Gulf Group Marine Brokers Ltd v Ministry of Business, Innovation and Employment
| Jurisdiction | New Zealand |
| Judge | Clark J |
| Judgment Date | 04 February 2021 |
| Neutral Citation | [2021] NZHC 85 |
| Court | High Court |
| Docket Number | CIV-2019-485-390 |
| Date | 04 February 2021 |
IN THE MATTER OF an application pursuant to section 3 of the Declaratory Judgments Act 1908
[2021] NZHC 85
Clark J
CIV-2019-485-390
IN THE HIGH COURT OF NEW ZEALAND
WELLINGTON REGISTRY
I TE KŌTI MATUA O AOTEAROA
TE WHANGANUI-A-TARA ROHE
Civil Procedure — application by defendant to be struck out under the High Court Rules 2016 as a party as it had no powers of enforcement or other regulatory function under the Consumer Guarantees Act — the plaintiff had applied for declaration that as a yacht broker it was not a “supplier” — whether the defendant was a proper contradictor — Declaratory Judgments Act 1908 — High Court Rules 2016
A O'Connor for Applicant
S P Connolly for Defendant
Gulf Group Marine Brokers Ltd provides a marketing service under a service contract to those wishing to sell a motor vessel. It does not sell motor vessels at all. Gulf Group says it offers no service to any purchaser. Nor, in simply marketing a motor vessel and introducing vendors and purchasers to each other, is it acting as an “agent” in any transaction. Gulf Group seeks a declaration that it is not regarded as a “supplier” under the Consumer Guarantees Act 1993.
The Ministry of Business, Innovation and Employment (the Ministry) is the named defendant. The Ministry says it has been improperly named as the defendant and has applied to be struck out as a party.
Gulf Group takes issue with the decision in Walters v Taylor Marine in which the High Court held that Taylor Marine Ltd, a company of marine brokers, came within the definition of “supplier” in the Consumer Guarantees Act. 1 Specifically, the High Court concluded that those acting as agents in the sale of goods are “suppliers” for the purposes of the Consumer Guarantees Act. 2
The Consumer Guarantees Act gives a right of redress against a “supplier” of goods where the goods do not comply with any guarantee set out in s 5 of that Act. In Walters v Taylor Marine the yacht sold to the plaintiffs was not free from all encumbrances as the agreement between the seller and Mr Walters stated. The agreement had been prepared by Taylor Marine, the seller's exclusive agent for the purpose of selling the vessel.
The defendants argued that the plaintiffs' approach to the definition of “supplier” was too broad and did not include the yacht brokers.
As the present interlocutory proceeding does not require a determination of the actual application for a declaration, it is unnecessary to discuss the reasoning in Taylor Marine. The short point is that the High Court found Taylor Marine was effectively substituted for the seller, even though the seller was not in trade, and that Taylor Marine had assumed the obligations under the Act which would have attached to the seller had he been in trade.
Gulf Group contends Walters v Taylor Marine is wrong in law and that a declaration is required to bring certainty to the boating industry. While Gulf Group does not specifically refer to Taylor Marine in its statement of claim it pleads that issues arise from time-to-time with motor vessels post-sale and that “recently Courts have indicated a view that an entity like Gulf Group would be a ‘supplier’ for the purposes of the Consumer Guarantees Act and as a result Gulf Group is liable for ‘supplier guarantees’ to any purchaser”.
Gulf Group seeks:
A declaration that a marine brokerage company providing a marketing service (designed to introduce buyers and sellers) to a vendor selling a vessel is not a “supplier” to any third party purchaser who purchases a vessel for the purposes of the Consumer Guarantees Act.
The Ministry applies under r 4.56 of the High Court Rules 2016 to be struck out as a defendant. It says it is not properly named as a defendant as it has no powers of enforcement or other regulatory function under the Consumer Guarantees Act.
Gulf Group opposes the application. It says the Consumer Guarantees Act “binds the Crown”; the Ministry is the Ministry “that has been subrogated the role and powers of policy pursuant to the Consumer Guarantees Act”; and the Ministry is the correct contradictor.
Accordingly, the only issue for determination is whether the Ministry should be struck out as defendant. The Ministry does not ask that the entire proceeding be struck out. While the Ministry does not mount a direct challenge to the proceeding itself the Ministry does query whether the proceeding is suitable for a declaratory judgment. That consideration is highlighted by the absence of a proper contradictor.
Section 3 of the Declaratory Judgments Act provides:
3 Declaratory orders on originating summons
Where any person has done or desires to do any act the validity, legality, or effect of which depends on the construction or validity of any statute, or any regulation made by the Governor-General in Council under statutory authority, or any bylaw made by a local authority, or any deed, will, or document of title, or any agreement made or evidenced by writing, or any memorandum or articles of association of any company or body corporate, or any instrument prescribing the powers of any company or body corporate; or
Where any person claims to have acquired any right under any such statute, regulation, bylaw, deed, will, document of title, agreement, memorandum, articles, or instrument, or to be in any other manner interested in the construction or validity thereof,—
such person may apply to the High Court by originating summons for a declaratory order determining any question as to the construction or validity of such statute, regulation, bylaw, deed, will, document of title, agreement, memorandum, articles, or instrument, or of any part thereof.
The jurisdiction to make orders under the Declaratory Judgments Act is wholly discretionary. The Court will not answer purely abstract questions in anticipation of actual controversy. It will not deal with mixed questions of fact and law: 3
The procedure is designed to provide a speedy and inexpensive method of obtaining a judicial interpretation where the matter in dispute cannot conveniently be brought before the court in its ordinary jurisdiction and where a declaratory judgment would be appropriate relief.
In their “classic text”, 4 Zamir and Woolf: The Declaratory Judgment, Lord Woolf and Jeremy Woolf, describe the declaratory jurisdiction: 5
The courts original declaratory jurisdiction may be described as follows: within the limits of their general jurisdiction and subject to any express statutory provisions to the contrary the courts have a discretion to grant declarations upon any matter what so ever.
In Mandic v Cornwall Trust Board the New Zealand Supreme Court emphasised the breadth of the jurisdiction under the Declaratory Judgments Act and that the jurisdiction was not constrained beyond the threshold described by s 3 namely, that the person applying “has done or desires to do any act the validity, legality or effect of which depends on the construction or validity of any statute”. 6
Access to the jurisdiction does not depend on there being an existing dispute nor is it necessary that there be a lis. While the jurisdiction is expansive, 7 it is discretionary and the Court may, on any grounds which it deems sufficient, refuse to give or make any such judgment or order. 8
In Canterbury Regional Council v Attorney-General, Miller J referred to the frequency with which the High Court has refused relief pursuant to its discretion under s 10 where there was no dispute between the parties, or no proper contradictor, or the plaintiff sought an advisory opinion. 9 Miller J referred to the often cited dictum of Lord Dunedin in Russian Commercial and Industrial Bank v British Bank for Foreign Trade Ltd: 10
The rules that have been elucidated by a long course of decisions in the Scottish Courts may be summarized thus: The question must be a real and not a theoretical question; the person raising it must have a real interest to raise it; he must be able to secure a proper contradictor, that is to say, some one presently existing who has a true interest to oppose the declaration sought.
Counsel for the Ministry, Mr Connolly, submitted that while the Ministry is responsible for administering the Consumer Guarantees Act that fact alone does not make it a proper contradictor.
A similar argument was considered in Canterbury Regional Council. 11 In Canterbury Regional Council the High Court granted the Attorney-General's application to be struck out as a party. Although the plaintiffs argued that the Attorney-General was the proper defendant because he was sued for the Minister for the Environment and the Minister of Local Government and the plaintiff sought declarations about the rights of elected councillors under legislation that the two Ministers administered, the Court did not agree. There was “no present or pending controversy between [the plaintiff] and the Crown, and no ministerial or official decision [was] impugned or even pleaded”. 12
While the claim may have pointed to weaknesses in the legislation, it did not address the Ministers' administration of the legislation. Miller J said one way of testing the point was to inquire whether any specific relief might be granted against the Ministers. He concluded there could be no such relief.
Having rejected the proposition that the Attorney-General is invariably a proper contradictor in a case such as that before him, Miller J concluded there was no other defendant to serve as a proper contradictor. 13 Ultimately, the Judge was satisfied the Attorney-General's presence was...
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Gulf Group Marine Brokers Limited v Ministry of Business, Innovation and Employment
...HIGH COURT OF NEW ZEALAND WELLINGTON REGISTRY I TE KŌTI MATUA O AOTEAROA TE WHANGANUI-A-TARA ROHE CIV-2019-485-390 [2021] NZHC 85 IN THE MATTER OF an application pursuant to section 3 of the Declaratory Judgments Act 1908 BETWEEN GULF GROUP MARINE BROKERS LIMITED Plaintiff AND MINISTRY OF B......