Supreme Court puts foot down

Litigation

The Supreme Court has released a short and sharp decision which acknowledges that Judges can make mistakes, but mistakes won’t always afford a further right of appeal.

In Myall v Tower Insurance Ltd [2018] NZSC 35 the Court was required to exercise its gatekeeping powers in considering whether to allow a second appeal, after the case had already been through the High Court and Court of Appeal.

The case concerned Mr Myall whose Tower insurance policy entitled him to rebuild his earthquake damaged house.  Unfortunately, Mr Myall was under-insured in that his certificate of insurance listed a house area of 650m2 when its actual area was 799m2. Under his policy Mr Myall was entitled to the cost of rebuilding his house to the same condition and extent as when new, and up to the area as shown in the certificate of insurance. 

In the High Court and Court of Appeal the parties argued about the appropriate way to determine the rebuild cost.  Mr Myall argued he was entitled to the cost of an 8 bedroom, 6 bathroom house (as he had) but built to a 650m2 area.  Tower’s position was preferred by the Courts, which was that the cost should be based on the rebuild cost of an 8 bedroom, 6 bathroom house to a 799m2 area, but adjusted on a pro-rata basis to account for the under-insurance (i.e. by 650/799).

Each party called expert witnesses in support of their respective positions.  Unfortunately, the High Court and Court of Appeal Judges mistakenly relied upon statements from an expert witness which were not made, in support of ultimate findings on expert costs.

Flowing from this Mr Myall sought leave to appeal to the Supreme Court on two points, the issue of the amount to be allowed for professional fees, and the matter of the adjustment calculation for rebuild cost detailed above.

To allow a further appeal the Supreme Court had to be satisfied that determining the appeal was necessary and in the interests of justice.  In the circumstances of Mr Myall’s case, the Supreme Court found it was not.  Despite acknowledging mistakes had been made, the Supreme Court found it was still open to the lower court to have reached the decision it had made, and due to its specific facts there were no wider public policy grounds to justify the Supreme Court intervening further by allowing an appeal.

The judgment reinforces that even where decisions contain errors these alone will not automatically give rise to a right of further appeal in the Supreme Court.

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