Body Corporate 207650 v Singh - [2019] NZHC 2818

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

I TE KŌTI MATUA O AOTEAROA TĀMAKI MAKAURAU ROHE

CIV-2018-404-000116

[2019] NZHC 2818

BETWEEN
BODY CORPORATE 207650

Judgment Creditor

AND

CHERYL SITARA SINGH

Judgment Debtor

On the papers

Judgment:

1 November 2019

JUDGMENT OF HINTON J [COSTS ON ADJUDICATION]

This judgment was delivered me on 1 November 2019 at 10:00 am pursuant to Rule 11.5 of the High Court Rules.

Registrar/ Deputy Registrar Date:

BODY CORPORATE 207650 v SINGH [2019] NZHC 2818 [1 November 2019]

[1] This judgment relates to a disputed application for costs in the proceedings between these parties.

[2] In a judgment dated 4 July 2019, I refused an application by Ms Singh to halt adjudication and adjudicated her bankrupt. I also held that the Body Corporate, as the successful party in the proceeding, was entitled to costs.

[3] Section 124(2) of the Unit Titles Act 2010 provides that the amount of any unpaid levy, together with any reasonable costs incurred in collecting that levy, is recoverable as a debt due to the Body Corporate. That is the starting point here. I accept on that basis that solicitor/client costs incurred in the bankruptcy proceeding are recoverable in principle.

[4] I also accept that the costs and disbursements set out by Mr Allan for the Body Corporate have been incurred in fact.

[5] I have to take into account, as Mr Bryers submits, that the Court is nonetheless required to determine whether the costs claimed are reasonable.1

[6] The judgment creditor is claiming a total of $65,132.50. The amount breaks down like this:

Fees $44,584.00

GST $6,687.60

Disbursements:

Photocopying

$2,526.17

Ministry of Justice $1,240.00

Bureau Charge $195.00

Kwanto $6,483.13 $10,444.30

$61,715.90

Fees (costs memos)

$3,416.60

$65,132.50

[7] I am conscious that the Body Corporate (namely the other unit owners) should not bear the burden of the significant legal costs incurred in this proceeding and that

1 Black v ASB Bank Ltd [2012] NZCA 384.

Ms Singh is to a very large degree the author of her own liability in terms of costs. The Body Corporate has been forced to keep replying to the endless memoranda and affidavits filed by her. But a sum close to $65,000 is a very substantial sum by way of costs and disbursements on an adjudication, even allowing for the application to halt. I agree with Mr Bryers that it seems high relative to the last costs claim and award made by me in this proceeding.2

[8] Mr Bryers has submitted a detailed analysis of the invoices provided by the Body Corporate. I will not go line by line through the claimed costs and Mr Bryers’ objections. A robust approach is appropriate in circumstances such as this.3

[9] In terms of disbursements, Mr Bryers objects in particular to the charge made by Kwanto of $6,483.13 for attendances relating to Mr White’s affidavit, on the basis that Mr White’s affidavit was filed out of time and prejudicial to Ms Singh. I agree with Mr…

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: [2019] NZHC 2818
Decision Date: 1 November 2019

CaseChat Overview and Summary

In the High Court of New Zealand, Body Corporate 207650, a collective body representing unit owners, filed a claim against Cheryl Sitara Singh, a judgment debtor, seeking recovery of costs related to a bankruptcy adjudication. The case involved a dispute over the application for costs following the adjudication of Ms Singh as bankrupt and the refusal of her application to halt the adjudication. The court was tasked with determining whether the costs claimed by the Body Corporate were reasonable and recoverable under the Unit Titles Act 2010.

The court addressed the principles of cost recovery, acknowledging that costs incurred in collecting unpaid levies are recoverable. The Body Corporate claimed a total of $65,132.50 in fees, GST, and disbursements. The court scrutinized the claimed costs, considering objections raised by Ms Singh's counsel regarding the reasonableness of the fees and disbursements. The objections included issues such as excessive time taken on certain steps, unnecessary second counsel fees, and inadequate information provided to assess the reasonableness of the costs.

The court accepted that some of the claimed disbursements, such as photocopying and certain legal services, were reasonable and necessary. However, it disallowed the fee for preparing costs memoranda and reduced the overall fees claimed by $2,000 due to excessive time taken and inadequate initial information. The court also disallowed a bureau charge as a non-recoverable disbursement. The total allowable costs and disbursements were reduced to $53,249.30, reflecting a significant reduction from the original claim but still a considerable sum for the nature of the proceeding. The court emphasized the importance of detailed information in cost applications to facilitate proper assessment by the court.

The court's final orders awarded costs and disbursements of $53,249.30 to the Body Corporate, reflecting the court's determination of reasonable costs after considering all submissions and objections. The court's decision highlighted the need for transparency and detailed information in cost applications, especially in matters of this magnitude.

Orders