Bary v Bary

[2024] NZHC 1416

IN THE HIGH COURT OF NEW ZEALAND NELSON REGISTRY

I TE KŌTI MATUA O AOTEAROA WHAKATŪ ROHE

CIV-2022-442-035

[2024] NZHC 1416

BETWEEN

DAVID BARY

Plaintiff

AND

ARON BARY

First Defendant

AND

AB CONTRACTING NELSON LIMITED

Second Defendant

Hearing:

On the papers

Appearances:

G D Pearson and M M S Gray for Plaintiff

F B Q Collins for First and Second Defendants

Judgment:

31 May 2024

JUDGMENT OF GRICE J

(Costs)

[1]                 In a judgment of 3 April 2024 I found against the plaintiff (David Bary) and determined that while the first defendant (Aron Bary) had breached fiduciary obligations in relation to effecting a transfer of the property initially held by Aron Bary and David Bary in a partnership established in 1997, the plaintiff had abandoned the partnership in early 2002.1 The plaintiff therefore was unsuccessful in his claim for an interest in the partnership or the property.

[2]                 In 2022 David Bary successfully maintained a caveat to protect the interest he sought in the property.2 Associate Judge Johnston was satisfied that on the evidence before him it “remain[ed] open to David to argue that he had some level of proprietary

1      Bary v Bary [2024] NZHC 711.

2      Bary v AB Consulting Nelson Ltd [2022] NZHC 1404.

BARY v BARY [2024] NZHC 1416 [31 May 2024]

interest in the property”.3 The Associate Judge made an order that the caveat not lapse until the substantive issue had been determined by the Court and made directions for the filing of substantive proceedings.4

[3]                 As the plaintiff points out, costs are at the discretion of the court.5 The submissions also note that the court may reverse an order for costs on an interlocutory application if satisfied that the original order should not have been made.6 The plaintiff further acknowledges that the general principle is that costs follow the event.7

[4]                 The plaintiff takes no issue with the costs claim set out in the defendants’ submissions based on a category/band 2B calculation in general terms.

[5]                 The only issue of contention is whether costs should be awarded on the caveat application. The plaintiff says he was successful in the caveat application, which was a proceeding that was distinguishable and separate from the substantive claim. He says there was nothing in the second proceedings which would indicate that there was anything “illicit” in the caveat application.

[6]                 I am unable to locate any orders for costs following the caveat application. The Associate Judge reserved costs, noting that if counsel could not agree then they may file and serve memoranda “in the usual way”. That did not happen and the costs on the caveat application were never determined. The defendants now seek those costs be quantified and included in the costs on the substantive claim.

[7]                 The defendants’ counsel is unsure how long the caveat hearing took. He says he has assumed it was one day but defers to David Bary’s counsel on that point. Neither party point to any orders made, therefore it appears no costs were awarded and the provision in r 14.8 that costs may be reversed on an interlocutory matter has no application.

3 At [56].

4      At [59]

5      High Court Rules 2016, r 14.1.

6      Rule 14.8(2).

7      Rule 14.2(1)(a).

[8]                 Costs follow the event. The caveat application was merely a step leading to an inevitable substantive hearing. That substantive claim was unsuccessful, therefore the caveat must lapse. Costs with respect to steps on the way, including the caveat application, follow the substantive outcome. The underlying basis for which the interest was claimed was not sustained after a full hearing. Therefore costs for the caveat application are awarded in the defendants’ favour. I make the orders for costs in terms of the claim in the defendants’ application based on 2B calculations together with disbursements, save for the claim of one day for the caveat hearing. Counsel for the plaintiff has not indicated whether the time taken for the hearing was one day or a half day. It is on the claimant for costs to satisfy me that the claim meets the requirements of the High Court Rules 2016. Given the uncertainty on the time taken for the caveat hearing, if counsel are unable to agree on that point the claim is only allowed to the extent of a half day.

Grice J

Solicitors:

Tavendale and Partners Ltd, Christchurch LegalFocus Limited, Nelson

Gibson Sheat, Wellington