When to use summary judgment

In her dissenting judgment in Sandman v McKay & ors [2019] NZSC 41, then Chief Justice Dame Sian Elias reminded litigators of the key principles for using summary judgment proceedings.

Her judgment sets the bar high for those contemplating summary judgment proceedings. It reminds lawyers that summary judgment is not simply a handy alternative to bypass or truncate the usual, but costly, process of discovery, interlocutories and viva voce evidence, tested by cross-examination at trial.

Where it is available because there is a clear answer to a claim, summary judgment will save much time and cost. But if a case is not clear-cut, the shortcut may prove longer and costlier in the end.

As most know, normal proceedings begin with a notice of proceeding (a prescribed form setting out some of the defendant’s rights) and a statement of claim. The action progresses through discovery and possible interlocutory steps before ending up at trial with evidence given by witnesses sworn in at a court hearing.

The witnesses’ evidence is tested by cross examination. This whole process can, at best, take a year or more to wend its way to trial.

By contrast, a summary judgment proceeding begins with the above documents plus an interlocutory application seeking summary judgment, supported by affidavit evidence.

Rather than filing a defence, the defendant files a notice of opposition supported by affidavit(s). Instead of a trial, the application is determined by the court after a counsel-only submissions hearing – ie, on the affidavits alone. (In general, no witnesses appear in person to give evidence).

The High Court Rules state that judgment may be given against a defendant if the plaintiff satisfies the court the defendant has no defence or against a plaintiff if the defendant satisfies the court that none of the causes of action in the plaintiff’s statement of claim can succeed.

Whether there is no defence, or a claim can or cannot succeed, is a matter lawyers often disagree about. As a consequence, the summary judgment process can be misused and even abused.

In Sandman, Elias CJ states:

  • If a claim is untenable on the pleadings as a matter of law, the defendant may apply under r 15.1(1)(a) of the High Court Rules 2016 for an order striking it out. That does not prevent the plaintiff re-pleading and bringing a further, properly-constituted claim.
  • The defendant may also apply for summary judgment under r 12.2(2) of the High Court Rules if he or she can satisfy the court “none of the causes of action in the plaintiff’s statement of claim can succeed”.
  • Because summary judgment creates an issue estoppel between the parties, preventing a further claim for the same wrong, a defendant may obtain summary judgment on summary application without full hearing only if the defendant can demonstrate a clear answer to all the plaintiff’s claims against him. The approach is rightly described as “exacting” because it is a serious thing to stop a plaintiff from bringing a claim unless it is quite clearly hopeless.
  • Summary judgment may be entered, or a claim may be struck out, on the basis that it is untenable as a matter of law, even if the decisive point of law is one of some difficulty, requiring substantial argument. But where the cause of action is novel or where established principle must be applied to novel circumstances, peremptory determination in the absence of full understanding of context established at a hearing of the facts is often not appropriate. A court may refuse summary judgment if amendment to the statement of claim reasonably in prospect would raise a cause of action upon which the court is not satisfied the plaintiff could not succeed.
  • If the defendant has a complete answer to the claim on facts which are not disputed or which can be conclusively established summarily, such facts may be proved by affidavit evidence on application for summary judgment. So, for example, the defendant may be able to demonstrate he or she is the wrong party to the claim, or that he has the benefit of a privilege or immunity, or that the terms of a contract or deed relied on by the plaintiff are inconsistent with the claim. Such peremptory determination is available only in clear cases because truncated process risks breach of natural justice and error.

Elias CJ described the principles as uncontentious. If that is so, then the devil must be in their application as the majority of the court upheld the judgment whereas, applying the aforesaid principles, she declined to do so.

Andrew Steele is a partner at Martelli McKegg

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