ERWOOD V HARLEY CA CA480/07

ERWOOD V HARLEY CA CA480/07 21 September 2007IN THE COURT OF APPEAL OF NEW ZEALAND CA480/07 [2007] NZCA 415BETWEEN ROBERT ERWOOD Applicant AND RAYLEE PATRICIA HARLEY Respondent Hearing: 17 September 2007 Court: Hammond, Robertson and J Hansen JJ Counsel: Applicant in person C R Carruthers QC for Respondent Judgment: 21 September 2007 at 3 pmJUDGMENT OF THE COURT A The application for a stay of execution pending appeal is dismissed. B The respondent will have costs of $1,500 and usual disbursements on this application. REASONS OF THE COURT(Given by Hammond J)Introduction[1] This is an application for a stay of execution pending appeal.[2] Mr Erwood and Ms Harley have been involved in protracted litigation. Ultimately Ms Harley was successful in that litigation, and costs totalling $121,236.64 were awarded to her. [3] Ms Harley attempted to execute on the judgment for that sum, by issuing writs of sale. By agreement a sum of $121,236.64 was then paid to the Registrar of the High Court at Auckland pending the determination of an application by Mr Erwood to set the writs of sale aside in their entirety. [4] That application was determined by Ronald Young J on 12 September 2007 in CIV 2000-485-27 Wellington Registry. In the result, the Judge held:(a) The application challenging the writs of sale is refused. (b) I refuse the application for a stay of payment of the sum held by the Registrar of the High Court at Auckland and order its immediate distribution in terms of the execution process.[5] Mr Erwood then took two steps. First, he filed a Notice of Appeal (CA485/07) challenging the judgment of Ronald Young J, both on certain process grounds and as a matter of substance. As to the latter, it appears to be his contention that the settlement on which the costs judgments against him rests, was a full and final settlement and leaves nothing to be paid by him. That is, it is his contention that he does not now owe Ms Harley any further sums. Secondly, Mr Erwood applied to this Court (CA480/07) to stay the orders of Ronald Young J until his appeal has been dealt with. [6] To complete the narrative, we had inquiry made of the Registrar of the High Court at Auckland immediately prior to the hearing before us. We were advised that the funds of $121,890.09 which were in Court were "paid" by cheque on 12 September 2007, as provided for in the High Court judgment, to "Russell McVeagh Trust Account". But as at the time of this Court's inquiry (10.03 am, 17 September) the monies were still in the High Court Trust Account and had not been transferred to Russell McVeagh. For completeness, we add that the payment amount on the cheque includes interest of $653.43 (after deduction of tax). Mr Carruthers QC was able to confirm from the Bar that as at the time of the hearingbefore us the particular cheque had not reached the hands of Russell McVeagh; it appears that it is still in the post. [7] On 19 September 2007 (that is, subsequent to the hearing), the Registrar of the High Court advised that the cheque has now been collected to the trust account of Russell McVeagh, and paid out by the firm, to Ms Harley.The law[8] Mr Erwood did not say what provision he was relying on for this application. We think the proper approach is to treat it as an application by Mr Erwood under r 12 of the Court of Appeal (Civil) Rules 2005 which gives concurrent jurisdiction to the High Court or this Court to grant a stay of execution pending the disposition of the appeal. [9] As this Court has observed, such an application requires the Court to balance the competing rights of the party who obtained the judgment appealed from, and the benefits of that judgment, against the need to preserve the appellant's position against the event of the appeal succeeding (Duncan v Osborne Buildings Limited(1992) 6 PRNZ 85). [10] In Dymocks Franchise Systems (NSW) Pty Ltd v Bilgola Enterprises Limited(1999) 13 PRNZ 48 Hammond J suggested that several factors should be considered on such an application:• Whether, if a stay is not granted, the right of appeal will be rendered nugatory;• Whether the successful party will be injuriously affected by the stay;• The bona fides of the applicant as to the prosecution of the appeal;• The effect on third parties;• The public interest in the proceeding;• The overall balance of convenience and the status quo. [11] Those suggested considerations were endorsed by this Court in New Zealand Insulators Limited v ABB Limited CA215/06 4 December 2006 at [13].This case[12] Mr Erwood said that if these funds pass into the hand of Ms Harley he will suffer a "loss". It is not entirely clear whether he meant by that that he would not be able to recover the funds, or whether he would suffer a loss by not being able to put them to better use in the meantime. However it is viewed, the argument is untenable. There is no evidence that Ms Harley would not be able to repay the funds if ultimately judgment were to go against her. And as to the second point, the funds have been earning High Court interest whilst they have been in Court. [13] Consideration of the balance of convenience inevitably invites some consideration of whether Mr Erwood has any respectable chance of success on the merits of the appeal. In this case, there was an agreed settlement – in writing – which was subsequently confirmed by Frater J in an Order of the High Court. The only argument open to Mr Erwood is to contend that the Order of the Court does not mean what it says. Ronald Young J gave careful attention to that matter. His construction of the relevant order is set out at [25] of his judgment. It is not necessary for us to recite the Judge's views on the construction of the agreement here. It suffices to say that Mr Erwood would appear to have very grave hurdles in contending for the interpretation he now says should be placed on the Court order. [14] Mr Erwood appeared to be seeking quite wide-ranging relief. He suggested that the monies which have been in court ought now to be paid to Dominion Finance and subject to orders preventing it being used pending hearing of the substantive appeal. It suffices to say that had the Court been moved to intercede, as matters stood at the time of the hearing the most it would have done would have been to order that the High Court cheque not be presented for collection byRussell McVeagh. But in our view that course would be inappropriate in this case: Ms Harley is entitled to the fruits of the judgment on which she stands and it has not been shown that she is not in a position to refund these monies in the unlikely event that Mr Erwood succeeds in his appeal, which is of course still on foot, and which he is entitled to continue to advance. [15] The fact that after the hearing the Court cheque was collected and paid to Ms Harley now makes this application technically "futile". However, we do not weigh that against Mr Erwood. That payment occurred post-hearing, and if we had been persuaded of the merit of the application (and we are not) the Court may (we put it no higher than that) have been able to order the monies to be repaid to the Court. [16] Finally, Mr Erwood complained that we have heard this stay application prior to an application he has made to (in effect) have his substantive appeal against the making of the costs order itself "reinstated". That particular application has had a tortuous history, and the fate of it is for hearing on 15 October 2007 in this Court. It is for the panel on 15 October to determine what the actual status of it is, and how, if at all it is to be advanced. The resolution of that matter may take some time, not least because it has become something of a procedural imbroglio. [17] Mr Erwood is not prejudiced in that respect. Again, in the event that he is successful in that appeal, there is no evidence to show he could not recover these monies from Ms Harley. And a distinct part of the delays in respect of that appeal can be laid at his door, and should not defer the payment of the fruits of the present judgment. [18] In the result, the application for stay of execution pending appeal in this instance is dismissed. Ms Harley will have costs of $1,500 and usual disbursements on this application.Solicitors: