Cases & Publications
Kevin Glover discussed the controversy over s 92A of the Copyright Act in his article "Section 92A revisited" published in the NZ Lawyer Issue 121 (18 September 2009).
Section 92A was enacted in April last year but has not come into force yet. Kevin briefly describes and reviews the policy proposal released for public consultation by the Ministry of Economic Development. The proposal describes the proposed s 92 process for rights holders to follow if they suspect that internet users have infringed their rights.
Kevin's comments include the appropriateness of the Copyright Tribunal assuming jurisdiction and the lack of appropriate safeguards for users who are accused of infringement under the proposed procedure.
Kevin concludes that the proposed policy would provide a lower-cost alternative to court proceedings for rights holders in copyright infringement cases. However, Kevin warns that such expediency could come at the expense of the rights of those accused of copyright infringement. While the framework set out in the consultation paper appears broadly acceptable, he notes that a proper assessment of the fairness of the procedure can only be made after the details in the proposal have been worked out.
(Anna Zhou, Editor, 29/10/09)
In “Domain name dispute resolution” [2009] NZLJ 35, Kevin Glover offers an analysis of a recent development in the law relating to the internet and websites.
In 2006, New Zealand’s Domain Name Commissioner’s Dispute Resolution Services (DRS) was launched. DRS provides an alternative process to litigation for resolving disputes relating to the ownership of New Zealand domain names.
Kevin’s article discusses the theoretical basis for DRS, how domain names were traditionally protected and how the New Zealand system functions. Its key features are that the decisions of the DRS act in rem and it does not have the power to award costs. Some problems have arisen with self-represented litigants.
The article reviews DRS’s leading decisions and concludes that it is “generally functioning well and is attractive for complainants compared with litigation in the High Court” because it is low cost and expedient.
(David Dickinson, Editor, 24/4/09)
(David Dickinson, Editor, 17/6/09)
In his recent paper “Don’t Be Lost: Different Conceptions of Loss in Insurance”, delivered to the AILA National Conference on Hamilton Island, 18 September 2008, Neil Campbell goes back to basics to demonstrate how, in recent case law, the courts have lost sight of them.
The paper sets out the law’s basic understanding of indemnity insurance and the two conceptions of loss – loss that is an aspect of insured event and financial loss suffered as a consequence of the insured event.
Mr Campbell proceeds to analyse three cases in which “insufficient attention was paid to the distinction between an insured event, and the financial loss that flowed from the insured event”.
The paper argues that in E J Hampson & Others Syndicate 1204 v Mining Technologies Australia Pty Ltd (1998) 10 ANZ Ins Cas 74, 114; [1999] 1 Qd R 60 (CA) the Queensland Court of Appeal failed to be alive to the possibility that despite the fact that the insured was able to recover property lost during an insured event, the property itself may have been initially lost.
In Bridgeman v Allied Mutual Insurance Ltd (1999) 10 ANZ Ins Cas 75,125, Mr Campbell asserts that New Zealand’s High Court became infatuated with the doctrine of “imminent peril” and as a result failed to distinguish between loss as an insured event and the financial loss flowing from that insured event.
Finally, in its analysis of Walker Civil Engineering Pty Ltd v Sun Alliance & London Insurance plc (1996) 9 ANZ Ins Cas 76,446 (SCNSW); affirmed (1999) 10 ANZ Cas 74,681 (NSWCA) the paper argues that the Supreme Court of New South Wales confused the insured event (property damage) and the proper measure of indemnity (cost of repair). Mr Campbell approves of Mason P’s observation in AXA Global Risks (UK) Ltd v Haskins Contractors Pty Ltd (2004) 13 ANZ Ins Cas 77,401 that “physical damage may have a cost impact that goes beyond addressing merely the integer of property that is physically marred”.
The paper will be published soon: (2009) 20(1) ILJ 40.
Developments in the Approach to the Duty of Care - Andrew Barker, ADLS Continuing Legal Education Programme, Heritage Hotel, 23 October 2008
Andrew Barker discussed how the three-stage test set out in South Pacific Manufacturing Co Ltd v NZ Security Consultants and Investigations Ltd [1992] 2 NZLR 282 (CA), focussing on proximity, policy and “fairness”, had been accepted as a general approach to all claims involving a novel duty of care. In particular, it was now accepted as the correct approach for claims of personal injury, negligent misstatement, and the negligence of public authorities. He then addressed another of the themes of his previous reviews, which was the increasingly conservative approach of the Court of Appeal to any extension of negligence liability. He analysed the recent decisions in Attorney-General v Body Corporate 200200 [2007] 1 NZLR 95 (CA) and Couch v Attorney-General [2008] NZSC 45.
Body Corporate 200200 raised the concept of a “situational duty of care”, which involves the formulation of a duty by reference to what actually happened between the parties, rather than the more abstract question of the “over-arching” nature of the relationship between the parties, and whether that relationship is of a type which could support a duty. William Young J (as he then was), delivering the judgment of a full bench of the Court of Appeal, he described the “situational duty of care” analysis as being likely to favour a plaintiff. He emphasised that the situational analysis may be appropriate in some cases, and had often been used by the courts, but warned that the courts should ensure that their focus remains on the broader implications – including policy considerations – of recognising a duty in the case before them, rather than get too caught up in the errors made in the particular case.
The Supreme Court had cause to consider this situational analysis in the decision of Couch v Attorney-General [2008] NZSC 45. Couch is the well-known case, arising from the Panmure RSA robbery, in which William Bell murdered three of his fellow employees and attempted to murder the appellant, Mrs Couch, leaving her seriously and permanently injured. Heath J struck out the plaintiffs’ claims in negligence and breach of statutory duty in Hobson v Attorney-General [2005] 2 NZLR 220. The Court of Appeal dismissed the plaintiffs’ appeal: Hobson v Attorney-General [2007] 1 NZLR 374. The decision of the Court of Appeal is a good illustration of the approach developed in the Body Corporate 200200 case. William Young P reproduced his discussion from the earlier case, and Chambers J endorsed his approach.
The decision of the Supreme Court was the Court’s first major discussion of the general approach to duty of care in novel fact situations. It raised the question of whether the conservative approach to the expansion of liability in negligence, so evident in decisions of the Court of Appeal over the past decade, would continue, and whether the pendulum may be about to swing back in favour of plaintiffs. The Court was unanimous in holding that Mrs Couch might be able to establish at trial a relationship of proximity between herself and the Probation Service, and that the policy reasons relevant to the existence of a duty of care could not be properly formulated at the strike-out stage. The majority (Blanchard, Tipping and McGrath JJ) held that a relationship of proximity would only exist if Mrs Couch could show “either as an individual or as a member of an identifiable and sufficiently delineated class” that she was or should have been known by the defendants to be subject to a “special risk” of suffering harm of the kind she sustained. Elias CJ and Anderson J, on the other hand, considered that the appellant may be able to establish a relationship of proximity regardless of whether she was exposed to any special risk, and that it might be enough for her to have been simply a member of the general public.
Significantly, the minority judgment rejected the Body Corporate 200200 approach, while the majority said little to support it. The minority favoured a less restrictive and more fact-specific enquiry into duty of care: essentially the exact opposite of that applied by the Court of Appeal in Body Corporate 200200. Only “high-level and generalised legal policies” relating to the duty of care would be suitable for strike-out.
The decision of the Supreme Court in Couch, especially in terms of the minority judgment, has a tendency to expand liability. While it is impossible at this stage to know whether Couch is the dawn of a new era in negligence liability in New Zealand, it is a clear indication that at least some members of the Court consider that the New Zealand approach has become too restrictive.
The Liability of Public Authorities - Andrew Barker, ADLS Continuing Legal Education Programme, Heritage Hotel, 23 October 2008
Andrew Barker, in a conference for the Auckland District Law Society, discussed the approach of New Zealand courts to claims in negligence against public authorities. The most important recent statements of this approach are the decisions of the Court of Appeal in Attorney-General v Body Corporate 200200 [2007] 1 NZLR 95 and Bella Vista Resort Ltd v Western Bay of Plenty District Council [2007] 3 NZLR 429.
These decisions provide some reasonably clear direction from the Court of Appeal as to how courts should approach an alleged duty of care on the part of a public authority in a situation not covered by previous case law. In particular, they outline the policy considerations the court will consider in its analysis. These principles can be summarised as follows:
(a) If the alleged duty of care is inconsistent with the scheme and purpose of the relevant legislation, there can be no duty of care.
(b) If there is no clear restriction on a private law duty of care, then the statutory context will be considered within the general approach to novel duties of care as set out in South Pacific Manufacturing Co Ltd v New Zealand Security Consultants and Investigations Ltd [1992] 2 NZLR 282 (CA).
(c) A strong indicator against any duty of care will be whether the public authority has a “quasi-legislative” or “quasi-judicial” character.
(d) The more policy-oriented and less operational a decision is, the less likely it will be subject to a duty of care.
(e) Courts are concerned with the practical implications of the suggested duty of care for the public authority in carrying out its functions.
(f) The courts are similarly unlikely to recognise a duty if it could open the floodgates to a potentially broad range of liability for the public authority.
(g) If the plaintiff has other remedies it can pursue, the court will be less likely to impose a duty of care.
These principles are uncontroversial, except for the idea of “quasi-legislative” or “quasi-judicial” powers. Mr Barker suggests that it is not entirely clear what the Court of Appeal means by either of these terms and proposed instead the old concept of discretionary decisions in respect of policy matters.
Mr Barker also discussed the impact of the recent Supreme Court decision in Couch v Attorney-General [2008] NZSC 45. As he discussed, the overall trend in New Zealand towards the liability of public authorities has been rather conservative. However, the decision of the Supreme Court in Couch v Attorney-General [2008] NZSC 45 suggests that this narrow approach to such liability may be about to change. The Court unanimously refused to strike out the plaintiff’s claim at the proximity stage of the enquiry, when the exact policy issues raised by the claim were unclear. Because claims of negligence against public authorities involve particular policy considerations, the scope for successful strike-out of such claims must now be greatly diminished. This is likely to be the case from the reduced scope for successful strike-out applications suggested by the decision. It remains to be seen whether the courts will adopt some of the more provocative suggestion in the minority judgment of Elias CJ and Anderson J that there is often greater scope for liability on the part of public authorities than private individuals.
Tony Molloy QC recently discussed the need for a specialist trust bar in New Zealand (G Wear, “QC says NZ needs specialist trust bar”, LawTalk, issue 702, 18 Feb 2008, p 17).
Pointing to other jurisdictions such as England and New South Wales that have specialist trust jurisdictions, he laments that despite having about 300,000 trusts in New Zealand there is a feeling that anyone can deal with trusts and that it is not an area in need of specialists.
Dr Molloy QC believes that enough interesting cases come up for New Zealand to develop an internationally recognised trust bar with specialist trust and equity High Court judges to hear them.
As the newly appointed joint editor of the prestigious Oxford University Press journal, Trusts and Trustees, Dr Molloy QC invites New Zealand lawyers with trust experience to contribute articles and case notes as a first step toward increasing New Zealand’s international exposure in the trust area. For further information, please email the commissioning editor, Fiona Mullen.
Sintes & Anor v W H Harris Limited (High Court, Christchurch, CIV 2006-409-001402, 27 February 2008, Fogarty J)
In this case, Clive Elliott successfully represented W H Harris Limited in both defending a claim for patent infringement and counterclaiming for a declaration that two of the ten claims in the plaintiff’s patent were invalid.
The patent in question was for a low-emissions stove, patented by the plaintiff. The defendant sold a stove that the plaintiff claimed infringed his patent. The two claims that were declared invalid involved the use of a double vent flue and a metal casing around the stove fitted with heat dissipating fins.
The majority of the decision canvasses the law relating to obviousness and discusses many of the leading cases in this area, including Windsurfing International Inc v Tabur Marine (Great Britain) Ltd [1985] RPC 59 (CA) and Mölnlycke AB v Procter & Gamble Ltd (No 5) [1994] RPC 49 (CA) both having been approved in the Supreme Court’s Lucas v Peterson Portable Sawing Systems Ltd [2006] 3 NZLR 721.
Mr Elliott submitted for the defendants that, pursuant to s41(1)(f) of the Patents Act 1953, the two claims of the first plaintiff’s patent were obvious and did not involve any inventive step.
Counsel for the plaintiffs submitted that the inventive concept was the whole of the two claims as a particular combination of features, which was inventive and therefore an inventive step. However a difficulty in the case was that all of the elements of the stove interacted with each other in a synergistic fashion.
At para [98] of the decision, Fogarty J states that he did not see himself as obliged to “follow slavishly” the Windsurfing decision and as a result turned to the counterpart test in the United States in Graham v John Deere Co of Kansas City 383 US 1 (1966), recently restated by the Supreme Court in KSR International Co v Teleflex Inc 550 US 7 (2007).
In reliance on KSR International Co v Teleflex Inc, Mr Elliott argued that the synergies were predictable prompting Fogarty J at para [159] to hold that he was “satisfied that predictability is a useful subordinate standard to apply” to the facts of the case.
At paras [193] and [195], his Honour found that the “synergetic effect is broadly predictable” and as such “did not require a degree of invention. It was the result of trial and error.”
This could very well mark the first time a court in New Zealand has relied on a decision of the US Supreme Court in the intellectual property field.
The decision is currently under appeal.
Before a full sitting on the High Court, Alan Galbraith QC and Ian Williams successfully represented Edward Leary in his appeal against a decision of the New Zealand Practitioners Disciplinary Tribunal (‘the Tribunal’) in which the Tribunal had dismissed his application under s 116 of the Law Practitioners Act 1982 to have his name restored to the roll of barristers and solicitors.
Several submissions were advanced on Mr Leary’s behalf, principally that the Tribunal had approached the application retrospectively as opposed to prospectively and had not given due weight to the 81 testimonials filed in support of the application.
Mr Leary’s appeal was allowed and his name was ordered to be restored to the roll of barristers and solicitors.
(Sinead McLaughlin, Editor, 15/2/08)
In this High Court decision, Ian Williams successfully represented Platinum Homes (NZ) Limited and Platinum Designs Limited against an application for an order extending an interlocutory injunction.
The first and second plaintiffs (‘Golden Homes’) were involved in the sale, marketing and design of houses. The second plaintiff, Golden Homes Holding Limited (‘GHH’) owned a bundle of intellectual property rights, including the copyright to certain plans, which it then sublicensed to the first plaintiff, Golden Homes (1998) Limited (‘GH’). GH then granted sub-licences related to seven major geographical areas in New Zealand. The second defendant, Westbury, had been GHs’ licensee for several areas around Auckland.
In December 2003, Golden Homes became aware that certain building consent applications had been lodged by Blue Chip Construction Limited (‘Blue Chip’) which appeared to be owned by GHH and licensed exclusively to GH. They appeared to resemble previous projects overseen by Westbury. A former Westbury manager had started Blue Chip as a new vehicle. Blue Chip traded under the name ‘Platinum Homes’ as a franchise holder of Platinum Homes (NZ) Limited (‘Platinum Homes’). Blue Chip supplied plans and planning support and sources building materials. Platinum Design offered design and drafting services and was owned by a former contractor and employee of GH.
Following this discovery of potential copyright infringement, Golden Homes commenced proceedings and secured an interlocutory relief against Blue Chip and Westbury. In its amended statement of claim, Golden Homes pleaded infringement against both plaintiffs and against Platinum Homes.
Allan J considered the relevant principles surrounding the granting of an interlocutory injunction and copyright infringement. As to copyright ownership, Justice Allan found that a serious question about ownership had been raised but that there were limitations in the plaintiffs’ evidence as to whether there was a seriously arguable case that copyright ownership subsisted with Golden Homes in terms of initial authorship. Similarly, a serious question as to infringement was made out but only by a very small margin. Thus, in considering the balance of convenience and ultimate discretion, his Honour noted that the original injunction was very wide and prohibited any infringement of any plans owned by GHH and licensed exclusively to GH. His Honour notes at para [77] - [80] that:
"The evidence is that Golden Homes holds a portfolio of about 300 plans. A few only of those plans are under direct consideration in this proceeding. An order couched in such wide terms is presumably based upon the assumption that the defendants, having arguably infringed certain copyright, are likely to infringe other copyright works in the future. That approach has been criticised: see EMI (Australia) ltd v Bay Imports Pty Ltd [1980] FSR 328.
Moreover, it must be seen as undesirable to frame an injunction in such fashion as to leave its application in doubt. A defendant faced with an injunction in respect of ‘any plans owned by…’ faces the real difficulty of determining whether any particular plan is owned by the plaintiffs.
On the face of it, an order in such wide terms as are currently sought against Platinum Homes and Platinum Design would appear not to be justified by the evidence. While the plaintiffs have produced evidence in respect of certain specified plans, there is little to suggest that unless restrained, Platinum Homes and Platinum Design are likely to breach the plaintiff’s copyright in the remaining 280 odd plans in which the plaintiffs claim copyright. Nor, in the light of the evidence adduced by the defendants, am I prepared to accept that any of them is engaged in a deliberate strategy aimed at usurping Golden Homes’ rights to copyright."
Ultimately, the plaintiffs failed to make out a case for the granting of a fresh injunction against Platinum Homes or Platinum Designs.
(Sinead McLaughlin, Editor, 15/2/08)
Auckland Regional Council v Rodney District Council and Parihoa Farms Ltd [2007] NZRMA 535
In this case, Stephen Mills QC acted for Parihoa Farms Ltd (‘Parihoa’) in successfully defending judicial review proceedings brought by the Auckland Regional Council (‘the ARC’). The ARC sought an order to set aside a resource consent which was granted in relation to the building of a house overlooking a walkway along the Tasman Sea on Auckland’s west coast. The ARC further sought related orders in the Environment Court for the demolition of the partly built house.
The owners and directors of Parihoa were husband and wife and were building the home to be a family dwelling for themselves and their children. When purchasing the property, the owners knew that its three titles were subject to an encumbrance that required written approval from Rodney District Council (‘RDC’) and the Department of Conservation (‘DOC’) for any subdivision of the titles in the future. The resource consent was granted on a non-notified basis in April 2005. However when Parihoa sought subdivision consent pursuant to the encumbrance, RDC and DOC subsequently refused to grant its approval - a process in which ARC was directly involved.
ARC’s application was based on several purported errors committed by RDC in granting the initial resource consent. The central issue concerned whether or not RDC’s decision not to notify the public and potentially affected parties of the application, regardless of the status of the activity, and to grant it, were correct.
Harrison J discussed new sections of the Resource Management Act 1991 and their effect on the leading Supreme Court decision of Discount Brands Ltd v Westfield (New Zealand) Ltd [2005] 2 NZLR 597. His Honour differed with his learned brother Baragwanath J who held in Progressive Enterprises Ltd v North Shore City Council [2006] NZRMA 72 that the new sections signalled a significant change in approach than that articulated in Discount Brands. This discussion merits close attention.
Ultimately, Harrison J found that the ARC had failed by a ‘considerable margin’ to show that RDC’s decision was unreasonable or one that no reasonable decision-maker could have made. He did however find that RDC had erred in not taking into account certain matters as provided by the legislation and by not notifying certain affected groups. Nevertheless, remedies on judicial review are discretionary and Harrison J adopted the proportionality principle formulated by Asher J in Diagnostic Medlab Ltd v Auckland District Health Board [2007] 2 NZLR 832.
His Honour turned to consider ARC’s knowledge and conduct in DOC and RDC’s refusal to grant subdivisional consent - a point which was the central focus of Mr Mills’ submissions. Harrison J agreed with Mr Mills that the ARC had adopted a strategy whereby pressure was put on RDC and DOC to withhold consent, under the misapprehension that this would force Parihoa to reapply for a new consent on a different title. Therefore, ARC had known for some time of the granting of the consent yet sought to impede it by other means.
Ultimately, it was held that the consequences for Parihoa of granting any relief to ARC “would be grossly disproportionate to the seriousness of RDC’s error or errors, either in deciding not to notify or to grant consent” (para 192).
ARC’s application for relief was consequently dismissed.
(Sinead McLaughlin, Editor, 11/2/08)
Please refer to the Archive section for Cases and Publications prior to 2008.
