Connolly v Keung - [2025] NZHC 2297

IN THE HIGH COURT OF NEW ZEALAND CHRISTCHURCH REGISTRY

I TE KŌTI MATUA O AOTEAROA ŌTAUTAHI ROHE

CIV-2024-409-510 [2025] NZHC 2297

IN THE MATTER of the Insolvency Act 2006 AND
IN THE MATTER of the bankruptcy of SENG BOU (PAUL)
KEUNG

BETWEEN LEISHA MAUD CONNOLLY
Judgment Creditor

AND SENG BOU (PAUL) KEUNG
Judgment Debtor

Hearing: On the papers

Appearances: W J Palmer and L C Elliott for Judgment Creditor Judgment Debtor appears in person

Judgment: 13 August 2025

JUDGMENT OF ASSOCIATE JUDGE PAULSEN (COSTS)

This judgment was delivered by me on 13 August 2025 at 3.00 pm pursuant to Rule 11.5 of the High Court Rules.

Registrar/Deputy Registrar Date:

CONNOLLY v KEUNG [2025] NZHC 2297 [13 August 2025]

[1] In a judgment of 24 June 2025, I dismissed Mr Keung’s application to set aside a bankruptcy notice issued by Ms Connolly.1 I held that Ms Connolly was entitled to costs, and as to the quantum of such costs Ms Connolly was to file a memorandum within 10 working days of the date of the judgment and Mr Keung had five working days to respond. Ms Connolly filed a memorandum in compliance with my judgment; Mr Keung did not. As a result, I must fix the quantum of costs without Mr Keung’s input.

[2] Ms Connolly seeks scale costs on a part 2B and part 2C basis, plus a 50 per cent uplift along with reasonable disbursements.

[3] There is no doubt that all steps in the proceeding justify an award on at least a 2B basis. The issues are whether:

(a)some steps should be assessed on a 2C basis; and

(b)there should be an uplift on scale costs.

Costs principles

[4] All issues of costs are discretionary but the discretion must be exercised having regard to the principles in the High Court Rules 2016 (the Rules). Rule 14.2 sets out the general principles applying to the determination of costs. In the present context, I note the following are relevant:

(a)an award of costs should reflect the complexity and significance of the proceeding;2

(b)costs should be assessed by applying the appropriate daily recovery rate to the time considered reasonable for each step reasonably required in relation to the proceeding;3

1      Connolly v Keung [2025] NZHC 1689.
2      High Court Rules 2016, r 14.2(1)(b).
3      Rule 14.2(1)(c).

(c)an appropriate daily recovery rate should normally be two-thirds of the daily rate considered reasonable in relation to the proceeding or interlocutory application;4 and

(d)so far as possible the determination of costs should be predictable and expeditious.5

[5] A party seeking increased costs bears the onus of demonstrating that such an award is justified.6

[6] Rule 14.6(3) of the Rules relevantly provides that increased costs may be claimed as follows:

14.6 Increased costs and indemnity costs

...

(3)The court may order a party to pay increased costs if—

...

(b)the party opposing costs has contributed unnecessarily to the time or expense of the proceeding or step in it by—

(i)failing to comply with these…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

Continue reading Connolly v Keung

Details

AGLC: Connolly v Keung [2025] NZHC 2297
Case: [2025] NZHC 2297
Decision Date: 13 August 2025

CaseChat Overview and Summary

In Connolly v Keung, Leisha Maud Connolly, the judgment creditor, sought costs against Seng Bou (Paul) Keung, the judgment debtor, following a dismissed application to set aside a bankruptcy notice. The case was heard in the High Court of New Zealand, Christchurch Registry. The primary issues for the court were to determine the appropriate assessment bands for certain steps in the proceeding and whether there should be an uplift on scale costs.

The court considered the principles for determining costs under the High Court Rules 2016, particularly Rule 14.2, which outlines the general principles for the determination of costs. The court noted that costs should reflect the complexity and significance of the proceeding and should be assessed by applying the appropriate daily recovery rate to the time considered reasonable for each step required in relation to the proceeding. Ms Connolly sought scale costs on a part 2B and part 2C basis, plus a 50 per cent uplift along with reasonable disbursements. The court found that all steps in the proceeding justified an award on at least a 2B basis. However, the court determined that only one step, the preparation of written submissions for the hearing, should be assessed on a 2C basis due to the significant time expended by Ms Connolly’s counsel in going through the unnecessarily large bundles of documents submitted by Mr Keung. The court did not consider the 30 May 2025 memorandum, filed in response to Mr Keung’s memorandum of “further evidence,” to be sufficiently burdensome to warrant a Band C assessment.

Regarding the 50 per cent uplift on scale costs, the court found that while some of Mr Keung’s conduct, such as filing large volumes of documents and making non-meritorious arguments, contributed unnecessarily to the time and expense of the proceeding, it was not appropriate to award increased costs. The court reasoned that the award of scale costs was already appropriate and reasonable in all the circumstances of the case. The court awarded Ms Connolly costs of $22,705 and disbursements of $208.

Orders