COMMISSIONER OF INLAND REVENUE V METHODIST CHURCH SAMOA NEW ZEALAND MASSEY PARISH HC AK CIV-2010-404-003669

COMMISSIONER OF INLAND REVENUE V METHODIST CHURCH SAMOA NEW ZEALAND MASSEY PARISH HC AK CIV-2010-404-003669 24 November 2010IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY CIV-2010-404-003669IN THE MATTER OF the Charitable Trusts Act 1957 BETWEEN THE COMMISSIONER OF INLAND REVENUE Plaintiff AND METHODIST CHURCH SAMOA NEW ZEALAND MASSEY PARISH Defendant Hearing: 24 November 2010 Appearances: (On the Papers) Judgment: 24 November 2010JUDGMENT OF DUFFY JThis judgment was delivered by Justice Duffy on 24 November 2010 at 2.30 pm, pursuant to r 11.5 of the High Court Rules Registrar/Deputy Registrar Date:Solicitors: Legal and Technical Services Inland Revenue Department (C M Mitchell and J Ridling) P O Box 33150 Takapuna for the Plaintiff Thorne Thorne White and Clark-Walker (J C Chamley) P O Box 140 (DX CP21508) Shortland Street Auckland 1140 for the Defendant Copy To: Liquidation Services Limited (S W Greer) P O Box 12448 Penrose Auckland 1642[1] Fairfax Media has applied to view the entire file in this proceeding. The given reason for their request is: "to prepare a story on the proceedings". [2] On receipt of this request, the Registry sought the views of the parties. This was done because the Registry treated the application as one which came under r 3.9. This was an error. The application falls outside r 3.9, and should have been dealt with under r 3.13. [3] Rule 3.9 takes effect once a proceeding has reached the stage where the substantive hearing has commenced. The rule continues to apply for a specified time either after judgment has been delivered or the proceeding is discontinued before final judgment is given. The commentary to r 3.9 (HR 3.9.01) makes it clear that the "substantive hearing stage" of a proceeding does not commence until the beginning of the hearing. [4] In this case the proceeding is well removed from a substantive hearing. Indeed, it is only at the stage where a statement of defence has recently been filed and an amended statement of defence is contemplated. The allocated date for hearing is on 7 April 2011. [5] The use of the appropriate rule is important because r 3.9(2) gives persons requesting information under this rule a right of access to Court documents, whereas access under r 3.13 is at the discretion of the Court. [6] For this request, the appropriate rules governing access to Court documents are rr 3.11 and 3.13. Rule 3.11 provides that if a person is not eligible to access a document, court file or any part of the formal court record under any of the rules 3.7 to 3.9, the person may access the document, court file, or any part of the formal court record with the permission of the court given on an application made under r 3.13. The commentary to r 3.13 (HR 313.02) provides that notice has to be given to persons adversely affected by the application and that the court should first decide who is to be given notice.[7] In the present case, because the Registry proceeded under a misapprehension that this was a r 3.9 application, notice has already been given to the parties. Both parties have responded opposing the request being granted. Their reasons for opposing access are: a) The proceedings have been adjourned for the defendant to file an amended and expanded statement of defence. The Commissioner of Inland Revenue (the Commissioner) asserts that in this circumstance, any possible defence the defendant may wish to plead is not presently before the Court, so that reporting of the proceedings based upon the present Court file may give a misleading representation of the defendant's position; b) Secondly, it is said the parties are in continual discussion regarding possible settlement negotiations. Issues raised in the negotiations involve the possible sale of property and/or refinancing from third parties. It is said that adverse and extended publicity of these proceedings may have a prejudicial effect on any efforts by the defendant to secure adequate funding for settlement; and c) Thirdly, it is said that whilst it can be argued the matter is already in the public domain because of the Companies Act 1993 requirement to advertise the liquidation proceedings, at this stage no other creditors of the defendant have expressed an interest in the proceedings. Any further publicity could only be justified upon the ground of public interest. The Commissioner submits that the public interest would best be served by reporting the case when and if all pleadings are before the Court. [8] The matters to be taken into account when considering release of information under r 3.13 are set out at r 3.16. This rule provides that the Judge must consider the nature of, and the reasons for, the application or request and take into account each of the matters set out in (a) to (f) of r 3.16. Those matters are:a) The orderly and fair administration of justice; b) Protection of confidentiality, privacy interests, including those of children and other vulnerable members of the community (and any privilege held by, or available to, any person); c) The principle of open justice, namely encouraging fair and accurate reporting of, and comment on Court hearings and decisions; d) The freedom to seek, receive and impart information; e) Whether a document to which the application or request relates is subject to any restriction under r 3.12; and f) Any other matter that the Judge thinks just. [9] The commentary to r 3.13.01 notes that there is provision for a request to be dealt with by way of formal application. [10] The present application is unhelpful in that it provides sparse reasons for the applicant being granted permission to view the Court file. This may be because the applicant has approached the request as one made under r 3.9, where there is a right to access the information sought. [11] Given the early stage in the proceedings, and given that the parties are discussing settlement, I consider there is a proper basis for the moment in refusing the request. I consider that the principles in r 3.13(a) and (b) favour refusal of access, and that those principles outweigh the other principles in r 3.16. If the parties are working towards a settlement, their chances of achieving that end should not be jeopardised by having the details of their dispute (as disclosed in the Court file) made available to the general public. Furthermore, as the Commissioner states, if the pleadings are not yet finally settled, any view they presently portray of the parties' dispute may be inaccurate.[12] This is not to say, however, that access at some time in the future will also be precluded. If the applicant can provide a stronger case for accessing the Court file, it should do so and its request can then be re-assessed. Duffy J