PRASAD v IRONSTONE HOLDINGS LTD CA275/2013 [2014] NZCA 159

PRASAD v IRONSTONE HOLDINGS LTD CA275/2013 [2014] NZCA 159 [29 April 2014]IN THE COURT OF APPEAL OF NEW ZEALANDCA275/2013[2014] NZCA 159BETWEEN BHASKAR PRASADApplicantAND IRONSTONE HOLDINGS LIMITEDRespondentHearing: 7 April 2014Court: O'Regan P, White and Miller JJCounsel: N C King for ApplicantE J Grove for RespondentJudgment: 29 April 2014 at 11.00 amJUDGMENT OF THE COURTA The application for an extension of time to appeal is declined.B The applicant is to pay the respondent's costs for a standard application on a band A basis and usual disbursements.____________________________________________________________________REASONS OF THE COURT(Given by White J)[1] The applicant, Mr Prasad, seeks an extension of time under r 29A of the Court of Appeal (Civil) Rules 2005 (the Rules) to appeal against his oral adjudication of bankruptcy in the High Court at Auckland on 19 March 2013. Mr Prasad did not file an appeal within the prescribed period to appeal against the decision.1 This application therefore became necessary.1 Court of Appeal (Civil) Rules 2005, r 29 (namely 20 working days).[2] The application is opposed by the respondent, Ironstone Holdings Ltd (Ironstone).[3] The following sequence of events led to Mr Prasad being adjudicated bankrupt:(a) Entry of judgment against him in the District Court at Manukau on 1 June 2012 for arrears of rent of $155,916.10 owed to Ironstone.(b) Service on him on 21 September 2012 of a High Court bankruptcy notice for non-payment of the District Court judgment debt, to be complied with by 8 October 2012.(c) Service on him on 26 October 2012 of an application to the High Court by Ironstone dated 11 October 2012 for his adjudication as a bankrupt.(d) Filing by Mr Prasad in the High Court of a notice of intention to oppose the bankruptcy application and an application in the District Court to set aside the judgment entered against him in that Court.(e) Dismissal by the District Court following a hearing on 21 February 2013 of Mr Prasad's application to set aside the judgment in that Court. 2[4] Mr Prasad did not appear either in person or by counsel when the District Court judgment was entered against him and when his application to set aside that judgment was dismissed. He also did not appear in person or by counsel when he was adjudicated bankrupt in the High Court. Mr Prasad, who claims that he was not advised of these hearings by his former lawyer, relies on the fact that he was not represented at them in support of his application for an extension of time to appeal to this Court. He also relies on claims of procedural impropriety, the merits2 Ironstone Holdings Ltd v Prasad DC Manukau CIV-2012-092-435, 21 February 2013.of his appeal and the serious consequences of bankruptcy for him.[5] There have, however, been further relevant events since Mr Prasad applied to this Court on 3 May 2013 for the extension of time to appeal against his bankruptcy adjudication:(a) He applied successfully to the High Court for a stay of the administration of his estate pending the disposal of his appeal to this Court, which was granted by way of handwritten minute to the parties. 3(b) He applied again to the District Court to set aside the default judgment. The application to set aside was unsuccessful, but the District Court did reduce the amount of the judgment from $155,916.10 to $33,779.15 on the ground that Ironstone had failed to mitigate its loss for the period during which arrears of rent were sought. 4(c) He applied unsuccessfully to the High Court to annul his bankruptcy on the ground that the adjudication order ought not to have been made. 5 The suspension of Mr Prasad's bankruptcy pending the appeal to this Court was also set aside. 6[6] In rejecting Mr Prasad's application to annul his bankruptcy, Associate Judge Bell held that the order of adjudication would still have been made by the High Court in respect of the unpaid District Court judgment of $33,779.15.7Associate Judge Bell also held that there was no prospect of Mr Prasad settling all his claims.8 The Judge noted that Mr Prasad had identified his creditors as:3 Prasad v Ironstone Holdings Ltd HC Auckland CIV-2012-404-5557, 23 May 2013 (minute of Associate Judge Faire).4 Ironstone Holdings Ltd v Prasad DC Manukau CIV-2012-092-435, 24 September 2013.5 Ironstone Holdings Ltd v Prasad [2013] NZHC 3529.6 At [60] and [66(b)].7 At [36]–[37].8 At [47].Mortgage to the BNZ $240,156.45Ironstone Holdings $33,719.15Consumer Finance $4,637.60Westpac $4,214.17ASB $21,681.39Inland Revenue Department $928.95McLearys $62,000.00Total: $367,337.71[7] Counsel for Mr Prasad, Mr King, confirmed that these figures remained correct.[8] Mr Prasad has not sought to appeal to this Court against the decision of Associate Judge Bell.[9] Against this background, we turn to consider Mr Prasad's application for an extension of time to appeal against his original adjudication of bankruptcy which, by virtue of r 29A(4) of the Rules, is governed by Part 2 of the Rules. Under these rules, the overarching consideration in determining whether to grant an extension of time is where the interests of justice lie.9[10] Following that approach in this case, we are satisfied for the following reasons that the application should be declined:(a) The fact that Mr Prasad was not represented at the time the original District Court judgment was entered against him is no longer relevant because he has subsequently had the opportunity to apply again to the District Court to set aside the default judgment. Although the application to set aside was unsuccessful, he did succeed in reducing the amount of the judgment against him. Any procedural impropriety in the first District Court decision was therefore cured by the subsequent decision in that Court.9 Robertson v Gilbert [2010] NZCA 429 at [24].(b) The fact that Mr Prasad was not represented at the time of the adjudication of bankruptcy in the High Court is also no longer relevant because he has subsequently had the opportunity to obtain a stay of his bankruptcy and to seek its annulment. Any procedural impropriety in the High Court adjudication has therefore been cured by the subsequent hearings in that Court in which he was represented.(c) Mr Prasad does not challenge the existence of the unpaid District Court judgment debt of $33,779.15 or the amounts still owed to his other creditors.10 The fact that he has not appealed against Associate Judge Bell's decision declining to annul his bankruptcy means that he must now be taken as accepting that he was correctly adjudicated bankrupt. There is therefore no merit in Mr Prasad's proposed appeal.Result[11] The application for an extension of time to appeal is therefore declined.[12] Mr Prasad is to pay Ironstone's costs for a standard application on a band A basis and usual disbursements.Solicitors:Sinisa Law, Auckland for ApplicantSkeates Law Ltd, Auckland for Respondent10 See McLeary v Prasad [2012] NZHC 2151.