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Supreme Court declines to hear wide-ranging claims of fraud, conspiracy against High Court judges and bloodstock industry players

4 Aug 2023

| Author: Hannah Hellyer

Civil procedure – unsuccessful application for leave to appeal – loan agreement – notice of demand seeking outstanding debt – lease purchase agreement – notice of default in due payments – application for summary judgment debts and repayment – cross-claim – oppressive conduct – claim to equitable set-off – conspiracy in thoroughbred industry – judicial recusal

Gregory John Jones v New Zealand Bloodstock Finance and Leasing Limited [2023] NZSC 98 per Glazebrook, Williams and Kós JJ.

 

On 23 May 2016, Gregory John Jones and New Zealand Bloodstock Finance and Leasing entered into a loan agreement granting Jones up to an initial $200,000 in advances, at 10% interest on the unpaid daily balance. Full payment had to be made on 30 June 2017 or upon demand.

By the end of 2016, Jones had been advanced more than $400,000.

On 10 October 2017, Jones and Bloodstock entered into a second contract, a lease purchase agreement, enabling him to acquire an interest in another horse for $44,000. He was required to make a partial annual repayment to Bloodstock each July and to pay the remainder on 10 October 2020 or on earlier termination.

In April 2019, Bloodstock served a notice of demand on Jones, seeking the outstanding debt of $369,800 under the first contract and, under the second contract, a notice of default in due payments amounting to $22,718. Bloodstock stated all amounts owing under the agreement – totaling $61,832 – would fall due if not remedied. Jones did not make any payments.

In early September 2019, Bloodstock applied for summary judgment in the High Court in respect of Jones’ debts, seeking $431,632 in repayments (plus interest and costs). Jones opposed the application on several grounds, including that Bloodstock had acted oppressively and he had an equitable set-off claim. He also alleged there was a conspiracy in the thoroughbred industry to harm his business interests.

Jagose J found against Jones, holding there was no evidence to suggest he had any available defence to Bloodstock’s claims. Moreover, there was nothing unfair or unjust about determining Bloodstock’s claim without taking into account Jones’ intended cross-claim.

Jones appealed. In various affidavits, he alleged certain High Court judges were party to the alleged conspiracies against his interests, alongside several members of his own family, his friends and others in the horse racing industry.

The Court of Appeal took an “unduly lenient approach to admissibility” and admitted some aspects of this further evidence, “essentially because the overall breadth of Jones’ suspicions was potentially relevant to an assessment of the credibility of his claims”.

The Court of Appeal disagreed with the High Court’s decision that Jones’ claims, even if they had merit, were not capable of qualifying for equitable set-off. But it dismissed his appeal. It held there was no tenable cause of action in relation to fraud, and the wide-ranging conspiracies alleged by Jones were neither substantiated nor credible.

Jones applied for leave to appeal to the Supreme Court. In a series of memoranda and affidavits, he criticised certain High Court and Court of Appeal judges and requested that judges of the Supreme Court recuse themselves where they had personal knowledge of the issues he referred to, had a personal relationship with the judges complained of, or where they had discussed Jones or any aspect of his litigation with those judges.

In a minute of 28 April 2023, the Supreme Court observed that it was for the court to determine whether any member should recuse him or herself and that it was contrary to principle that the judiciary could be interrogated on such matters. Notwithstanding that principle, it confirmed that no judge of the court, whether assigned to the panel or not, met any of Jones’ criteria.

 

Applicable principles: whether matter involves issues of general public importance and general commercial significance – whether significant miscarriage of justice if case not heard – whether loan contracts are enforceable or should instead be varied – whether Bloodstock should be estopped from demanding repayments in the manner sought – whether the Court of Appeal erred in deciding Jones could not succeed in a defence based on fraud or oppressive conduct – whether principle “fraud unravels everything” applies – whether Jones’ evidence falls short of the standard required to establish a lawful or unlawful conspiracy – whether Court of Appeal conducted its hearing in accordance with natural justice principles – whether Court of Appeal applied orthodox principles relating to summary judgment in reaching its decision – whether Jones’ indicated immediate intention to issue proceedings against several judges, among whom a clear link of collegiality might be expected, would concern a fair-minded and fully-informed observer as to the impartiality of the panel – whether Supreme Courts Act 2016 permits substitution of retired or overseas judges.

 

Held: Application for leave to appeal dismissed. No matter of general public importance or commercial significance raised. No miscarriage of justice if case not heard. Insufficient prospect of success to justify grant of leave.

 

Hannah Hellyer is an Auckland criminal defence barrister and a member of the ADLS Criminal Law committee and Parole Law committee.

Jones v New Zealand Bloodstock Finance and Leasing [2023] NZSC 98.

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