Cable Bay Wine Limited v Auckland Council

[2021] NZHC 3181

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

I TE KŌTI MATUA O AOTEAROA TĀMAKI MAKAURAU ROHE

CIV 2020-404-1880

[2021] NZHC 3181

UNDER

The Resource Management Act 1991

BETWEEN

CABLE BAY WINE LIMITED

Appellant

AND

AUCKLAND COUNCIL

Respondent

CIV 2020-404-2456

UNDER

The Judicial Review Procedure Act 2016, the Judicature Amendment Act 1972 and Parts 5 and 30 of the High Court Rules 2016

BETWEEN

CABLE BAY WINE LIMITED

Applicant

AND

THE ENVIRONMENT COURT

First Respondent

Continued…

On the papers

Counsel:

A G Webb for Cable Bay Wine Ltd

S F Quinn and K H Rogers for Auckland Council

S J Simons and O C Manning for the third respondents: J Loranger, L Niemann, M Poland and C Poland

Judgment:

25 November 2021

COSTS JUDGMENT OF CAMPBELL J

This judgment was delivered by me on 25 November 2021 at 4:00 pm pursuant to Rule 11.5

of the High Court Rules Registrar/Deputy Registrar

CABLE BAY WINE LIMITED v AUCKLAND COUNCIL [2021] NZHC 3181 [25 November 2021]

AUCKLAND COUNCIL

Second Respondent

JULIE LORANGER, LINDSAY NIEMANN, MICHAEL POLAND, CHRISTINE POLAND, STEPHEN EDWARDS and SUZANNE

EDWARDS
Third Respondents

[1]                  In my judgment dated 30 September 2021, I dismissed Cable Bay’s appeal and declined its application for judicial review. I said that Auckland Council and the third respondents who took an active role in the appeal and review (Ms Loranger, Ms Niemann, and Mr and Mrs Poland) were entitled to costs from Cable Bay. The parties have been unable to agree costs. Counsel have filed memoranda.

[2]                  Auckland Council seeks costs on a 2B basis for the appeal and the judicial review, in the sum of $20,315. The third respondents also seek costs on a 2B basis, in their case in the sum of $19,784.15.

[3]In response, Cable Bay says that:

(a)It having applied for leave to appeal my decision, determination of costs should be deferred until its application and any appeal are resolved.

(b)If costs are to be determined now:

(i)Only one set of costs should be allowed.

(ii)Alternatively, if two sets of costs are allowed, there should be some reductions to the amount sought by the third respondents.

Should determination of costs be deferred?

[4]                  An application for leave to appeal does not operate as a stay of the proceeding in which the decision was given.1 The application for leave therefore does not prevent costs being determined. The usual practice of this Court is to determine costs, notwithstanding an appeal or an application for leave to appeal, unless the parties agree otherwise. There is a good reason for this: the Court may not award interest on costs for the period before the date when the costs are awarded.2

1      Court of Appeal (Civil) Rules 2005, r 12.

2      Interest on Money Claims Act 2016, s 20(1) (and, under the regime before that Act, see Chesterfields Preschools Ltd v Commissioner of Inland Revenue [2013] NZCA 44, [2013] 2 NZLR 499 at [20]; New Zealand Venue and Event Management Ltd v Worldwide NZ LLC [2016] NZCA 282, (2016) 23 PRNZ 260 at [23]).

[5]There is no reason in this case for not following that usual practice.

Should only one set of costs be allowed?

[6]                  In submitting that only one set of costs should be allowed, Mr Webb for Cable Bay relied on r 14.15 of the High Court Rules 2016. This provides:

The court must not allow more than 1 set of costs, unless it appears to the court that there is good reason to do so, if—

(a)several defendants defended a proceeding separately; and

(b)it appears to the court that all or some of them could have joined in their defence.

[7]                  This rule requires the Court to exercise some caution before awarding costs in favour of multiple parties, particularly when there is some overlap or community of interest in the litigation position of those parties.3 The policy behind the rule is to minimise costs by shortening hearings where a joint defence can reasonably be expected. The Court should look in a realistic way at whether, and to what extent, the parties have a common or overlapping interest.4

[8]                  The authors of McGechan on Procedure state that the following principles can be distilled from cases that have considered r 14.15:

(a)The court will look in a realistic way at whether parties have common or overlapping interests and, if so, to what extent. A consideration is the extent to which separate cases were run against, and separate relief sought from, each defendant, and whether the impact on the defendants of granting that relief would have been identical or different.

(b)Whether a conflict of interest was likely in terms of the way the plaintiffs ran their case, and/or whether the defendants’ relationship was such that they were justified in remaining at arm’s length from each other.

(c)If defendants’ reputations are at stake (for example, where they are alleged to have acted fraudulently or to have colluded in trading unfairly), the court will be more ready to accept, as reasonable, separate representations.

3      Grey District Council v Blain [2014] NZHC 939 at [5].

4      Independent Māori Statutory Board v Auckland Council [2017] NZHC 678 at [8]–[9].

(d)Whether the parties took legal advice as to the appropriateness of separate/joint representations and, if so, what it was and whether it was followed.

(e)The extent to which one party did or could have relied upon the evidence or submissions of another.

[9]                  Mr Webb submitted that Auckland Council and the third respondents had, to a very significant extent, a common interest in defending Cable Bay’s appeal and judicial review. He submits that the only new issue raised in the third respondents’ submissions was an argument that the appeal to the High Court was filed out of time. He observes that argument was rejected in my judgment. Further, Mr Webb argues that at the hearing the third respondents simply adopted Auckland Council’s submissions and added “very little further by way of oral submissions”.

[10]              I accept that Auckland Council and the third respondents had some common interests in this proceeding. However, I do not think it is realistic to have expected them to have joined in their defence. Auckland Council had originally been supportive of Cable Bay’s application for resource consent. On Cable Bay’s appeal to the Environment Court, Auckland Council and the third respondents did not take the same position on many of the issues. Given that background, I do not think it realistic to expect the third respondents to have joined Auckland Council’s defence of the appeal and review.

[11]              I do not accept that the only new issue raised in the third respondents’ submissions was the argument that Cable Bay’s appeal was out of time. Just as one example, Mr Quinn for the Council and Ms Simons for the third respondents had different approaches to the application of s 108AA of the Resource Management Act 1991. Nor do I accept that at the hearing the third respondents added very little by way of oral submissions.

[12]              For r 14.15 to be engaged, it must appear to the Court that Auckland Council and the third respondents “could have joined in their defence”: r 14.5(b). For the reasons set out in the previous two paragraphs, it does not appear to me that they could have done so. Accordingly, r 14.15 is not engaged.

[13]              A similar conclusion was reached by Hinton J last year in a similar case, Ahuareka Trustees (No 2) Ltd v Auckland Council.5 In that case a s 274 party participated in an appeal where Auckland Council was the respondent. The appeal was dismissed. An issue arose as to whether the s 274 party should have costs as well as Auckland Council. Hinton J carefully analysed the application of r 14.15 in that context. Her Honour allowed a separate set of costs for the s 274 party, observing that that party had a clear interest greater than and distinct from that of the wider public in opposing the appellant’s efforts to obtain resource consent. Her Honour said that the policy of the Resource Management Act 1991 would be undermined by requiring a s 274 party such as the association in that case to make a distinctive contribution to the proceeding before it could be awarded costs.6 Mr Webb did not refer me to Ahuareka.

[14]              I therefore reject Mr Webb’s submission that only one set of costs should be allowed.

What costs should be awarded?

[15]              If two sets of costs are to be awarded, Cable Bay does not take issue with the costs sought by Auckland Council but does contest some aspects of the costs sought by the third respondents.

[16]              First, the third respondents seek costs for the appearance at the hearing of second counsel. Mr Webb says there should not be an allowance. I agree.

[17]              Secondly, Mr Webb contests the disbursements claim for the filing of a statement of defence to Cable Bay’s application for judicial review. He does not set out the basis of his position, but I infer it is that the judicial review application was made only because the third respondents argued (unsuccessfully, it turned out) that the appeal was out of time. I accept the third respondents’ claim for the filing fee. It is correct that Cable Bay made its application only after the third respondents said the appeal was out of time. But Cable Bay could have stood its ground on the appeal. It

5      Ahuareka Trustees (No 2) Ltd v Auckland Council [2020] NZHC 2303.

6      At [20] and [21].

chose to make the application. The application was unsuccessful, and they should pay costs on it.

[18]              Finally, Mr Webb argues that there should be an overall reduction of 50 per cent on the basis the third respondents put the other parties to additional costs by pursuing the argument that the appeal was filed out of time. Mr Webb says this “caused” Cable Bay to apply for judicial review. For the reasons I have just set out, I do not accept that. Further, the application for judicial review gave rise to minimal additional costs, as it raised the same issues as those pursued by Cable Bay on its appeal.

Result

[19]Cable Bay is to pay Auckland Council costs of $20,315.

[20]              Cable Bay is to pay Ms Loranger, Ms Niemann, and Mr and Mrs Poland costs and disbursements of $17,991.65.

[21]              Interest is awarded on each amount under s 10 of the Interest on Money Claims Act 2016 from the date of this judgment until the date of payment.

Campbell J