Cook v Kirkland

[2019] NZHC 3206

IN THE HIGH COURT OF NEW ZEALAND CHRISTCHURCH REGISTRY

I TE KŌTI MATUA O AOTEAROA ŌTAUTAHI ROHE

CIV-2018-409-611

[2019] NZHC 3206

BETWEEN

TONI DAVID COOK

Plaintiff

AND

JAMES MICHAEL KIRKLAND

First Defendant

AND

ERNEST JOHN TAIT

Second Defendant

Hearing:

5 December 2019 (On the papers)

Counsel:

M Phillipps for the Plaintiff

V A Nichols and A N Riches for the First Defendant No appearance for the Second Defendant

Judgment:

5 December 2019

JUDGMENT OF ASSOCIATE JUDGE LESTER

This judgment was delivered by me on 5 December 2019 at 4.15pm pursuant to Rule 11.5 of the High Court Rules

Registrar/Deputy Registrar 5 December 2019

COOK v KIRKLAND [2019] NZHC 3206 [5 December 2019]

[1]                 Notwithstanding that this proceeding was resolved in a settlement in part brokered by the Court, both the plaintiff and first defendant are seeking costs in respect of the proceedings. The second defendant took no part in the proceeding and I make no further reference to the second defendant.

[2]                 As recorded in Associate Judge Osborne’s Minute of 1 November 2018, the proceeding concerned the estate of June Cook, the mother of the plaintiff. The plaintiff is the sole beneficiary in Ms Cook’s estate.

[3]                 The defendants were appointed by Ms Cook as her executors and trustees under her Will of 4 May 2000.

[4]                 The plaintiff sought in the proceedings an order removing the defendants as trustees and appointing the plaintiff and/or an identified solicitor as a replacement trustee.

[5]                 These proceedings followed on from another set of proceedings issued by   Mr Cook against the defendants in the District Court.

[6]                 Those proceedings were met with an application for security for costs dealt with by his Honour Judge McCaskill in a judgment dated 17 October 2018. The allegations in those proceedings concerned chattels that had gone missing from the late Ms Cook’s residence and additional chattels sold at auction in circumstances where the plaintiff had wished to obtain those chattels.

[7]                 A key factor in the Judge ordering security in that case was that Mr Cook lacked standing to bring a claim directly against the trustees in respect of the chattels

– that right being an asset in Ms Cook’s estate. His Honour characterised the plaintiff’s case as weak as a matter of fact and law. Security was ordered. Those proceedings were discontinued without the security being paid. The plaintiff says that discontinuance was to recognise the difficulty of standing in the District Court. Replacement proceedings were issued in this Court and costs issues in the District Court ultimately resolved.

[8]                 The statement of claim sought, as I have said, orders removing the defendants as trustees of Ms Cook’s estate.

[9]                 The defendants were critical of the statement of claim and that criticism has continued in their memorandum in respect of costs. The defendants submit that the statement of claim does not particularise the grounds upon which removal is sought. There is some merit in this criticism.

[10]              With proceedings reissued in this Court, a further application for security for costs was made relying on much the same grounds as the application in the District Court, save that the issue of standing no longer existed.

[11]              At the commencement of the hearing of the application for security for costs, I referred to  the  fact  that  plaintiff’s  counsel  had  referred  to  the  rule  in Saunders v Vautier.1 As Mr Phillipps sought to gain control of the estate’s causes of action relating to the chattels, I noted that the plaintiff could achieve that end through calling for that asset to be distributed to him.

[12]              That  suggestion  led  to  the  matter  being  resolved  and  in  a  Minute  of  13 May 2019, I recorded the agreement that had been reached.

[13]              After some further intervention from the Court, the settlement was finally implemented.

[14]              The plaintiff seeks costs on the grounds, in effect that the proceedings were necessary to force resolution of the plaintiff’s dispute.

[15]              I note the plaintiff’s submissions refer to my Minute of 13 May 2019 as being a judgment, but as I recorded in that Minute, the resolution did not represent orders made by the Court in respect of a claim by either party, but a pragmatic solution suggested by the Court.

1      Saunders v Vautier (1841) 49 ER 282, (1841) 4 Beav 115.

[16]              The defendants seek costs on the basis that the relief sought by the plaintiff, that is a Court directed removal of the defendants, did not succeed. In addition, the first defendant points to his having made an application for security for costs where, at the very least, jurisdiction to award security existed, the plaintiff being resident    in Australia. A further point is that the plaintiff did not file a notice of opposition to the application for security within the time prescribed by the High Court Rules, resulting in the plaintiff having to seek and being granted an indulgence in being given leave to file his papers in opposition out of time.

[17]              The normal rule is that costs follow the event. However, here it is far from clear just what the “event” is. The plaintiff set out to remove the defendants as trustees implicitly on the grounds of a breach of duty of some sort. The defendants as solicitors not surprisingly resisted that suggestion. Their agreement to stand down as trustees was one driven by pragmatism and was a suggestion made by the Court.

[18]              At the end of the day, I consider there should be no order as to costs. There is some merit in the defendants’ criticism of the plaintiff’s pleading. The pleading does not set out specific grounds for the removal of the defendants as trustees. That said, it is quite clear from the history of dealings between the parties that the defendants were fully aware that the plaintiff, as the sole beneficiary of Ms Cook’s estate, had lost confidence in them as trustees of the estate. Some pragmatic resolution was called for and as I have said, it was only with the intervention of the Court that a pragmatic solution was reached. I have the impression that the parties’ positions became unnecessarily entrenched when pragmatism was called for.

[19]Accordingly, each party’s application for costs is declined.

Associate Judge Lester

Solicitors:

Vicki Ammundsen Trust Law Ltd, Auckland Saunders & Co, Christchurch