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Court of Appeal Judgments of Public Interest

This page provides access to judgments of the Court of Appeal in the last 90 days deemed to be of particular public interest.

More information about finding court judgments is available on the judgments section of this website.

It is the responsibility of users of the information contained in these decisions to ensure compliance with conditions or other legal obligations governing access, release, storage and re-publication. See also the guide on statutory provisions that prohibit publication of certain information in certain circumstances. If in doubt you should consult the court that issued the decision(s).  Judicial Decisions are presented in PDF format to preserve the integrity of the documents.

Ross v Southern Response Earthquake Services Limited
16 September 2019
[2019] NZCA 431

Appeal allowed. Costs order.

Practice and Procedure - representative proceedings.

Mr  and  Mrs  Ross  brought a claim against Southern Response Earthquake Services Ltd (Southern Response) in relation to the settlement agreement that they entered into to settle their insurance claim for damage to their house caused by the Canterbury earthquakes. Mr and Mrs Ross say that many policyholders settled claims in similar circumstances, and as a result have the same claims against Southern Response. Mr and Mrs Ross applied to the High Court for leave to bring proceedings as representatives of a class of around 3,000 policyholders on an opt out basis. Associate Judge Matthews held that the claim should be brought on an opt in basis and resolved a number of issues about the membership of the representative group. Mr and Mrs Ross obtained leave to appeal to this Court.

Did the Associate Judge err in finding that the representative claim could not be brought on an opt out basis? Held; yes. There is no jurisdictional barrier to the making of opt out orders in representative proceedings. Nor is there any policy reason why they should be exceptional. In most cases there will be compelling access to justice reasons for making an opt out order. It is not necessary or appropriate to wait for detailed legislation about class actions to be enacted before the court is willing to make such orders. The courts have the necessary powers to manage the procedural issues that will arise in the context of opt out representative proceedings. An opt out approach is appropriate in this case.

Did the Associate Judge err in limiting the membership of the class to rebuild customers?  Held;  yes. Repair customers have the same interest in the proceedings for the purposes of r 4.24  of the High Court Rules 2016. It would  be more consistent  with the goals of efficiency  and fairness for them to be included in the claimant class in this proceeding.

Griffin v R
10 September 2019
[2019] NZCA 422

The appellant was convicted on one charge of manslaughter and one charge of aggravated robbery, and sentenced to 10 years and nine months' imprisonment. Sentence to be served without parole by operation of the three strikes law. Whether the Judge erred in adopting a starting point too high by comparison to similar and more serious cases.

Held: no. Having regard to both comparable manslaughter sentencing and GBH sentencing (the latter used as a cross-check, in accordance with Everett v R [2019] NZCA 68), the starting point of 12 years' imprisonment was plainly appropriate and within range.

Kim Dotcom v Her Majesty’s Attorney-General on behalf of the Government Communications Security Bureau
06 September 2019
[2019] NZCA 412

Appeal dismissed.

The  Government   Communications   Security   Bureau   ("GCSB")   unlawfully   intercepted Mr Dotcom's private communications at the request of the New Zealand Police, who were conducting an operation in aid of United States authorities who sought his extradition to face criminal charges in that jurisdiction. The intercepts continued for 10 days after Mr Dotcom's anest on 20 January 2012. The instant civil proceedings seeking damages for breach of privacy interests were severed from Mr Dotcom's 2012 judicial review proceeding once it became apparent the GCSB had acted unlawfully. At the GCSB's invitation, the High Court entered judgment against it. All that remains is to fix the damages payable.

Mr Dotcom appeals an interlocutory judgment of the High Court in which Gilbert J granted the GCSB's application under s 70 of the Evidence Act 2006 for an order that the intercepted communications not be disclosed in the proceeding for reasons of matters of State and that the public interest in the information being disclosed was outweighed by the public interest in withholding it. The GCSB claims that disclosure of the communications would adversely affect its operational activities and reveal or permit deduction of sources, method of collection, capacity, or capability.

During the hearing for the non-disclosure application, neither Mr Dotcom (or his co-plaintiffs) nor his counsel were permitted to see the disputed communications. Rather, it was disclosed to Mr Grieve QC who was appointed as a Special Advocate with the parties' consent. Mr Grieve's brief was ambiguous and evolved throughout proceedings. He negotiated disclosure of some of the material initially withheld. But after surveying the remaining material and taking advice from an independent expert, Mr Grieve found himself unable to resist the non-disclosure application. He refused to support the plaintiffs' application to cross-examine GCSB witnesses as he thought there was no basis to challenge the contentions made by the GCSB (in closed affidavits). Ultimately he did not resist the GCSB application with respect to the disputed material.

In this appeal, Mr Dotcom contends that the s 70 disclosure hearing in the High  Court miscanied because of the way in which the Special Advocate's role was constituted and performed there. He argues the s 70 balancing exercise must be done afresh by this Court.

Did the Special Advocate process miscarry in the High Court?

Held: No. Mr Grieve was initially appointed as amicus curiae by the High Court in the judicial review proceeding, but the role  evolved  over  time.  Mr  Grieve  was  not  obliged to follow  Mr Dotcom's instructions to question the GCSB witness and oppose the application. Whether appointed as Special Advocate or amicus, his task was to ascertain Mr Dotcom's wishes with respect to the disputed information but to pursue them only to the extent he thought appropriate. That is an inevitable  consequence  of  his  inability  to  share  the  disputed  information  with Mr Dotcom. He also did not err in his conclusion that no purpose would have been served by opposing the application to cross-examine on the grounds proposed. Mr Dotcom's premise, that the GCSB wants to protect tradecraft already in the public domain, is incorrect.

Does the public interest in non-disclosure of the raw communications outweigh the public interest in disclosure, pursuant to s 70 of the Evidence Act?

Held: Yes. The intercepted communications are relevant, and there is a public interest in them being disclosed so they may be put to use in and for purposes of this proceeding. Natural justice and open justice are the two dimensions to the public interest in favour of disclosure. That said, this is not a case in which the information must be disclosed if justice is to be done at all. The GCSB has admitted liability; what is in issue is the quantum of damages for dignitary losses. Summaries of information already disclosed will permit a fair trial in this case. The GCSB's claim that disclosure would harm national security and international relations is well-founded. The balancing exercise favours non-disclosure.

Zhang v Sealegs International Limited
27 August 2019
[2019] NZCA 389

Copyright - infringement.
Appeal allowed. Orders in High Court set aside.

The respondent (Sealegs) asserts copyright, as models, in the prototypes of its arrangement of known mechanical components comprising the wheel assemblies of its amphibious system externally located on the hulls of boats. The High Court held that the arrangement of components was highly original and was appropriated by the second appellants' (Orion) amphibious system design.

Were the prototypes "models" and therefore "artistic works" for the purposes of s 14(1) of the Copyright Act 1994?
Held, yes. Critical enquiry was purpose for which item was created; prototypes constructed as part of process which would culminate in production of final product manufactured for sale.

Did the Judge err in finding that there was a high degree of originality in the arrangement of features?
Held, yes. Negligible originality in relation to sequence of various generic components in leg assemblies. Some skill and labour expended by Sealegs in choosing shape and dimension of particular components; but this conferred only a modest degree of originality on arrangement itself.

Did the Judge err in assessing whether there was objective similarity between the two systems?
Held, yes. Consideration of objective similarity deficient in four respects: failure to take into account extent to which claimed copyright work commonplace or dictated by functional constraints; insufficient significance apportioned to differences because of originality assessment, "fundamental functionality" used to justify discounting significance of differences; significance incorrectly attributed to similarity in dimensions and geometry.

Can objective similarity be established?
Held, no. Some degree of originality in bespoke form of arrangement visible in leg assemblies on prototypes; however Sealegs' bespoke leg assembly arrangement and Orion's leg assembly arrangement not visually similar. Moerover Sealegs confined claim squarely to generic arrangement. No originality in sequence of generic components; Sealegs' claim fails at this stage for want of copyright comparator, meaning appeal determined in appellants' favour.

Sami v R
29 July 2019
[2019] NZCA 340
Pulemoana v R
09 July 2019
[2019] NZCA 293

Appeal dismissed.
Evidence - admissibility.
Criminal practice and procedure -juries. Criminal law - inconsistent verdicts

Mr Pulemoana was found guilty of the murder of James Fleet and the manslaughter of Raymond Fleet. He appealed his convictions.

Did a Crown witness give evidence that resulted in a miscarriage of justice?
Held, no. Evidence given of what a co-offender had told witness about Mr Pulemoana's involvement, in particular that he had placed James Fleet in a headlock shortly before he was killed, regrettable but no miscarriage of justice caused. Nothing deliberate or improper in way evidence introduced; while "headlock" was uttered it was indistinct; even if the jury did hear it, significance unlikely to be fully appreciated and jury given clear directions it was inadmissible.

Did the Judge err in refusing to discharge a juror (Mr X)?
Held, no. Mr X attended two antenatal classes run by James Fleet's mother (Ms Fleet) approximately 14 years ago; Ms Fleet and the juror's wife had been Facebook friends and had limited online interactions six to seven years ago. Mr X was unaware of the Facebook contact, had no other interactions with Ms Fleet or the Fleet family, and confirmed he could approach task with an open and unbiased mind. Nothing which might lead a reasonably informed and fair minded observer to apprehend or suspect he might not have discharged his duty in an impartial manner.

Was Mr Pulemoana's murder conviction unreasonable because it was inconsistent with the manslaughter verdict for Mr Hora?
Held, no. Factual inconsistency arises where given the evidence two verdicts cannot stand together. There is no inconsistency where verdicts are reconcilable because of differences in the nature and quality of the admissible evidence. Verdicts reconcilable; differences founded in nature and quality of evidence relative to Mr Hura's and Mr Pulemoana's respective cases.

Bushline Trustees Limited v ANZ Bank New Zealand Limited
24 June 2019
[2019] NZCA 245

Appeal allowed.  Question of damages remitted to High Court for consideration.
Contract – Misrepresentation – Breach – Entire agreement clause – Remedies.
The appellants (Bill and Sharon Coomey, through their trusts, Bushline) are Taranaki dairy farmers.  They were for many years customers of the first respondent, ANZ and, before it, the National Bank.  The first respondent funded both working capital and development (fixed) capital as the appellants grew their farming business.  That business was cashflow negative at times, reflecting the long-term investments being made.

From 2005 onwards, the parties entered into a series of financial arrangements, including fixed and floating rate loans and interest rate swaps, designed to fix the appellants’ interest obligations.  The swaps were marketed to the appellants as an attractive means of fixing interest rate obligations while providing greater flexibility than fixed-term loans, as well as providing the ability to profit by exiting the swaps early if market conditions were favourable.

In April 2008, by which time the appellants’ funding from the first respondent totalled $11.97 million, the first respondent agreed to fund the $7.25 million purchase price of a new property.  The appellants’ existing and new debt was refinanced as a single floating rate loan of some $19.47 million.  These fixed rate swaps between the appellants and the first respondent hedged that debt.

After April 2008 the appellants’ financial position deteriorated.  Their farming business encountered difficulties while the global financial crisis caused the floating rate to drop, meaning the swaps were less advantageous.  In addition, the first respondent increased the margin applicable to the floating rate loans underlying the swaps several times, further increasing the appellants’ borrowing costs.  In the face of considerable financial pressure, the appellants sold assets and progressively refinanced their debt on less favourable terms as the swaps expired.  They eventually stopped banking with the first respondent and refinanced elsewhere.
The appellants contended in the High Court that the first respondent had mischaracterised the benefits of the swaps and breached promises made during negotiations that it would fix the margin on the floating rate loans underlying the swaps for five years and monitor the swaps to ensure they were working to the appellants’ advantage.  The appellants claimed damages ranging up to $6.29 million based on a variety of legal theories and calculations, including negligence; breach of contract; misrepresentation under s 6 of the Contractual Remedies Act 1979; oppressive conduct under s 120 of the Credit Contracts and Consumer Finance Act 2003; and misleading and deceptive conduct under s 43 of the Fair Trading Act 1986.  

In its defence, the first respondent denied any misrepresentation, suggested the claims were barred by statutory limitation periods and relied upon a series of acknowledgment and disclaimer clauses in the parties’ written agreements to exclude liability.  

The High Court found that some misleading representations were made as to the benefit of the swaps, but the first respondent was entitled to rely upon the disclaimer clauses and statutory limitation period to exclude liability for misrepresentations.  The first respondent did not undertake to fix the margin on the floating rate loans for five years, and to the extent that there was a promise to monitor the swaps, the first respondent had lived up to that promise.  The remaining causes of action were time-barred or not made out and the entire claim was dismissed accordingly.  

The appellants appealed.
Had the first respondent breached an undertaking or made a misrepresentation?  Held: Yes.  Some of what the appellants termed “misrepresentations” were in fact undertakings, that is, contractual terms not reduced to writing in the refinancing agreements.  That being said, two breaches of undertakings and one misrepresentation were evident.  First, the first respondent had misled the appellants by overstating the benefits of the swaps.  Second, the evidence showed that, judged objectively, the parties had agreed to fix the margin applicable to the floating rate loans for five years.  The first respondent had, therefore, breached that agreement.  Third, the first respondent had agreed to monitor the appellants’ borrowing strategy but had failed to respond to the appellants’ enquiries about the possibility of breaking the swaps early and failed to communicate its view as to the likelihood of reductions in the prevailing floating rate and the commensurate impact on the appellants.
Could the first respondent rely upon the disclaimer clauses to preclude liability despite s 4 of the Contractual Remedies Act?  Held: No.  Considering the policy underlying the Contractual Remedies Act and the particular circumstances of and relationship between the parties, it would not be fair and reasonable to allow the first respondent to rely upon those disclaimers.  Although the appellants had received legal advice it was of a formal, mechanical nature and did not resolve the point that the swap product had been incorrectly explained to the appellants by the first respondent.
The first respondent was therefore liable for enforceable breaches of two undertakings and one misrepresentation.  It was not necessary in those circumstances for the Court to consider the remaining collateral contract, negligence and Fair Trading Act submissions.  Furthermore, there was insufficient evidence of oppression to establish that Credit Contracts and Consumer Finance Act claim.  

Turning to the first respondent’s substantive defences, the exclusion clauses did not reach far enough to exclude liability for the breaches found and the claim was not time-barred as the misrepresentations and breaches had recurred several times after the statutory cut off.  Accordingly, the claims were made out.
As requested by the parties, the matter was remitted to the High Court for the assessment of damages.