Jock Anderson

Heard the story of how a judge accused of bias came down on the side of a real estate agent he bought a house through then used the agent to try to sell another?

Wellington man Brian O’Hara says he has asked Judicial Complaints Commissioner Ian Haynes to investigate district court judge Chris Tuohy’s involvement in a case Mr O’Hara says has so far cost him about $400,000 in legal bills and court costs.

Mr O’Hara has had no success so far, with High Court Justice Ron Young this month  finding no bias by Judge Tuohy and dismissing Mr O’Hara’s appeal.

Now Mr O’Hara says he doesn’t want to pour more money into another appeal so he hopes Mr Haynes can provide the answers he wants.

Mr O’Hara went to court earlier this year in a bid to get back a $102,500 deposit he paid on a $1.12 million Oriental Bay apartment owned by the BR Finch Trust.

Bruce Finch, the BR Finch Trust and real estate agents Just Paterson were the other parties.

In the district court Mr O’Hara claimed there was a wrongful refusal to refund his deposit. He claimed he had been mislead or deceived by real estate agent Ian Paterson who, he said, misrepresented that he had a “current” register valuation of $1.4 million for the property, when the valuation was about 16 months old.

The nub of that case was whether or not Mr Paterson told Mr O’Hara he had a current valuation. Mr Paterson denied ever saying the valuation was a “current” one.

When Mr O’Hara cancelled the contract, Mr Finch and his family trust elected not to pursue specific performance, accepted the contract was cancelled, but figured the cancellation was wrongful and hung on to Mr O’Hara’s deposit.

Judge Tuohy concluded Mr Paterson did not use the word “current.” Judge Tuohy also concluded that whether the valuation was or was not current was “not of particular importance” to Mr O’Hara.

Finding against Mr O’Hara, Judge Tuohy said that given the property market was “on the up” any previous valuation was likely to be exceeded by the time Mr O’Hara made his offer.

And this is where it gets interesting.

Before dealing with the case Judge Tuohy disclosed, in a telephone conference and again in court, a previous contact with real estate firm Just Paterson and employees of the firm.

About March 2004, Judge Tuohy and his wife bought a house from vendors represented by Just Paterson’s Kate Paterson, a daughter of Ian and Sally Paterson, the other two directors of Just Paterson.

After buying the house the Tuohys instructed Kate Paterson to act exclusively for them to sell their existing property. Just Paterson couldn’t find a buyer and another agent eventually sold the Tuohy property.

No-one objected to Judge Tuohy hearing the case at the time.

But Mr O’Hara, after further inquiries and consideration, took the view that Judge Tuohy should not have heard his case because of actual or apparent bias.

After Judge Tuohy’s judgment went against him Mr O’Hara discovered the judge had given Just Paterson a sole agency agreement to sell his house, a discovery that partly inspired his appeal.

Mr O’Hara challenged whether Judge Tuohy had made a clear disclosure, before dealing with the case, of the agreement with Just Paterson to sell his house.

At the High Court the allegation of actual bias against Judge Tuohy was dropped and Mr O’Hara relied on “a reasonable apprehension of bias.”

Referring back to Judge Tuohy’s telephone conference Justice Young held that “it may be” that the judge mentioned “probably obliquely, the sale of his own house.”

Although Judge Tuohy said in a report requested by the High Court under the High Court Rules, that he intended to make it clear to all parties the full extent of the contact with Just Paterson, he accepted that he may not “have effectively conveyed that Just Paterson were for a period agents for the sale of our house.”

Justice Young accepted that at the time of the telephone conference Mr O’Hara did not understand Just Paterson had acted for Judge Tuohy attempting, unsuccessfully to sell his family home.

When Judge Tuohy again raised his previous contact with Just Paterson before the hearing got under way Justice Young accepted it “may well not have been clear to counsel the extent of Just Paterson’s involvement in selling the judge’s house.”

Among other things Mr O’Hara argued there as a “reasonably extensive” contact between Kate Paterson and the judge and his wife over the purchase of the property; the Tuohy’s gave Just Paterson a two month sole agency to sell their house; Ian Paterson attended an open home at the Tuohy’s property; all the Patersons were contacts for the sale of the Tuohy house; the sole agency finished ten months before the case began and Just Paterson stood to get about $15,000 if they sold the Tuohy house.

Justice Young said the inference Mr O’Hara drew from those facts was that the Tuohys were sufficiently impressed with Just Paterson, whom they saw as reliable, capable and competent agents, to entrust with the sale of their house.

Because of that, Mr O’Hara argued, Judge Tuohy would have come to the case with the pre-determined view that Just Paterson was a reliable and credible real estate agent.

He claimed there was a real danger the judge might have unfairly favoured Just Paterson’s case and the witnesses appearing for them.

Justice Young said a vital issue was the credibility of witnesses and Ian Paterson’s credibility was at the core of the case.

Justice Young said Mr Paterson’s only involvement in the sale of the Tuohy property was attending one open home. He said the judge did not and had not ever met Mr Paterson.

Concluding there was no real danger of bias Justice Young said there was no reason to suppose Judge Tuohy would have any reason to unfairly regard Mr Paterson or Just Paterson with favour.

“If anything,” Justice Young said, “The Judge had reason to be disappointed with Just Paterson because they did not sell his house.”

Mr O’Hara says he is “extremely disappointed” by the conduct of the judges in both hearings.

Feedback on this story to jockanderson@ihug.co.nz