Casama Group (NZ) Limited v Guenole

[2013] NZHC 347

IN THE HIGH COURT OF NEW ZEALAND WELLINGTON REGISTRY

CIV 2012-485-2579 [2013] NZHC 347

BETWEEN  CASAMA GROUP (NZ) LIMITED First Plaintiff

ANDMINERAL LIMITED Second Plaintiff

ANDJACKSON ESTATE LIMITED Third Plaintiff

ANDGEOFFREY RONALD GUENOLE First Defendant

ANDSCETTRINI INVESTMENTS LIMITED Second Defendant

On papers

Counsel:         R C Laurenson for Plaintiffs

P S J Withnall for Defendants

Judgment:      27 February 2013

JUDGMENT OF THE HON JUSTICE KÓS (Costs)

[1]      On 30 November 2012 the plaintiffs issued these proceedings.  They sought an injunction for the immediate release of wine stock distrained by the defendants, the second defendant in particular.

[2]      The plaintiffs’ wine stock had been in the possession of their distributor, Wine Logistics Limited.   That company in arrears in paying rent to the second defendant.  As a result the second defendant distrained the wine stock.  However it

was not the property of Wine Logistics Limited, but rather of the plaintiffs.

CASAMA GROUP (NZ) LIMITED v GUENOLE & ANOR HC WN CIV 2012-485-2579 [27 February 2013]

[3]      In my judgment of 3 December 2012 I held that the distraint by the second defendant was unlawful. The injunction was granted.

[4]      The parties are now disagreed as to what costs should be paid.

[5]      The relevant  general  principles  in  relation  to  costs  are that  costs  should follow the event, that the calculation of costs should be predictable and that the award of costs should not exceed the actual costs incurred by the party claiming costs. The Court retains, in Rule 14.1, an overall discretion as to what costs might be awarded.

No costs?

[6]      For the defendants, Mr Withnall submits that costs should not follow the event in this case, essentially because the commencement of the proceedings was “overly  hasty”.    He  has  set  out  correspondence  between  the  parties’ solicitors jousting over the legal position, between 27 and 30 November 2012.

[7]      I do not accede to the proposition that the proceedings were prematurely or unnecessarily filed.  The second defendant was distraining the plaintiffs’ wine stock. Earlier proceedings between Wine Logistics Limited and the defendants had been issued in early November in the District Court.  The resolution of those proceedings, as I set out in my judgment, was imprecise.  The plaintiffs were not parties.  But it was clear from what went on in those proceedings that much if not all of the wine stock being distrained could not be the property of Wine Logistics Limited, but rather its clients,  the plaintiffs.   Despite clear uncertainty as to entitlement, the second  defendant  continued  to  distrain  the  wine  stock.   At  this  point  the  very profitable  Christmas  market  rush  was  on.    I do  not  think  the  plaintiffs  can  be criticised for applying to this Court to regain their property in order to be able to sell it in that market.  Litigating to vindicate a property right is expensive, particularly for the entity infringing that right.  But it is not as expensive as missing the market.

[8]      I therefore reject the first ground on which the defendants oppose costs.

Less costs?

[9]      The second point made by the defendants is that while they accept costs should otherwise be calculated on a category 2 band B basis, the allowance for item

1 in the third schedule – commencement of proceedings – would be excessive if calculated on a band B basis.   That allows three days for commencement of the proceeding.   The statement of claim in this case is exactly two paragraphs long. However I think we must take into account, also, the fact that an affidavit in support of the interlocutory application (which alone is separately provided for in item 22) and an undertaking as to costs had to be filed.  Even allowing for these matters, three days is excessive.  I will allow 1.5 days for item 1, but at the category 2 daily rate.

[10]     Subject to that one qualification the plaintiffs’ costs calculation is confirmed.

Who should pay?

[11]     A third point made by the defendants is that any costs award in this case should be made against the second defendant only.  Despite the points made by the plaintiffs in their reply memorandum of 18 February 2013, I am satisfied that it is proper that a costs order be made against the second defendant only.   It was the entity  directly  infringing  the  plaintiffs’  rights  at  the  time  of  the  hearing  on

3 December.

Costs on costs?

[12]     Costs on the present costs application will lie where they fall.

Stephen Kós J

Solicitors:

Sievwrights Law, Wellington, for Plaintiffs

I D Hay, Wellington, for Defendants