Craig v Stringer

[2025] NZHC 1772

IN THE HIGH COURT OF NEW ZEALAND CHRISTCHURCH REGISTRY

I TE KŌTI MATUA O AOTEAROA ŌTAUTAHI ROHE

CIV-2024-409-542

[2025] NZHC 1772

BETWEEN

COLIN GRAEME CRAIG

Judgment Creditor

AND

JOHN CHARLES STRINGER

Judgment Debtor

Hearing:

24 June 2025

Appearances:

N D Whittle for Judgment Creditor

J J Gasson and S Caradus for Judgment Debtor

Judgment:

1 July 2025

JUDGMENT OF ASSOCIATE JUDGE LESTER

CRAIG v STRINGER [2025] NZHC 1772 [1 July 2025]

[1]                 Mr Stringer applies to set aside a bankruptcy notice issued by Mr Craig. The bankruptcy notice is based on a judgment awarding Mr Craig $56,935.34 for disbursements  incurred  by  Mr Craig  in  a  defamation  proceeding  brought  by  Mr Stringer against Mr Craig.

[2]                 Mr Stringer relies on three grounds  in  this  application.  The  first  is  that Mr Stringer has the benefit of an award of disbursements in his favour, arising from a separate proceeding Mr Craig brought against Mr Stringer.1 In that separate proceeding, Mr Stringer was awarded disbursements in March 2023, but those disbursements have not yet been quantified.2 A separate but related ground of challenge is that Mr Stringer says following being awarded disbursements, he made an oral agreement with Mr Craig that they would treat the two awards as cancelling each other out. Finally, Mr Stringer says he was not validly served with the bankruptcy notice.

Service

[3]                 On 1 November 2024, Mr Craig’s solicitors emailed Mr Stringer as follows: “Regarding service of documents, would you accept service by email? If not, can you confirm you live at the [address] or have you moved?”

[4]                 Mr Stringer replied 15 minutes later by email: “I’ve moved, … Service by email is  best,  as  before.  Is there a response to  the respective costs  offset  from  Mr Craig?”

1      Craig v Stringer [2023] NZHC 666.

2      At [361] and [365]. Mr Stringer was a litigant in person in these proceedings, hence he was not entitled to costs at the time.

[5]                 The last passage of this quote refers to the offsetting of the two disbursement awards, which I deal with separately.

[6]Mr Gasson, counsel for Mr Stringer, in his submissions says:

28.While Mr Stringer did agree to accept service of ‘documents’ by   email, this was in the context of a conversation regarding an offer being made on Mr Stringer’s property. Mr Stringer believed he was agreeing to service of documents relating to that offer. He did not know that he was agreeing to service of a bankruptcy notice.

[7]                 Mr Stringer in his affidavit says: “I did not consent to service of the Notice by email. It was my understanding that I was agreeing to service of documents in an unrelated matter.”

[8]                 Mr Stringer’s evidence does not explain the basis of this understanding. Nor does he link his  agreement  to  service  by  email  to  the  offer  on  his  property.  Mr Gasson’s submissions are therefore a gloss on this evidence.

[9]                 While in August 2024 there had been reference to someone (not Mr Craig) expressing an interest in buying Mr Stringer’s house, as Mr Stringer put it, “under false pretences”, by 19 August 2024 Mr Stringer was referring to being able to lay aside what he described as the nonsense with that offer.

[10] That Mr Stringer in his reply email at [4] above, raised the question of the offset of the disbursement awards is squarely against the idea that he thought he was being asked about receiving documents in an unrelated matter. The prior email exchange that day was about the offsetting of the disbursement awards. Further, that a solicitor was asking him about accepting service would convey that the documents did not  relate  to  a  property  transaction  —  offers,  or  the  like  in  the  course  of a negotiation, are not served.

[11]              Rule 6.7 of the High Court Rules 2016 (the Rules) provides: “Service by     a method agreed to in writing by a party is sufficient service on that party”.

[12]              On its face, the email exchange records Mr Stringer agreeing to accept service by email. Nothing in its wording or the context of the exchange suggests that agreement should be read as not applying to a bankruptcy notice. I find the bankruptcy notice was validly served.

Oral agreement to offset awards

[13]Mr Craig’s entitlement to costs was fixed on 21 July 2022 and as noted is for

$56,935.34.

[14]              Mr Stringer says that following the award of disbursements in his favour on 29 March 2023, he and Mr Craig reached an informal agreement that Mr Craig would take no action to enforce his judgment debt given Mr Stringer had his own claim against Mr Craig. Mr Stringer says that they would both “walk away”.

[15]              Mr Craig denies this agreement was reached. Mr Stringer’s evidence in respect of this agreement is in the most general of terms. He does not say when or where it was reached or provide other details. What he does rely on is the fact that Mr Craig did not seal his judgment until 30 August 2024, that is over two years since the figure was fixed on 21 July 2022. Mr Stringer says this delay is consistent with the agreement he asserts. In effect Mr Stringer questions why else would Mr Craig have not sought to enforce a judgment in his favour earlier.

[16]              For the reasons I will explain more fully below, it is inherently unlikely that Mr Craig would agree to forego his judgment for nearly $57,000 in exchange for   Mr Stringer’s unquantified claim for disbursements which, in the circumstances I will describe below, would have been known by Mr Craig to be worth substantially less than Mr Craig’s judgment.

[17]              On 19 August 2024, Mr Craig raised with Mr Stringer his outstanding judgment. Mr Stringer replied by email on the same day, saying:

Obviously I was also awarded costs in the commensurate case, and as I had legal representation and support in the first few years of that proceeding, as you did, those costs would be about the same. I thought we had an understanding our respective costs would be offset, which is why I had not detailed and filed a second costs claim. I thought we agreed if we both had

similar outcomes in the respective cases, as was the case, we would let the costs lay because they would obviously offset one another being two halves of what was at one time, a combined case.

[18]              Mr Craig responded that he did not appear to have received any judgment in respect of costs in Mr Stringer’s favour and asked for a copy of the judgment. While Mr Craig does not expressly deny the existence of a walkaway agreement, such is inherent in his response.

[19]              In reply, later on the same day, Mr Stringer referred to the judgment in which he had obtained the award of disbursements and said:

I’m happy to offset the two respective orders, as realistically – without going [through] all 8 years of costs – they would be commensurate with one another, despite both being heard in Auckland which created additional costs for me as defendant (airfares and accommodation, etc) which would normally have been heard in [Christchurch].

(emphasis added)

[20]              Accordingly, Mr Stringer’s initial reaction on 19 August 2024 was to say he was happy to offset the two respective orders, rather than alleging there was already in place an agreement that the two awards had cancelled each other out, which is the position Mr Stringer has since moved to. The highlighted words above are the language of a proposal, not of a pre-existing  concluded  agreement. The thrust  of Mr Stringer’s present position is that Mr Craig agreed to walk away from his fixed disbursement award in exchange for Mr Stringer not pursuing his unquantified disbursement award.

[21]              On 8 October 2024, Mr Craig’s solicitor had become involved. The solicitor sent Mr Stringer a copy of the sealed order obtained by Mr Craig on 30 August 2024. Mr Stringer replied the same day saying that Mr Craig:

… seemed to be unaware of the costs awarded [to] me in the split parallel case. These naturally will offset one another. He asked for a copy of that judgment

… and I sent it to him.

[22]              This is not Mr Stringer referring to a pre-existing agreement that the two judgments, without more, cancelled each other out.

[23]              Early on the afternoon of 8 October 2024, Mr Stringer again emailed the solicitor saying:

We had an understanding that if both of us were to win the respective parts, the expenses would be offset. That is what happened. Therefore no appraisal of the expenses of the second part was completed. Having not heard from [Mr Craig] in more than two years, I presumed this matter was at an end as per our understanding.

[Mr Craig] has since asked for an expenses claim and asked if this could be done before Christmas. ?? It is not correct; I did have legal representation in the case, easily commensurate with his expenses …

[24]              Mr Stringer also referred to having additional costs  that were incurred as     a result of travelling to Auckland and securing accommodation there.

[25]              Mr Craig’s solicitor replied: “As I understand it, from this email, you haven’t sought an award of costs or disbursements to be set by the Registrar?”

[26]              Mr Stringer responded promptly, again on 8 October 2024, that he was happy to have the costs and disbursements set by the Registrar, but says:

… I clearly understood [Mr Craig] and I understood they would offset anyway, which they would, and we agreed to let the respective expenses lay, back in 2023. If that is not now the case, then we can waste time going [through] the process and offset everything.

[27]              Later on 8 October 2024, Mr Stringer again emailed Mr Craig’s solicitor indicating his expenses would be close to $50,000. Mr Stringer refers to offsetting the claims and offers to provide a sum of money to Mr Craig in case of an “overlap in his favour” above and beyond what Mr Stringer anticipated would be his disbursement award, and said: “I thought [Mr Craig] and [I] had agreed all this years ago…”.

[28]              Mr Stringer, in his emails to Mr Craig and/or his solicitor, does not contend that Mr Craig agreed to an offset irrespective of the value of Mr Stringer’s disbursement award. It is clear Mr Stringer thought his disbursement award would more or less match the judgment obtained by Mr Craig but, as I will describe below,

that assumption was based on a misapprehension as to the time period for which    Mr Stringer could claim disbursements.

[29]              I remind  myself  of  the  Court’s  approach  on  an  application  to  set  aside a bankruptcy notice should be treated as akin to that taken when affidavit evidence is considered on an application for summary judgment. Such a summary process is not suitable for the determination of disputed facts, but the Court need not accept uncritically any evidence that is inherently lacking in credibility, inconsistent with contemporary documents or uncommercial.

[30]              I am satisfied that the claim Mr Craig agreed some time after March 2023 to write-off or, using Mr Stringer’s words to “walk away” from his judgment of nearly

$57,000 simply because Mr Craig had obtained a disbursement award, is not credible. I reach that conclusion for the following reasons:

(a)As already noted, Mr Stringer’s evidence of the alleged agreement is in the most general of terms and lacks detail.

(b)There is no contemporary reference to the alleged agreement — the idea of an offset was raised only when Mr Craig sought payment of his judgment.

(c)The agreement, as Mr Stringer would now have it, is not as described by him in the email exchange reviewed above. It is easy to accept that the idea of an offset of judgment once quantified may have been discussed, whereas the idea Mr Craig would agree to extinguish his judgment irrespective of the value of Mr Stringer’s judgment is not.

(d)As just touched on, the agreement asserted by Mr Stringer does not make commercial sense. Immediately after obtaining Mr Craig’s disbursement award, Mr Craig sought to bankrupt Mr Stringer albeit this was withdrawn. Given the years of litigation between them, it is inherently unlikely that Mr Craig would have adopted such an uncommercial approach.

[31]I find there was no such offset agreement.

What is Mr Stringer’s disbursement award worth?

[32]              Disbursements were to be fixed by the Registrar, but in order to prevent that process requiring Mr Stringer’s application to set aside the bankruptcy notice being adjourned again, I called for copies of the submissions in respect of disbursements in order that I could fix them as part of this application.

Partial settlement of Mr Craig’s proceedings against Mr Stringer

[33]              At a judicial settlement conference held on 30 January 2017, the parties reached a settlement of all issues between them in the proceeding in which Mr Stringer was six years later awarded disbursements. Associate Judge Osborne issued a consent judgment on 31 January 2017.3 The significant part of the judgment records: “There is no order as to costs and directions as to costs or disbursements previously made or reserved are rescinded”.4 The settlement is recorded as being a “full and final settlement of all issues between them.”5

[34]              Accordingly, as at the date of Osborne J’s judgment of 31 January 2017, no party had any entitlement to costs against the other.

[35]              In a judgment issued on 19 December 2017, Associate Judge Osborne recalled his 31 January 2017 judgment.6 Mr Stringer sought that the judgment be recalled because of what he considered to be an inaccuracy in the consent judgment.

[36]              Associate Judge Osborne made an order for recall and recorded that the recall only impacted on the first aspect of the consent judgment whereby judgment was entered for Mr Craig in relation to the allegation that Mr Craig had sexually harassed Ms MacGregor. That paragraph concludes: “It would be inappropriate to rescind any aspect of the judgment other than that relating to the first mentioned allegation”.7

3      Craig v Stringer [2017] NZHC 50.

4 At [4].

5 At [1].

6      Craig v Stringer [2017] NZHC 3221.

7 At [51].

[37]              Mr Stringer was awarded reasonable disbursements in respect of the recall application.8

[38] Mr Craig’s proceeding continued against Mr Stringer in respect of the allegation referred to at [36]. Mr Stringer was successful, hence on 29 March 2023 he was awarded disbursements against Mr Craig.

[39]              The point of referring to Associate Judge Osborne’s decisions is that Mr Craig says the effect of those two judgments is that Mr Stringer cannot claim disbursements prior to 31 January 2017.

[40] Mr Gasson, in a memorandum prepared for the Registrar for the purpose of fixing disbursements, submits the passage from the 31 January 2017 judgment dealing with costs, reproduced at [33] above, is “… merely a statement that no order for costs or disbursements was made at that time”.

[41]              I do not accept this submission. “Where in respect of a proceeding, or a step in a proceeding, the court makes ‘no order as to costs’. This means that each party must bear its own costs of that proceeding or step”.9 A full and final settlement had been reached. The consent order is clear that there is no order as to costs and all existing entitlements, whether they be directions concerning costs or the reservation of costs, were at an end. The 19 December 2017 judgment expressly does not change this order.

[42]              I find the terms of the 30 January 2017 settlement mean Mr Stringer’s entitlement to disbursements in the proceeding brought against him by Mr Craig does not extend to disbursements incurred before 31 January 2017.

[43]              It  is  because  Mr Craig  would  have  been  aware  of  this  limitation  on   Mr Stringer’s entitlement to disbursements that it is inherently unlikely that Mr Craig would have agreed to forego his $56,935.34 judgment in exchange for Mr Stringer’s unquantified and time limited ability to claim disbursements. Mr Craig knew

8 At [60].

9      G E Dal Pont Law of Costs (5th ed, LexisNexis, Australia, 2021) at [1.24].

Mr Stringer’s use of solicitors predated 30 January 2017. Mr Stringer’s disbursements thereafter were going to be more modest than Mr Craig’s award.

The effect of the time limitation on quantum

[44]              Mr Stringer says he is entitled to an award of disbursements of $55,614.63. Excluding all disbursements prior to 30 January 2017 reduces the starting point for an assessment of Mr Stringer’s claimed disbursements to $16,645.47 — that figure is contained in Mr Craig’s submission to the Registrar and has not been challenged.

[45]              Of the starting position, I accept the submissions on behalf of Mr Craig that one of the disbursements claimed is in fact an award of costs Mr Stringer had to pay Mr Craig of $1,064.12 and is not a recoverable disbursement.  Mr Stringer had paid  a filing fee for an application concerning interrogatories in which he was unsuccessful. Mr Stringer cannot claim disbursements in respect of an unsuccessful interlocutory application.    One  disbursement  claimed  on  1 October 2018  of  $1,600,  is  for     a scheduling fee in  a different  proceeding,  and  so  is  excluded.  An  invoice  of  22 May 2020 is from the Court of Appeal, not the High Court and is also excluded.

[46]              Of the $16,645.47, Mr Craig calculated $6,914.12 represents filing fees including some fees for which dates are unknown. The value of the excluded items  in [45] above is $4,264.12 meaning the total filing fee claim Mr Stringer can maintain is $2,650, albeit it includes some disbursements for which dates are not given.

[47]              Mr Craig, in his memorandum of 11 March 2025 to the Registrar, has calculated the total disbursements Mr Stringer is entitled to as $4,868.86. He does that by allowing 50 per cent of the remaining photocopying costs, 50 per cent of post and courier costs and some allowance for USB sticks.

[48]              I intend to fix the total award of disbursements in Mr Stringer’s favour in the sum of $9,500. That figure is intended to give Mr Stringer the benefit of the doubt. It is not feasible to assess the reasonableness of all photocopying charges claimed or the postal/courier charges in Mr Stringer’s schedule. I can assume Mr Stringer had no incentive to incur unnecessary expenses in a proceeding in which he was the defendant. The March 2023 judgment awarding Mr Stringer disbursements was six

years after the 31 January 2017 consent judgment. Given the length of time the proceeding  ran for,  the sum  I have adopted cannot  be said  to be excessive,  albeit  I accept it is fixed “in the round”.

[49]              Accordingly, judgment is entered in Mr Stringer’s favour for $9,500 for disbursements in proceeding CIV-2015-409-575.

[50]              That means that Mr Stringer has a legal setoff against Mr Craig’s judgment debt, leaving $47,473.34 owing to Mr Craig.

[51]              Rule 24.10(1) of the Rules extends the time for compliance with a bankruptcy notice until an application to set aside the bankruptcy notice has been determined.

[52]              As Mr Stringer’s legal setoff is not greater than the judgment debt upon which the bankruptcy notice is based, the bankruptcy notice is set aside only to the extent of the judgment for disbursements now entered for Mr Stringer.10

[53]              There is no basis to require Mr Craig to re-issue his bankruptcy notice for the reduced amount as suggested by Mr Gasson. Such would only create unnecessary cost and delay.

Costs

[54]              Mr Stringer’s application has had only had modest success. Mr Craig is, for the purposes of costs, the successful party, maintaining most of the amount he claimed in his bankruptcy notice. That is particularly so given Mr Craig always acknowledged some modest adjustment to the value of his claim was necessary.

10     Insolvency Act 2006, s 17(7)(a).

[55]              There is an order that Mr Stringer will pay Mr Craig costs on a 2B basis plus disbursements as fixed by the Registrar in respect of this application.

Associate Judge Lester

Solicitors:

Saunders & Co, Christchurch (for Mr Stringer) Chapman Tripp, Auckland (for Mr Craig)