Chen v General Finance Limited

[2023] NZHC 3258

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

I TE KŌTI MATUA O AOTEAROA TĀMAKI MAKAURAU ROHE

CIV-2023-404-000548

[2023] NZHC 3258

BETWEEN

LIYUN CHEN

First Applicant

ROYALL FAMILY TRUST
Second Applicant

AND

GENERAL FINANCE LIMITED

Respondent

Hearing:

On the papers

Counsel:

Self-represented Applicants

A Johnson for the Respondent

Judgment:

17 November 2023

JUDGMENT OF GORDON J

This judgment was delivered by me

on 17 November 2023 at 3 pm, pursuant to r 11.5 of the High Court Rules

Registrar/Deputy Registrar Date:

Solicitors/Counsel:

Martelli McKegg, Auckland Copy to: the Applicants

CHEN v GENERAL FINANCE LTD [2023] NZHC 3258 [17 November 2023]

[1]This is a decision on costs.

[2]        On 31 May 2023, I gave judgment in favour of the respondent, General Finance Ltd (General Finance) against the first and second applicants, Liyun Chen and Royall Family Trust (together, the applicants).1

[3]        The applicants sought permission to apply by originating application to set aside notices issued by General Finance under ss 119 and 122 of the Property Law Act 2007 (PLA) until their claim in a separate proceeding (CIV-2023-404-581) was decided.

[4]        I determined that it was not in the interests of justice for the applicants to commence their proceeding as an originating application and therefore refused the application.2 I also noted that even if permission had been given for the applicants to commence their proceeding by an originating application, any such application would fail on the merits.3

[5]        At the commencement of the hearing on 25 May 2023, I made two non- publication orders by way of a minute prohibiting the publication of certain paragraphs in the applicants’ submissions.4 I accepted that General Finance would face a real risk of serious financial and reputational harm which went well beyond allegations being simply unwelcome and embarrassing.

[6]        Mr Johnson appeared for General Finance in relation to the originating application, while Mr Elliot KC and Mr Stewart appeared in relation to the non- publication order.

[7]        I reserved costs. In the absence of agreement between the parties on costs General Finance filed a memorandum seeking costs dated 9 November 2023. While this is well beyond the 25 working days provided for in the judgment, I will, nevertheless, consider the application. I extended the period for the applicants’

1      Chen v General Finance Ltd [2023] NZHC 1329.

2 At [56].

3 At [57].

4      Chen v General Finance Ltd HC Auckland CIV-2023-404-548, 25 May 2023.

response but no opposing memorandum has been filed. I will accordingly proceed on the basis of the respondent’s memorandum.

Costs principles

[8]        The starting point for the assessment of costs is that all matters with regard to costs are at the discretion of the Court.5 However, this discretion is not an unfettered one and is to be guided by the general principles in rr 14.2 to 14.5 of the High Court Rules 2016 (HCR). A fundamental costs principle is set out in r 14.2(1), which provides that the party who failed with respect to a proceeding should generally pay the costs of the successful party. The rules are intended to create a framework for determining costs in individual cases that is both “predictable and expeditious”.6

[9]        Ultimately, the overriding consideration when exercising a discretion to award costs is that any award ought to do justice between the parties.7

Respondent submissions

[10]      General Finance seeks costs on a 2B basis, pursuant to Schedule 2 and 3 of the HCR. It further says that because it is not GST registered and therefore the GST cannot be recovered by it, GST is included in the total sum sought for the disbursements.

[11]      General Finance seeks total costs of $16,610.50 and disbursements of $160 as set out in the schedules annexed to this judgment.

Assessment

[12]      The principle that costs follow the event is not displaced in this case. I do not consider there are exceptional reasons justifying departure from this principle. Therefore, General Finance is entitled to costs on a 2B basis.

[13]      In relation to the originating application I am satisfied the steps claimed for were taken and the amounts claimed accord with the schedules in the HCR.

5      High Court Rules 2016, r 14.1.

6      Rule 14.2(g).

7      Packing In Ltd (in liq) v Chilcott (2003) 16 PRNZ 869 (CA) at [5].

[14]      Regarding the non-publication order, the only issue on which I pause is the claim for second counsel. No guidance is set out in the HCR as to the circumstances in which such a claim will be allowed. Criteria such as the complexity of the proceedings including the issues involved; the range of evidence; and the number of witnesses, depositions and the volume of evidence before the Court, may be taken into account.8

[15]      However, that is not always the case. In New Conservative v Television New Zealand Ltd Woolford J was of the view that although the proceeding was not lengthy or complex (either legally or factually) second counsel was warranted because of the significance and urgency in the proceeding.9

[16]      In the present case the offending submissions were filed on Friday 19 May 2023. An affidavit from the managing director of General Finance was prepared addressing the impact on General Finance that would follow from publication. There were also written legal submissions. I accept the allegations were a significant issue for General Finance. As well there was a degree of urgency involved as the hearing was on Thursday 25 May 2023. I therefore propose to allow the claim for second counsel.

[17]      However, the amount claimed is incorrect. General Finance seeks $597.50 for a time allocation of 0.25 days. But item 27 in sch 3 of the HCR provides for 50 per cent of the allowance for the appearance for the principal counsel. The claim for principal counsel is .25 days. Therefore, the appropriate allocation and amount for second counsel is 0.125, or $298.75.

[18]      The steps in relation to the non-publication order are otherwise in accordance with the HCR.

[19]      With the one change in allocation that makes the sub-total for the non- publication order $5,915.25, bringing total costs to $16,311.75.

8      Brady v Presbyterian Church of Aotearoa New Zealand [2013] NZHC 2300 at [2].

9      New Conservative v Television New Zealand Ltd [2020] NZHC 3096 at [12].

[20]The disbursements claimed are appropriate.

Result

[21]      I make an order that the applicants are to pay costs and disbursements to General Finance in the total sum of $16,471.75.

Gordon J

ANNEXURE

Originating application

Step	Description	Band/allocation	Amount
38	Preparing and filing opposition to originating application and supporting affidavits	B (2 days)	$4,780
40	Preparing written submissions	B (1.5 days)	$3,585
41	Preparation    of    bundle    for hearing	B (0.6 days)	$1,434
42	Appearance at hearing for principal counsel on 25 May by A W Johnson	B (0.25 days)	$597.50
Sub-total	4.35	$10,396.50

Disbursements	Cost (inclusive of GST)
Filing Fee (Notice of Opposition)	$110
Total	$110

Application for non-publication order

[22]  

Step	Description	Band/allocation	Amount
22	Filing          interlocutory application     for     non- publication order	B (0.6 days)	$1,434
24	Preparation    of    written submissions	B (1.5 days)	$3,585
26	Appearance at hearing for principal counsel on 25 May 2023 by C Elliot KC	B (0.25 days)	$597.50
27	Appearance at hearing for second counsel on 25 May 2023 by R Stewart	B (0.25 days)	$597.50
Sub-total	2.6	$6,214

Disbursements	Cost (inclusive of GST)
Filing Fee (Sealed Order of non-publication)	$50
Total	$50

Total Costs and Disbursements $16,770.50