WESTPAC BANKING CORPORATION ABN 33007 457 141 V CHISHOLM HC AK CIV 2006-404-3230

WESTPAC BANKING CORPORATION ABN 33007 457 141 V CHISHOLM HC AK CIV 2006-404-3230 17 April 2007IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY CIV 2006-404-3230BETWEEN WESTPAC BANKING CORPORATION ABN 33007 457 141 Plaintiff AND DEAN ALAN CHISHOLM Defendant Hearing: 17 April 2007 Appearances: Mr Robinson for plaintiff Mr Bates for defendant Judgment: 17 April 2007ORAL JUDGMENT OF ASSOCIATE JUDGE J P DOOGUESolicitors:Simpson Grierson, Private Bag 92518, Wellesley Street, Auckland - by email: michael.robinson@simpsongrierson.com Legal Vision, P O Box 47-587, Ponsonby, Auckland - by email: legalvision@clear.net.nz[1] This matter has come before me on 17 April 2007 by way of an opposed summary judgment application. Unfortunately there have been a number of procedural problems with the proceedings in getting them to this point. The main one has arisen from the wholesale breaches of timetable orders that I made. The summary judgment application originally had a return date of 21 September 2006. At that time Mr Chisholm was in Australia. For various reasons the hearing was carried forward to this year. It is actually now some 10 months since the proceeding was filed in the High Court. I made timetable orders that originally required Mr Chisholm to file and serve his affidavit/s by 24 October 2006 and I later extended that to 6 December 2006. His affidavit and that of a Mr Nottingham filed by him in opposition to the application for summary judgment were actually filed on 7 February 2007. Notwithstanding the very considerable period of time that has elapsed to enable the defendant to get his evidence in order, there seem to be deficiencies with the affidavits and it those which have lead to an objection being made by Mr Robinson this morning, to substantial parts of the defendant's affidavits being read. The objections concern depositions which are either hearsay or are statements of belief. I accept the submission for the plaintiff that the law concerning whether or not there is latitude for hearsay in summary judgment applications is correctly stated in Ports of Auckland Limited v The Ship Raumanga ( Giles J, High Court Auckland 8 May 1998, AD 883, p. 1). In particular the position which should guide the parties in summary judgment applications is set out in a well-known passage from that judgment as follows:The plaintiff sought an order striking out certain parts of the affidavit of David Brown filed on behalf of the owners upon the grounds that it infringed the rules against hearsay in affidavits. Rule 510 deals with the form and contents of affidavits. They are to be confined to such matters as would be admissible if given in evidence at trial by the deponent. Section 7 of the Evidence Amendment Act (No. 2) 1980 specifies the circumstances in which oral hearsay evidence can be given in a civil proceeding as an exception to the general rule. Oral hearsay is only possible where the maker of the statement is unable to give evidence. The circumstances where that arises are specified in s. 2(2) of that Act. None of the criteria can be established in the present case. Rule 252, which deals with interlocutory applications, incorporates the provisions of Rule 510 in relation to affidavits. A proviso introduces an amelioration in limited circumstances. Although a summary judgment application is interlocutory it is not, in my view, to be treated as a purelyprocedural interlocutory where an attitude of flexibility as to hearsay is often extended. It is a substantive interlocutory because if the application succeeds the action will have been resolved by the entry of judgment. For that reason the rules of evidence must be complied with.[2] The effect of all of this is that hearsay evidence is not admissible in summary judgment applications. Mr Bates for the defendant submitted that the position was to the contrary. Quite apart from the fact that that is inconsistent with the case I have just made mention of, there is good reason why the rules of evidence should be applied in summary judgment applications and that is that the parties are not available for cross-examination. [3] Turning to the second ground of objection which is that the affidavits contain statements of belief, there is some relaxation of the inadmissibility of that material in Rule 249 but the matter is left to the discretion of the Court in exercising discretion the Court is to be guided by r 249(2). [4] In addition to the grounds that the affidavits contain hearsay evidence and statements of belief a further objection emerged in the course of the argument before me which is that some of the passages in Mr Chisholm's affidavit contain statements of opinion on matters of value of property. [5] Turning now to the various portions of the affidavits that are objected to. I will deal first with Mr Chisholm affidavit and will give my rulings briefly. [6] Paragraph 18 contains statements of belief about the range of prices at which properties in the estate were selling at. The clause contains a statement of belief about the comparative value of another site in relation to the site which is the subject of the property sale which is being examined in these proceedings. There is at least one other statement of belief and also a statement of opinion which is not qualify the whole of that paragraph of the affidavit is objectionable and is not to be read. [7] Paragraph 19 contains statements of belief concerning the relationship between a real estate agent and the person who ultimately purchased the mortgaged property by tender. There are statements of belief in this clause which cannot bepermitted and they are not saved by the discretion in r 249(2). They cannot be salvaged by subrule (2) because clearly subrule (a) and (b) do not apply. So far as the interests of justice are concerned, I do not accept that Mr Chisholm has been handicapped by having insufficient time or opportunity to get proper evidence before the Court of these matters which would justify me accepting bald statements of opinion such as those which are contained in paragraph 19. [8] Paragraph 20 as well contains statements of belief concerning a failure to pay a deposit and that there was some type of breach of ethics by a real estate agent involved in the transaction, it too is in admissible and will not be read. [9] So far as paragraph 21 is concerned, it contains a statement of opinion that sale took place at less than true value. The defendant has not qualified himself to give such an opinion. It also contains statements of belief that the agent may have "talked down" the value of the property for the purpose of resale. That material contained in paragraph 21 in its totality is not admissible. [10] Paragraph 22 contains inadmissible evidence of belief and will not be read. [11] The same can be said of paragraphs 23 and 24 and they are excluded in their entirety. [12] So far as Mr Nottingham's affidavit is concerned this sets out statements of belief concerning "allegations against the real estate agent involved in the sale of 8 Scenic Drive, Queenstown". These are set out in an exhibit to Mr Nottingham's affidavit. They seem to combine an assertion that Mr Columb is prepared to make an offer concerning the property and that also an agent retained by the plaintiff's has been "running down" the property and otherwise behaving inappropriately. None of this material is admissible. It again comprises statements of belief. The letter is admissible to the extent that it comprises an offer in the terms set out in paragraph one of the letter but for no other purpose. [13] Paragraph 14 returns to the matter of Mr Columb having instructed Mr Nottingham to make an offer to purchase. It recounts that Mr Columb had heard theplaintiff's agent talking negatively about the value of the property. Obviously that is hearsay and is inadmissible. There are then assertions about what Mr Columb's view was of the value of the property and that he was aware of the recent valuation – that is hearsay evidence. As well, there is a property valuation report annexed to the affidavit of Mr Nottingham. This valuation is from "Mac Property". I was initially disposed to allow that valuation to be placed before the Court even though the valuer had not given an affidavit. Mr Bates posed the question of what harm did it do to put the valuation before the Court in this form or what could be added by the valuer giving an affidavit? On reflection, it seems to me that the answer is that if the valuer gives an affidavit he accepts responsibility on oath for the accuracy of the facts recorded in his affidavit and the opinion that he gives. The contrary is the case where the valuation is simply annexed to someone else's affidavit as an exhibit. I therefore decline to accept the Mac Property valuation. [14] There is also a valuation annexed to Mr Chisholm's affidavit which I need to deal with. The same comments can be made about that valuation. I do not intend to read it. _____________ J.P. Doogue Associate Judge