Clayton v Clayton

[2014] NZHC 3086

NOTE: PURSUANT TO S 35A OF THE PROPERTY (RELATIONSHIPS) ACT 1976, ANY REPORT OF THIS PROCEEDING MUST COMPLY WITH SS 11B TO 11D OF THE FAMILY COURTS ACT 1980.  FOR FURTHER INFORMATION, PLEASE SEE COURT/LEGISLATION/RESTRICTIONS-ON-PUBLICATIONS.

IN THE HIGH COURT OF NEW ZEALAND ROTORUA REGISTRY

CIV-2014-463-000067 [2014] NZHC 3086

IN THE MATTER OF	the Property (Relationships) Act 1976
BETWEEN	MARK ARNOLD CLAYTON Appellant
AND	MELANIE ANN CLAYTON Respondent

Hearing:

12 November 2014

(Heard at Wellington)

Counsel:

M J McCartney QC and K E Sullivan for appellant
J R Hosking for respondent

Judgment:

4 December 2014

RESERVED JUDGMENT OF DOBSON J

Contents

Introduction ....................................................................................................................................... [1] Background........................................................................................................................................ [3] Appellate approach to costs orders ................................................................................................ [12] Incorrect or inadequately informed perception of success .......................................................... [17] Wrongfully attributing obstructive tactics to Mr Clayton........................................................... [24] Wrongly disregarding Calderbank offers....................................................................................... [33] Failure to consider issues involving the trusts separately ............................................................ [37] Wrong daily rates applied .............................................................................................................. [42] Wrong application of category 3, band C/wrong to award increased costs ............................... [49] Reimbursement of experts’ fees ..................................................................................................... [54] Result ................................................................................................................................................ [66]

CLAYTON v CLAYTON [2014] NZHC 3086 [4 December 2014]

Introduction

[1]      This is an appeal from a costs order made by the Family Court at Rotorua in respect of relationship property litigation.1

[2]      On 1 May 2014, Judge J F Munro ordered the appellant (Mr Clayton) to pay the  respondent  (Mrs Clayton)  $200,000  on  account  of  costs  and  $37,471  for disbursements.    The  Judge  also  confirmed  Mr Clayton’s  liability  to  meet  the expenses of an accounting expert, Mr Lyne, and a tax expert, Mr Plunket, who had been retained on behalf of Mrs Clayton.  After attributing Mrs Clayton with liability for $25,000 of Mr Lyne’s fees, Mr Clayton was liable for $212,471 of Mr Lyne’s costs.  Mr Plunket’s fees were $11,490.32.

Background

[3]      The timing of this appeal is somewhat unusual.  Judge Munro’s substantive

decision was given on 2 December 2011, after truncated hearings between 6 July and

2 August 2011.2    At Mr Clayton’s request, Judge Munro deferred dealing with the costs issues in relation to the proceeding, notionally until all matters had been finally determined.  Mr Clayton then pursued an appeal from the substantive decision.  The High  Court  decision  on  that  appeal  was  delivered  in  February  2013,  in  which Hansen J expressed the view that costs ought to be determined at the completion of each  substantive  stage  of  the  proceedings.3   Accordingly,  Judge  Munro  invited further submissions on costs in the Family Court.  These submissions were received on behalf of Mrs Clayton in July 2013, and on behalf of Mr Clayton and the trusts that were also respondents in the proceedings in October 2013.  The Judge then dealt with costs issues on the papers, and her costs judgment was delivered on 1 May

2014.

[4]      In  the  meantime,  Mr Clayton  pursued  a  further  appeal  from  Hansen J’s

decision.  That appeal was heard by the Court of Appeal in July 2014 and a decision is awaited. Any material reversal by the Court of Appeal of the success Mrs Clayton