were it otherwise there would be great
       inconvenience and uncertainty.

[6]    In Unison Networks Ltd v The Commerce Commission  [2007] NZCA 49 [10],
the Court of Appeal affirmed the Horowhenua County principles as "well settled".
And in a case like this, where new evidence
is relied on, as Neuberger J said in
Charlesworth v Relay Roads Ltd (in liq) [1999] EWHC 829;  [1999] 4 All ER 397, 405, the discretion to
allow that evidence in, and to recall, must be exercised `in a way best designed to
achieve justice', subject
always to this countervailing consideration:

       Because it is inherently contrary to the public interest and unfair on the other
       side that an unsuccessful party should be able to raise new points or call
       fresh evidence after a full and final judgment
has been given ... it would
       generally require an exceptional case before the court is prepared to accede
       to an application
...

Conclusions


[7]    This is not one of those exceptional cases. Mr and Mrs Kumar are attempting
to place their case on a new
footing, and a footing of questionable stability. Mr and
Mrs Kumar themselves, in their original pleading, identified the agreement
dated
27 November 2008 as the foundation for their relationship with Lucina, while
acknowledging also, of course, that Lucina had
a third mortgage over their property
and attendant rights. They made no reference to the term loan agreement.


[8]    That is not
in itself decisive. The agreement and mortgage were not the
entire foundation for their relationship. On 27 November 2008, they,
and a prior
mortgagee, entered into a deed of priority. The term loan agreement was meant also
to be entered into. But that agreement,
it is Lucina's evidence on this application,
which was prepared by its solicitor and approved by Mr and Mrs Kumar's counsel,
was
returned amended to include the term on which they now rely. The amendment

was rejected and a fresh copy sent. It was never returned.
Lucina has chosen since
to rely only on the mortgage.


[9]    That seems to me plausible. Mr and Mrs Kumar may say that Lucina's
solicitor accepted the amendment and that, otherwise, they would never have
authorised their solicitor to register the mortgage.
But that is inconsistent with a
letter from Lucina's solicitor, dated 28 November 2008, rejecting the amendment
and attaching a fresh
draft, to which there was never any reply. The arrangement
entered into, as first pleaded, does then appear to rest, principally,
if not exclusively,
on the agreement dated 27 November 2008 and the mortgage in an unamended state.


[10]   Mr and Mrs Kumar advance
no safe ground on which I could begin to
consider, in the interests of justice, recalling my judgment.            I decline their
application. Lucina is under its mortgage entitled to indemnity for the costs it has
incurred on this application. There will be
that further award.




                                                                    P J Keane J