Burgess v Beaven

• Jurisdiction: New Zealand
• Judge: Nation J
• Judgment Date: 21 April 2015
• Neutral Citation: [2015] NZHC 789
• Docket Number: CIV 2014-409-000622
• Court: High Court
• Date: 21 April 2015

Between

Gary Owen Burgess

Applicant

and

Susan Natalie Beaven

Respondent

[2015] NZHC 789

CIV 2014-409-000622

IN THE HIGH COURT OF NEW ZEALAND

CHRISTCHURCH REGISTRY

Application for a waiver of security for costs — the applicant wished to appeal a decision of the Family Court (FC) to strike out his application to have an agreement declared void for non-compliance with the Property (Relationships) Act 1976 (PRA) — parties had been involved in litigation since 2007 — Supreme Court (SC) had issued judgment and various other matters had been considered by both FC and High Court — whether security for costs should be waived as there was merit in the appeal — whether the substantive application was an abuse of process as it sought to relitigate matters determined in other court proceedings and issue estoppel applied.

Appearances:

Plaintiff in person

A Corry for Respondent

JUDGMENT OF Nation J

Introduction

1 On 5 August 2014, Judge Somerville in the Family Court at Christchurch issued a decision striking out an application which Mr Burgess had filed with the Family Court on 9 September 2011. 1 He also ordered that Mr Burgess must pay full solicitor and client costs to the respondent in relation to those proceedings.

2 Mr Burgess filed a notice of appeal on 2 September 2014. In a memorandum for the first case management conference on 22 October 2014, Mr Burgess asked that security for costs be dispensed with. The Court was also advised that Mr Burgess had applied to the Family Court for a rehearing of the application which had been struck out.

3 After the initial conference, Mander J adjourned the appeal proceedings to await the outcome of the application for rehearing. 2

4 There was a further conference with Mander J on 3 December 2014. Because there had been no progress in the Family Court on the rehearing application, Mr Burgess wished to proceed with his appeal. In order for the appeal to proceed to a hearing, his application to dispense with security for costs on the appeal had to be dealt with.

5 The application for waiver of security for costs was accordingly set down for hearing on 11 March 2015. Mr Burgess represented himself. Ms Corry appeared for the respondent. Mr Burgess filed lengthy written submissions in relation to his application.

6 Mr Burgess argued that security for costs should be dispensed with because:

• (a) there was considerable merit in his appeal because he had not been put on notice in the proceedings that there was any risk of strike-out;

• (b) there was merit in the application he was seeking to pursue in the Family Court;

• (c) he was not financially able to provide security for costs; and

• (d) this impecuniosity was the result of wrongs he had suffered in the relationship property proceedings, wrongs which he was seeking to rectify through the proceedings which had been struck out.

7 Ms Corry did not file submissions in opposition. However, in a memorandum for the first case management conference, Ms Corry contended that the proceedings were struck out on the grounds that they were vexatious and an abuse of the Court's process, that there was little merit in Mr Burgess proceeding with his appeal when he was endeavouring to obtain a rehearing in the Family Court, and that the appeal should be struck out. In oral submissions she said that the application for waiver had to be considered against the background of all the previous litigation in which the parties and the Courts had been involved. Against that background, the respondent would not consent to a waiver of costs.

8 As a result of the discussions I had with Mr Burgess and Ms Corry, I deal with the current application on the basis that this appeal would be categorised as a category 2 proceeding, the hearing of which would take one day. In terms of r 20.13 the amount that would be payable as security, unless I direct otherwise, will be $1990.

The legal principles

9 The way in which the Court should consider whether or not security for costs should be required on an appeal has been considered comprehensively by the Supreme Court in Reekie v Attorney-General. 3 The Supreme Court was concerned with an appeal to the Court of Appeal from the High Court. Its judgment is relevant here, as this Court is concerned with an appeal that can be brought from an inferior Court without leave.

10 The following particular statements from the Court's judgment are relevant:

[31] As we have indicated, the Registrar should dispense with security if of the view that it is right to require the respondent to defend the judgment under challenge without the usual protection as to costs provided by security.

…

[33] Although an order dispensing with security is therefore, in itself, of limited economic significance, the costs regime, including the usual requirement for appellants to provide security for costs, imposes some discipline on litigants. The liability to pay costs if unsuccessful is a disincentive to the commencement of frivolous proceedings. As well, most litigants will not commence proceedings if the costs of the exercise, including those they must pay if unsuccessful, exceed the likely benefits. So the costs system discourages litigation which is disproportionate to the occasion. Increased costs may be ordered where proceedings have been conducted vexatiously, and this serves as a disincentive to vexatious conduct. An appellant who will not be able to meet a subsequent order for costs is free of constraints that affect other litigants and this freedom carries with it the potential for injustice to the respondent.

[34] … a litigant whose opponent is legally aided is usually unable to obtain an order for costs if successful. … But a grant of legal aid is subject to independent merits and cost/benefit assessments of the proceedings for which legal aid is sought and legal aid can be withdrawn

if the legally aided person acts unreasonably. … These mechanisms … in the case of the legal aid system, still provide – substitutes for the discipline usually provided by the costs regime.

[35] Against that background, we consider that the discretion to dispense with security should be exercised so as to:

• (a) preserve access to the Court of Appeal by an impecunious appellant in the case of an appeal which a solvent appellant would reasonably wish to prosecute; and

• (b) prevent the use of impecuniosity to secure the advantage of being able to prosecute an appeal which would not be sensibly pursued by a solvent litigant.

A reasonable and solvent litigant would not proceed with an appeal which is hopeless. Nor would a reasonable and solvent litigant proceed with an appeal where the benefits (economic or otherwise) to be obtained are outweighed by the costs (economic and otherwise) of the exercise (including the potential liability to contribute to the respondent's costs if unsuccessful). As should be apparent from what we have just said, analysis of costs and benefits should not be confined to those which can be measured in money.

[37] … Providing the case is of the kind which would be appropriate for a grant of legal aid, an impecunious litigant who is privately represented should be able to obtain a dispensation from the requirement to provide security.

…

[39] Protecting respondents from vexatious appeals is a legitimate purpose of the security for costs regime. This is consistent with the approaches (a) taken in relation to legal aid and (b) formerly taken in respect of appeals in forma pauperis. It is also consistent with Australian authority as to first instance proceedings. 4 An appeal, or its conduct, may be vexatious even though it raises some issues which are arguable. Vexatiousness might be manifested, for instance, by the unreasonable and tendentious conduct of litigation, extreme claims made against other people involved in the case or perhaps a history of unsuccessful proceedings and unmet costs orders. 5

[40] A litigant in person does not incur the expense of legal representation and, if impecunious, will obtain a fee waiver and will not be in a position to pay costs if unsuccessful. All costs associated with litigation so prosecuted fall on other parties. This means that litigants in person may be more prepared to engage in litigation which, when viewed in light of the costs that others must incur, is disproportionate to the occasion and which therefore would not be prosecuted by a solvent litigant. In such circumstances, the Registrar or reviewing judge may conclude that it is

unjust to require the respondent to defend the judgment without the protection of security.

[41] As we have made clear, cost and benefit are not to be assessed in purely financial terms. An appeal may raise issues of public interest which are not measurable in economic terms. As well, considerations which are personal to an appellant (for instance, considerations affecting reputation) may legitimately fall to be considered as part of the cost/benefit assessment. Proceedings relating to the vindication of rights under the New Zealand Bill of Rights Act 1990 may have both personal and public non-financial benefits. In the end, what is called for is an exercise of judgment.

11 In the Court of Appeal where the Registrar has the discretion to dispense with security, the Supreme Court stated:

[21] The Registrar should only dispense with security if of the view that it is right to require the respondent to defend the judgment under challenge without the usual protection as to costs provided by security. …

12 The Supreme Court also noted that in cases where Judges of the Court of Appeal have reviewed dispensation decisions:

[28] In the vast majority of cases security is either not required (because the appellant is legally aided) or, alternatively and more commonly, provided. For this reason, cases where security is dispensed with are necessarily exceptional. But this does not mean that an...