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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.

CaseSummary
Frucor Beverages Ltd v Blumberg
11 November 2019
[2019] NZCA 547

Appeal dismissed. Costs order.

Insurance - liability of insurer. Damages - mitigation of loss.

Mr Blumberg's vehicle was damaged in a collision with a car driven by an employee of Frucor Beverages Ltd (Frucor). Frucor's employee was at fault. While Mr Blumberg's vehicle was being repaired, he used a replacement car provided by Right2Drive (R2D). In terms of its hire agreement, R2D pursued the at-fault driver's insurer for its hire charges. If it could not recover the charges from the at-fault driver's insurer, R2D's policy was to waive its charges, and not to pursue Mr Blumberg  for the hire charges. The insurer  refused  to pay  and R2D, exercising its rights under the hire agreement, commenced a proceeding in the name of Mr Blumberg against Frucor (in effect, against Frucor's insurer).

The other two respondents' circumstances were substantially similar  to  Mr  Blumberg's. These cases arise as insurers are resisting R2D's entry into the New Zealand market by refusing to pay its invoices for hire charges. The respondents were successful in the High Court.

Issue: In respect of the hire charges for the R2D replacement car, had Mr Blumberg  incurred  a compensatable loss or expense recoverable by him from Frucor?
Held: Yes. In terms of the hire agreement, Mr Blumberg was liable to pay any hire charges advised to him by R2D which it had not recovered from Frucor. The fact that R2D had a policy of not seeking to recover those charges from Mr Blumberg did not affect that legal liability. Nor did the fact that R2D could not have enforced Mr Blumberg's liability against him until it had taken certain steps.

Issue: Was R2D's hire agreement unenforceable, in that it assigned a bare cause of action and was champertous?
Held: No. Mr Blumberg's authority to R2D to act as his "agent, representative and attorney" to recover the hire charges did not transfer the right to recover. Even if it did, R2D unarguably had a genuine commercial interest in Mr Blumberg recovering the hire charges from Frucor. There could be nothing objectionable in R2D taking an assignment of the cause of action, if that is what it did. English authority takes the view that a hire agreement comparable to R2D's is not champertous.

Issue: Was it reasonable for Mr Blumberg to take the R2D option rather than one of the other available options? Were R2D's hire charges reasonable?
Held: Yes. R2D was recommended by the repairer that Frucor's insurance company had approved. Further, having placed Mr Blumberg in the position of needing to obtain a replacement vehicle while his own was repaired, Frucor cannot criticise him for not taking other options that may have been less burdensome to it. When compared to other rates available in the market, R2D's hire charges were reasonable in the circumstances.

Issue: Did R2D's charges include the cost of additional services which were not properly allowed by the Judge to Mr Blumberg as mitigation expenses?
Held: No. The evidence  in  the  High  Court  was that  R2D's  hire  charges  were  based  on the market, and did not include allowance for the additional benefits it provided. The additional delivery/collection fee R2D charged was reasonable.

Issue: Was the repairer's carelessness in not ordering replacement parts in a timely way an intervening cause  disentitling Mr Blumberg from   recovering  R2D's   hire   charges   for the resulting extended repair period of some 12 days?
Held: No. There was no evidence that the repairer was at fault for the delay. Frucor's negligence placed Mr Blumberg in the position of needing to have his vehicle repaired.

Issue: Did the Judge err in allowing Mr Blumberg interest on the judgment sum?
Held: No. In terms of the hire agreement Mr Blumberg was liable to pay interest on the outstanding amount of the invoice after the 90-day credit period passed. If interest is not awarded on the hire charges, Vero will have a windfall (the free use of the amount for the interim three years or so) and there will be hardship to R2D. Effectively, Frucor, the wrongdoer here, will be permitted to take advantage of its own default in not paying the invoice for the hire charges. The rule that a party cannot take advantage of its own wrong is fundamental.

Attorney-General v The Trustees of the Motiti Rohe Moana Trust & Ors
04 November 2019
[2019] NZCA 532

We answer the questions of law in [81] of the judgment.

Practice and Procedure – Resource Management Act 1991 – Fisheries Act 1996
Statutes – Interpretation
Local Government – Regional Councils – Power
Practice and Procedure – Declarations

In 2014 the Bay of Plenty Regional Council (the Council) proposed a Regional Coastal Environment Plan (the Plan). The area subject to the Plan included the immediate surroundings to Motiti island. The Motiti Rohe Moana Trust (the Trust) opposed the proposed plan and eventually appealed to the Environment Court, and separately sought declarations to the effect that the Council could restrict fishing techniques to preserve the Motiti coastal marine area.

The Resource Management Act 1991 (RMA) assigns to regional councils, in conjunction with the Minister of Conservation, a number of functions to do with the coastal marine area. Councils exercise control through regional plans that incorporate objectives and policies promulgated in a coastal policy statement issued by the Minister. Under s 30(1)(d) the functions of regional councils and the Minister in the coastal marine area include control of (i) land and associated natural and physical resources, (ii) the occupation of space in and extraction of natural materials from the coastal marine area, and (vii) activities in relation to the surface of water. However, there is an express limit to the power conferred. It yields in some circumstances to fisheries legislation. A regional council and the Minister of Conservation “must not perform” the three s 30(1)(d) functions listed “to control the taking, allocation or enhancement of fisheries resources for the purpose of managing fishing or fisheries resources controlled under the Fisheries Act 1996” under s 30(2) of the RMA.

The Council has now agreed to protect indigenous biodiversity in three areas of outstanding natural character in the Motiti coastal marine area, a function provided for in s 30(1)(ga) of the RMA, by way of restricting fishing. The question is whether it has the jurisdiction to do so.

Leave was given by the Court of Appeal to answer four questions of law.

Question One: Does s 30(2) of the RMA only prevent a regional council from controlling activity in the coastal marine area if the purpose of those controls is either to manage the utilisation of fisheries resources or to maintain the sustainability of the aquatic environment as a fishing resource?

The effect of s 30(2) is that a regional council may control fisheries resources in the exercise of its s 30 functions including the listed s 30(1)(d) functions provided it does not do so to manage those resources for Fisheries Act purposes.

Question Two: Can a regional council exercise all of its functions under the RMA concerning the protection of Māori values and interests in the coastal marine area provided that they are not inconsistent with the special provision made for Māori interests under the Fisheries Act?

The control of fisheries under the Fisheries Act extends to provision for taiapure-local and customary fishing, and a regional council may be required to bear that in mind when determining in a particular setting whether s 30(2) precludes the exercise of its functions under subs 30(1)(d)(i), (ii) or (viii). It is otherwise not necessary or appropriate to answer the question in this case.

Question Three: To what extent, if any, does s 30(2) of the RMA prevent a regional council from performing its function to maintain indigenous biodiversity under s 30(1)(ga)? In answering this question, is it correct to say that it is only appropriate for a regional council to exercise this function if it is strictly necessary to achieve that purpose?

The RMA does not specify that the function of maintaining indigenous biodiversity in s 30(1)(ga) is subject to s 30(2). It is not the case that a regional council may exercise this function only when strictly necessary when dealing with fisheries resources controlled under the Fisheries Act. But any controls imposed under subs 30(1)(d)(i), (ii) or (vii) are subject to s 30(2). Section 30(1)(ga) policies can be subject to s 30(2) where specified s 30(1)(d) functions are also invoked.

Question Four: Did the High Court err by setting aside the declaration made by the Environment Court and should it have made a different declaration?

No. Whata J was correct for the reasons he gave. The questions of law have been separated from their factual setting and are expressed in a very general way. It would be difficult to craft declarations that encapsulate the reasons we have given.

Orchard v R
04 November 2019
[2019] NZCA 529

Applications to adduce fresh evidence declined. Appeal allowed.

The appellant was convicted on one count of wounding with intent to cause grievous bodily harm, one count of breaching a protection order, two counts of assault and one count of driving dangerously. Downs J sentenced Mr Orchard to six years and nine months' imprisonment on these charges. Mr Orchard appeals against sentence only.

Criminal law - Sentencing - starting point. Whether the Judge erred in adopting a starting point for the lead GBH offence that was too high.

Held: yes. Applying Zhang v R [2019] NZCA 507, having regard to the offending as a whole and the importance of not imposing guideline judgments in a mechanistic way, rather than searching for aggravating features and thereby boosting band standing in terms of R v Taueki [2005] 3 NZLR 372 (CA), the better approach is to look at the specific examples given in Taueki for band one and band two domestic violence offending, and to ask to which the new offending is more proximate. Here the offending was more proximate to the example given in Taueki for band one than the example given for band two offending. Although involving more than one aggravating feature, it was not premeditated and it did not cause serious and lasting injury. It lay on the borderline of bands one and two, warranting a starting point of six years and six months' imprisonment.

Criminal law - Sentencing - uplifts. Whether the Judge erred in giving uplifts for the protection order breach and prior offending that were too high.

Held: yes. The discrete six month uplift for the breach of protection order was wrong in principle, it being based on the same actus reus as the index GBH offence. The six month uplift for Mr Orchard's previous breach of order exceeded the prior sentence, the appropriate uplifts being no more than two months' imprisonment.

Criminal law - Sentencing - mitigation. Whether the Judge erred in giving a discount for the appellant's mental health issues that was too low.

Held: yes. A discount of 20, rather than 15, per cent properly reflects the causative effect of Mr Orchard's mental health disability on the offending perpetrated by him. 

Zhang v R
21 October 2019
[2019] NZCA 507
Media release

Methamphetamine sentencing – guideline judgment

This judgment introduces a new guideline for methamphetamine sentencing. 

When setting the starting point for methamphetamine offending, the quantity band structure from R v Fatu [2006] 2 NZLR 72 (CA) is retained as a reasonable proxy for the social harm done by the drug and the illicit gains made from making, importing and selling it, but with significant modification (including removing the distinction between supply, importation and manufacture, adjusting the sentence ranges for each band and creating a new band five for quantities in excess of 2 kilograms), as set out below:

 

 

Former:  Fatu

New:  Zhang

Band one:  < 5 grams

2 – 4.5 years

Community – 4 years

Band two:  < 250 grams

3 – 11 years

2 – 9 years

Band three:  < 500 grams

8 – 15 years

6 – 12 years

Band four:  < 2 kilograms

10 years to life

8 – 16 years

Band five:  > 2 kilograms

10 years to life

10 years to life

 

However, the role played by the defendant is also an important consideration in setting the starting point, in order to assess the seriousness of the conduct and the criminality involved in the offending.  Diminished role may result in an offender moving not only within a quantity band but also between bands.  Sentencing judges may find it helpful to use the United Kingdom Sentencing Council’s categorisations of role (into lesser, significant and leading), categorisations which are used in analysing the individual appeals before the Court.

At the second stage of the sentencing exercise, personal mitigating circumstances relating to the offender are applicable to all instances of Class A drug offending, as in the case of any other offending.  In the context of methamphetamine offending, certain factors will be particularly relevant, including addiction, which may need to be considered in combination with mental health issues, and poverty and deprivation where that has impaired choice and diminished moral culpability.  Counsel and sentencing judges are encouraged to make greater use of the power in s 25 of the Sentencing Act 2002 to adjourn sentencing to enable rehabilitation programmes to be undertaken.

Minimum periods of imprisonment must not be imposed as a matter of routine or in a mechanistic way.  A reasoned analysis is required under s 86 of the Sentencing Act.  Deterrence, denunciation and accountability are likely to be at the forefront of decisions in drug cases where a minimum period of imprisonment is imposed, generally in cases involving significant commercial dealing.  Potential deportation of an offender is not a relevant consideration.

The judgment applies to all sentencing taking place after the judgment is issued, regardless of when the offending took place.  It applies to sentences that have already been imposed where an appeal against sentence has been filed before the judgment was delivered and the application of the judgment would result in a more favourable outcome for the appellant.

Individual appeals

Leanne Maree Crighton

Leave to bring second appeal against sentence granted.  Appeal allowed.

Ms Crighton was convicted on 11 charges of offering to supply methamphetamine, three charges of supplying methamphetamine, one charge of possessing methamphetamine and other minor offending.  Ms Crighton was sentenced by Judge Zohrab in the District Court at Nelson to 22 months’ imprisonment on these charges.  Her first appeal against sentence was dismissed by Cooke J in the High Court at Nelson.  Ms Crighton seeks leave to bring a second appeal against sentence only.

Criminal law — Sentence.  Whether the Judge erred in imposing a manifestly excessive sentence.

Held: yes.  Applying the new guidelines, the appropriate starting point is two years’ imprisonment, reflecting the quantity involved (3.75 grams, falling into band one) and Ms Crighton’s role (in the “lesser” category, characterised by lack of influence over those above her in the chain of operations, lack of awareness of the scale of the operation and little or no actual or expected gain, the offending having occurred to pay for her own drug use and that of her partner). 

A 30 per cent discount is warranted to reflect Ms Crighton’s personal circumstances, involving both mental health and addiction vulnerabilities.  To that end, Ms Crighton adduced evidence establishing a causative link between her use of methamphetamine and her offending.  A further discrete discount of 25 per cent for the guilty pleas applies.  This would reduce Ms Crighton’s sentence to 12 months’ imprisonment.

Jonelle Rachel Phillips

Leave to appeal out of time granted.  Leave to adduce further evidence on appeal declined.  Appeal allowed.

Ms Phillips was convicted on two charges of supplying methamphetamine, one representative charge of supplying methamphetamine, one charge of possessing methamphetamine for supply, one charge of possessing a Class B controlled drug, one representative charge of supplying cannabis and one charge of possessing cannabis for supply.  Ms Phillips was sentenced by Collins J in the High Court at Wellington to four years and three months’ imprisonment on these charges.  Ms Phillips appeals against her sentence only.

Criminal law — Sentence.  Whether the Judge erred in imposing a manifestly excessive sentence.

Held: yes.  Applying the new guidelines, the Judge’s five year starting point falls below the applicable quantity band (at least six kilograms, in band five) but reflects the very limited role played by Ms Phillips in an operation essentially conducted by her partner (at the bottom end of the “lesser” category).  The one year uplift for Ms Phillips’ personal drug dealing charges was appropriate, resulting in a global starting point of six years.  A six month uplift for Ms Phillips’ relevant previous convictions was also appropriate.

In terms of personal mitigating factors, the three month discount for remorse and six month discount for time spent on restrictive bail conditions were not challenged on appeal.  A 30 per cent discount is warranted to reflect the fact that Ms Phillips’ mental health and addiction issues were causative of her offending and that her personal circumstances would render a sentence of imprisonment more severe than for another offender, and to reflect her progress toward rehabilitation.  The 15 per cent guilty plea discount is upheld.  Ms Phillips’ sentence is therefore quashed and substituted with a sentence of three years and two months’ imprisonment.

Jacqueline Josephine Hobson

Leave to appeal out of time granted.  Appeal allowed.

Ms Hobson was convicted on three charges of importing methamphetamine, three charges of possession of methamphetamine for supply and one charge of conspiracy to import methamphetamine.  Ms Hobson was sentenced by Judge Andrée Wiltens to nine years’ imprisonment with a four and a half year minimum period of imprisonment (MPI) on these charges.  Ms Hobson appeals against her sentence (including the imposition of the MPI).

Criminal law — Sentence.  Whether the Judge erred in imposing a manifestly excessive sentence.

Held: yes.  Applying the new guidelines, the appropriate starting point on the importation charges is nine years’ imprisonment, reflecting the quantity (a minimum of 300 grams, falling into band three) and Ms Hobson’s role (at the lower end of the “leading” category, being primarily motivated by financial gain, having a management function and communicating with the supplier in Thailand, but in a relatively unsophisticated operation).  A nine month uplift is appropriate to reflect the conspiracy charge, being half the increase warranted had the offence been completed. 

The 20 per cent global discount for personal factors is warranted on the basis that a 10 per cent discount for Ms Hobson’s potential for rehabilitation and a 10 per cent discount for her guilty plea is generous but within range.  Ms Hobson’s sentence is therefore quashed and substituted with a sentence of seven years and ten months’ imprisonment.  No adjustment is required for parity, given Ms Hobson was significantly more culpable than her co-offender.

Criminal law — Sentence — minimum period of imprisonment.  Whether the Judge erred in imposing a minimum period of imprisonment.

Held: yes.  There was nothing out of the ordinary about Ms Hobson’s offending.  The operation was relatively small and the information available indicates that there are at least reasonable rehabilitative prospects.  In these circumstances, the concerns of deterrence or community protection (or any of the other purposes in s 86(2) of the Sentencing Act 2002) are not engaged such as to warrant the imposition of an MPI.

Jing Yuan Zhang

Appeal dismissed.

Mr Zhang was convicted on one charge of importing methamphetamine and was sentenced by Judge Johns in the District Court at Manukau to eight years and six months’ imprisonment with a four year and three month MPI.  Mr Zhang appeals against the imposition of the MPI only.

Criminal law — Sentence.  What is the appropriate sentence under the new guidelines.

Held: Although Mr Zhang did not appeal his sentence, we comment on how the new guidelines would apply to his offending.  The appropriate starting point would be 15 years’ imprisonment, having regard to the quantity (17.9 kilograms, well over the band five threshold) and Mr Zhang’s role (at the lower end of the “significant” category, serving as an operational function within a chain, travelling to New Zealand and taking steps to ensure the consignment cleared customs, as well as taking actions that indicated he was intending to package the drugs for sale, but no indication that he was to take an active role in the supply stage of the operation).

The 50 per cent global discount given by the Judge could properly be divided into a 30 per cent discount for personal mitigating factors and a 20 per cent discount for the guilty plea.  This would have resulted in an end sentence of eight years and five months’ imprisonment.  Had the sentence been challenged, we would not have disturbed it on appeal on the basis of this one month reduction.

Criminal law — Sentence — minimum period of imprisonment.  Whether the Judge erred in imposing a minimum period of imprisonment.

Held: no.  As Mr Zhang is a first time offender assessed at a low risk of reoffending, an MPI would not be warranted on the basis of community protection alone.  However, this was knowing participation in substantial, commercial scale drug offending with potentially very serious social consequences, unmitigated by any vulnerability.  For Mr Zhang to be eligible for release after just two years and 10 months’ imprisonment would send an unacceptable message to those included to participate in commercial scale drug offending.  Deterrence, denunciation and accountability all warrant the imposition of a 50 per cent MPI.

Shane Thompson

Leave to appeal out of time granted.  Appeal dismissed. 

Mr Thompson was convicted on one representative charge of supplying methamphetamine and one charge of possessing methamphetamine for supply.  Mr Thompson was sentence by Judge Rea in the District Court at Napier to 13 years’ imprisonment on these charges, with a six and a half year MPI.  Mr Thompson appeals against the imposition of the MPI only.

Criminal law — Sentence.  What is the appropriate sentence under the new guidelines.

Held: Although Mr Thompson did not appeal his sentence, we comment on how the new guidelines would apply to his offending.  The appropriate starting point would be 16 years’ imprisonment on the supply charge, reflecting the quantity (4.2 kilograms, in band five) and Mr Thompson’s role (at the top end of “leading”, being the principal offender in a large methamphetamine distribution network).  A two year uplift to reflect the possession for supply charge is also appropriate, meaning the Judge’s 18 year starting point for both charges is within range.

The discounts awarded by the Judge, being six months for time spent on electronically monitored bail, three months for forfeiture of certain vehicles and 25 per cent for the guilty plea, were orthodox.  The end sentence is therefore within range.

Criminal law — Sentence — minimum period of imprisonment.  Whether the Judge erred in imposing a minimum period of imprisonment.

Held: no.  Although Mr Thompson’s acceptance of responsibility, family support and the assessment of a low risk of reoffending diminish the need for community protection, a 50 per cent MPI was nonetheless appropriate in this instance.  Accountability for the harm done to the community and denunciation assume particular importance given the size and scale of the operation, and the absence of addiction in fact renders Mr Thompson’s offending more serious.  Willingness to accept responsibility, commendable as this is, does not detract from this analysis. 

Lok Sing Yip

Leave to appeal out of time granted.  Appeal allowed.

Mr Yip was convicted on two charges of importing methamphetamine, two charges of supplying methamphetamine, one charge of attempting to supply methamphetamine and two charges of possessing methamphetamine for supply.  Mr Yip was sentenced to 16 years and six months’ imprisonment on these charges, with an eight year MPI.  Mr Yip appeals against his sentence (including the imposition of the MPI).

Criminal law — Sentence.  Whether the Judge erred in imposing a manifestly excessive sentence.

Held: yes.  Applying the new guidelines, the appropriate starting point is 23 years’ imprisonment, reflecting the extremely high quantity (60.9 kilograms, well exceeding the threshold for band five and being the second largest seizure of imported methamphetamine at the time of sentencing) and Mr Yip’s role (mid-to-lower level of “leading”, given Mr Yip’s relative importance in the hierarchy of the organisation and oversight over co-offenders, as well as financial motivation, but having regard also to the relatively low level of compensation in proportion to the quantity of drugs and the fact Mr Yip was not a leader of the organisation).

The three year discount for Mr Yip’s personal circumstances, including youth, genuine remorse, lack of prior convictions, limited English and lack of family support in New Zealand, was appropriate, and the 25 per cent discount for Mr Yip’s guilty plea, although generous, will not be disturbed on appeal.  Mr Yip’s sentence is therefore quashed and substituted with an end sentence of 15 years’ imprisonment.

Criminal law — Sentence — minimum period of imprisonment.  Whether the Judge erred in imposing a minimum period of imprisonment.

Held: no.  This was knowing participation in a substantial, commercial scale drug offending with potentially extremely serious social consequences.  Mr Yip played a leading role in organising that activity, albeit at a mid-to-lower level, and his participation was unmitigated by vulnerability of any kind.  The sheer scale of the offending engages the purposes of deterrence, denunciation and accountability.  An MPI of 50 per cent was therefore justified.  In light of the change to the end sentence, the MPI is quashed and replaced with an MPI of seven years and six months.

Canterbury Regional Council v Dewhirst Land Co Ltd and Anor
08 October 2019
[2019] NZCA 486

Resource Management – offences, non-complying activity, regional councils. Criminal Practice and Procedure – application for leave to appeal, question of law on appeal.
Application for leave to bring a second appeal granted. Appeal dismissed.
The respondents pleaded guilty to several charges under the Resource Management Act 1991 in relation to activities that they carried out on land adjacent to the Selwyn River. The respondents, prior to sentencing, contested the extent to which the activities took place on the bed of the river. The High Court held that, for the purposes of determining the “bed” of a river for the purposes of s 2(a)(ii) of the Resource Management Act, the “bank to bank” test outlined in Kingdon v The Hutt River Board should be applied, and the actual banks of a river must be established first. Further, the words “usual or non-flood” should be implied into the s 2(a)(ii) definition of “bed” before the words “fullest flow”. The appellant, Canterbury Regional Council, sought leave to appeal on three questions of law.
Whether leave to appeal should be granted? Held: leave should be granted, the issues raised are of general and public importance.
Whether the High Court erred in its assessment of the correct test for determining the extent of the riverbed in applying the definition of “bed” in s 2 of the Resource Management Act? Held: the High Court did not err, the Judge was correct to apply Kingdon; the determination of a bed of a river depends on the position of the river’s banks and also on the water coverage measure as determined by the river’s fullest flow which occurs within those banks.
Whether the High Court erred in adding the phrase “usual or non-flood” into the definition of “bed” in s 2 of the Resource Management Act by implication? Held: the High Court did err, there is no need to imply the words “usual or non-flood” into the definition, the contextual application of the definition to the facts of a case will involve an assessment of what is usual, ordinary or non- flood.
Whether the High Court erred in concluding that the assessment of various flow rates or return periods was an irrelevant consideration in determining the extent of the riverbed? Held: the High Court did not err.

Commerce Commission v Viagogo AG
02 October 2019
[2019] NZCA 472

Appeal allowed. Application remitted to the High Court. No order as to costs.

Injunction -interim injunction.

The Commerce Commission filed proceedings against viagogo AG (Viagogo) claiming that Viagogo is making false, misleading or deceptive representations to New Zealand consumers through its ticket reselling website, in breach of the Fair Trading Act 1986. The Commission applied without notice for an interim injunction restraining Viagogo from making certain types of representation to New Zealand consumers through its website before the proceedings had been served on Viagogo in Switzerland. The High Court held that it had no jurisdiction to grant interim relief against Viagogo before Viagogo had been served with the proceedings. The Commission appealed to this Court.

Does the High Court have jurisdiction to grant interim injunctions before service of the proceedings on a defendant and resolution of any protest to jurisdiction filed by that defendant? Held; yes. Interim relief may be granted against an overseas defendant before service of the proceedings, and before any protest has been determined, in order to improve the prospect of the court being able to do justice between the parties after a determination of the merits at a trial. The fact that the defendant is to be served overseas, and the prospect of a protest to jurisdiction, are factors that the court will need to consider when deciding whether it is in the overall interests of justice to grant interim relief. But those factors do not preclude the court from granting interim relief.

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.