Bhamidipati v Bhamidipati
[2019] NZHC 1523
•2 July 2019
NOTE: PURSUANT TO S 35A OF THE PROPERTY (RELATIONSHIPS) ACT 1976, ANY REPORT OF THIS PROCEEDING MUST COMPLY WITH SS 11B,
11C AND 11D OF THE FAMILY COURT ACT 1980. FOR FURTHER INFORMATION, PLEASE SEE
https://www.justice.govt.nz/family/about/restriction-on-publishing-judgments/
IN THE HIGH COURT OF NEW ZEALAND WELLINGTON REGISTRY
I TE KŌTI MATUA O AOTEAROA TE WHANGANUI-A-TARA ROHE
CIV-2018-485-61
[2019] NZHC 1523
UNDER the Property (Relationships) Act 1976 IN THE MATTER
of an appeal against a decision of the Family Court at Hutt Valley
BETWEEN
SEETARAMA RAO BHAMIDIPATI
Appellant
AND
LALITHA DEVI BHAMIDIPATI
Respondent
Hearing: On the papers Counsel:
M A F Gilkison for Appellant K Lakshman for Respondent
Judgment:
2 July 2019
JUDGMENT OF CLARK J (COSTS)
Introduction
[1] On 5 April 2019 I dismissed Mr Bhamidipati’s application to adduce further evidence on appeal and awarded costs to the respondent, Mrs Bhadimidipati.1
1 Bhadimidipati v Bhadimidipati [2019] NZHC 720.
BHAMIDIPATI v BHAMIDIPATI [2019] NZHC 1523 [2 July 2019]
[2] Subsequently, Mr Bhadimidipati filed a notice of abandonment of appeal. The respondent now seeks costs on a 2C basis or, alternatively, on a 2B basis along with the fee (as a disbursement) of the expert witness, Mr Wood.
Discussion
Scale costs
[3] The appeal was classified as a category 2 proceeding following a case management conference on 25 June 2018, but is yet to be allocated a time band. Particularly in an interlocutory context the court will focus on the complexity of the issues rather than the length of the written submission when determining a time band.2 Where there has been a comparatively large amount of time for the particular step, and that time is considered to be reasonable, band C will be appropriate.3
[4] The respondent’s position is that band C is appropriate because a significant amount of time was required to prepare the affidavits of Mr Wood and Mrs Bhadimidipati in response to the affidavits of the appellant and his expert Mr Elms. Counsel for the respondent, Mr Lakshman, submitted Mr Elms’ report canvassed a large amount of material and took Mr Elms 50 hours to complete, and a corresponding amount of time was required to prepare a response. Mr Lakshman provided the following calculation of costs on a 2C basis:
Step 23 Filing opposition to interlocutory application 2.0 $4,460.00 Step 24 Preparation of written submissions 3.0 $6,690.00 Step 26 Appearance at hearing of defended application, for sole counsel 0.25 $557.50 $11,707.50
[5] The appellant takes issue with the allocation of costs on a band C basis and also with the proposed disbursements. Counsel for Mr Bhadimidipati, Mr Gilkison, submitted the appeal was within a relatively narrow legal compass and to the extent there was complexity for the respondent, the complexity was associated with the work done by Mr Wood. Further, Mr Wood had no right of reply to Mr Elms and the work
2 McGechan on Procedure HR14.5.01 citing Minister of Education v James Hardie New Zealand
[2018] NZHC 2960 at [16].
3 High Court Rules, r 14.5(2)(c).
he completed “was not required within the compass of the [application for leave to adduce further evidence on appeal]”.
[6] I accept the appellant’s position with regard to the appropriate band. None of the three steps for which the respondent claims costs (the notice of opposition, written submissions and appearance) required a comparatively large amount of time.4
[7] The respondent, Mrs Bhadimidipati, did file two affidavits but her evidence was quite simple and straightforward. The first affidavit comprised eleven paragraphs and summarised the steps she was obliged to take in the Family Court particularly in terms of seeking third party discovery because Mr Bhadimidipati had not provided the relevant information. That background is explained in some detail in the decision of Judge Binns and it is summarised also in my judgment dismissing the interlocutory application.
[8] The second affidavit is only seven paragraphs. Neither alone, nor together, would it have been reasonable for a comparatively large amount of time to be expended on the preparation of Mrs Bhadimidipati’s affidavits.
[9] Nor, judging from the content of Mr Wood’s affidavit,5 would I have expected that more than a minimal amount of counsel’s time was required to attend to its completion.
[10] Costs are appropriately awarded on 2B basis. Mr Lakshman has calculated 2B costs for the relevant steps as follows:
Step 23 Filing opposition to interlocutory application 0.6 $1,338.00 Step 24 Preparation of written submissions 1.5 $3,345.00 Step 26 Appearance at hearing of defended application, for sole counsel 0.25 $557.50 $5,240.50
4 Rule 14.5(2)(c).
5 I describe Mr Wood’s affidavit in the next part of this judgment.
Disbursement
[11] The respondent seeks as a disbursement Mr Wood’s fee of $14,165.70 (GST inclusive). A disbursement may be disallowed or reduced if it is disproportionate in the circumstances of the proceeding.6
[12] Mr Lakshman says Mr Wood’s continued engagement post-trial was unavoidable given that the application to adduce further evidence on appeal concerned criticisms of Mr Wood’s approach and opinion evidence at trial.
[13] Mr Gilkison submits Mr Wood’s work responding to the application was not required within the compass of the application. Mr Gilkison also submits Mr Wood had no right of reply to Mr Elms. In the alternative, Mr Gilkison argues that the appellant should be entitled to review the results of Mr Wood’s work before he accepts he should pay for it.
[14] Rule 14.12(2) provides that 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.
(3)Despite subclause (2), a disbursement may be disallowed or reduced if it is disproportionate in the circumstances of the proceeding.
…
[15] Mr Wood’s affidavit consisted of 83 paragraphs. The first 41 paragraphs rehearse events prior to the Family Court hearing in October 2017. Then, in six paragraphs, Mr Wood comments on Mr Bhadimidipati’s affidavit, corrects dates and summarises information given by Mr Bhadimidipati to Mr Wood when he was advising the parties for the purpose of the Family Court proceeding. In the remaining 34 paragraphs, Mr Wood responds to each part of Mr Elms’ report, covering (using
6 Rule 14.12(3).
Mr Elm’s headings): rental income; tax credit for share trading losses; consolidation of business interest; and tax losses.
[16]As I recorded in my judgment:7
[23] The broad thrust of the first part of Mr Wood’s evidence is that Mr Bhamidipati’s failure to provide relevant information, or his failure to provide relevant information in a timely manner, hampered Mr Wood’s overall ability to assist the parties and advise them about a possible settlement. Mr Wood describes his many requests for information, the dates on which he made the requests and the inadequacy of the responses.
[24] Mr Wood takes issue with many of the conclusions in Mr Elms’ report. In particular, in respect of the four items Mr Elms sets out in his summary as requiring adjustment, Mr Wood’s evidence is that Mr Elms’ figures do not make sense.
[17] There is no doubt that Mr Wood was of immense value in the Family Court proceeding. In my judgment, in response to Mr Bhadimidipati’s suggestion that Mr Wood was not entirely independent, I set out Judge Binns’ observation:8
I note that I was incredibly assisted by Mr Wood who presented as being extremely patient and measured. Mr Bhamidipati criticised Mr Wood and made accusations that he was biased, however these were quite unfounded and did not reflect well on Mr Bhamidipati.
[18] But the costs that are presently claimed are for the time spent preparing evidence on this interlocutory application. The disbursement claimed must be specific to the conduct of this interlocutory application, reasonably necessary for the hearing of the interlocutory application and reasonable in amount.9 Mr Wood’s fee is for the approximately 50 hours he spent on his affidavit in support of the opposition to the interlocutory application. That is the time that Mr Elms apparently took as well. Mr Lakshman submitted that “is a significant matter; it is not mere coincidence”.
[19] As I have set out, Mr Wood deposed to events that were relevant to the proceeding in the Family Court and which occurred before the hearing in that court. It might be thought those matters have no relevance to an application to adduce new evidence on appeal. But in this case Mr Wood’s evidence was both relevant and
7 Bhamidipati v Bhamidipati, above n 1.
8 At [42].
9 High Court Rules 2016, r 14.12(2).
helpful in assessing the merits of the interlocutory application. As I noted in the judgment:10
(a)The broad thrust of the first part of Mr Wood’s evidence concerned Mr Bhadimidipati’s failure to provide relevant information, or relevant information in a timely manner thereby hampering Mr Wood’s overall ability to assist the parties and advise them about a possible settlement.
(b)The proposed evidence on behalf of the appellant examining the parties’ business enterprises on a global basis, was in fact available prior to the hearing in the Family Court and the necessary analysis would have been undertaken by Mr Wood had all the relevant information been provided to him. “It was not provided, despite the obligation on the parties to ensure a complete record of their respective financial positions was placed before the Court.”11
(c)All of the financial information had been within Mr Bhadimidipati’s control not Mrs Bhadimidipatis.
[20] Relevant to my determination of costs and the allowance of Mr Wood’s disbursement is the observation I made at the conclusion of my judgment:12
… I view the interlocutory application in light of Judge Binns’ description of the “punitive approach” Mr Bhamidipati had taken towards Mrs Bhamidipati; Mr Bhamidipati’s application for an adjournment when the parties had known of the fixture for five months; Mr Bhamidipati’s refusal to provide full and frank disclosure; and the “extreme lengths” and expense which Mrs Bhamidipati was forced to undertake to obtain basic disclosure.
[21] The essential point is that Mr Wood’s affidavit was made necessary by the failure of the appellant to provide the information required for the Family Court proceeding. Mr Wood’s evidence as to the background as well as his review and assessment of the proposed evidence was both specific to and reasonably necessary
10 Bhamidipati v Bhamidipati, above n 1, at [23], [31], and [33].
11 At [31].
12 At [44] (footnotes omitted).
for the conduct of the interlocutory application for leave to adduce Mr Elms’ evidence. Accordingly, the disbursement is allowed.
Result
[22]The appellant is to pay the respondent costs of $5,240.50 and disbursements of
$14,165.70.
Karen Clark J
Solicitors:
Mackay & Gilkison, Wellington for Appellant Idesi Legal Ltd, Johnsonville for Respondent
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