Body Corporate 172108 v Manchester Securities Limited (in liquidation)

[2022] NZHC 184

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

I TE KŌTI MATUA O AOTEAROA TĀMAKI MAKAURAU ROHE

CIV-2021-404-001066

[2022] NZHC 184

BETWEEN

BODY CORPORATE 172108

Plaintiff

AND

MANCHESTER SECURITIES LIMITED (IN LIQUIDATION)

First Defendant

FLAT BUSH FINANCE LIMITED
Second Defendant

ROBERT JAMES CUMMINS, trustee of the MANCHESTER SECURITIES TRADING TRUST

Third Defendant

Hearing:

On the papers

Counsel:

T J G Allan and K M Wakelin for Plaintiff

K P Sullivan for Second and Third Defendants

Judgment:

15 February 2022

COSTS JUDGMENT OF ASSOCIATE JUDGE P J ANDREW

This judgment was delivered by Associate Judge Andrew on 15 February 2022 at 3.30 pm

pursuant to r 11.5 of the High Court Rules Registrar / Deputy Registrar

Date………………………

BODY CORPORATE 172108 v MANCHESTER SECURITIES LTD (IN LIQ) & ORS [2022] NZHC 184 [15

February 2022]

Introduction

[1]                 On 11 November 2021, the third defendant, Mr Robert Cummins, discontinued an “originating application for removal of caveat” dated 6 October 2021.

[2]                 The plaintiff, Body Corporate 172108, seeks costs on the discontinued application, pursuant to r 15.23 of the High Court Rules, in the sum of $8,604.00, plus disbursements of $110.00.

[3]                 The Court has received written submissions  from  both  the  plaintiff  and  Mr Cummins. I am making this decision on costs on the papers.

Decision

[4]                 Rule 15.23 of the High Court Rules creates a presumption that a plaintiff who discontinues will pay costs to the defendant. The presumption may be displaced if the Court find there are circumstances which make it just and equitable that it should not apply.1

[5]                 In assessing whether to award costs on an application under r 15.23, Associate Judge Abbott in FM Custodians Ltd v Pati,2 held that the Court should:

(a)Not take into account the merits of the case (unless they are so obvious that they should influence the costs issue);

(b)Consider the reasonableness of the stances of the parties in the proceeding; and

(c)Take into account conduct prior to commencement of proceedings.

[6]                 For the reasons given in the plaintiff’s submissions, I find that the presumption should not be displaced in this case. They include the findings of Gwyn J in which

1      FM Custodians Ltd v Pati [2012] NZHC 1902 at [9] and [10]; citing North Shore City Council v Local Government Commission (1995) 9 PRNZ 182 at 188; Kroma Colour Prints Ltd v Tridonicatiato NZ Ltd [2008] NZCA 150, (2008) 18 PRNZ 973 at [12].

2      FM Custodians Ltd v Pati, above n 1, at [11].

she expressly upheld the caveat, pending a determination of the substantive dispute as to priorities.3 I note, that in line with the directions of Gwyn J, the Body Corporate responsibly and reasonably commenced the current proceeding to determine substantively the priority of the competing equitable interest.

[7]                 I reject the submission of Mr Cummins that the costs application is based on a meritless, technical procedural point.4 The presumption is of course not lightly displaced.5 There are no circumstances here which make it just and equitable that the presumption should not apply. The plaintiff has incurred wasted costs which appear to arise from a pattern of conduct by Mr Cummins attempting to re-litigate issues already determined by the Court.

[8]                 I find that Mr Cummins should pay costs to the plaintiff, Body Corporate, on a 2B basis and in the sum of $8,604.00 as set out in the schedule to the plaintiff’s submissions. I grant the full allowance of two days for the filing of a notice of opposition. That notice was extensive, extending to four pages. I also accept that the Body Corporate plaintiff should be awarded costs on the costs memorandum, given the unsuccessful attempts to agree costs, the need to prepare the application and submissions and the relatively modest amount at stake.

Result

[9]                 I order that Mr Cummins, the third defendant, is to pay costs to the plaintiff Body Corporate together with disbursements in the total sum of $8,714.00 (being the calculation set out in the schedule attached to the plaintiff’s submissions.

Associate Judge P J Andrew

3      Body Corporate 172108 v Flat Bush Finance Ltd [2020] NZHC 3135.

4      Mr Cummins relies upon Roe-Shaw v Body Corporate 81340 [2021] NZHC 2114, a judgment of Cooke J of 13 August 2021.

5      Yarrell v Earthquake Commission[2016] NZCA 517 at [12].