SM v LFDB [2022] NZHC 1231

SM v LFDB [2022] NZHC 1231

The application was dismissed because the funds were legally owned by the plaintiff under prior court orders and the applicant was not an innocent third party but acted recklessly by accepting instructions despite knowledge of the defendant's debarment and without verifying the continuing force of the freezing order, so relief to retain the funds was denied.

Citation
[2022] NZHC 1231
Parties
Plaintiff: SM; Defendant: LFDB
Court
High Court
Jurisdiction
New Zealand
Judgment Date
31 May 2022
Procedural Posture
Civil (freezing Order; Interlocutory Application) / Interlocutory Application; Judgment on the Papers; Dismissed
Outcome
Application dismissed; plaintiff awarded costs; timetable set for costs memoranda.
Legal Topics
Variation of Freezing Order, Debarment, Third Party Receipts, Relief From Court Process
Civil Procedure Freezing Order / Mareva Injunction Abuse of Process Solicitor Professional Conduct Variation of Freezing Order Debarment Third Party Receipts Relief From Court Process

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Parties

SM

Plaintiff

LFDB

Defendant

Procedural Posture

Civil (freezing Order; Interlocutory Application) / Interlocutory Application; Judgment on the Papers; Dismissed

Legal Issues

  1. 1 Whether the freezing order should be varied to permit a solicitor to retain payments received from an entity associated with the debarred defendant
  2. 2 Whether the solicitor was an innocent third party entitled to relief from the freezing order
  3. 3 Whether the solicitor's conduct amounted to reckless acceptance of instructions contrary to prior court orders and abuse of process

Ratio Decidendi

The application was dismissed because the funds were legally owned by the plaintiff under prior court orders and the applicant was not an innocent third party but acted recklessly by accepting instructions despite knowledge of the defendant's debarment and without verifying the continuing force of the freezing order, so relief to retain the funds was denied.

Court Disposition

Application dismissed; plaintiff awarded costs; timetable set for costs memoranda.

Orders

  • Application dismissed.
  • SM entitled to costs; if costs cannot be agreed SM to file a memorandum by 1 July 2022.