Chen v Tawa Trade Finance Limited

[2023] NZHC 3254

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

I TE KŌTI MATUA O AOTEAROA TĀMAKI MAKAURAU ROHE

CIV-2023-404-000492

[2023] NZHC 3254

BETWEEN

LIYUN CHEN

First Applicant

LC1521319 DEVELOPMENT CO LIMITED
Second Applicant

AND

TAWA TRADE FINANCE LIMITED

Respondent

Hearing:

On the papers

Counsel:

Self-represented Applicants

D Chisholm and C Pendleton for the Respondent

Judgment:

17 November 2023

JUDGMENT OF GORDON J

This judgment was delivered by me

on 17 November 2023 at 10 am, pursuant to r 11.5 of the High Court Rules

Registrar/Deputy Registrar Date:

Solicitors/Counsel:

Turner Hopkins, Auckland Copy to: the Applicants

CHEN v TAWA TRADE FINANCE LTD [2023] NZHC 3254 [17 November 2023]

[1]This is a decision on costs.

[2]        On 31 May 2023, I gave judgment in favour of the respondent, Tawa Trade Finance Ltd (Tawa), against the first and second applicants, Liyun Chen and LC1521319 Development Co Ltd (together, the applicants).1

[3]        The applicants sought permission to apply by originating application to set aside a letter of demand and a Property Law Act 2007 (PLA) notice issued by Tawa until their claim in a separate proceeding (CIV-2023-404-427) was determined. I concluded 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

[4]        I reserved costs. In the absence of agreement between the parties Tawa filed a memorandum seeking costs dated 31 July 2023. Ms Chen did not respond within the time allowed for in my judgment.4 There was a delay in the Registry referring Tawa’s costs memorandum to me. Given that delay I afforded a further opportunity to the applicants to respond. No response has been received. Accordingly, I proceed to determine costs on the basis of Tawa’s memorandum.

Costs principles

[5]        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

1      Chen v Tawa Trade Finance Ltd [2023] NZHC 1333.

2 At [46].

3 At [47].

4 At [48].

5      High Court Rules 2016, r 14.1.

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

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

Respondent’s submissions

[7]        Tawa says that the applicants’ application for permission to commence the proceeding by originating application was misconceived and caused wasted expense. It says that if the applicants had bona fide considered they had grounds to challenge the PLA notice or otherwise restrain the mortgagee sale, they should have simply applied for an injunction in their substantive proceeding.

[8]        Instead of claiming costs in accordance with its loan and security documentation, Tawa has resolved to seek costs and disbursements on a 2B basis. Therefore, Tawa seeks costs of $9,918.50 as set out in the table annexed to this judgment.

[9]        Tawa also seeks disbursements of $95.65 (excluding GST) to recover the filing fee on its notice of opposition.

Assessment

[10]      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, Tawa is entitled to an award of costs against the applicants.

[11]      I am satisfied that: 2B is the appropriate basis for the costs claim; the steps for which Tawa seeks costs as set out in the annexed table were taken; and the time sought for each step accords with the scale in the HCR.

[12]The filing fee for the notice of opposition is also appropriately sought.

6      Rule 14.2(g).

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

Result

[13]      I make an order that the applicants are to pay to Tawa costs of $9,918.50 and disbursements of $95.65 totalling $10,014.15.

Gordon J

ANNEXURE

Costs sought by Tawa

Item	Description	Band/allocation	Amount
38	Filing notice of opposition to originating application and supporting affidavits	B (2 days)	$4,780
39/12	Mention in duty judge list on 20 April 2023	B (0.2 days)	$478
40/241	Preparation     of     written submissions	B (1.5 days)	$3,585
26	Hearing on 25 May 2023 before Gordon J	B (0.25 days)	$597.50
29	Sealing Judgment or order	B (0.2 days)	$478
Total	4.15	$9,918.50

1      Counsel referred to both items 40 and 24. They are both provisions for the preparation of written submissions. Item 24 falls under interlocutory applications whereas item 40 falls under originating applications. They both have the same allocated number of days.