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      Batley v MacDonald [2025] NZHC 974.

[6]    On 9 August 2024, the plaintiffs advanced a  second  Calderbank  offer  to Mr MacDonald in which they offered to accept a total sum of $270,000 plus costs on a scale 2B basis or as agreed between the parties in settlement of the dispute. The plaintiffs have provided the letter containing this offer to the Court. In that letter, the plaintiffs set out the reasons why “their prospects of succeeding at trial [were] extremely strong”, explaining that Mr MacDonald’s affirmative defences were no longer available in light of recent Supreme Court authority, and that the plaintiffs had evidence to rebut Mr MacDonald’s substantive defence. Mr MacDonald did not respond to this offer directly.   However, in a memorandum filed with the Court on   8 October 2024, Mr MacDonald’s counsel stated that:

The claim is for relief under s 301 of the Companies Act 1993. It is not a claim for liquidated damages. As has been raised by Counsel for the defendant in earlier conferences, the nature of the duties allegedly breached and to whom they are owed (generally to the company), and whether the plaintiffs are entitled to direct receipt of any compensation awarded under s 301, as opposed to any award of compensation being payable to the liquidator of the company, are not settled questions. Therefore, a trial of the proceeding remains necessary even given that the defendant is not intending to call evidence.

(footnotes omitted)

[7]    As noted in my substantive decision,2 in August 2023 the Supreme Court in Yan v Mainzeal Property and Construction Ltd (in liq) (Mainzeal) confirmed that compensation may be paid directly to plaintiff creditors in respect of breaches of     ss 135 and  136  of  the  Companies  Act  1993.3  The  plaintiffs  say  that  even  if  Mr MacDonald wanted to somehow convince the High Court to rule against Supreme Court authority, his continued contest of the breach and quantum of compensation issues in the proceeding is inexcusable. Further, the plaintiffs set out that on 12 November 2024, their solicitors wrote to Mr MacDonald’s former solicitors explaining why his argument as to the destination of compensation would not succeed with reference to Mainzeal and subsequent case law, and invited Mr MacDonald to advise as to how he expected to resolve the matter. The plaintiffs received no response to this letter.

2 At [123].

3      Yan v Mainzeal Property and Construction Ltd (in liq) [2023] NZSC 113, [2023] 1 NZLR 296 at

[163] and [168].

[8]    The plaintiffs say that the strength of their case should have been obvious to Mr MacDonald, especially as he was initially represented and advised by experienced counsel. They say that in spite of this, Mr MacDonald continued to take steps in the litigation that drove the plaintiffs’ costs up until the eleventh hour. The plaintiffs submit that the Court can infer that Mr MacDonald employed this litigation tactic to place financial pressure on the plaintiffs with the likely aim of causing them to abandon their claim, which was ultimately found to be meritorious. The plaintiffs further submit that Mr MacDonald’s failure to accept their settlement offers was unreasonable considering the strength of their claims and the “discounts” provided to Mr MacDonald in terms of the amounts for which they offered to settle — presumably relative to the amounts they were subsequently awarded on their substantive claims. The plaintiffs also say that Mr MacDonald refused to co-operate in matters including discovery and the provision of particulars of his defence.

[9]    The plaintiffs’ memorandum sets out the procedural history of the case, including several instances where Mr MacDonald delayed in taking steps in the proceeding and failed to respond to requests and correspondence from the plaintiffs. The plaintiffs’ summary of the procedural history also highlights the late stage at which Mr MacDonald advised of his intention not to file briefs of evidence, and later advised of his intention not to participate in the trial.

[10]   In summary, the plaintiffs say that the following factors provide convincing grounds for an award of indemnity costs in their favour:

(a)The delays caused by Mr MacDonald throughout the proceeding by failing to comply with Court directions and the High Court Rules 2016.

(b)All of the additional steps taken by the plaintiffs in this proceeding in preparation for a trial that could have been dealt with as a formal proof or affidavit hearing, and the wastage of Court resources that has occurred.

(c)Mr MacDonald’s failure to accept the plaintiffs’ Calderbank offers and the strong legal arguments advanced by the plaintiffs.

[11]   Mr MacDonald opposes the plaintiffs’ claim for indemnity costs. He claims that he attempted to reach a settlement with the plaintiffs that would have enabled them to recover an amount close to what they have now lost, but that they refused his offer and instead chose to proceed to litigation. Mr MacDonald does not provide any evidence of this attempt to settle. However, the plaintiffs’ 8 November 2021 letter to Mr MacDonald’s former counsel sets out that Mr MacDonald initially offered to pay

$35,000 to the first plaintiffs and $60,000 to the second plaintiffs in order to settle their claims.

[12]   Mr MacDonald also says the plaintiffs appear to have incurred costs close to the amounts of the losses they suffered, which he considers to be unreasonable. He asked that the plaintiffs provide evidence that they have actually paid the legal fees claimed. By memorandum dated 12 June 2025, the plaintiffs’ counsel confirmed that the plaintiffs have paid their legal fees on an ongoing basis.

[13]   Mr MacDonald says he has endeavoured to comply with all Court directions and that he wanted to continue to defend his position but had to withdraw from the litigation because he ran out of funds to afford expert witnesses and counsel.

[14]   Mr MacDonald adds that he is in a precarious financial position following the loss of his business. He says he has recently suffered serious health issues and was made redundant from his role as Project Manager at Jennian Waikato in March 2023. Mr MacDonald says he commenced work as a builder in 2023 and remains employed in that role, with few available assets.

Legal principles

[15]   Rule 14.1(1) of the High Court Rules provides that all matters are at the discretion of the Court if they relate to costs of or incidental to a proceeding, or of a step in a proceeding.

[16]   While the Court will ordinarily make an award of scale costs in accordance with the principles in rr 14.2–14.5 of the High Court Rules, r 14.6(4) sets out the circumstances in which the Court may make an award of indemnity costs:4

(4)The court may order a party to pay indemnity costs if—

(a)the party has acted vexatiously, frivolously, improperly, or unnecessarily in commencing, continuing, or defending a proceeding or a step in a proceeding; or

(b)the party has ignored or disobeyed an order or direction of the court or breached an undertaking given to the court or another party; or

(c)costs are payable from a fund, the party claiming costs is a necessary party to the proceeding affecting the fund, and the party claiming costs has acted reasonably in the proceeding; or

(d)the person in whose favour the order of costs is made was not a party to the proceeding and has acted reasonably in relation to it; or

(e)the party claiming costs is entitled to indemnity costs under a contract or deed; or

(f)some other reason exists which justifies the court making an order for indemnity costs despite the principle that the determination of costs should be predictable and expeditious.

[17]   The courts have held that a party’s misconduct must be “flagrant” if it is to justify an award of indemnity costs against them.5

[18]   Rule 14.6(3) sets out the circumstances that may justify an award of increased costs:

(3)The court may order a party to pay increased costs if—

(a)the nature of the proceeding or the step in it is such that the time required by the party claiming costs would substantially exceed the time allocated under band C; or

(b)the party opposing costs has contributed unnecessarily to the time or expense of the proceeding or step in it by—

4      Defined in r 14.6(1)(b) of the High Court Rules 2016 as “the actual costs, disbursements, and witness expenses reasonably incurred by a party”.

5      Bradbury v Westpac Banking Corporation [2009] NZCA 234, [2009] 3 NZLR 400 at [28], citing

Prebble v Awatere Huata (No 2) [2005] NZSC 18, [2005] 2 NZLR 467 at [6].

(i)failing to comply with these rules or with a direction of the court; or

(ii)taking or pursuing an unnecessary step or an argument that lacks merit; or

(iii)failing, without reasonable justification, to admit facts, evidence, documents, or accept a legal argument; or

(iv)failing, without reasonable justification, to comply with an order for discovery, a notice for further particulars, a notice for interrogatories, or other similar requirement under these rules; or

(v)failing, without reasonable justification, to accept an offer of settlement whether in the form of an offer under rule 14.10 or some other offer to settle or dispose of the proceeding; or

(c)the proceeding is of general importance to persons other than just the parties and it was reasonably necessary for the party claiming costs to bring it or participate in it in the interests of those affected; or

(d)some other reason exists which justifies the court making an order for increased costs despite the principle that the determination of costs should be predictable and expeditious.

[19]   The Court of Appeal in Bradbury v Westpac Banking Corporation summarised the distinction between the circumstances that will give rise to scale, increased and indemnity costs awards as follows:6

(a)standard scale applies by default where cause is not shown to depart from it;

(b)increased costs may be ordered where there is failure by the paying party to act reasonably; and

(c)indemnity costs may be ordered where that party has behaved either badly or very unreasonably.

[20]   Rule 14.10(1) of the High Court Rules provides that a party to a proceeding may make a written offer to another party at any time that is expressly stated to be without prejudice except as to costs and relates to an issue in the proceeding. Under  r 14.11(1), the effect that the making of such an offer has on the question of costs is at the discretion of the Court.

6      Bradbury v Westpac Banking Corporation, above n 5, at [27].

[21]   Rule 14.12 governs awards of disbursements incurred in the course of a proceeding. That rule relevantly provides:

14.12   Disbursements

(1)In this rule,—

disbursement, in relation to a proceeding,—

(a)    means an expense paid or incurred for the purposes of the proceeding that would ordinarily be charged for separately from legal professional services in a solicitor’s bill of costs; and

(b)    includes—

(i)fees of court for the proceeding:

(ii)expenses of serving documents for the purposes of the proceeding:

(iii)expenses of photocopying documents required by these rules or by a direction of the court:

(iv)expenses of conducting a conference by telephone or video link; but

(c)    does not include counsel’s fee.

(2)A disbursement must, if claimed and verified, be included in the costs awarded for a proceeding to the extent that it is—

(a)    of a class that is either—

(i)approved by the court for the purposes of the proceeding; or

(ii)specified in paragraph (b) of subclause (1); and

(b)    specific to the conduct of the proceeding; and

(c)    reasonably necessary for the conduct of the proceeding; and

(d)    reasonable in amount.

…

Discussion

[22]   I agree with the plaintiffs that Mr MacDonald’s conduct throughout this proceeding has involved several failures to act reasonably, and that an award of ordinary scale costs would not be sufficient to reflect this.

[23]   However, I consider that Mr MacDonald’s conduct only reached the high threshold of “very unreasonable” behaviour, so as to justify an award of indemnity costs, from 25 August 2023 when the Supreme Court delivered its judgment in Mainzeal. That decision confirmed that creditors of a company in liquidation have standing to bring a claim against a director for breach of directors’ duties,7 and that a court can order compensation to be paid directly to plaintiff creditors.8 Following the Mainzeal decision, Mr MacDonald persisted with affirmative defences challenging the plaintiffs’ standing and entitlement to compensation in spite of the Supreme Court’s clear conclusions on these issues.

[24]   As I said in my substantive judgment, the plaintiffs’ case was always strong; and the strength of their claims in relation to Mr MacDonald’s alleged breaches of his director’s duties should have become increasingly apparent to Mr MacDonald as the plaintiffs took further steps in the proceeding such as providing documents in discovery around 8 September 2023.

[25]   The unreasonableness of Mr MacDonald’s conduct from 25 August 2023 was exacerbated by his initial delay of just over one month in filing and serving his affidavit of documents, and his subsequent failures to comply with the plaintiffs’ requests  for  further  discovery  from  around  October 2023.   These  failures  on  Mr MacDonald’s part eventually prompted the plaintiffs to obtain certain documents from the liquidators of Mr MacDonald’s company at their own expense in or around June 2024. The plaintiffs say that they had to incur further costs of filing additional affidavits of documents, primarily relating to the documents uplifted from the liquidators, because Mr MacDonald failed to respond to correspondence in which the plaintiffs provided these documents to him by way of informal discovery.

[26]   As the plaintiffs submit, there is no suggestion that Mr MacDonald’s lawyers failed to explain his discovery obligations to him, or that the liquidators refused to co-operate with him in relation to issues of discovery. I accept that Mr MacDonald behaved unreasonably throughout the discovery process and thereby caused unnecessary delays in the proceedings and expense to the plaintiffs.

7 At [163].

8      At [163] and [168].

[27]   As I outlined in my substantive judgment, Mr MacDonald increased the plaintiffs’ costs considerably through his failures to comply with timetable directions and his decision to withdraw from participation in the proceedings just two weeks before the scheduled trial date.

[28]    Mr MacDonald did not serve his briefs of evidence, list of documents for inclusion in the common bundle or response to the plaintiffs’ draft chronology by the original due date of 30 August 2024. On 7 October 2024, given Mr MacDonald’s failure to meet the 30 August 2024 deadline, the plaintiffs filed a memorandum updating the Court as to the status of the proceeding and seeking an order compelling Mr MacDonald to serve his briefs of evidence. It appears that Mr MacDonald only advised of his intention not to serve any briefs of evidence in early October 2024. Further, it was only on 17 February 2025 that Mr MacDonald advised of his intention not to participate in the trial at all, by which time the plaintiffs would have completed substantial preparation for a defended hearing that was scheduled to take place only two weeks later.

[29]   Mr MacDonald claims that he endeavoured to comply with the Court’s timetable directions. He says he was unable to continue defending the proceeding because he “simply ran out of funds to be able to afford expert witnesses and counsel”, and objects to being “punished” for this by an order requiring him to pay indemnity costs. He claims that it was the plaintiffs’ decision to incur these costs instead of discussing “other options”.

[30]   I  do  not  accept   this   explanation   as   a   reasonable   justification   for   Mr MacDonald’s late withdrawal from participation in the proceedings. It does not adequately explain the delay of several months between his initial failure to serve his briefs of evidence, list of documents for inclusion in the common bundle and response to the plaintiffs’ draft chronology by the original deadline of 30 August 2024, and his expression of an intention not to participate in the proceedings in February 2025; nor does it explain his unresponsiveness to the plaintiffs’ correspondence during that period. By memorandum filed with the Court on 8 October 2024, Mr MacDonald’s counsel sought to rely on the affirmative defences relating to issues around the plaintiffs’ standing and the appropriate destination of compensation as justifying a trial

of the proceeding even though Mr MacDonald had decided not to call evidence. By that stage, the Supreme Court’s Mainzeal judgment had rendered those defences inarguable. In my view, Mr MacDonald ought to have abandoned his defence of the plaintiffs’ claims much earlier than he did, and his late withdrawal from the litigation is not justifiable on the basis that he merely ran out of funds to continue.

[31]   Even if Mr MacDonald was genuinely prevented from complying with timetable directions or continuing to defend the claim due to a lack of funds, he should have taken steps to communicate this to the plaintiffs and the Court ahead of his failure to meet the 30 August 2024 deadline instead of putting the plaintiffs to the burden of following up with his counsel, updating the Court and seeking an order compelling Mr MacDonald to serve his briefs of evidence, and ultimately allowing the plaintiffs to continue to prepare for a defended hearing until two weeks before it was scheduled. I also cannot accept Mr MacDonald’s contention that the plaintiffs are at fault for incurring litigation costs because they were unwilling to consider alternatives to litigation. The plaintiffs have provided evidence that on 9 August 2024, they offered to accept a settlement sum of $270,000 — an amount less than they were ultimately awarded in the litigation — plus costs on a scale 2B basis. Mr MacDonald did not respond to that offer. The settlement proposal that he appears to have advanced before the  commencement  of   proceedings,   as   detailed   in   the   plaintiffs’   letter   of  8 November 2021, offered payments of much lower amounts to the plaintiffs, and I consider that it was entirely reasonable for them to reject that offer.

[32]   I am satisfied that an award of indemnity costs is appropriate under r 14.6(4)(a) of  the  High  Court  Rules  in   relation   to   steps   taken   by   the  plaintiffs  from 25 August 2023. I consider that Mr MacDonald acted “improperly” in continuing to defend the proceeding from this date. From this point onwards, his persistence with affirmative defences that had clearly become inarguable combined with various other forms of unreasonable conduct, including non-compliance with the Court’s timetable directions,9 amounted to “very unreasonable” behaviour or “flagrant misconduct” justifying an award of indemnity costs.

9      High Court Rules, r 14.6(4)(b).

[33]   The plaintiffs’ memorandum as to costs and accompanying materials show that the first plaintiffs’ claimed actual costs from 25 August 2023 amount to $130,205.33, comprising:

(a)legal fees and disbursements of $125,723.08;

(b)experts’ fees of $2,882.25; and

(c)hearing and scheduling fees of $1,600.

[34]   The actual costs claimed by the second plaintiffs from 25 August 2023 amount to $126,906.21, comprising:

(a)legal fees and disbursements of $122,423.96;

(b)experts’ fees of $2,882.25; and

(c)hearing and scheduling fees of $1,600.

[35]   Mr MacDonald takes issue with the reasonableness of the overall amounts claimed by the plaintiffs for the entire proceeding, on the basis that they are close to the amounts the plaintiffs lost.

[36]   Rule 14.6(1)(b) of the High Court Rules states that an award of indemnity costs comprises only “the actual costs, disbursements, and witness expenses reasonably incurred by a party” (emphasis added). However, the Court of Appeal has confirmed that it is incorrect in law to assess the reasonableness of a claim for indemnity costs by simply comparing the amounts claimed with the amounts at stake in the litigation.10 Instead, indemnity costs are to be calculated “on the basis of a reasonable allocation of actual costs having regard to the appropriate time taken, the significance and complexity of the work, and a median hourly rate reasonably applicable”.11

10     Edel Metals Group Ltd v Geier Ltd [2018] NZCA 494 at [62].

11     Edel Metals Group Ltd v Geier Ltd, above n 10, at [58] and [62], citing Bradbury v Westpac Banking Corporation (2008) 18 PRNZ 859 (HC) at [204] and [209].

[37]   Having reviewed the plaintiffs’ memorandum and supporting invoices, I consider that the steps recorded, and the amounts charged are reasonable in the context of this proceeding. Further, I am satisfied that it was reasonable for the plaintiffs to proceed to litigation, despite the modest amounts at stake, given the strength of their claims and Mr MacDonald’s lack of response to their August 2024 settlement offer. The behaviour which I found proved justifies a civil consequence despite the relatively modest sums at stake. The loss caused to the plaintiffs by Mr MacDonald was not an insignificant sum for most New Zealanders and the plaintiffs should not be required to effectively write off a strong claim because of the cost of litigation. Defendants who behave very unreasonably should not avoid liability for costs on the basis that the amount of the loss they caused is similar to the cost of successfully bringing proceedings against them. Such an argument has access to justice implications.

[38]   The plaintiffs have provided a detailed breakdown of the disbursements included in their claim for indemnity costs, most of which are verified by invoices. I am satisfied that the disbursements incurred during the period from 25 August 2023 for which verification has been provided meet the requirements of r 14.12 such that they must be included in the award of indemnity costs covering this period. I note that no invoices have been provided to verify the hearing and scheduling fees of $1,600 claimed by each group of plaintiffs but I am satisfied that these fees meet the requirements of r 14.12(2)(a)–(d). These disbursements will be referred to the Registrar for verification.

[39]   In the period before 25 August 2023 when delivery of the Mainzeal decision eliminated any possibility of Mr MacDonald’s affirmative defences succeeding, it is not clear that Mr MacDonald’s behaviour involved “flagrant misconduct” sufficient to justify an award of indemnity costs. However, I am satisfied that an award of increased costs is appropriate in relation to steps taken during this period. As stated in Bradbury v Westpac Banking Corporation, “increased costs may be ordered where there is failure by the paying party to act reasonably”. 12

12     Bradbury v Westpac Banking Corporation, above n 5, at [27(b)].

[40]   The main unreasonableness in this period stems from Mr MacDonald unnecessarily delaying the progress of the proceedings. The plaintiffs first filed their statement of claim in August 2022. On 27 October 2022, Mr MacDonald filed his bare statement of defence without any disclosure additional to those documents provided by the plaintiffs. In either October or November 2022, the plaintiffs made a request for further and better particulars of Mr MacDonald’s defence. It is apparent that none were forthcoming because on 16 May 2023, Associate Judge Brittain issued a minute recording Mr MacDonald’s reason for the delay in responding to the request for further particulars, which was lack of access to financial information. On 10 July 2023 Associate Judge Brittain issued a further minute recording that Mr MacDonald had still not responded to the request for further particulars. Mr MacDonald was ordered to respond by 21 July 2023 and discovery orders were also made. That timeframe was not  met.   Mr MacDonald  filed  his  amended  statement  of  defence  on  or  about  8 August 2023 and the amended statement of defence only marginally expanded on the original statement of defence. There was a quite unnecessary delay of at least eight to nine months which inevitably added to the costs for the plaintiffs. Delay necessitates further meetings with legal advisors, further case management conferences and the need to monitor and follow up non-compliance. I consider that there was an element of drawing the process out to dissuade the plaintiffs from continuing their claim. For these reasons I consider that a 50 per cent uplift from scale is justified.

[41]   For the purposes of calculating scale costs, I consider that this case is appropriately classified as a 2B proceeding, being a proceeding “of average complexity requiring counsel of skill and experience considered average  in  the High Court”,13 and in relation to which a “normal amount of time is considered reasonable” for each step.14 While the materials filed by the plaintiffs do not include a breakdown of the steps taken for the purposes of calculating a scale costs award, the costs available on a 2B basis until 25 August 2023 can be estimated with reference to the materials provided and the documents on the Court file. It is apparent that the steps taken by the plaintiffs during this period include the following items included in sch 3 of the High Court Rules:

13     High Court Rules, r 14.3(1).

14     Rule 14.5(2)(b).

(a)commencement of proceeding by plaintiff;

(b)reply;

(c)filing interlocutory application — specifically, the plaintiffs’ interlocutory   application   for   directions   as    to    service    dated 29 August 2022;

(d)obtaining judgment without appearance — in respect of the plaintiffs’ interlocutory application for directions as to service;

(e)appearance at first or subsequent case management conference — an allowance would be made for each of the case management conferences on 15 May 2023 and 10 July 2023;

(f)list of documents on discovery;

(g)preparation for first case management conference (including discussion about discovery); and

(h)filing memorandum for first or subsequent case management conference or mentions hearing — specifically, the memorandum dated 12 May 2023 and  filed  for  the  case  management  conference  on  15 May 2023.

[42]   An award of 2B costs for these steps would amount to $20,554. An uplift of 50 per cent results in an increased costs award of $30,831, which, divided equally between the plaintiffs, comes to an award of $15,415.50 each for the period before 25 August 2023. I am satisfied that this is a reasonable award for this period.

[43]   The materials provided by the plaintiffs indicate that, from the time proceedings began until 25 August 2023, the first plaintiffs incurred disbursements of

$554.88 and the second plaintiffs incurred disbursements of $545.91. I am satisfied that these disbursements ought to be included in the costs awards for this period, as

they meet the requirements of r 14.12(2)(a)–(d) and have all been verified by the invoices provided.

[44]   I note that in his submissions as to costs, Mr MacDonald says that he is currently in a “precarious” financial position. No evidence has been provided to support this submission. Further, the courts have held that impecuniosity is not “an answer” to a claim for a costs award.15 As this Court said in Te Whare O Te Kaitiaki Ngahere Incorp Society v West Coast Regional Council, “[a] costs award should be made at a meaningful level, even against an impecunious party, when that party has advanced a case which is poorly pleaded or lacking in merit”.16 Accordingly, there appears to be no reason to reduce the costs awards to which the plaintiffs are entitled.

Result

[45]   I therefore consider that the first plaintiffs are entitled to an award of costs comprising the following amounts:

(a)indemnity  costs  of  $128,605.33  in  respect  of  the  period   after   25 August 2023;

(b)increased costs of $15,415.50 for steps taken in the litigation prior to 25 August 2023; and

(c)disbursements of $554.88 incurred before 25 August 2023.

[46]   A further disbursement of $1,600 for hearing and scheduling fees will be allowed subject to verification by the Registrar.

[47]   The second plaintiffs are entitled to an award of costs comprising the following amounts:

15 Te Whare O Te Kaitiaki Ngahere Incorp Society v West Coast Regional Council [2014] NZHC  2969, [2014] ELHNZ 339 at [16], citing  Gibson  v Fisher  HC Auckland  CIV-2006-404-103, 17 July 2007 at [9].

16 Te Whare O Te Kaitiaki Ngahere Incorp Society v West  Coast Regional Council, above n 15, at  [16].

(a)indemnity  costs  of  $125,306.21  in  respect  of  the  period   after   25 August 2023;

(b)increased costs of $15,415.50 for steps taken in the litigation prior to 25 August 2023; and

(c)disbursements of $545.91 incurred before 25 August 2023

[48]   A further disbursement of $1,600 for hearing and scheduling fees will be allowed subject to verification by the Registrar.

Wilkinson-Smith J