Waterhouse v Contractors Bonding Ltd

• Jurisdiction: New Zealand
• Judge: White J
• Judgment Date: 14 May 2013
• Neutral Citation: [2013] NZCA 151
• Docket Number: CA542/2012
• Court: Court of Appeal
• Date: 14 May 2013

Between

Godfrey Waterhouse

First Appellant

and

Robert John Waterhouse

Second Appellant

and

Contractors Bonding Limited

Respondent

[2013] NZCA 151

Court:

O'Regan P, Wild and White JJ

CA542/2012

IN THE COURT OF APPEAL OF NEW ZEALAND

Application for strike out of second appellant's appeal against a summary judgment award by the High Court in respect of an underwriting agreement, on the grounds that the summary judgment was “an interlocutory decision” against which leave to appeal was required under s24G(1) Judicature Act 1908 (“JA”) (restriction of right of appeal from interlocutory decisions) — proceeding was on commercial list — respondent argued that as no leave had been sought or obtained, the Court of Appeal had no jurisdiction to hear and determine the appeal — whether the summary judgment was an interlocutory judgment under s26G JA.

Counsel:

S Grant for First and Second Appellants

R E Harrison QC for Respondent

JUDGMENT OF THE COURT

A The application by the respondent, Contractors Bonding Limited, to strike out the notice of appeal by the second appellant, Robert John Waterhouse, is dismissed.

B There is no order for costs.

REASONS OF THE COURT

(Given by White J)

1 Contractors Bonding Ltd (CBL) applies for an order striking out the appeal by Robert John Waterhouse (RJW) against a decision of Potter J in the High Court at Auckland commercial list on 3 August 2012 granting CBL summary judgment in respect of RJW's claims against it. 1

2 RJW and his father Godfrey Waterhouse (GW), both residents of the State of Georgia in the United States, are plaintiffs in commercial list proceedings against CBL, a New Zealand-based underwriter, operating internationally. They are claiming damages of NZD 4.5 million for alleged wrongdoing arising out of a contract between CBL and Phoenix Brokers Inc (Phoenix), a company registered in Georgia, owned and operated by GW and the employer of RJW. The contract was to underwrite liability insurance for taxi operators (known as livery insurance) in Georgia in respect of policies issued by Phoenix as brokers.

3 CBL filed an interlocutory application for summary judgment against GW and RJW and, alternatively, for orders striking out their claims on the grounds that the Georgia limitation statute applied, and that any liability was to Phoenix only, neither GW nor RJW having personally suffered any actionable damage. Potter J rejected the limitation ground, the application to strike out the proceeding and the application for summary judgment in respect of the claim by GW, but granted the application for summary judgment in respect of RJW's claim. 2

4 Accepting that Potter J's decision rejecting its applications to strike out the proceeding and to grant summary judgment in respect of GW's claim is “an interlocutory decision”, CBL has applied to the High Court at Auckland for leave to appeal to this Court as required by s 24G(1) of the Judicature Act 1908. If the High Court refuses leave, CBL will be able to apply to this Court for leave under s 24G(2).

5 RJW, on the other hand, taking the view that Potter J's decision to enter summary judgment for CBL in respect of his claim is not “an interlocutory decision”, has simply filed a notice of appeal in this Court against that part of the judgment without first seeking leave to appeal.

6 CBL's application to strike out RJW's appeal to this Court is made on the grounds that Potter J's grant of summary judgment is “an interlocutory decision” against which leave to appeal is required under s 24G(1) and, as no leave has been sought or obtained, this Court has no jurisdiction to hear and determine RJW's appeal.

7 RJW opposes the application on the grounds that the entry of summary judgment in favour of CBL was not “an interlocutory decision” under s 24G(1) and, as he therefore has a right of appeal to this Court without the need to obtain leave, this Court does have jurisdiction to hear his appeal. If RJW is wrong and leave is required, he will not be able to pursue his appeal now unless the High Court is prepared to allow him further time to seek leave as the time prescribed for him to do so has expired. 3

8 The parties agree that the outcome of the strike out application depends on the interpretation of the expression “an interlocutory decision” in s 24G which applies to proceedings in the Auckland High Court commercial list and which provides:

24G Restriction of right of appeal from interlocutory decisions

• (1) No appeal shall lie from an interlocutory decision of the High Court in respect of any proceeding entered on a commercial list unless leave to appeal to the Court of Appeal is given by the High Court on application made within 7 days of the decision being given or within such further time as the High Court may allow.

• (2) If the High Court refuses leave to appeal from any such interlocutory decision, the Court of Appeal may grant that leave on application made to the Court of Appeal within 21 days of the refusal of leave by the High Court.

9 For CBL, Mr Harrison QC submits that Potter J's decision to enter summary judgment for CBL in respect of RJW's claim against it was “an interlocutory decision” under s 24G(1) because:

• (a) it was granted on an interlocutory application for summary judgment under r 12.4(1) and 4(4)(a) of the High Court Rules;

• (b) the formal Court order is an interlocutory order;

• (c) to look at the nature and effect of the outcome of the application, rather than the form of the application, would mean that a decision determining a defence application for summary judgment would be categorised as “an interlocutory decision” if the Court declined the application, but not if it granted the application and indeed, as in the present case, part of the same decision would be interlocutory and part not;

• (d) in other respects under the High Court Rules the distinction drawn between what is interlocutory and what is not (and is therefore “final”) is determined by reference to the nature of the procedural step or stage which brings the matter before the Court for adjudication;

• (e) the leave restriction imposed by s 24G(1) supports the overall purpose in making provision for commercial lists; 4

• (f) it is well settled that a judgment granting an application to strike out a claim is an interlocutory (rather than a final) judgment, which equally results in an interlocutory order; 5

• (g) the same principle and approach has been applied in relation to both successful and unsuccessful applications for summary judgment; 6 and

• (h) it should be followed in respect of cases on the commercial list. 7

10 For the following reasons, which reflect in large part the submissions of Ms Grant for GW and RJW, we do not accept the submissions for CBL.

11 First, the starting point is to recognise that but for the fact that the proceeding is on the commercial list and therefore subject to s 24G(1), there would be no question that RJW has a right of appeal to this Court without leave against Potter J's summary judgment decision, whether that decision is described as interlocutory or final. This is because:

• (a) the Supreme Court has held in Siemer v Heron 8 that s 66 of the Judicature Act gives an appeal as of right against interlocutory decisions of all kinds made in the High Court unless that Act itself or a rule or order made pursuant to it creates a restriction;

• (b) decisions of this Court drawing distinctions between different categories of interlocutory rulings, including Winstone Pulp International Ltd v Attorney-General, 9 which involved s 24G, have been overruled by the Supreme Court; 10 and

• (c) apart from s 24G(1), there is no provision in the Judicature Act or in any rules or order made pursuant to it requiring leave to be obtained to bring an appeal against any High Court interlocutory decision, including a grant or refusal of summary judgment whether by a Judge or an Associate Judge. 11

12 In particular, since the Court of Appeal (Civil) Rules 1997 there has been no provision equivalent to r 27(1) of the Court of Appeal Rules 1955 imposing different time periods for bringing appeals from High Court interlocutory judgments and final judgments. Since the 1997 Rules there has been a standard period for bringing all appeals that may be brought as of right. 12 This means that the previous decisions interpreting the expression “any interlocutory judgment or order” in r 27(1) of the

1955 Rules, relied on by CBL in the present appeal, 13 are no longer directly in point. We consider whether the reasoning in those decisions should nonetheless be accepted and applied to the interpretation of s 24G(1) later. 14

13 Second, it is clear from the text and purpose of s 24G(1) that Parliament did intend to create a restriction in respect of the otherwise general right to appeal available under s 66 of the Judicature Act. The restriction involved imposing a leave requirement for interlocutory decisions of the High Court in respect of any proceeding entered on a commercial list. At the same time, as s 24G(1) recognises, there is no leave requirement for commercial list decisions other than those categorised as “interlocutory”. The leave requirement does not apply to all decisions in proceedings entered on the commercial list.

14 The imposition of a leave requirement of this nature was consistent with the purpose of the commercial list which was established in 1986 to enable commercial cases to be resolved more expeditiously than other litigation. 15 Categories of cases eligible for entry on the commercial list were defined, commercial list judges were appointed and the High Court was empowered to give directions for the speedy and inexpensive determination of the real questions between the parties in the proceedings, even if the directions were inconsistent with the High Court Rules. 16 In this context the purpose of s 24G was to...