Calibre Financial Services Limited v Mortgage Administration Services (Calibre) Limited

IN THE COURT OF APPEAL OF NEW ZEALAND

CA538/2012
[2012] NZCA 548

BETWEEN CALIBRE FINANCIAL SERVICES LIMITED
Applicant

AND MORTGAGE ADMINISTRATION SERVICES (CALIBRE) LIMITED
First Respondent

AND CAIRNS LOCKIE LIMITED (IN LIQUIDATION)
Second Respondent

Hearing: 23 October 2012

Court: Arnold, Ellen France and French JJ

Counsel: P L Rice for Applicant
S O McAnally for Respondents

Judgment: 27 November 2012 at 10.30 am

JUDGMENT OF THE COURT

ALeave to appeal against the decision of the High Court dated 18 April 2012 is given.
BCosts on this application for leave reserved.

____________________________________________________________________

REASONS OF THE COURT

(Given by Ellen France J)

Calibre Financial Services Ltd (Calibre), the applicant, succeeded in its claim against Mortgage Administration Services (Calibre) Ltd and Cairns Lockie Ltd (in liquidation) in the District Court.[1] However, Mortgage Administration’s appeal to the High Court was successful.[2] In order to further appeal, Calibre needs leave, either from the High Court or from this Court.[3] Peters J declined leave in a judgment delivered on 2 August 2012.[4] Calibre then sought leave from this Court.
[1]Calibre Financial Services Ltd v Mortgage Administration Services (Calibre) DC Auckland CIV-2009-004-3175, 31 May 2011.
[2]Mortgage Administration Services (Calibre) Ltd v Calibre Financial Services Ltd [2012] NZHC 732.
[3] Judicature Act 1908, s 67.
[4]Mortgage Administration Services (Calibre) Ltd v Calibre Financial Services Ltd [2012] NZHC 1921.
We have determined that leave should be given. Under r 27(2)(b) of the Court of Appeal (Civil) Rules 2005, this Court is not required to give reasons for giving leave.[5] The applicable test on a s 67 leave application is well established.[6] We are satisfied that Calibre has shown that there is a question of law in this case which is capable of serious argument. We are also satisfied the case does involve interests of sufficient importance to outweigh the cost and delay of a further appeal.
[5]See, for example: Catley v Perry Developments CA68/05, 17 June 2005 and Rose v Rose CA26/06, 2 August 2006.
[6] Waller v Hider [1998] 1 NZLR 412 (CA) at 413.
It is noteworthy in terms of the s 67 test that Judge Sinclair in the District Court and Peters J in the High Court reached different conclusions on the interpretation of the agreement entered into between Calibre and Mortgage Administration as part of securitisation arrangements. We are persuaded there is a real question as to whether the indemnity clause in the agreement exposed Mortgage Administration to a limited kind of expense or was a broader attribution of risk. Although the amount directly in issue is not significant, the interpretation issue may have a broader impact on other issues between the parties and, possibly, more generally.
It is appropriate that costs on the application for leave be reserved. They can be determined by the Court that hears the substantive appeal.

Solicitors:
Sanderson Weir, Auckland for Applicant
Keegan Alexander, Auckland for Respondents

CaseChat Overview and Summary

In the Court of Appeal of New Zealand, Calibre Financial Services Limited sought leave to appeal against a decision of the High Court, which had overturned a District Court decision in their favour. The respondents to the appeal were Mortgage Administration Services (Calibre) Limited and Cairns Lockie Limited, the latter of which was in liquidation. The hearing of the appeal took place on 23 October 2012 before Arnold, Ellen France and French JJ, with counsel appearing on behalf of both parties. The Court gave judgement on 27 November 2012 at 10.30 am.

The key legal issue before the Court of Appeal was whether Calibre Financial Services Limited should be granted leave to appeal to the Court of Appeal against the decision of the High Court. The High Court had previously declined to grant leave, but the Court of Appeal is empowered to grant leave under section 67 of the Judicature Act 1908 if it is satisfied that there is a question of law which is capable of serious argument and that the case involves interests of sufficient importance to outweigh the cost and delay of a further appeal. The Court of Appeal was also required to determine whether the costs of the application for leave should be reserved.

The Court of Appeal determined that leave should be granted. It found that there was a real question of law in the case, namely the interpretation of an indemnity clause in an agreement between the parties. The Court of Appeal was persuaded that the case involved interests of sufficient importance to outweigh the cost and delay of a further appeal, particularly because the interpretation of the indemnity clause may have a broader impact on other issues between the parties and, possibly, more generally. The Court of Appeal also decided to reserve costs on the application for leave, so that they could be determined by the Court that hears the substantive appeal. This decision was made pursuant to rule 27(2)(b) of the Court of Appeal (Civil) Rules 2005, which provides that the Court of Appeal is not required to give reasons for granting leave.

CaseChat Overview and Summary

Orders of the court

Background to the litigation

Evidence Before The Court

Reasons for decision

Legal Principle Established