Bhana v Grant

IN THE COURT OF APPEAL OF NEW ZEALAND

I TE KŌTI PĪRA O AOTEAROA

CA381/2017
[2019] NZCA 81

BETWEEN	ASHOK DENNIS BHANA First Appellant JASU MATI BHANA Second Appellant STEPHEN CHIMAN BHANA Third Appellant
AND	DAMIEN GRANT AND STEVEN KHOV as liquidators of the Ranolf Company Limited (in liquidation) Respondents

Court:	French, Cooper and Brown JJ
Counsel:	Second and Third Appellants in person A S Botterill for Respondents
Judgment: (On the papers)	29 March 2019 at 3.00 pm

JUDGMENT OF THE COURT
(Costs)

AThe second and third appellants must pay the respondents costs in the sum of $4,683.00 and disbursements of $435.00.
BWe direct the Registrar to deduct the costs and disbursements awarded from the amount paid into Court for security for costs.

____________________________________________________________________

REASONS OF THE COURT

(Given by Brown J)

Following the grant of an extension of time under r 29A of the Court of Appeal (Civil) Rules 2005, on 7 August 2017 an appeal was filed against the judgment of the High Court in Ranolf Co Ltd (In liq) v Bhana.[1]
[1]Ranolf Co Ltd (In liq) v Bhana [2017] NZHC 1183, [2017] NZAR 1047.
The appellants failed to comply with the requirements of r 43(1). They applied for an extension of time under r 43(2) until 21 February 2018. The respondents did not consent.[2] On 8 February 2018 an extension of time was granted by Asher J until 2 March 2018.
[2]They considered any extension should be to no later than 21 December 2017.
The appellants again failed to comply with r 43(1). They filed a second application which was opposed by the respondents. After a hearing on 11 June 2008 an order was made on 28 June 2018 extending the time for filing the case on appeal until 26 July 2018.[3] The Court stated that if the appellants failed to file their case on appeal and seek the allocation of a fixture by that date their appeal would be deemed abandoned and would be automatically struck out.
[3]Bhana v Grant [2018] NZCA 223.
The appellants failed to take the requisite steps with the consequence that the appeal was deemed abandoned on 27 July 2018.
On the second application for an extension under r 43(2) the respondents sought costs. The issue of costs was reserved pending delivery of the decision of this Court on appeal in Commissioner of Inland Revenue v New Orleans Hotel (2011) Ltd.[4] Consequent upon the decision of the Supreme Court in McGuire v Secretary of Justice there is no impediment to the respondents pursing their claim for costs.[5]
[4]Commissioner of Inland Revenue v New Orleans Hotel (2011) Ltd [2018] NZHC 971.
[5]McGuire v Secretary of Justice [2018] NZSC 116.
The appellants sought to defer responding to the respondents’ application for costs. However on 6 March 2019 French J directed that their response was to be filed by 13 March 2019, failing which the Court would proceed to determine the costs application.
On 14 March 2019 the appellants purported to file an application for a stay of proceedings. We do not consider that they have standing to do so, their appeal having been deemed abandoned. In any event, there is no proper basis for further delaying the conclusion of this matter. The appellants have already had the benefit of three procedural indulgencies.
The respondents seek costs on a band A basis calculated as follows:

Item	Details	Days	Amount
8	Consent to application	0.2	$ 446.00
4	Preparation for hearing of defended application	1.0	$2,230.00
5	Appearance at hearing of defended application on 11 June 2018	0.5	$1,115.00
Memorandum dated 10 August 2017	0.2	$ 446.00
Memorandum dated 21 November 2017	0.1	$ 223.00
Memorandum dated 16 March 2018	0.2	$ 446.00
Memorandum dated 22 March 2018	0.1	$ 223.00
Memorandum dated 7 May 2018	0.2	$ 446.00
Memorandum dated 9 May 2018	0.1	$ 223.00
Memorandum dated 16 May 2018	0.2	$ 446.00
Memorandum dated 22 May 2018	0.2	$ 446.00
Total	$6,690.00

Disbursements

Counsel’s return flights from Auckland to Wellington re 11 June 2018 hearing	$ 435.00
Total	$ 435.00

The respondents are entitled to costs for their memorandum in opposition dated 16 March 2018 and for their preparation for and appearance at the hearing on 11 June 2018 in the total sum of $3,791.00. The disbursement for air travel is also recoverable.
We consider that the respondents should also have costs in connection with the quite detailed memoranda of 16 and 22 May 2018. However we do not accept that the brief memoranda of 22 March, 7 and 9 May 2018 warrant an award of costs.
Nor do we consider that the respondents are entitled to costs (in the sum of $1,115.00) in connection with steps taken in relation to the first application for an extension to the terms of which they did not consent. The memoranda of 10 August and 21 November 2017 related to that first application.

Result

The second and third appellants must pay the respondents costs in the sum of $4,683.00 and disbursements of $435.00.
We direct the Registrar to deduct the costs and disbursements awarded from the amount paid into Court for security for costs.

Solicitors:
Waterstone Insolvency, Auckland for Respondents

In the Court of Appeal of New Zealand, Ashok Dennis Bhana, Jasu Mati Bhana, and Stephen Chiman Bhana appealed against the decision of the High Court in Ranolf Company Limited (In liquidation) v Bhana. The respondents, Damien Grant and Steven Khov, liquidators of Ranolf Company Limited, sought costs associated with the appellants' failure to comply with procedural rules and deadlines in their appeal. The Court was required to determine whether the respondents were entitled to costs under the Court of Appeal (Civil) Rules 2005 and if so, the appropriate amount. The Court considered the appellants' repeated failures to meet deadlines, their applications for extensions of time, and the legal precedents governing costs in such situations.

The Court of Appeal found that the appellants had not complied with the procedural requirements, having missed several deadlines and failed to file their case on appeal within the stipulated time. Despite multiple extensions granted by the Court, the appellants did not meet the final deadline, leading to the abandonment of their appeal. The Court noted that the respondents had opposed the appellants' applications for extensions and had incurred costs in preparing for and appearing at the hearing of the defended application. The Court assessed the costs incurred by the respondents, including legal fees and disbursements, and determined that the respondents were entitled to costs for specific memoranda and the hearing, but not for all the items claimed.

The Court ruled that the second and third appellants must pay the respondents costs amounting to $4,683.00 and disbursements of $435.00. The Court ordered that these costs and disbursements be deducted from the amount paid into Court for security of costs. This decision underscores the importance of adhering to procedural rules and the consequences of failing to do so, including the potential for significant costs to be awarded against the defaulting party.

CaseChat Overview and Summary

Orders of the court

Background to the litigation

Evidence Before The Court

Reasons for decision

Legal Principle Established