Commissioner of Police v Rae
[2024] NZHC 1585
•17 June 2024
ORDER PROHIBITING PUBLICATION OF NAMES, ADDRESSES OR IDENTIFYING PARTICULARS OF CONNECTED PERSONS (REDACTED) IN THE HIGH COURT OF NEW ZEALAND WELLINGTON REGISTRY
I TE KŌTI MATUA O AOTEAROA TE WHANGANUI-A-TARA ROHE
CIV-2020-485-043
[2024] NZHC 1585
UNDER the Criminal Proceeds (Recovery) Act 2009 IN THE MATTER OF
an application under r 8.21 of the High Court Rules 2016
BETWEEN
COMMISSIONER, THE NEW ZEALAND POLICE
Applicant
AND
DAVID CHARLES RAE
Respondent
AND
SARAH LOUISE RAE
First Interested Party
S LIMITED
Second Interested Party
R LIMITED
Third Interested Party
A.V.A CONSULTING LIMITED Fourth Interested Party
Hearing: On the papers Appearances:
S B McCusker for Applicant
D C Rae in person for Respondent
M G Robinson for the United States GovernmentJudgment:
17 June 2024
JUDGMENT OF GRICE J
(Costs)
COMMISSIONER OF POLICE v RAE (COSTS) [2024] NZHC 1585 [17 JUNE 2024]
Introduction
[1] In a judgment delivered 29 May 2024, I declined the respondent, Mr David Rae’s, application for non-party discovery ahead of a hearing regarding an application for civil forfeiture orders brought by the Commissioner of Police (the Commissioner).1 I reserved costs and made directions for the filing of any application and submissions on costs, suggesting that a 2B band and categorisation appeared appropriate.2 I said:
[96] Costs are reserved. It is appropriate that costs on any interlocutory matter should be dealt with following the hearing in an application such as this. I note to assist the parties, that the band and categorisation of 2B for costs seems appropriate. Parties should file any application and submissions for costs within five days of the judgment delivery date, and file any response within a further five days.
[2] Mr Rae has indicated that he intends to appeal the decision, and seeks that costs be reserved pending any appeal and the outcome of the substantive trial in May 2025. The Commissioner opposes this, and seeks that costs be fixed on a 2B basis in the amount of $10,038.3
Legal principles
[3] Costs are awarded at the discretion of the court.4 However, this discretion must be exercised in accordance with the principles set out in the High Court Rules 2016. The general rule is that costs follow the event.5 So far as possible, the determination of costs should be predictable and expeditious.6
1 Commissioner of Police v Rae [2024] NZHC 1384. The hearing excluded consideration of jurisdictional issues concerning the United States Government materials which were the subject of the non-party discovery application. Non-publication orders were made in relation to persons redacted in earlier judgment.
2 At [96].
3 The applicant’s submissions and application for costs are dated 7 June 2024. Mr Rae had earlier submitted in a memorandum dated 31 May 2024 that he considered costs should be reserved. He has filed no further memorandum in response to that of the applicant seeking costs, therefore I have treated his earlier memorandum as setting out his grounds of opposition to the Commissioner’s application to costs.
4 High Court Rules 2016, r 14.1.
5 Rule 14.2(1)(a).
6 Rule 14.2(1)(g).
[4] On an interlocutory application, costs should be fixed and payable at the time the application is determined, unless there are special reasons to the contrary.7 However, the court may reverse, discharge, or vary an order for costs on an interlocutory application if subsequently satisfied that the original order should not have been made.8 Such cases tend to involve a party seeking to reverse an adverse costs order after successfully appealing the interlocutory decision.9
Submissions
[5] Mr Rae contends that costs should be reserved on the basis that the Commissioner’s submissions, particularly those made orally, were inconsistent with affidavit evidence and the exhibited file.
[6] Mr Rae submits that the Commissioner changed his position in relation to Mr Rae’s United States convictions from that adopted before Cooke J, without notifying the Court or the respondent. He says that in the list appearance before Gwyn J, counsel for the Commissioner did not correct the potential misunderstanding about the evidential position of the United States convictions. The Commissioner disputes this, noting that present counsel (who were not involved in the hearing before Cooke J) merely expressed in response to a query from Gwyn J that it might be necessary to consider whether United States convictions would be conclusive proof of that offending under the Evidence Act 2006. As observed in the judgment, the Commissioner now accepts that s 47 of the Evidence Act does not apply to the United States convictions.10
[7] Mr Rae also takes issue with the Court’s reliance on oral submissions made by the Commissioner that the applicant would not rely on the fact that the respondent owned or controlled Cargill Consulting Ltd or that it was a shell company. Mr Rae says that these submissions “stand in stark contrast to the actual evidence”, and were made with no prior indication that this position would be taken. However, the Commissioner contends that his position in relation to Cargill was made clear in
7 Rule 14.8(1).
8 Rule 14.8(2).
9 Palmerston North City Council v Hardiway Enterprises Ltd [2018] NZHC 3005 at [6].
10 Commissioner of Police v Rae, above n 1, at [80].
written submissions, and was supported by a number of relevant references to affidavits in advance of the hearing.
Analysis
[8] The primary basis for Mr Rae’s opposition to costs is that the Commissioner has changed his position. He submits that he should not be penalised in costs where “last-minute” changes in the direction of the evidence were mounted orally and no corrective affidavits were filed. However, as argued by the Commissioner, the matters which Mr Rae now raises concern with, particularly in relation to the Commissioner’s position that Cargill was not controlled or owned by Mr Rae, were set out in detail in the Commissioner’s written submissions. In regard to the Commissioner’s indication that he was not relying on the United States convictions as conclusive proof of the offending, this was also clarified prior to the hearing. No additional time was taken up in relation to that matter.
[9] In any event, the documents sought in the discovery application were wide ranging and, in addition to the 16 classes of documents specifically sought, Mr Rae sought orders that all documents held by the United States Government in relation to the prosecutions against him be disclosed. This would go to Mr Rae’s claim that despite pleading guilty to the relevant offending in the United States and confirming under oath that he had committed the acts giving rise to the offending before the United States District Court, he was not in fact guilty. This went well beyond the categories of document related to Cargill and the United States convictions. In addition, he argued that the United States documents would assist Mr Rae in his case that the Commissioner and the United States Government were acting in bad faith throughout. I concluded:
[92] I do not consider the documents sought by Mr Rae in discovery are material to the Commissioners forfeiture application or defence. I dismiss the application for non party discovery.
[93] If I am wrong about materiality and/or the necessity of the items listed by Mr Rae, I would nevertheless exercise my discretion to dismiss the application for discovery in relation to all items sought. In this case, even without considering the jurisdictional issues, the discovery of materials surrounding the United States investigation and prosecutions would require the Court to embark on a relitigation of the United States proceedings and the decisions made by authorities in the context of criminal proceedings. That
would require a wide-ranging investigation by this Court of United States procedures and evidence. Such an investigation would not be consistent with the objective of the Rules to secure the “just, speedy, and inexpensive determination” of the proceeding. It also requires this Court to consider whether Mr Rae committed perjury in a United States court. From a public policy viewpoint that would weigh against exercising my discretion in favour of the application.
[10] I conclude that the issues raised by Mr Rae in contending that the Commissioner changed his stance are not made out. In any event, the argument relevant to those issues did not add to the time or cost of the hearing such that costs should not be awarded in favour of the Commissioner on a 2B basis. There are no special reasons to warrant departing from the usual rule that costs are fixed and payable at the time the interlocutory application is determined. It remains open to a court assessing the case on appeal to reverse, discharge, or vary this order should that be considered necessary.
[11] I note that no issue was taken with the detail of the costs claim which appears reasonable in the circumstances, and therefore it is appropriate that costs be fixed on a standard 2B basis.
Orders
[12] I order that costs against the respondent be fixed on a 2B basis in the amount of $10,038, as sought by the applicant.
Grice J
Solicitors:
Luke Cunningham & Clere, Wellington Robinson Legal, Wellington