JONES v NEW ZEALAND BLOODSTOCK FINANCE & LEASING LIMITED [2023] NZHC 572 [21 March 2023]

JONES v NEW ZEALAND BLOODSTOCK FINANCE & LEASING LIMITED [2023] NZHC 572[21 March 2023]IN THE HIGH COURT OF NEW ZEALANDAUCKLAND REGISTRYI TE KŌTI MATUA O AOTEAROATĀMAKI MAKAURAU ROHECIV-2022-404-1770[2023] NZHC 572IN THE MATTER of an application to set aside a bankruptcynoticeBETWEEN GREGORY JOHN JONESApplicantAND NEW ZEALAND BLOODSTOCKFINANCE & LEASING LIMITEDRespondentHearing: (On the papers)Counsel: Applicant self-representedF A King for RespondentJudgment: 21 March 2023JUDGMENT OF ASSOCIATE JUDGE LESTER[1] The plaintiff, Mr Jones, has applied to set aside a bankruptcy notice dated23 September 2022.[2] On 10 November 2022, Associate Judge Andrew (as he then was), madedirections in relation to Mr Jones' application. Mr Jones was to, by 24 November2022, file and serve a memorandum addressing the nature of the evidence he intendedto give at the March 2023 hearing. Mr Jones was to file and serve his writtensubmissions and a common bundle by 26 February 2023, with the creditor,New Zealand Bloodstock Finance & Leasing Ltd, to file its submissions by3 March 2023. The hearing was scheduled for 13 March 2023.[3] On 10 February 2023, Mr Jones, having not filed the memorandum directed byAssociate Judge Andrew, filed a further application seeking leave to call oral evidenceat the hearing of his application to set aside the bankruptcy notice pursuant to rr 7.27and 9.75 of the High Court Rules 2016 (the Rules), an order for the appointment ofan expert under r 9.36, together with an order adjourning the hearing on13 March 2023 to a date after 3 April 2023.[4] While those orders were opposed, Associate Judge Gardiner, in a Minute dated22 February 2023, granted an adjournment of the application to set aside thebankruptcy notice to 20 April 2023 at 10 am. The Judge noted there would be nofurther adjournment of that hearing.[5] As to the balance of Mr Jones' application, Judge Gardiner recorded a decisionwould be made on the papers and that if oral submissions were considered necessary,a telephone conference would be arranged.[6] The two remaining aspects of Mr Jones' 10 February 2023 application werereferred to me as I am allocated to the hearing on 20 April 2023.[7] On 2 March 2023, I timetabled submissions for this application requiringMr Jones to file any submissions within five working days, that is, by 9 March 2023.In a memorandum dated 7 March 2023, Mr Jones sought further time to file hissubmissions and referred to r 7.34 of the High Court Rules 2016 that deals with thehearing of interlocutory applications. In a Minute of 10 March 2023, I extended thetime for Mr Jones' submissions to 15 March 2023, and confirmed Mr Jones'application to call oral evidence would be dealt with on the papers as per the existingdirections. Mr Jones did not file submissions by 15 March 2023 and none werereceived prior to the finalisation of this judgment on 21 March 2023.The grounds relied on to set aside the bankruptcy notice[8] Mr Jones' application at para [2] relies on the following grounds to set asidethe bankruptcy notice and for a separate stay of the proceedings pursuant to s 42 of theInsolvency Act 1986. Those grounds are:(a) As to order 1(a)- The Bankruptcy Notice is defective as it states a sum in respect ofthe Judgment which is incorrect; and- The application has a cross-claim against the creditor that:(i) Is equal to greater than the Judgment debt; and(ii) The Applicant could not use this cross-claim as a defence inthe action or proceeding in which the Judgment was obtained;(b) As to order 1(b), any application for adjudication should be halteduntil the Applicant's appeal in relation to the Judgments is heard.(c) As to all orders, it is just and equitable and in the interests of justiceto make the orders sought.Mr Jones' evidentiary application[9] Mr Jones, in his application of 10 February 2023, sought the following orders:(a) an order for leave to call oral evidence pursuant to rr 7.27 and 9.75 ofthe High Court Rules; and(b) an order for the appointment of an expert to assist the Court pursuantto r 9.36 of the High Court Rules.[10] Mr Jones also sought that his applications be determined prior to the hearingof his application to set aside the bankruptcy notice, hence Associate Judge Gardinerdirected the application be dealt with on the papers. Mr King, counsel for therespondent, notes that Mr Jones was given until 24 November 2022 to provide detailsof the evidence he wished to advance. However, the present application was madesome two months later. It would be inappropriate for that delay to hold up thedetermination of the status of the respondent/creditor's bankruptcy notice.[11] Mr Jones' application is in broad terms. The grounds on which the orders aresought are as follows:(a) As to all the orders sought they are in the interests of justice .(b) As to Order (a) in respect of Rules 7.27 and 9.75 of the High CourtRules that special circumstances exist in respect of the calling of oralevidence.(c) As to the order pursuant to Rule 9.36 that there are importantquestions in the proceeding which could be resolved by an expert'sreport.[12] No particulars or elaboration of these grounds are provided in the application.Mr Jones' applications in more detail[13] Rule 7.27 of the Rules provides:7.27 Evidence normally given by affidavit(1) Evidence relating to interlocutory applications is given by affidavit.(2) Despite subclause (1), in special circumstances, a Judge may acceptoral evidence.(emphasis added)[14] The authors of McGechan at HR7.27.01 note that the Rule does not empowera judge to make "a pre-emptory order which would have the effect of forcing"a reluctant deponent to attend to give oral evidence.11 Jessica Gorman and others McGechan on Procedure (online ed, Thomson Reuters) at [7.27]. SeePlymouth Hotel Ltd v Broadcasting Corporation of New Zealand, HC Wellington, A564/85,2 May 1986; and Churchill Group Holdings Ltd v Aral Property Holdings Ltd, HC AucklandCIV-2001-404-2302, 20 August 2009.What evidence does Mr Jones seek be given orally?[15] In his affidavit in support of the application, which I apprehend was intendedto fulfil the role of the memorandum directed by Associate Judge Andrew, Mr Jonesrefers to the evidence he wishes to call.[16] Mr Jones refers to affidavit evidence given in a list of other proceedings andhe says:It is my intention to raise in support of my application all the evidence referredto in the various sets of proceedings that I have become involved in andreferred to above.[17] The above includes six affidavits referred to in the summary judgmentproceedings that found the debt relied on for the issue of the bankruptcy notice in thismatter, together with affidavits from other proceedings.[18] In his affidavit, Mr Jones says he believes it is necessary to hear evidence fromPeter Westend, Brian O'Shea, Luke McDonald and a member of the Magic Millionssale company, as well as Mr Clarke (a horse valuer), and Dr Craig Lawrence(a veterinarian from Cambridge Vet Services). It is not clear to me whether Mr Joneswishes to call someone from Scone Equine Clinic or Associate Professor FrancoisRenee Bertin in relation to the Pierro Saltatio filly. Other individuals are referred toin Mr Jones' affidavit but he does not say whether he wishes to call them, for example,a Mr David Ellis.[19] Rule 9.75 of the Rules, which is also relied on by Mr Jones, provides:9.75 Person refusing to make affidavit(1) If a person having information relevant to a proceeding or aninterlocutory application refuses to make an affidavit as to thatinformation, a party may apply for an order directing the person toappear and be examined on oath before the court, or any person thecourt appoints, as to that information.(2) The court may—(a) make any orders the court thinks just for the attendance of thatperson before the court, or before the person named in theorder, for the purpose of being examined, and for theproduction of any documents specified in the order; and(b) impose any terms the court thinks just, as to the examinationand the costs of and incidental to the application andexamination.[20] There is no evidence from Mr Jones that he has called upon any of thewitnesses he would like to give evidence to provide an affidavit so as to bring r 9.75into play. Such is a pre-condition for the exercise of the Court's jurisdiction underr 9.75.2[21] McGechan at HR9.75.01 notes that r 9.75 does not compel execution of anaffidavit. The order the Court makes is for appearance and examination on oath. Theauthors note that implicit in the requirement for examination on oath is that a transcriptof the sworn testimony will be taken. The authors note the transcript is viewed asa substitute for an affidavit, should be treated as filed, and therefore available for useby either party.[22] While Mr Jones does not say so, it would seem that he seeks an order underr 7.27 of the Rules for oral evidence and will then ask the Registry to issue subpoenasfor those he wants to attend Court. Rule 9.75 does not require the reluctant deponentto appear at the interlocutory hearing – their evidence is taken prior with the transcripttaking the place of their affidavit.[23] If I am correct that Mr Jones intends to request the issuing of a subpoena, suchare issued under r 9.52(1), which provides:(1) Orders of subpoena in form G 25 to require the attendance ofwitnesses at the trial to testify or to produce documents, or both, maybe obtained by any party, at any time after the filing of the statementof claim.[24] The rule refers to the witnesses at trial and to subpoenas being available anytime after the filing of a statement of claim.[25] My speculation that Mr Jones is planning to apply for subpoenas may beentirely misplaced. However, the rules relied on by Mr Jones in his application are2 McGechan at HR 9.75.02 notes there is a positive requirement to establish a refusal to swear anaffidavit. See European Stone Surfaces Ltd v Italian Surfaces NZ Ltd (2006) 18 PRNZ 165 at[10]-[11].not capable of achieving what he apparently wants to happen at the hearing of hisapplication, that is, that named individuals be ordered to attend at the hearing of theapplication to set aside the bankruptcy notice and be examined by Mr Jones.[26] As noted, r 7.27 does not provide an avenue for forcing a reluctant deponent toattend and give evidence at an interlocutory hearing. Rule 9.75 has no application, forthe reasons already given. Rule 9.52 does not apply to interlocutory hearings.3 Here,there is neither a trial nor a statement of claim. If Mr Jones had been planning to applyfor a subpoena, in my view, such would not have been available.Decision[27] I do not see jurisdiction in the Rules relied on by Mr Jones to make the typesof orders he seeks which contemplate that witnesses will appear on 20 April 2023 andin effect, be cross-examined by him.[28] Mr Jones has been well aware of the factual allegation he wants to rely on inhis application. They were referred to in the judgment that founds the bankruptcynotice in this proceeding, being the judgment of Jagose J of 5 June 2020 and in thelargely unsuccessful appeal from that judgment released by the Court of Appeal on25 August 2022. In late 2021, Mr Jones issued proceedings in the Auckland HighCourt under CIV-2021-404-002267, which covers broadly the same grounds he relieson to challenge the bankruptcy notice.[29] The Rules do not contemplate that the Court can order the attendance ofa witness at the hearing of an interlocutory application to set aside a bankruptcy noticein order for their evidence to be taken viva voce. The respondent does not wish to callany such witnesses. While Mr Jones wishes to examine witnesses, I apprehend hedoes not want to call them as his own witnesses, rather, he wants to cross-examinethem.3 See European Stone Surfaces Ltd v Italian Surfaces Ltd, above n 2, applying A v Botrill (1999) 14PRNZ 94; and Mailley v Shaw [2021] NZHC 759. In Mailley v Shaw, Associate Judge Bell didsay a subpoena might be used to require a witness to attend where a proposed witness has notgiven an affidavit when a Judge decided to accept oral evidence. At paras [4] and [5], his Honoursaid r 9.52 applied to trials and interlocutory applications are not trials. Cross on Evidence at EVA150.4 provides that the High Court has declined jurisdiction to give leave to serve a New Zealandsubpoena for the purposes of interlocutory proceedings.[30] I decline to make the orders sought at paras 1(a) and 1(b) of Mr Jones'application of 10 February 2023.[31] Mr Jones is to file and serve his written submissions in support of hisapplication to set aside and a common bundle of documents 10 working days prior tothe hearing date, with the respondent filing and serving its submissions five workingdays prior.____________________________________Associate Judge LesterSolicitors:Greg Jones, AucklandMcKenna King Dempster, Hamilton