Asbestos solutions Limited v Jones t/a PJ Home Improvements

[2024] NZHC 3929

IN THE HIGH COURT OF NEW ZEALAND HAMILTON REGISTRY

I TE KŌTI MATUA O AOTEAROA KIRIKIRIROA ROHE

CIV-2023-419-178

[2024] NZHC 3929

UNDER

AND

the Insolvency Act 2006

IN THE MATTER

of the Bankruptcy of ALAN JONES

BETWEEN

ASBESTOS SOLUTIONS LIMITED

Judgment Creditor

AND

ALAN JONES trading as PJ HOME IMPROVEMENTS

Judgment Debtor

Hearing:	17 December 2024
Parties:	D Delic for the Judgment Creditor A Jones, Judgment Debtor in Person CT Jones for the Official Assignee
Judgment:	19 December 2024

JUDGMENT OF ASSOCIATE JUDGE SUSSOCK

This judgment was delivered by me on 19 December 2024 at 12 pm pursuant to r 11.5 of the High Court Rules

Registrar/Deputy Registrar

Solicitors:

SD Legal Lawyers, Hamilton

ASBESTOS SOLUTIONS LTD v JONES [2024] NZHC 3929 [19 December 2024]

Introduction

[1]                 The judgment debtor, Alan Jones, applied on a without notice basis to annul the bankruptcy order made against him on 25 November 2024 pursuant to s 309 of the Insolvency Act 2006.

[2]                 I issued a minute on 13 December 2024 directing that the application was to be heard on a with notice basis on 17 December 2024 and dispensing with service on the judgment creditor and the Official Assignee, as a copy of the application was attached to the minute.

[3]                 At the beginning of the hearing, counsel for the judgment creditor, Mr Delic, confirmed that the bankruptcy order had not in fact been sealed. The application therefore proceeded on the basis that it was an application to recall the bankruptcy order, rather than an application to annul.

[4]                 After hearing from counsel and the debtor, I determined that the bankruptcy order ought to be recalled. I issue this judgment to confirm the order made and to set out my reasons.

Legal principles relevant to recall

[5]                 The grounds upon which an order may be recalled are strictly limited. In Saxmere Co Ltd v Wool Board Disestablishment Co Ltd (No 2),1 the Supreme Court confirmed that three categories of cases had been recognised by the New Zealand courts as appropriate for recall if the order has not already been sealed, adopting the following passage from the decision of Wild CJ in Horowhenua County v Nash (No 2) as a convenient statement of those principles:2

Generally speaking, a judgment once delivered must stand for better or worse subject, of course, to appeal. Were it otherwise there would be great inconvenience and uncertainty. There are, I think, three categories of cases in which a judgment not perfected may be recalled — first, where since the hearing there has been an amendment to a relevant statute or regulation or a new judicial decision of relevance and high authority; secondly, where counsel

1      Saxmere Co Ltd v Wool Board Disestablishment Co Ltd (No 2) [2009] NZSC 122, [2010] 1 NZLR 76 at [2], referred to in Uhrle v R [2020] NZSC 62, [2020] 1 NZLR 286 at [29].

2      Horowhenua County v Nash (No 2) [1968] NZLR 632 (SC) at 633. See also Craig v Williams

[2019] NZSC 60 at [10].

have failed to direct the Court’s attention to a legislative provision or authoritative decision of plain relevance; and thirdly, where for some other very special reason justice requires that the judgment be recalled.

[6]                 In addition, in Uhrle v R the Supreme Court confirmed that exceptional circumstances are required.3

Should the bankruptcy order be recalled?

[7]                 Mr Jones seeks an annulment or recall of the bankruptcy order, on the basis that he had instructed a lawyer to appear for him but he did not. Mr Jones explains that the minute from the Court advising of the next hearing date, following a request for an adjournment from the judgment creditor, was sent to his previous counsel, rather than the new lawyer engaged (apparently because his previous lawyer was going on sabbatical).

[8]                 The correspondence with his lawyers attached to the application shows that, on the date that the order was made, his new lawyer was corresponding about further information to provide for a grant of legal aid to assist in advising Mr Jones how to respond to the bankruptcy proceedings and whether to oppose or apply for a stay. There was then correspondence from the intended lawyer on 3 December 2024, after the bankruptcy order had been made on 25 November 2024, confirming an interim grant from Legal Aid to enable research to be undertaken.

[9]                 Mr Delic submits that the email advising the hearing date was sent through not only to counsel but also to Mr Jones’ wife, and that she has not filed an affidavit to confirm why she did not pass that email on to Mr Jones.

[10]             In addition, Mr Delic submits that there have been considerable delays in this matter already and that Mr Jones is simply attempting to relitigate issues that have already been determined on appeal, referring to the fact that Mr Jones was represented by an experienced barrister on the appeal. Mr Delic submits that all that will happen if the order was recalled would be further delay and cost for his client.

3      Uhrle v R, above n 1, at [3].

[11]             I accept that if the order is recalled, there will be further costs incurred by the judgment creditor. However, I also accept, as explained by Mr Jones, that now that the appeal has been determined, there are further steps that need to be taken by him and that he is not trying to use the bankruptcy court as an appeal court. Mr Jones submits that if he is the customer of the judgment creditor as the appeal Court has now held, the issues that Mr Jones says were raised with the judgment creditor prior to the invoice being due need to be raised in response to the application.

[12]             As discussed at the hearing, I am satisfied that there is a very special reason that justice requires the judgment be recalled because Mr Jones was not represented at the hearing on 25 November 2024 when he expected to be. In addition, the matters that he had instructed were to be raised (including in affidavit evidence filed in support) would have been appropriately raised (although no view is reached on the likely outcome). I therefore confirm the order for recall below.

Next call

[13]             Because Mr Jones is instructing new lawyers, I am allocating the next call in the bankruptcy list on 10 March 2025 to allow Mr Jones sufficient time to properly instruct them and to avoid an unnecessary appearance for the judgment creditor. Any notice of opposition to the bankruptcy application or application for stay is to be filed by 28 February 2025. This allows a generous period for instruction and I confirm, as discussed in the hearing, that this date is to be strictly complied with.

[14]             Finally, I note that the parties are encouraged to attempt to resolve matters by agreement between themselves. This appears to be in all parties’ best interests.

Orders

[15]I order:

(a)the bankruptcy order made against Alan Jones of 53A Hubert Road, Queenwood, Hamilton on 25 November 2024 is recalled;

(b)Mr Jones is to file any notice of opposition and/or application for stay by 28 February 2025; and

(c)the application for adjudication is next to be called in the bankruptcy list on 10 March 2025 at 10 am.

Associate Judge Sussock