HART V ANZ BANK NEW ZEALAND LIMITED COA CA858/2012

HART V ANZ BANK NEW ZEALAND LIMITED COA CA858/2012 [12 February 2013]IN THE COURT OF APPEAL OF NEW ZEALANDCA858/2012[2013] NZCA 9BETWEEN BARRY JOHN HARTAppellantAND ANZ BANK NEW ZEALAND LIMITEDRespondentCounsel: D Murray for AppellantL O'Gorman for RespondentJudgment: 12 February 2013JUDGMENT OF HARRISON J ON APPLICATION TO REVIEWREGISTRAR'S REFUSAL TO DISPENSE WITH SECURITY FOR COSTSThe application for review of the Registrar's decision declining to dispense withsecurity for costs is dismissed.REASONS[1] On 17 December 2012 the appellant, Barry Hart, filed a notice of appeal in this court against an order made by Associate Judge Sargisson in the High Court at Auckland earlier that day adjudicating him bankrupt on the petition of ANZ Bank New Zealand Ltd, the respondent. A fixture to hear his appeal has been allocated for 10.00 am tomorrow, 13 February 2013.[2] On 21 December 2012 security for costs was set at $5,880. On 5 February 2013 Ms Davina Murray, acting as Mr Hart's counsel, applied to the Registrar for awaiver of the requirement to pay security for costs before Mr Hart's appeal washeard: r 35(6) of the Court of Appeal (Civil) Rules 2005. The Registrar declined that application in a decision delivered on 11 February 2013. This morning Ms Murray has filed an application for an order reviewing the Registrar's decision: s 7(2) of the Court of Appeal (Civil) Rules and s 61A(3) of the Judicature Act 1908.[3] In declining Mr Hart's application the Registrar took into account thesefactors:(a) Mr Hart relied upon his impecuniosity as the primary ground for purporting a waiver but he had failed to provide any financial information in support.(b) Even if Mr Hart was impecunious, that state alone is not a sufficient reason to grant a waiver. In the absence of financial information, the fact that Mr Hart has been adjudicated bankrupt does not lead to the necessary inference that neither the Official Assignee nor a third party is or may be holding sufficient funds to pay security.(c) The grounds raised by Mr Hart did not fall into the category of exceptional circumstances.(d) It was necessary to protect the ANZ Bank against the prospect that if Mr Hart's appeal was unsuccessful it would have no security forpayment.[4] In support of Mr Hart's application Ms Murray submits that:(a) The subject of Mr Hart's appeal relates to his adjudication in bankruptcy. As a result of that adjudication, his estate is now being administered by the Official Assignee. Mr Hart does not have any control over funds held by the Official Assignee. Nor can he instruct the Official Assignee to award money to a preferential creditor. The Insolvency Act 2006 does not provide a duty on the Official Assignee to pay for appeals against bankruptcy.(b) Mr Hart is in receipt of the national superannuation, which is his only source of income.(c) The ANZ Bank acted improperly in filing and pursuing the bankruptcy proceeding in the High Court for the purpose ofpreventing Mr Hart from pursuing a separate appeal against a judgment delivered in the High Court on 29 October 2012 entering summary judgment against him in favour of the ANZ Bank for $20,543,951. Mr Hart's appeal against that decision is due to be heardin this Court on 19 March 2013.(d) It is in the interest of justice that Mr Hart can execute his appeal rights, and consideration should be given to the litigation history between the parties.[5] On this basis Ms Murray submits that exceptional circumstances exist which justify an order waiving the obligation to pay security for costs.[6] I am not satisfied that the Registrar erred. It must be emphasised that the obligation to give security for costs is expressed in mandatory terms: r 35 of the Court of Appeal (Civil) Rules. However, the Registrar has a power to waive payment of security, which is to be exercised against the ultimate touchstone of whether enforcement of the obligation is in the interest of justice.[7] Mr Hart carries the obligation of establishing special or exceptional circumstances justifying a waiver in his case. He relies primarily upon his impecuniosity. It is common ground that he has been adjudicated bankrupt and is a superannuitant. However, reliance on those bald facts falls well short of establishing impecuniosity. Mr Hart has failed to provide a detailed financial statement of his assets and liabilities and those of all companies or other entities with which he is associated or of his own sources of income or those entities with which he is associated. At the very least a detailed declaration should have been provided.[8] It follows that Mr Hart has failed to provide a sufficient evidential basis for concluding that his appeal rights will be rendered nugatory if security is not waived.[9] Moreover, Ms Murray has failed to address the merits of Mr Hart's appeal.She has not shown that it is truly arguable, such as would justify removing the financial protection which would otherwise be available to the ANZ Bank in theevent that the appeal failed. It is beyond dispute, as Associate Judge Sargisson found, that Mr Hart had committed an act of bankruptcy and the bank was prima facie entitled to its order of adjudication. Mr Hart failed to take any steps in the High Court to provide a sound factual legal basis for opposing an order for adjudication. He simply sought an adjournment.[10] There is no evidence to support Ms Murray's assertion that the ANZ Bank has acted improperly. The High Court made an order on its petition for Mr Hart'sbankruptcy without any finding or suggestion of impropriety. This ground has no substance.[11] In the result I am not satisfied that the Registrar erred. Mr Hart's application for an order reviewing her decision is dismissed. Security remains at $5,880. It must be paid in a form satisfactory to the Registrar such as by a bank cheque by 10 am on 13 February 2013 when Mr Hart's appeal will be called in Court asscheduled. In the event that security is not given, the ANZ Bank will be entitled to apply for consequential orders.Solicitors:Buddle Findlay, Auckland for Respondent