Barfoot & Thompson Limited v Real Estate Agents Authority (Cac20007)

[2014] NZHC 3314

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

CIV-2014-404-1528 [2014] NZHC 3314

IN THE MATTER

of an appeal under s 116 Real Estate

Agents Act 2008

BETWEEN

BARFOOT &THOMPSON LIMITED Appellant

AND

REAL ESTATE AGENTS AUTHORITY (CAC 20007)

First Respondent

AND

RICHARD AND EVETTE CAMPBELL Second Respondents

Hearing:	On the papers
Judgment:	18 December 2014

JUDGMENT AS TO COSTS OF THOMAS J

This judgment was delivered by me on 18 December 2014 at 1.00 pm pursuant to Rule 11.5 of the High Court Rules.

Registrar/Deputy Registrar

Date:………………………….

Solicitors:

Glaister Ennor, Auckland. Meredith Connell, Auckland.

BARFOOT &THOMPSON LIMITED v REAL ESTATE AGENTS AUTHORITY (CAC 20007) [2014] NZHC

3314 [18 December 2014]

[1]      The parties have been unable to agree on the issue of costs and have filed memoranda.

[2]      The appellant, having being successful in the appeal, seeks costs on a 2B

basis in the sum of $12,381.

[3]      The position of the first respondent, the Real Estate Agents Authority, is that costs should lie. The reasons for this are:

(a)      the  Authority  abided  on  the  only  ground  of  appeal  which  was dispositive of the appeal;

(b)the Authority’s submissions on the most significant legal issue arising on the appeal, being the obligation to disclose information relating to a property other than a physical defect, were consistent with the Court’s judgment;

(c)      the appellant chose to seek High Court guidance on issues which were not dispositive of the appeal and should have to bear its own costs in doing so;

(d)a costs award could operate as a disincentive to the Authority from abiding on the outcome of an appeal in the future; and

(e)      the Authority’s change of position in the High Court was a result of factual findings made by the Tribunal and represented a reasonable concession.

[4]      The appellant does not accept that approach.  While the Authority conceded that a finding that disclosure should have been made in this case did not have to be viewed as a supervision failure under s 50 of the Real Estate Agents Act 2008, and the Authority did  not  address  the  issue  of  s  50  in  its  written  submissions,  the appellant says that nowhere in either the submissions or oral argument was there a concession that the Tribunal’s finding of a breach of s 50 was wrong.

[5]      On the third ground of appeal, whether the Tribunal erred in not exercising the discretion available to it to decide if there should be no further action taken in respect of the complaint, the Authority abided.   The Authority acknowledged the issue was a difficult one in a novel area and that in the circumstances of the case and given  the  findings  by  the  Tribunal,  such  an  outcome  would  be  appropriate. However, as pointed out by the appellant, it would have been open to the Authority to have made its concession on the exercise of the discretion at the hearing before the Tribunal rather than only conceding once the decision was appealed to this Court. The appellant says, had it succeeded on the third alternative appeal ground regarding exercise of discretion only, then it would agree that reduced costs would have been appropriate but, as the appeal needed to be filed for the concession to have been made, some costs would still have been sought.  However, the appellant notes that the judgment was not based on the exercise of the discretion as the Court decided in favour of the appellant on both the first and second substantive appeal grounds.

[6]      It is relevant to refer to a matter raised in the costs memoranda but not touched on at the hearing.  That is, it seems the Tribunal took a somewhat different approach from the Committee as to the facts of how the appellant approached the question of whether or not to disclose the suicide.   It seems that the Committee considered the facts showed the appellant had a blanket policy of non-disclosure. However, the Tribunal considered that earnest and sincere thought was given to the proper  and  fair  way  to  handle  disclosure  or  non-disclosure.    I  agree  with  the appellant that the issue on the appeal related to the findings of the Tribunal and the Authority should have considered its stance on that basis.

[7]      The real issue relates to the second ground of appeal which was the issue of moment before the Court.  The Court upheld the appellant’s ground of appeal to the effect that the Tribunal had misinterpreted the relevant test.   The Court was then required, as this was a general appeal, to reach its on conclusion as to whether disclosure should have been made or not.  To that extent the second ground of appeal did not address the ultimate issue of whether the appellant breached Rule 6.4 in not providing disclosure.

[8]      In my assessment both the Authority and the appellant sought guidance on the  issue  of  disclosure  generally.    This  was  referred  to  not  only  in  the  oral submissions but also in the written submissions where there was some analysis of the approach in New Zealand and other comparable jurisdictions.   The appellant says that was not the purpose of the appeal, rather the decision was appealed because the appellant considered it was wrong.  That maybe the case, but the appeal did raise an issue of some importance to the industry generally.

[9]      Costs are at the discretion of the Court.1   This is an appropriate case to take into  account  the  nature  of  the  appeal.    This  was  not  a  contest  between  two commercial parties but an appeal which raised matters of some importance to the real estate industry generally. A ground for reducing costs under r 14.7 is:

(e)  the  proceeding  concerned  a  matter  of  public  interest,  and  the  party opposing costs acted reasonably in the conduct of the proceeding;

[10]     To that extent it was important for the appeal to be heard rather than the matter dealt with simply by relying on the discretion of the Tribunal where it could have decided to take no further action.  That would not have been, in my assessment, of any real assistance to either party.  Notwithstanding the issues raised by the first and third grounds of appeal, it was the second ground of appeal which was the real focus of the hearing.

[11]     In the circumstances, I am satisfied that it is appropriate to make an award to the appellant but limited to 50 per cent of the costs sought.   That recognises the circumstances of the case including that, despite the ultimate result, the general guidance outlined in the judgment was more consistent with the position adopted by

the Authority rather than the appellant.

1      High Court Rules, r 14.1.

[12]     For those reasons, an award of costs of 50 per cent of those sought by the

appellant is made.

Thomas J