Henderson v Walker

JurisdictionNew Zealand
CourtHigh Court
JudgeThomas J
Judgment Date03 September 2019
Neutral Citation[2019] NZHC 2184
Date03 September 2019
Docket NumberCIV-2014-409-45

[2019] NZHC 2184

IN THE HIGH COURT OF NEW ZEALAND

CHRISTCHURCH REGISTRY

I TE KŌTI MATUA O AOTEAROA

ŌTAUTAHI ROHE

Thomas J

CIV-2014-409-45

Between
David Ian Henderson
Plaintiff
and
Robert Bruce Walker
Defendant
Counsel:

J Moss and H M Weston for Plaintiff

R J B Fowler QC and S B McCusker for Defendant

Tort — liquidator — disclosure of material by liquidator — breach of confidence — cope of invasion of privacy tort — scope of the tort — reasonable expectation of privacy-personal material stored on company laptop and server — misfeasance in public office — application of the tort of conversion applied to intangible property, such as private digital files — liquidation had been stayed when the material had been obtained by warrant and supplied to the liquidator

The Court held the information had the necessary quality of confidence. Although the intermingling of the information made it more difficult to identify, W had been aware that he was in possession of confidential information. The confidential information was disclosed by the police to W for the purpose of either assessing whether H had committed a criminal offence or facilitating the liquidation of the various companies. The confidential information was imparted to W in circumstances importing an obligation of confidence from 27 May 2011, being the date from which W could safely be attributed with knowledge that the laptop contained confidential documents. However, W could not have known that the Tape Drive contained confidential information when he provided it to the IRD in April 2011 which meant the information contained had not been imparted in circumstances importing an obligation of confidence.

Because the liquidation of PVL was stayed, the only authority W had had to deal with the Tape Drive or the laptop came from either the police or PVL's receiver. There was no evidence that the receiver had authorised W to deal with third parties on behalf of the receiver. The Tape Drive and laptop belonged to PVL and, while the liquidation was stayed, W had no right to deal with PVL's property. W had gossiped to his friends with a disregard for what they did with the information. There were no circumstances in which the OA could be entitled to receive private material. There was a public interest in the disclosure to the police July 2011 and OA in September 2013 of information that suggested H may have breached the conditions of his bankruptcy. An award of $5,000 was sufficient to compensate H for his personal anguish, humiliation and stress resulting from the various breaches of confidence.

The fact that there was personal information on the laptop belonging to PVL and there was no effort to quarantine the information had not meant that the reasonable expectation of privacy had been lost, that was notwithstanding PVL's computer policy. A director of a company was reasonably entitled to expect privacy in connection with private material stored on a company laptop. W had not known or appreciated the likelihood of there being personal information on the Tape Drive provided to the IRD, he was not liable for that provision. The deliberate sending of private information to the OA would be considered highly offensive to an objective reasonable person in H's position. It was appropriate to give a declaration that there was a breach of H's privacy in respect of certain disclosures to the OA. No award of damages was merited to compensate H for any personal anguish, humiliation and stress arising from the breach of his privacy. There was only a limited number of personal emails and they were buried amongst thousands of other non-private (or inoffensive) documents. There was no publication of the information to the general public. The OA regularly dealt with private information concerning bankrupts

Historically there had been the assumption that the tort of conversion applied only to tangible personal property because the concept of possession, which underlies the tort, was usually considered to require both physical control and an intention to exclude others. Intangible property was by its nature not physical, so appears incapable of being physically controlled, and therefore possessed. It was well established that information was not property. Unlike information, it was possible to apply the concept of possession to digital assets (including all forms of information stored digitally on an electronic device). After returning the laptop, W had only retained copies of H's personal digital files, which could not be converted. Although there may be circumstances in which a person could be liable for converting digital assets, none of those circumstances applied to W's conduct towards H's personal digital files.

Although the role of liquidator was prescribed by statute and liquidators must comply with certain statutory duties, the position was fundamentally of a private nature and could not be considered a public office for the purposes of the tort of misfeasance in public office. There was no evidence W had breached his statutory duties.

The Court declined to order W to provide a schedule of the material accessed and distributed from the Laptop and Tape Drive. H had had the benefit of discovery in the current proceeding, further matters were unlikely to be uncovered.

JUDGMENT OF Thomas J
Table of contents

Introduction

[1]

Background

[6]

Private and privileged documents

[41]

Distributions

[43]

(i) 12 April 2011 — Tape Drive to the IRD

[44]

(ii) 28 May 2011 — email from Mr Walker to a United States university address, Mr Holden, Mr Thorne and Mr Tubb

[51]

(iii) 13 June 2011 — email from Mr Eathorne to Mr Slevin attaching a screenshot concerning SOL Management Ltd

[54]

(iv) and (v) 14 June 2011 and 26 August 2011 — Mr Walker provided Mr Slevin flash drives of all emails and voice recordings from the Laptop

[59]

(vi) 11 July 2011 — Mr Eathorne provided the police with materials relating to SO Systems Ltd

[68]

(vii) 12 June 2012 — Mr Walker sent Mr Thorne an email between Mr Henderson and the then Mayor of Christchurch

[74]

(viii) 4 July 2013 — Mr Walker gave emails from the Laptop on a flash drive to Ron McQuilter of Paragon New Zealand

[87]

(ix) 26 September 2013 — Mr Eathorne provided the Official Assignee with a brief of evidence containing information about Mr Henderson's American Express card

[98]

(x) 29 February 2016 — PVL discovery of 848,000 documents, including 65,000 from the Laptop

[104]

(xi) 22 September 2011 — Messrs Walker and Eathorne to Mr Holden

[110]

Other disclosures

[123]

Factual findings

[126]

Breach of confidence — relationship with the invasion of privacy tort

[144]

Breach of confidence — application

[161]

Does the information have the necessary quality of confidence about it?

[161]

Was the information imparted in circumstances importing an obligation of confidence?

[170]

Has there been an unauthorised use of the information?

[184]

Defence of public interest

[191]

Damages

[196]

Invasion of privacy — scope of the tort

[199]

Reasonable expectation of privacy

[200]

Highly offensive to the objective reasonable person

[203]

Publicity

[207]

A note about procedure

[218]

Notice requirement

[219]

Invasion of privacy — application

[221]

Are there facts in respect of which there is a reasonable expectation of privacy?

[221]

Did Mr Walker have notice that the information was private?

[229]

Would disclosure be considered highly offensive to a reasonable person?

[230]

Damages

[242]

Conversion

[248]

Conversion of intangible property

[250]

Did Mr Walker convert Mr Henderson's personal digital files?

[271]

Misfeasance in public office

[277]

Does Mr Henderson have standing to sue?

[278]

Are liquidators public officers?

[279]

Proof of loss

[297]

Conclusion

[298]

Breach of statutory duty

[299]

Has there been a breach of statutory duty?

[301]

Did Parliament intend breaches of pt 16 of the Companies Act should be a ground of civil liability?

[304]

Conclusion

[305]

Contempt of Court

[306]

Result

[316]

Introduction
1

To say there is bad blood between David Henderson and Robert Walker is an understatement. From the time Robert Walker was appointed liquidator of Property Ventures Ltd (PVL) on 27 July 2010, he has been on a collision course with David Henderson, former director of companies in the PVL group. Frustrated by PVL's liquidation being stayed, when Mr Walker was appointed liquidator of five other companies in the group, he set about his task with gusto. Fearing that documents relevant to the liquidations might be unlawfully accessed following the February 2011 Christchurch earthquake, Mr Walker was instrumental in the police seeking and obtaining warrants to seize records of the companies. It is what Mr Walker did on receipt from the police of PVL's tape drive and a laptop (used by Mr Henderson but owned by PVL) that is the subject of these proceedings. Mr Henderson claims Mr Walker, fuelled by malice towards him, provided his personal information to the Inland Revenue Department (IRD), the Official Assignee and other third parties.

2

Mr Henderson claims Mr Walker not only breached his rights to privacy and confidence in confidential information but also that he breached a number of duties associated with his office as liquidator and as an officer of the Court.

3

Mr Henderson seeks declarations in respect of his six causes of action, orders that Mr Walker provide a schedule of material accessed and to whom it has been distributed and $100,000 in general damages for personal anguish, humiliation and stress.

4

Mr Walker denies there has been any unlawful...

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4 cases
  • Driver v Radio New Zealand Ltd
    • New Zealand
    • High Court
    • 12 December 2019
    ...of privacy. Highly offensive threshold 97 The law in relation to the highly offensive limb was recently summarised by Thomas J in Henderson v Walker: 51 [206] What is highly offensive is assessed from the perspective of a reasonable person in the position of the plaintiff as opposed to a re......
  • Ian Bruce Hyndman v Robert Bruce Walker
    • New Zealand
    • Court of Appeal
    • 23 February 2021
    ...tort, because it responds to the abuse of power rather than the existence of a privacy interest in the information. 99 We note that in Henderson v Walker Thomas J accepted, relying on Marcel, that the information on the laptop and tape drive was obtained in circumstances importing an obliga......
  • Peters v Bennett and Others
    • New Zealand
    • High Court
    • 20 April 2020
    ...irregularity as defined by Mr Peters, was not intensely personal information as in the cases of P v D, Peck v United Kingdom, or Henderson v Walker. 22 He sought to contrast the information in those cases with the disclosure of Mr Peters' payment 98 In P v D, the information in issue concer......
  • 100 Investments Limited v Walker
    • New Zealand
    • High Court
    • 7 August 2020
    ...as follows: 256 Duties in relation to accounts (1) Subject to subsection (2), the liquidator of a company must— Henderson v Walker [2019] NZHC 2184. (a) (b) keep accounts and records of the liquidation and permit accounts and records, and the accounts and records in the company, to be inspe......

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