Baker v Baker - [2022] NZHC 2058

IN THE HIGH COURT OF NEW ZEALAND TAURANGA REGISTRY

I TE KŌTI MATUA O AOTEAROA TAURANGA MOANA ROHE

CIV-2018-470-125

[2022] NZHC 2058

UNDER the Companies Act 1993

IN THE MATTER

AND

of an application pursuant to sections 174 and 241 of the Companies Act 1993

IN THE MATTER

of the liquidation of Glenville Properties (Katikati) Limited (in liquidation)

BETWEEN

LLOYD JOHN BAKER and PETER DOUGLAS BAKER

Plaintiffs

AND

VALERIE JEAN BAKER

First Defendant

cont/…

Hearing: On the papers

Counsel:

M Beech and L Gellert for the Applicants J Shaw for the Respondents

Judgment:

18 August 2022

COSTS JUDGMENT OF ASSOCIATE JUDGE SUSSOCK

This judgment was delivered by me on 18 August 2022 at 4pm pursuant to r 11.5 of the High Court Rules

Registrar/Deputy Registrar

Solicitors/Counsel:
Lowndes Jordan, Auckland
Norris Ward McKinnon, Hamilton Matt King Law, Tauranga

M Beech, Regional Chambers, Auckland

BAKER v BAKER [2022] NZHC 2058 [18 August 2022]

FLORENCE VALERIE BAKER
Second Defendant

GLENVILLE PROPERTIES (KATIKATI) LIMITED
Third Defendant

VALERIE JEAN BAKER and FLORENCE VALERIE BAKER
Applicants

MALCOLM GRANT HOLLIS and WENDY ANN SOMERVILLE
Respondents

Introduction

[1] In a judgment dated 31 May 2022, I granted Valerie Jean Baker and Florence Valerie Baker leave to review decisions of the liquidators of Glenville Properties (Katikati) Ltd (in liquidation) pursuant to s 284 of the Companies Act 1993.1

[2] I asked the parties to confer regarding the question of costs and file memoranda if agreement could not be reached. Costs have not been able to be agreed and memoranda have now been filed.

Costs claimed

[3] The applicants seek scale costs on a combined Category 2B/3C basis with a 50 per cent uplift for a total amount of $26,805.75 plus disbursements.

[4] The applicants submit that the appropriate category for certain steps is Category 3 as the application considered a novel issue in insolvency law which had not had the benefit of full argument before the High Court previously and was sufficiently complex and significant to require counsel to have special skill and experience in the High Court.2 They say therefore that the application and subsequent steps warranted specialist insolvency lawyers appearing, a fact evidenced by the applicants engaging specialist insolvency solicitors and the liquidators instructing counsel for the hearing.

[5] They further submit that to the extent that there has been a previous cost categorisation in this proceeding, that categorisation related to entirely different issues between the shareholder parties whereas this application related to the conduct of the liquidators of the company.

[6] In addition, the applicants say there are several factors which meant it was reasonable to spend a comparatively large amount of time compared to a more typical interlocutory application.

1 Baker v Baker [2022] NZHC 1253.
2 At [25].

[7] As well as the issue of whether reg 15(2) of the Companies Act 1993 Liquidation Regulations 1994 (Liquidation Regulations) was a time-bar to the application for leave, the evidence filed by the applicants was required to cover a number of different factual issues relevant…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

Continue reading Baker v Baker

Details

AGLC: Baker v Baker [2022] NZHC 2058
Case: [2022] NZHC 2058
Decision Date: 18 August 2022

CaseChat Overview and Summary

In the High Court of New Zealand Tauranga Registry, the case of Baker v Baker involved a dispute between Lloyd John Baker and Peter Douglas Baker, who were the plaintiffs, and Valerie Jean Baker and Florence Valerie Baker, who were the defendants. The plaintiffs sought a review of the liquidators' decisions of Glenville Properties (Katikati) Ltd (in liquidation) under section 284 of the Companies Act 1993. The case was heard on the papers, with the applicants represented by M Beech and L Gellert, and the respondents represented by J Shaw.

The main legal issues in the case were the appropriate categorisation of costs for the interlocutory application and the question of whether increased costs should be awarded. The applicants sought scale costs on a combined Category 2B/3C basis with a 50% uplift for a total amount of $26,805.75 plus disbursements. The respondents argued that costs should be reserved pending the outcome of the substantive application for review, and if not reserved, should be awarded on a Category 2B basis.

The Court held that costs should be fixed now and awarded on a combined 2B/3C basis, considering the application to be relatively complex in relation to both the reg 15(2) argument and the necessary analysis of the facts for the substantive leave application. The Court allowed the costs of second counsel as this is usual in a Category 3 case. However, the Court did not accept that increased costs ought to be awarded, as it appeared that even if the respondents had not opposed the leave application, a separate hearing would still have likely been required.

The final order was that the respondents are to pay costs on a combined 2B/3B/3C basis to the applicants in the amount of $10,810.50 plus disbursements of $550 for a total of $11,360.50, and that costs are to be paid to the applicants pursuant to reg 16(b) of the Liquidation Regulations out of the expenses of the liquidator.

Orders