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High Court of New Zealand Decisions |
Last Updated: 24 October 2018
IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY
I TE KŌTI MATUA O AOTEAROA TĀMAKI MAKAURAU ROHE
CIV-2017-404-002191 [2018] NZHC 2434
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UNDER
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The Prisoners’ and Victims’ Claims Act 2005
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IN THE MATTER OF
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An appeal against the decisions in the matter of VSC 001/16 and
002/16
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BETWEEN
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NICHOLAS PAUL ALFRED REEKIE Appellant
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AND
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CLAIMANTS A and B Respondents
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Hearing:
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11 July 2018
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Appearances:
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Appellant in Person
Victoria Casey QC as Amicus Curiae for the Respondents
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Judgment:
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14 September 2018
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JUDGMENT OF MOORE J
This judgment was delivered by me on 14 September 2018 at 3:00 pm pursuant to Rule 11.5 of the High Court Rules.
Registrar/ Deputy Registrar
Date:
REEKIE v CLAIMANTS A & ANOR [2018] NZHC 2434 [14 September 2018]
Introduction
[1] Mr Reekie is a convicted rapist serving a sentence of preventive
detention. He was ordered to pay an award of $50,000 in
exemplary damages to two
of the victims of his offending in the Victims’ Special Claims Tribunal
(“the Tribunal”).1 This appeal concerns the lawfulness
of that award. Mr Reekie says the process the Tribunal followed breached his
right to natural
justice and that the Tribunal’s assessment of damages was
manifestly unreasonable.
Background
[2] Mr Reekie was sentenced on 3 August 2004 on 31 charges, including
multiple charges of sexual violation against four complainants.
Two of those
complainants are Claimants A and B, who are the respondents in this appeal. The
offending against Claimant A occurred
in 1992. Mr Reekie was sentenced to a
term of 14 years’ imprisonment with a minimum period of nine and a half
years.2 Preventive detention was not an available sentencing option
at that time. In respect of Claimant B, he was sentenced to preventive
detention with a non-parole period of 20 years.3
[3] On 21 July 2012, Mr Reekie made a Privacy Act 1993
request to the Department of Corrections (“Corrections”)
seeking
the provision of certain documents about him. Some of that information was
provided on 6 November 2012. Mr Reekie complained
that the disclosure was
insufficient and sought compensation from Corrections for a breach of the
Privacy Act.
[4] On 25 February 2016, a settlement was reached between Mr Reekie and
Corrections. Corrections acknowledged its management
of the request failed to
meet expected standards. Corrections agreed to make a payment by way of
compensation in the sum of $1,350
to be held as follows:
“Mr Reekie acknowledges that in accordance with section 17(1) of the
Prisoners’ and Victims’ Claims Act 2005, the
payment of compensation
in the sum of ONE THOUSAND AND THREE HUNDRED AND FIFTY DOLLARS ($1,350) will be
paid to the Secretary for
Justice to be dealt with in accordance with the
provisions of that Act.”
1 Claimant A v Reekie Victims’ Special Claims Tribunal VSC001/16, 25 August 2017.
2 R v Reekie HC Auckland T021833, 15 July 2003, at [17]-[18].
3 R v Reekie CA339/03, 3 August 2004.
The Prisoners’ and Victims’ Claims Act 2005
[5] In order to explain the events that followed, it is necessary to
set out the framework of the Prisoners’ and Victims’
Claims Act 2005
(“the Act”) in some detail.
[6] The Act represents a legislative response to the awards of
compensation made in Taunoa v Attorney-General to prisoners
unlawfully detained in a segregated behaviour management regime.4
As the Minister of Justice told Parliament during the first reading of the
Prisoners’ and Victims’ Claims Bill:5
“Most people, including myself, have a deep sense that it is wrong that
serious offenders can be awarded compensation for wrongful
treatment without
those offenders themselves being required to pay compensation to their victims
for the serious wrongs inflicted
upon them.”
[7] As well as narrowing the class of cases in which prisoners can claim
compensation, the Act establishes a scheme by which victims
can make claims
against payments of compensation made to prisoners as redress for the harm they
have suffered. “Victim’s
claim” is defined in s 9 as a claim
for damages or exemplary damages made by or on behalf of a victim against an
offender,
based on acts done or omitted to be done by the offender in committing
the offence.
[8] The payment of $1,350 to Mr Reekie is an example of a compensation
payment captured by the Act and claimable by the victims
of his offending.
There is also no dispute that Claimants A and B are victims under the scheme of
the Act.
[9] Subpart 2 of Part 2 of the Act serves two
purposes:6
(a) it establishes, requires payments into, and regulates the operation of a
victims’ claims trust account (“the account”);
and
(b) it provides a procedure for the making and determination of
victims’
claims.
5 (14 December 2004) 622 NZPD 17986.
6 Prisoners’ and Victims’ Claims Act 2005, s 3(2).
[10] As is recorded in Mr Reekie’s deed of settlement with
Corrections, s 17 of the Act requires that payments of compensation
made to
prisoners must be paid to the Secretary for Justice to be held in the
interest-bearing account, once the steps at s 18(1)(a)-(c)
have been followed.
The residue may be paid out of the account only in accordance with subpart 2,
Part 2 of the Act (or any regulations
made under s 57). The Secretary of Justice
must give notice of payments made into the account.7 The Act also
sets out how victims’ claims may be filed.8
[11] Once a claim has been filed, it is referred to the Tribunal. The
Tribunal consists of a District Court Judge, and its function
is to determine
victims’ claims for damages filed under the Act.9 The
Tribunal’s procedure in determining claims is relatively unorthodox. This
is to minimise the impact of the process on victims.
To that end it possesses
wide powers to regulate the procedure it chooses to follow.10
Claims are determined on the papers without the need to hear oral
evidence, although this may be appropriate in certain situations.11
The Tribunal may receive as evidence any statement, document, information
or matter that, in the Tribunal’s opinion, may assist
in determining the
victim’s claim, whether or not such material would be admissible in a
court of law. It may also accept as
proven, findings of fact that have been
accepted or proved at the original trial.12 Additionally, it may
access relevant Court documents or records or request other
information.13
[12] The Tribunal must not accept a victim’s claim unless
satisfied, on the balance of probabilities, that:14
“(a) the claimant is a victim of the offender; and
(b) the victim has, through or by means of the offence, suffered
injury, loss, or damage for which the victim has not received,
and is not to
receive, effective redress; and
(c) the claim discloses a cause of action that is, under the general
law, one for which damages are, in the particular case,
payable.”
7 See ss 20-25.
8 Section 28.
9 Section 58.
10 Section 45. This is subject to the statutory provisions in ss 28-44, 46, 59 and 60 of the Act.
11 Sections 34 and 38.
12 Section 37.
13 Sections 35 and 39.
[13] If it does accept a claim, the Tribunal may order that an amount of
money be paid to the victim.15 It may also order payment if a sum is
agreed to by all victims and the offender, or if it considers a proposed payment
is reasonable
by way of final settlement of all victims’ claims
concerned.16
[14] In fixing the amount to be paid, the Tribunal must determine any amounts without regard to the amount of money actually held in the account for the offender.17
Moreover, in determining whether the amount should be paid by way of damages
or exemplary damages, and in fixing quantum, the Tribunal
must apply the general
law relating to awarding damages.18
The claims brought by Claimants A and B
[15] On 30 June 2016, just over a month after the amount of $1,350 was placed into the account, notice was given to interested Government departments. Notice was also given in daily newspapers in the five main centres on 2 July 2016, advising that any person who had been a victim of Mr Reekie was entitled to make a claim against the money held in the account. Any notice of claim had to be filed before Tuesday,
3 January 2017.
[16] Only claims by Claimants A and B were received within the specified
time. No claims were lodged out of time. The claims
filed sought general or
exemplary damages, citing the emotional harm the victims had suffered as a
result of Mr Reekie’s sexual
offending against them.
[17] Prior to the hearing Mr Reekie offered $1,000 to each Claimant by
way of settlement. He submitted that if his offer was rejected,
the claim should
be dismissed.
15 Section 46(3).
16 Section 46(4).
17 Section 47(1).
The Tribunal’s decision
[18] Judge C S Blackie, sitting as the Tribunal, found exemplary damages
were available. He was satisfied of the matters in s
46(2), namely
that:
(a) each Claimant is a victim of Mr Reekie;
(b) each, through his offending, has suffered injury, loss or damage
for which they have not received and are not likely to
receive effective
redress; and
(c) the claims disclose the torts of assault and battery which justify
exemplary damages.
[19] He noted the “gross indecencies” suffered by each of the
Claimants, and awarded exemplary damages in the sum
of $25,000 to each Claimant
for Mr Reekie’s “outrageous conduct”.19
Mr Reekie’s appeal
[20] Mr Reekie has raised six questions of law:20
(a) Did the Judge err by hearing some matters in Mr Reekie’s
absence?
(b) Was Mr Reekie inadequately informed of the basis of the claims
against him?
(c) Did the Judge err in proceeding to hearing after being
informed
Mr Reekie had not been served with either notice of claim?
(d) Did the Judge err when he allowed the hearing to proceed once made
aware Mr Reekie was “statute-barred” from
making
submissions?
19 Claimant A v Reekie, above n 1, at [20].
(e) Was there an undue delay in this matter, and if so, who
caused it and what was its effect? and
(f) Was the award of exemplary damages available to the Judge and was the
amount awarded manifestly unreasonable?
[21] Because Mr Reekie is self-represented, an order was made
appointing
Ms Casey QC as amicus curiae. She helpfully identified the key issue on
appeal: whether Mr Reekie was provided with a copy of the
claim as required by s
31 of the Act. However, at the hearing the Judge’s approach to the
assessment of damages also assumed
significance. I shall deal with the latter
issue separately, although for reasons which follow the appeal does not turn on
it.
Was Mr Reekie provided with a copy of the claim?
[22] Section 31(1) requires that before determining a victim’s
claim, the Tribunal must serve a copy of the claim on the
offender and provide a
reasonable opportunity for the offender to make written submissions. The claim
must be served on the offender
as soon as practicable after it is filed.21
Section 31(3) then balances the privacy interests of victims against the
offender’s right to natural justice. It provides that
information
identifying the victim’s address must be removed from the copy of the
claim served on the offender unless, in the
Tribunal’s opinion, that
information is necessary to ensure the offender is fully and fairly informed of
the nature of the
claim. Section 31(4) and (5) then relate to the reasonable
opportunity given to the offender to make submissions:
“(4) The Tribunal gives the offender the reasonable opportunity
required by subsection (1) by requiring his or her written
submissions to be
filed with the Secretary of the Tribunal—
(a) within 60 days after the expiry of the periods specified in
section 33(a); or
(b) within a further period the Tribunal is satisfied, on an application
for the purpose before the expiry of that 60-day period,
is justified by
exceptional circumstances.
21 Section 31(2).
(5) In determining under subsection (4)(b) whether it is satisfied a
further period is justified by exceptional circumstances,
the Tribunal must have
regard to the number and complexity of the victims’ claims filed against
the offender.”
[23] With respect to the s 31 requirements, the Judge stated in his
decision:22
“The respondent is fully aware of these proceedings, having been served with a notice of claim, the summary of the misconduct giving rise to the claim, the nature of the relief sought by way of compensatory damages. Further, I directed by a minute, issued on 12 April 2017, that if the claimant’s representative, Ms Gardner, was able to meet with the respondent, he would be able to read the contents of their statements. He was not, however, to be given copies of those statements, except through instructing counsel. I imposed that restriction so as to reduce the possibility of the claimants being
re-victimised. Despite attempts, no face-to-face meeting has been
possible.”
[24] Mr Reekie disagreed with this summary. He argued the Judge
erroneously delegated the responsibility of serving the claims
on him to the
representative of the Claimants, Dr Gardner, who never completed the task.
Relatedly, he argued the method of service
directed by the Judge did not comply
with the strict obligation in s 31 to “serve a copy of the claim” or
his right to
be fully informed of the nature of the claims. He further argued
that a complete lack of specificity in the claims means the Tribunal’s
decision is a nullity.
Analysis – procedural failings
[25] As Ms Casey helpfully summarised, the documentary record
corroborates
Mr Reekie’s account and reveals a serious procedural
failure.
[26] Both claims were filed in December 2016. But almost six months
later, in a letter of 4 May 2017, Mr Reekie wrote to the
Tribunal advising he
still had not been served with a copy of the claims. Earlier, in a Minute of 12
April 2017, the Judge had made
the following directions as to
service:23
“Clearly, with the interests of victims in mind, this Tribunal has the
ability under its creating Statute to set its own procedure.
Therefore, in this
case, I make the following directions as to mode of service:
(1) A notice of claim is to be served on the defendant, such notice to
contain the following particulars:
22 Claimant A v Reekie, above n 1, at [16].
23 [Claimant A] v Reekie Victims’ Special Claims Tribunal VSC001/16, 12 April 2016, at [4]-[5].
(a) The full name and date of birth of the claimant.
(b) A summary of the misconduct giving rise to the claim.
(c) The nature of the relief sought by way of compensational damages.
(2) Service of the notice of claim is to be effected personally upon the
respondent by counsel for the claimant, Ms Gardner.
At the time of service, assuming she is able to meet personally with the
respondent, Ms Gardner is to read to the respondent the contents
of the
victims’ statements. He is not, however, to be provided with a copy of
their statements.”
[27] For reasons which are not apparent this Minute was not sent to Mr
Reekie until
13 May 2017, just over a month later. It was accompanied by a covering
letter from the Registrar, who advised Mr Reekie he would
“not be
permitted to keep copies of the claim[s] and associated documentation”.
This advice was wrong; in fact the
Judge’s direction was that Mr Reekie
could not be provided copies of the victims’ statements (they were
simply to be read to him). The letter also advised the meeting between Mr
Reekie and Dr Gardner would take place on 24
May 2017 at the Special Needs Block
Interview Room at Auckland Prison.
[28] On 21 May 2017 Mr Reekie filed a “Notice of Opposition ... to
the Minute of Judge C S Blackie dated 12 April 2016”,
complaining the
Judge’s directions had not complied with s 31 and advising he had still
not been served with the claims. He
also expressed concern that the time for
filing submissions, set out in s 31(4), had expired and he was time-barred from
making submissions.
In a letter sent the same day to Dr Gardner he advised that
he would not be meeting with her, because he considered it would not
be proper
or lawful service of the claims.
[29] The Tribunal issued another Minute on 14 June 2017, asking counsel to clarify whether Mr Reekie had received the notices of claim. The Judge also asked counsel to advise whether Mr Reekie’s settlement offer of $1,000 per Claimant was acceptable. This Minute was served on Mr Reekie on 19 June 2017. He responded the same day with a further memorandum informing he had refused to meet with Dr Gardner. He explained that when he arrived at the Special Needs Block Interview Room on
24 May 2017, prison staff advised him the meeting would take place elsewhere. He refused to go with the staff to the new location. In correspondence dated 26 June 2017
Dr Gardner confirmed this. She was informed by prison staff that Mr Reekie
“insisted that we be brought to the cell block to
meet with him”.
She submitted she had “done everything” she could “to ensure
Mr Reekie is able to view the
submissions as part of natural justice, but has
refused to meet”.
[30] As a result, Mr Reekie was never provided with a copy of the claim
forms lodged by the Claimants. Ms Casey has obtained
written confirmation of
this from the Tribunal. Despite this, the Judge appears to have proceeded on
the misunderstanding Mr Reekie
had been served.
[31] Thus there has been a fundamental procedural failing. The mandatory
requirement that the offender be served a copy of the
claim and given a
reasonable opportunity to make submissions was not met. While the
Tribunal’s procedure is designed to minimise
the impact of the process on
the victims, it was envisaged it would “still [be] consistent with natural
justice requirements.”24 In this case, the breach of the
rules of natural justice has tainted the Tribunal’s substantive
decision.25
[32] Before addressing what orders should be made, three further comments regarding the process followed are necessary. First, while aspects of the Tribunal’s procedure are at its discretion, others are not. These include s 31.26 The requirement that Mr Reekie be served with the claims and given a reasonable opportunity to make written submissions was not capable of being varied by the Tribunal. However, as
Ms Casey pointed out, a person is sufficiently served if any of the methods
set out in s 27(1) are followed.
[33] This leads to the second point. While s 31(3) calls for redaction of “information that identifies, or that may lead to the identification of, the address of the place where the victim lives”, it does not allow for redaction of substantive aspects of the claim, particularly those necessary to fully and fairly inform the offender of the
nature of the claim. The priority of natural justice over privacy is
apparent in the final
24 (14 December 2004) 622 NZPD 17986.
25 Ancare New Zealand Ltd v Wyatt (NZ) Ltd [2009] NZCA 211, [2009] 3 NZLR 501 at [46].
26 Prisoners’ and Victims’ Claims Act 2005, s 45.
part of s 31(3), which allows the Tribunal to not redact the victim’s
address if that information is necessary to ensure the
offender is fully and
fairly informed.
[34] Accordingly, in order to be fully and fairly informed and be able to
make submissions, Mr Reekie must be given more. I agree
with Ms Casey that the
Tribunal should exercise caution in allowing any information beyond that
referred to in s 31(3) to be redacted
from the claim forms, given the dictates
of natural justice.
[35] Moreover, while I understand the Tribunal’s reasons for doing
so, I accept
Mr Reekie’s submission that merely having the victims’ statements
read to him is insufficient to enable him to respond
to the claims in
submissions. Any orders made to protect the victims should not impinge on the
offender’s reasonable opportunity
to make written submissions on the
claims. As Ms Casey submitted, Mr Reekie’s ability to sensibly respond
should be read in
light of s 27(1) of the New Zealand Bill of Rights Act 1990.
It is a matter for the Tribunal to determine how this objective is
best given
effect to, but it seems to me it would be necessary for Mr Reekie to have some
means for taking contemporaneous notes
when the victims’ statements are
presented to him; that he has available some form of aide-mémoire when
later preparing
submissions. Alternatively, as Ms Casey suggested, he could be
given limited access to the victims’ statements while preparing
his
submissions, with the statements retrieved once his preparation is
complete.
[36] As Ms Casey sensibly pointed out, to avoid the tension between the
victims’ interests and natural justice arising
in future cases, the
Tribunal could consider exercising its powers to obtain copies of relevant
sentencing notes and Court transcripts
rather than obtaining statements from the
victims themselves. Such a course would have the benefit of focusing on the
offender’s
conduct, which is the primary consideration in assessing any
award of exemplary damages in any event. It may be that on any rehearing,
this
is the course the Tribunal will elect to adopt.
[37] Finally, despite Mr Reekie’s claim, he was not time-barred from making submissions. The Judge, in his Minute of 12 April 2017, directed that “notice of defence to the applications and any evidence pertaining thereto should be filed within
28 days of the date of service”.27 Given the time for
filing in accordance with s 31(4)(a) expired 60 days after the deadline for the
filing of claims, on 5 March 2017,
this constituted a “further
period” for filing “justified by exceptional circumstances” in
terms of s 31(4)(b).
I agree that not being informed of service of the claim
until some two months after this deadline constituted “exceptional
circumstances”. However, given the strict time limits in s 31, and the
requirement to give the offender a reasonable opportunity
to make written
submissions, the situation was not ideal. Service needed to be effected earlier
consistent with the principles of
natural justice.
What order should be made?
[38] Mr Reekie submitted I should strike the claims out altogether, but
in the event I did not I should substitute the Tribunal’s
decision with my
own, implementing a settlement offer made by Mr Reekie of $5,000 per Claimant.
While Claimant B is prepared to
accept this offer, Claimant A is not. In the
absence of agreement, and not having heard submissions on damages, I am not
prepared
to substitute my own decision.
[39] In any event it is clear to me the Tribunal’s decision cannot
stand. I agree with Ms Casey that the appropriate course
is to refer the matter
back to the Tribunal for rehearing. That course will have the additional
benefit of the Tribunal receiving
and considering submissions on both damages
and quantum. It will also provide the Tribunal with the benefit of the guiding
observations
which follow.
The assessment of damages
[40] During the hearing, I discussed with counsel whether, in the event I was to remit the matter back to the Tribunal for rehearing, some guidance on the approach to assessing exemplary damages might be desirable. I did so because I was concerned the Judge’s assessment may have been inadequate. I called for further submissions on the approach to assessing and fixing exemplary damages, as well as the effect of s 47(1) of the Act on any award of damages. I have now had the benefit of considering
those very helpful submissions in preparing this judgment, and place on
record my
27 [Claimant A] v Reekie, above n 23, at [8].
gratitude to the parties for their assistance. What follows are observations
intended to assist the Tribunal in its approach to determining
exemplary
damages.
[41] While the Tribunal’s procedure is designed to minimise the risk of retraumatising victims, ss 46 and 47 are clear; the Tribunal is bound by the general law in determining liability and quantum. It will not be sufficient to make a determination of liability, particularly in a claim for exemplary damages (for which under the general law there exists a high threshold) without a robust analysis of the law and the facts. I disagree with the Judge’s conclusion that:28
“There are authorities limiting the amount of exemplary damages
available if the perpetrator has otherwise been punished by
the criminal law.
However, it would defeat the purpose of this Act if such an approach were taken
in respect of claims such as those
currently presented.”
[42] On the contrary, the Act plainly contemplates that the Tribunal will
engage in such issues, adopting the applicable legal
principles. Moreover, in
my view the Tribunal’s duty to rigorously analyse the merits of a claim
for damages, including what
quantum should be awarded, is particularly relevant
in the context of s 47(1). As noted, that provision requires the Tribunal to
determine any amounts payable to victims without taking into account the funds
actually held in the offender’s account. It
exposes offenders who suffer
wrongful treatment in prison to a summary procedure by which victims may claim
substantial damages against
them greater than the amount of money paid to an
offender as compensation. To the extent an award of damages exceeds the amount
held as compensation for the offender, the victims may enforce the order as if
it was a judgment of the District Court.29 The consequences of an
excessive award will include adjudicating the offender bankrupt. The stern
consequences of an award made
under the Act therefore compel a robust
determination.
[43] I agree with Ms Casey the Tribunal must address each of the three elements in s 46(2) (set out above at [12]) in its decision. Moreover, each element must have some evidential foundation, although s 59 provides that such a foundation need not derive
from any information or matters which would be admissible in a court of
law.
28 Claimant A v Reekie, above n 1, at [18].
29 Prisoners’ and Victims’ Claims Act 2005, s 48(4)-(6).
[44] Section 46(2)(a) requires the Tribunal to be satisfied the claimant
is a victim of the offender. As well as meeting the s
8 definition, they must
not have obtained, or be seeking, judgment in respect of the conduct on which
the claim is based in civil
proceedings against the offender.30 I
agree with Ms Casey that the claim forms completed by the Claimants do not fully
cover the requirements of s 28(1)(c), nor the comparable
requirement at s
46(2)(b) that they have not received and are not likely to receive effective
redress for the injury, loss or damage
they have suffered. In terms of the
remainder of s 46(2)(b), I accept that the victims’ statements and the
sentencing notes
were sufficient evidence of injury, loss or damage.
[45] As for ss 46(2)(c) and 47(2), the Tribunal’s conclusion that Mr Reekie’s offending discloses the tort of battery is plainly correct. However, further considerations flow from the requirement that the general law of liability and quantum of damages be applied. The availability of a limitation defence is one factor that needs to be considered under the general law. While s 64 provides for the purposes of the Act standard limitation periods are suspended for the period the offender is serving a sentence of imprisonment, that does not affect limitation defences which have accrued prior to the commencement of imprisonment. It pertains only to the running of limitation periods during the term of imprisonment; it does not affect their existence.31
Therefore in respect of Claimant A (who was the victim of offending in 1992),
subject
to important questions of the reasonable discoverability of the cause of
action,32 and whether Claimant A was operating under a
disability for any period after the offending,33 it appears the
six-year period for bringing a claim in tort under s 4(1) of the Limitation Act
1950 expired before Mr Reekie was convicted
and imprisoned. These are legal
questions which need to be resolved before an award of exemplary damages may be
made.
[46] A second factor is that, as the Judge noted, claims for compensatory
damages arising out of personal injury covered by the
Accident Compensation Act
2001 or its
30 Section 28(1)(c).
33 Limitation Act 1950, s 24. See generally Jay v Jay, above n 32, at [90], applying T v H [1995] 3
NZLR 37 (CA) at 61.
predecessors are barred under the general law.34 Damages for
mental injuries caused by intentional assaults or batteries were within the
statutory bar of the Accident Compensation
Act 1982,35 and s 8(3) of
the Accident Rehabilitation and Compensation Insurance Act 1992. Moreover, the
current Accident Compensation Act provides
cover for mental injury caused by
criminal acts such as Mr Reekie’s.36 The claims therefore had
to be for exemplary damages, which fall outside the statutory
bar.37
[47] Exemplary damages are to be confined to torts which are committed
intentionally or with subjective recklessness, which is the
close moral
equivalent of intention.38 The purpose of an award of exemplary
damages was discussed extensively by the Supreme Court in Couch v
Attorney-General (No 2), where McGrath J stated:39
“Two linked considerations ... are, in my opinion, of fundamental
importance in deciding when exemplary damages are to be awarded.
The first is
that the primary purpose of exemplary damages is to punish a defendant for
wrongful conduct. Deterrence of the offender
is likely to be the effect of an
award, as is vindication of the plaintiff who suffers harm and receives the
damages. But these are
both incidental consequences and should not divert the
courts from the punitive purpose of the remedy.
Secondly, because the focus of the courts is on punishment, it is the
culpability of the defendant’s conduct that justifies
an award of
exemplary damages. Assessment of the degree of culpability is straightforward
where a defendant intentionally causes
harm.”
[48] Outrageousness of conduct is not the sole criterion: the focal point of the inquiry is not the committing of the tort per se, but the subjective appreciation of the risk of wrongful harm.40 Because exemplary damages are punitive, the focus must be on the conduct of the tortfeasor rather than the extent of harm. In determining whether the threshold for exemplary damages is met, the Tribunal may thus take into account the mental elements of the offending. The sentencing Judge’s comments about
culpability will also likely be relevant. The Tribunal should also
consider the gloss on
34 Accident Compensation Act 2001, s 317. Section 6 defines “former Act”.
35 Willis v Attorney General [1989] 3 NZLR 574 (CA) at 576; M v Roper [2018] NZHC 2330 at
[164], [171].
36 Accident Compensation Act 2001, s 21.
37 Section 319.
38 Couch v Attorney-General (No 2) [2010] NZSC 27, [2010] 3 NZLR 149 at [178] per Tipping J.
39 At [238]-[239].
40 At [178]-[179]. See also Wright v Bhosale [2016] NZCA 593, [2017] NZAR 203 at [52]- [53].
liability for exemplary damages provided by s 319(3) of the Accident
Compensation
Act:
“(3) In determining whether to award exemplary damages and, if they are
to be awarded, the amount of them, the court may have
regard to—
(a) whether a penalty has been imposed on the defendant for an offence
involving the conduct concerned in the claim for exemplary
damages; and
(b) if so, the nature of the penalty.”
[49] If satisfied exemplary damages are available, the Tribunal must then
turn to fix quantum. In doing so, the following principles
outlined by Hammond J
in McDermott v Wallace should guide the
assessment:41
(a) the claimant must be the victim of punishable
behaviour;
(b) there should be moderation in making awards; (c) the means of the parties should be considered; (d) other awards to the claimant are relevant;
(e) regard must be had to the imposition of any criminal penalty;
and
(f) the conduct of the parties is relevant, including that of the
claimant.
[50] Another cornerstone consideration, as Tipping J stated in
Couch, is that exemplary damages “are not a surrogate way of
awarding greater compensation”.42
[51] Additionally, aggravating and mitigating factors are relevant.43 While in comparison to other torts sexual battery cases tend to attract larger awards of exemplary damages due to the nature of the acts involved, “much depends on the
individual circumstances of each case”, including the lack of
means of the parties.44
41 McDermott v Wallace [2005] NZCA 144; [2005] 3 NZLR 661 (CA) at [94]- [102], as summarised in Hikurangi Forest
Farms Ltd v Negara Developments [2018] NZHC 607, [2018] NZAR 804 at [204].
42 Couch v Attorney-General (No 2), above n 38, at [95].
43 Jay v Jay, above n 32, at [105].
44 At [106].
[52] I make no comment on the final award arrived at by the Tribunal.
However, it is not apparent consideration was given to the
multiple and
competing factors relevant to assessing quantum. These principles should have
been weighed alongside the Judge’s
finding of outrageous conduct;
namely Mr Reekie’s lack of means, his criminal penalty, the effect of
two awards, and
the principle of moderation. His conduct, including his
settlement offers and/or the presence of remorse, if any, was also
relevant.
[53] It is hoped that these observations will assist the Tribunal in its
determination of liability and quantum at the rehearing.
I also gratefully
adopt Ms Casey’s suggestion that reference may be had to the tables
summarising awards of exemplary damages,
and the relevant factors underpinning
each award in the cases therein, in J v J45 and McDermott v
Wallace,46 though such reference should not supervene the
requirement for a robust assessment of the relevant principles.
Result
[54] The appeal is allowed.
[55] A rehearing in the Tribunal is
ordered.
Moore J
Solicitors:
Ms Casey QC, Wellington
Copy to:
The Appellant
45 J v J [2013] NZHC 1512 at [200], approved in Jay v Jay, above n 32, at [102]-[111].
46 McDermott v Wallace, above n 41, at [97].
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