Bridging Finance Group Limited v Tapp - [2025] NZHC 1686

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

I TE KŌTI MATUA O AOTEAROA TĀMAKI MAKAURAU ROHE

CIV-2024-404-003307

[2025] NZHC 1686

BETWEEN
BRIDGING FINANCE GROUP LIMITED & NEW ZEALAND CAPITAL

MANAGEMENT LIMITED
Plaintiffs

AND

STEVEN JOHN TAPP

Defendant

Hearing: On the papers

Judgment:

25 June 2025

JUDGMENT OF DOWNS J

(Costs)

This judgment was delivered by me on Wednesday, 25 June 2025 at 3 pm pursuant to r 11.5 of the High Court Rules.

Registrar/Deputy Registrar

Solicitors/Counsel: Aspiring Law, Wanaka. SRG Judd, Auckland. GDR Shand, Auckland.

BRIDGING FINANCE GROUP LTD & NEW ZEALAND CAPITAL MANAGEMENT LTD v TAPP [2025] NZHC 1686 [25 June 2025]

Background

[1] Two sets of costs arise. Both concern land owned by Steven Tapp in Kaiwaka, over which the plaintiffs held mortgages.

[2] Mr Tapp defaulted on his loan obligations. The plaintiffs sought to sell the property. Mr Tapp then applied for an interim injunction to restrain the sale. On 14 March this year, I dismissed that application.1 The plaintiffs seek indemnity costs in relation to their successful dismissal of that application, relying on these clauses in the loan agreement(s):2
7. RIGHTS AND POWERS OF LENDER ON DEFAULT

…

(f)Costs of default are payable: All sums expended by the lender in the exercise of the lender’s rights and powers following a default or in exercising or enforcing or attempting to exercise or enforce any power, right or remedy contained or implied in this contract are payable by you to the lender upon demand. This clause does not limit any other term of this contract relating to costs; nor is it limited by any other such term.

…

12. COSTS

(a)Costs payable by you: You must pay to the lender upon demand, the lender’s legal costs (as between solicitor and client) for:

…

(ii)costs on default: legal services arising from or related to any default under this contract or the enforcement or exercise or attempted enforcement or exercise of any of the lender’s rights, remedies and powers under this contract…

(iii)costs of variation, waiver or change demand…

(iv)legal costs of lender: legal services relating to the protection of the lender’s security interest taken in conjunction with this contract…

[3] Mr Tapp resists indemnity costs. He says the relevant invoices are not clearly referrable to the application; case law does not support indemnity costs; and his

1 Bridging Finance Group Ltd v Tapp [2025] NZHC 521.
2 High Court Rules 2016, r 14.6(4)(e).

reception of legal aid means no costs should be awarded against absent exceptional circumstances.3

[4] The second costs issue arises this way. The plaintiffs applied for possession of the property. But, they ended up selling the property (1 April 2025) while Mr Tapp was still in possession. The plaintiffs then abandoned their possession application (9 May 2025).

[5] The plaintiffs seek indemnity costs in relation to their abandoned application, again under the loan agreement(s). Mr Tapp seeks increased costs against the plaintiffs. 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: [2025] NZHC 1686
Decision Date: 25 June 2025

CaseChat Overview and Summary

Bridging Finance Group Limited and New Zealand Capital Management Limited brought an action against Steven John Tapp, who defaulted on his loan obligations related to a property in Kaiwaka. The plaintiffs sought to sell the property, and Tapp applied for an interim injunction to prevent the sale, which was dismissed. The plaintiffs now seek indemnity costs related to this dismissed application and an abandoned possession application, which they argue should be awarded under the loan agreements. Tapp contests the indemnity costs, arguing that case law does not support such an award and that he was receiving legal aid at the time of the dismissed application.

The court examined whether the costs were reasonably incurred, considering the nature of the work and the sums claimed. The court found that the invoices, though broad, were clearly related to the dismissed application, and the costs were reasonable. Case law supported the award of indemnity costs in analogous circumstances, and the provisional immunity conferred by the Legal Services Act 2011 did not apply as Tapp was not an aided person at the relevant time. The court also noted that the plaintiffs’ possession application was reasonable given Tapp's significant default, so costs in relation to this application should lie where they fall.

The court ordered that Tapp must pay the plaintiffs $27,481.45 in indemnity costs for the dismissed interim injunction application. The costs related to the abandoned possession application were to lie where they fell, as it was reasonable for the plaintiffs to seek possession given the circumstances.

Orders