HITCHCOCK v MURPHY [2021] NZCA 689

HITCHCOCK v MURPHY [2021] NZCA 689 [15 December 2021]IN THE COURT OF APPEAL OF NEW ZEALANDI TE KŌTI PĪRA O AOTEAROACA745/2020[2021] NZCA 689BETWEEN STEPHEN LESTER HITCHCOCKApplicantAND SUSAN KERRIE MURPHYRespondentCourt: Courtney and Goddard JJCounsel: G J Thwaite for ApplicantK E Hogan for RespondentJudgment:(On the papers)15 December 2021 at 11.30 amJUDGMENT OF THE COURTA The application to set aside the abandonment of appeal in CA545/2020 isdeclined.B The applicant must pay costs to the respondent for a standard applicationon a band A basis, with usual disbursements.____________________________________________________________________REASONS OF THE COURT(Given by Goddard J)Background[1] Mr Hitchcock, the applicant, is the brother of the respondent, Ms Murphy.Ms Murphy owns a 10-acre rural property in Auckland. Mr Hitchcock has lived at theproperty since 2003, with some periods of absence. Mr Hitchcock has at various timesprovided funds to Ms Murphy, though the basis on which he did so is in some respectscontested. He has also undertaken work on the property, though the parties differ aboutthe purpose of that work, whether it was done at Ms Murphy's request or for herbenefit, and also about its value.[2] Ms Murphy intends to subdivide the property and sell the subdivided sections.On 2 May 2019 Mr Hitchcock lodged a caveat against the title to the property.On 18 March 2020, a notice to lapse the caveat was issued.[3] On 25 March 2020, Mr Hitchcock filed an originating application in theHigh Court seeking an order under s 143 of the Land Transfer Act 2017 that the caveatnot lapse. That application was dismissed by Associate Judge Gardiner (High Courtcaveat decision).1[4] On 25 September 2020 the Associate Judge made interim orders stayingenforcement of her decision and sustaining the caveat, pending determination ofa foreshadowed appeal to this Court. However on 30 September 2020 those interimorders were discharged, as the caveat had already lapsed following notice to theRegistrar of the High Court caveat decision.[5] On 13 November 2020 Mr Hitchcock commenced proceedings in theHigh Court against Ms Murphy seeking orders for specific performance of an allegedagreement to subdivide the property and sell a 2.5-acre section to him, and in thealternative seeking a declaration of constructive trust over a 2.5-acre section of theproperty.The appeal to this Court[6] On 24 September 2020 Mr Hitchcock filed a notice of appeal in this Court(CA545/2020) against the High Court caveat decision. However on 23 October 2020,Mr Hitchcock abandoned his appeal. A notice of result was issued on 27 October2020.1 Hitchcock v Murphy [2020] NZHC 2207, (2020) 21 NZCPR 303 [High Court caveat decision].[7] Then on 22 December 2020, despite that earlier abandonment, Mr Hitchcockapplied for an extension of time to appeal from the High Court caveat decision, underr 29A of the Court of Appeal (Civil) Rules 2005 (Rules). That application made noreference to the previous appeal, or to the abandonment of that appeal.[8] A teleconference was held on 10 February 2021. Mr Hitchcock was advisedthat in circumstances where his appeal had been abandoned, the proper course was toapply to set aside the notice of abandonment. He proceeded to do so: that is theapplication now before this Court (CA745/2020).When may a notice of abandonment be set aside?[9] Rule 44 of the Rules provides for the abandonment of an appeal. It is silent onthe circumstances in which a notice of abandonment may be withdrawn.[10] In Humphries v Carr, this Court held that the discretion to set aside anabandonment will be exercised only in "compelling" or "exceptional" cases.2The ultimate question is what the interests of justice require.3 That test must beapplied having regard to the context, and in particular the prior abandonment of theappeal. That abandonment will be a relevant factor — often, a highly material factor— when assessing the interests of justice, having regard to the importance of finality.The applicant will need to provide a reasonable explanation for their change ofposition. Where a respondent has relied on the abandonment of the appeal, that islikely to count strongly against setting that abandonment aside.[11] The factors that are relevant to an extension of time application will also berelevant in this context, including:4(a) the length of delay in pursuing the appeal;(b) the reasons for the delay;2 Humphries v Carr [2009] NZCA 608 at [17], quoting Sexton v Rice Craig [2007] NZCA 200at [31]; and R v Cramp [2009] NZCA 90 at [35].3 Almond v Read [2017] NZSC 80, [2017] 1 NZLR 801 at [38].4 At [38].(c) the conduct of the parties, particularly the applicant;(d) any prejudice or hardship to the respondent or others with a legitimateinterest in the outcome; and(e) the significance of the issues raised by the proposed appeal, both to theparties and more generally.[12] The merits of the proposed appeal may be relevant, but the court should reacha view on the merits only where they are obviously very strong or very weak.A decision to refuse an application to set aside an abandonment of an appeal basedsubstantially on the lack of merit of that appeal should be made only where the appealis clearly hopeless.5Applicant's submissions[13] Mr Hitchcock says that his former lawyer abandoned the appeal without hisinformed consent. His proposed appeal is meritorious. Ms Murphy is not materiallyprejudiced by the delay in pursuing the appeal, or by the withdrawal of the notice ofabandonment.Respondent's submissions[14] Ms Murphy opposes the application. She says the evidence shows the noticeof abandonment was filed with Mr Hitchcock's knowledge, and in accordance withhis instructions. It was consistent with advice he received from experienced counseland was a strategically sensible decision. She was entitled to treat the appeal as havingbeen abandoned. This is not a compelling or exceptional case in which the importanceof finality is displaced. She also reiterates her submission that Mr Hitchcock'sproposed appeal lacks any merit.5 At [39].The evidence before this Court about the abandonment[15] Mr Hitchcock has filed an affidavit in which he says that the appeal wasabandoned before he received formal advice about whether or not he should do so, andwithout his prior approval.[16] In order to enable this Court to consider the merits of Mr Hitchcock's argumentthat the abandonment was filed without instructions from him to do so, Mr Hitchcockprovided a waiver of privilege. Mr Hitchcock's former solicitor, Mr Baker, hasprovided an affidavit setting out the background to the abandonment.[17] Mr Baker says he met with Mr Hitchcock in person on 8 October 2020 todiscuss the proceedings. He advised Mr Hitchcock that because the caveat had lapsed,an appeal was futile. Rather, the focus should be on the High Court proceedings to befiled in relation to Mr Hitchcock's claims. Mr Baker says there were furthercommunications consistent with that discussion. Mr Baker also communicated withcounsel who had been retained, Mr St John. Mr St John proceeded to file the noticeof abandonment.[18] Mr Baker also says that he sent a letter dated 6 November 2020 toMr Hitchcock recording in writing the approach discussed on 8 October 2020.A file note that he made on 6 November 2020 records that Mr Hitchcock called, andconfirmed that the appeal should be withdrawn.[19] There is a measure of confusion about timing. Although Mr Baker's evidencesuggests that Mr Hitchcock had given instructions to abandon the appeal on 8 October2020, Mr Baker subsequently asked this Court for an extension of time to pay securityfor costs for the appeal because he was "still taking instructions" on 22 October 2020.And confirmation of Mr Hitchcock's decision to withdraw the appeal appears to havebeen given by him to Mr Baker on 6 November 2020, as noted above, some two weeksafter the notice of abandonment had been filed on 23 October 2020.[20] Be that as it may, the position that was ultimately reached was thatMr Hitchcock had instructed his lawyers to abandon the appeal, and the appeal hadbeen abandoned.Discussion[21] Even if the original appeal had not been abandoned, and Mr Hitchcock wassimply seeking an extension of time under r 29A of the Rules, that extension wouldnot be granted. The fundamental difficulty that Mr Hitchcock faces is that the caveathas lapsed. There is no power to reinstate a lapsed caveat.6[22] It may be possible for Mr Hitchcock to make an application in his newHigh Court proceedings for leave to lodge a second caveat, under s 146 of theLand Transfer Act. But there is no relief that could be granted by this Court on appealfrom the caveat decision that would revive the original caveat and give Mr Hitchcockthe relief he seeks before this Court. Thus the appeal cannot succeed: it is futile.[23] It is unsurprising that competent legal advisers gave Mr Hitchcock the adviceoutlined in Mr Baker's affidavit, and advised that the appeal should be abandoned.The evidence that Mr Hitchcock agreed to that course of action is clear, even if thereis some confusion around the dates.[24] Mr Hitchcock's original legal team rightly understood that pursuing an appealfrom the High Court caveat decision would be a waste of time and money. It wastherefore, very sensibly, abandoned.[25] The abandonment of the appeal was a further nail in its coffin. But it was inany event already doomed.[26] It follows that the test for withdrawal of abandonment of an appeal is not metin the present case. Mr Hitchcock's application must be dismissed.[27] Costs should follow the event in the ordinary way.6 Chambers v District Registrar of Land Titles Office HC Wellington M396/97, 12 November 1997at 7, quoting Metcalfe v Skyline Holdings Ltd (1982) 1 NZCPR 480 (HC) at 484.Result[28] The application to set aside the notice of abandonment of appeal inCA545/2020 is declined.[29] The applicant must pay costs to the respondent for a standard application ona band A basis, with usual disbursements.Solicitors:Insight Legal Ltd, Rodney for Respondent