Batley v MacDonald - [2025] NZHC 2122

IN THE HIGH COURT OF NEW ZEALAND HAMILTON REGISTRY

I TE KŌTI MATUA O AOTEAROA KIRIKIRIROA ROHE

CIV-2022-419-239

[2025] NZHC 2122

UNDER Part 18 of the High Court Rules 2016 and the Companies Act 1993

IN THE MATTER

of the liquidation of John S. MacDonald Builders Limited (in Liquidation)

BETWEEN

WARWICK BRUCE BATLEY and HELEN WILHELMINA CATHARINA VAN GOCH

as trustees of the BATLEY FAMILY TRUST First Plaintiffs

NIDHI SINGH and VED PRAKASH

SINGH as trustees of the V P & N SINGH FAMILY TRUST

Second Plaintiffs

AND

JOHN STEWART MACDONALD

Defendant

Hearing: On the papers

Counsel:

N Malarao and J Cordeiro for First and Second Plaintiffs Defendant in person

Judgment:

31 July 2025

JUDGMENT OF WILKINSON-SMITH J

[Costs]

This judgment was delivered by me on 31/07/2025 at 3 pm
Pursuant to Rule 11.5 of the High Court Rules

Solicitors:
Norling Law Ltd, Auckland N Malarao, Auckland
Copy to defendant.

…………………………

Registrar/Deputy Registrar

BATLEY v MACDONALD [2025] NZHC 2122 [31 July 2025]

[1] On 28 April 2025 I issued a judgment in which I found for the plaintiffs,1 and directed the parties to file documents relevant to the determination of costs in the event that they were unable to agree costs between themselves. I have since received memoranda on costs from the plaintiffs and the defendant.

[2] The plaintiffs maintain their claim, originally advanced at the substantive hearing, for indemnity costs. They have provided invoices to corroborate the amounts claimed, which total $166,701.75 in respect of the first plaintiffs and $160,369.17 in respect of the second plaintiffs.

[3] In support of their claim for indemnity costs, the plaintiffs refer to the following remarks in my substantive judgment:

[168] Mr MacDonald increased the costs to the plaintiffs considerably by filing a statement of defence, failing to comply with timetable orders, and then two weeks before the scheduled trial date, advising that he did not intend to participate. The plaintiffs had to prepare for a trial that could have been dealt with by way of a formal proof hearing.

…

[172] The actual amount claimed is relatively modest when compared to many matters involving commercial disputes that come before the Court. It is also modest compared to the cost of litigation. The plaintiffs’ case was always strong. Without an award of indemnity costs the result would be largely symbolic.

[4] The plaintiffs say that they have incurred considerable cost and devoted significant time and effort to this proceeding while Mr MacDonald has caused substantial delay, and that a refusal to award indemnity costs in these circumstances would effectively leave them with “no relief at all”.

[5] The plaintiffs say that on 8 November 2021, before commencing proceedings, they presented Mr MacDonald with an offer made without prejudice save as to costs (a Calderbank offer) in which they offered to accept a total sum of $180,000 in full and final settlement of all claims. The letter containing that offer has been provided to the Court. Mr MacDonald did not accept that offer.

1

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.

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Details

Case: [2025] NZHC 2122
Decision Date: 31 July 2025

CaseChat Overview and Summary

The High Court of New Zealand was tasked with determining the costs of litigation between the plaintiffs, Warwick Bruce Batley and Helen Wilhelmina Catharina van Goch as trustees of the Batley Family Trust, and Nidhi Singh and Ved Prakash Singh as trustees of the V P & N Singh Family Trust, and the defendant, John Stewart MacDonald. The plaintiffs sought indemnity costs, claiming that MacDonald's actions significantly increased their legal expenses. The court was required to decide whether MacDonald's conduct warranted an award of indemnity costs under Rule 14.6(4) of the High Court Rules, and if so, the appropriate amount.

The court found that MacDonald's conduct was indeed "very unreasonable" and amounted to "flagrant misconduct," justifying an award of indemnity costs. MacDonald's persistence with indefensible affirmative defences post the Mainzeal Supreme Court decision, non-compliance with discovery requests, and failure to respond to settlement offers were key factors. The court held that an award of indemnity costs was appropriate from 25 August 2023, the date of the Mainzeal decision, and increased costs were warranted for the period before this date due to MacDonald's unreasonable delay in responding to the plaintiffs' requests. The court awarded the first plaintiffs indemnity costs of $128,605.33, increased costs of $15,415.50, and disbursements of $554.88, with an additional $1,600 for hearing and scheduling fees pending verification. The second plaintiffs were awarded indemnity costs of $125,306.21, increased costs of $15,415.50, and disbursements of $545.91, with an additional $1,600 for hearing and scheduling fees pending verification. The court emphasised that defendants who behave very unreasonably should not escape liability for costs simply because the litigation costs are comparable to the loss caused.

Orders