Dovey Aviation Consulting Limited v Attorney-General
[2021] NZHC 1224
•28 May 2021
IN THE HIGH COURT OF NEW ZEALAND WELLINGTON REGISTRY
I TE KŌTI MATUA O AOTEAROA TE WHANGANUI-A-TARA ROHE
CIV 2018-485-972
[2021] NZHC 1224
BETWEEN DOVEY AVIATION CONSULTING LIMITED
Plaintiff
AND
THE ATTORNEY-GENERAL OF NEW ZEALAND
First Defendant
JAMES PATRICK RANKIN
Second DefendantWARBIRDS OVER WANAKA AIRSHOWS LIMITED
Third Defendant
EDWARD RICHARD MILES TAYLOR
Fourth DefendantCHRISTOPHER CHARLES LEE
Fifth DefendantRONALD JOHN DAVID LAMONT
Sixth DefendantALLEN VICTOR HOGAN
Seventh Defendant
On the papers Judgment:
28 May 2021
JUDGMENT OF MALLON J
(Costs)
DOVEY AVIATION CONSULTING LIMITED v THE ATTORNEY-GENERAL OF NEW ZEALAND [2021] NZHC 1224 [28 May 2021]
Introduction
[1] I refer to my judgment dated 9 March 2021 entering judgment for the plaintiff. Pursuant to the leave reserved in that judgment, I have since received submissions from the parties about costs. It is accepted that the plaintiff is entitled to an award of costs and no issue is taken with the disbursements claim.
[2]The issues are:
(a)whether category 2 or 3 should apply;
(b)whether any steps should be at band C rather than band B;
(c)whether some steps have been appropriately claimed; and
(d)whether there should be any uplift.
Category 2 or 3
[3] In a memorandum dated 13 March 2019 filed in the proceeding the parties agreed that the costs category should be 2B. The plaintiff now seeks to revisit this. To do so he must establish “special reasons” for why category 2 should not apply.1
[4] Mr Chapman, counsel for the plaintiff, submits that this was a case where it was necessary to have special skill and experience in aviation law and as it applies to airshows. He says that, in the absence of his own accepted special skill and experience in that area, it would probably have been impossible for him to conduct the case as sole counsel. He notes that collectively the defendants had five counsel.
[5] Mr Chapman submits that the significant complexity of the case became apparent as the matter progressed. He notes, for example, that the two weeks allocated
1 High Court Rules 2016, r 14.3(2). The defendants referred to the following cases that discuss what can constitute special reasons: Delegat v Norman [2014] NZHC 1099; J v J [2013] NZHC 1822; Carlin Enterprises Ltd v Fright Aubrey Ltd (in liq) CIV-2007-409-2030, 27 October 2011; and Balance Agri-Nutrients Ltd v Ravensdown Fertiliser Co-operative Ltd HC Auckland CIV- 2009-404-2171, 11 August 2011.
for the hearing ended up being three weeks. He says that counsel for the Warbirds over Wanaka (WoW) defendants indicated at the end of the hearing that a higher cost category was potentially appropriate. He says this was a recognition of how the proceeding played out.
[6] Dealing with that last point first, in my view what counsel for the WoW defendants said at the end of the hearing does not assist. The position at the end of trial was that:
(a)I asked counsel whether there was agreement on the appropriate category for costs and, if not, whether they were able to offer any indication that I would not hold them to.
(b)Counsel for the WoW defendants acknowledged that “this has been a complex trial”, he needed to turn his mind to whether it might be a category 3 situation and he wished to be heard on that. However, he also said that his mind had been on responding to the allegations over the preceding three weeks and costs had not been on his mind.
(c)Counsel for the New Zealand Defence Force (NZDF) defendants submitted category 2 was appropriate although for some steps, such as the preparation of Mr Brown’s brief of evidence for example, band C might be appropriate.
(d)Counsel for the plaintiff did not indicate a view.
(e)The parties wished to be heard further on costs and my judgment allowed for that.
[7] If I were looking at this matter afresh, my view would be that the proceeding was on the cusp of category 3 but it is debatable. The complexity came from the various rules and documents under which an airshow operates and the detailed understanding of the facts and expert evidence (with even the fact witnesses giving evidence based on their considerable training and experience) that was necessary to
determine whether reasonable care had been exercised in respect of (largely) accepted duties. I consider this complexity would have made it a more difficult case for counsel with average High Court skill and experience. I consider this distinguishes the proceeding from relatively straightforward cases in specialist areas which would normally be category 2.2
[8] Having said that, the nature of the case was known at the outset. Quite the level of work that would be involved may not have been anticipated, but that is something better considered under the bands than in changing the category from that agreed upon at an early stage. That is for two reasons. First, it better reflects the nature of the complexity. That is, it would have required more work on some of the steps, especially if counsel did not have familiarity with the operation of airshows and warbird aircraft.3
[9]Secondly, as it was said in Paper Reclaim Ltd v Aotearoa International Ltd:4
[29] … The idea behind early categorisation is that it assists the parties in calculating, as a proceeding goes forward, their potential exposure to costs. In that way, it assists [the] general principle … that “so far as possible the determination of costs should be predictable and expeditious” (emphasis added).
[10] The Court went on to say that the party seeking to have the proceeding recategorised to category 3 had only proposed it after the substantive hearing and when the result was known. It considered it obvious that the party would not have sought recategorisation if it had failed. The same can be said here. I also note that in settlement offers made by the defendants, costs based on category 2B were included as part of the offers. While the offers were a long way short of what the plaintiff considered appropriate, it does illustrate that the parties made decisions partly on anticipated costs exposure.
2 See, for example, McIlroy v New Zealand ACT Party HC Wellington CIV-2003-485-174, 16 December 2005 at [8], in which MacKenzie J observed a specialist counsel is not necessarily a counsel with special skill and experience for categorisation purposes.
3 The allocation for trial preparation and the hearing is based on the length of the trial. It therefore already takes into account that the complexity of the matter meant that a two week trial ended up taking three weeks.
4 Paper Reclaim Ltd v Aotearoa International Ltd [2007] NZCA 544.
[11] I conclude that costs are to remain at category 2. The plaintiff has not demonstrated “special reasons” for changing from the category established earlier.
The bands
[12] The requirement for special reasons to depart from what was agreed does not apply to the bands. That is because the bands can differ with the step. The plaintiff seeks band C for the following steps:
(a)the statement of claim;
(b)the replies;
(c)notice to answer interrogatories;
(d)answers to interrogatories; and
(e)notice to give particulars.
[13] The plaintiff submits that each of these steps involved a comparatively large amount of time. He says they required making Official Information Act (OIA) requests of the Queenstown Airport Corporation, NZDF and the Civil Aviation Authority (CAA); analysis of answers to these requests and the delivery of follow up requests; analysis of the CAA Rules, advisory circulars AC91-1, AC91-9, AC139-6 and AC172-1, ICAO publication 9342, the NZASA Guide to Airshow Display Direction, the WoW exposition and the AIP supplements for WoW 2012 to WoW 2018; consideration of the CAA accident report; and consideration of the defendants’ discovered documents. The plaintiff says that, apart from the volume of material that had to be considered, determining the relationship and interplay between those sources of the duties and the obligations of those conducting airshow operations was also a task requiring a comparatively large amount of time.
[14] I accept that submission in general terms. I consider it more directly applies to the statement of claim and the notices to answer interrogatories than it does to the other, more straightforward, steps. Having reviewed the replies, the answers to
interrogatories and the notice to give particulars, I am not persuaded that band C should apply to these steps. Band B is to apply to those steps.
[15] The defendants submit the statement of claim was unnecessarily complicated because of the multiple alleged duties and multiple alleged breaches it contained. For example, the fourth to seventh defendants were alleged to have owed 92 separate and distinct duties of care and to have committed over 100 separate breaches.5 The plaintiff responds with the point that the relevant rules and documents under which the defendants operated imposed many obligations on the defendants and the alleged duties reflected this. Moreover, by pleading the duties in such a particular way and based on those rules and documents, the defendants would be less likely to deny any duty of care and the dispute over the scope of the duties owed would be identified for the Court.
[16] I consider there is a degree of merit on both sides on this point. I accept the plaintiff’s point that the particularity of the duties alleged allowed clarification of what was or was not in dispute. On the other hand, I accept that the particularity with which they were pleaded meant that the pleaded duties and breaches were overlapping and said more or less the same thing in many places and could have been synthesised to some degree. Having said that, I consider that of the various steps preparatory to briefs, trial preparation and the trial, it is the statement of claim that likely required the most work because of the need to obtain information via the OIA requests and to get to grips with the information provided and the regulatory environment under which the airshow operated in order to prepare the claim.
[17] Band B allows three days for the preparation of the statement of claim whereas band C allows 10 days. The defendants submit that 10 days is just too much and would allow the plaintiff a windfall. I disagree. I consider the reasonable amount of time involved for this step is well above the three day allowance and is at or closer to the 10 day allowance. Predictability in the application of the costs rules means that once a band is clearly inadequate, the allowance should be at the next band.
5 The WOW defendants say that the plaintiff did not address these in closing submissions although the WOW defendants were put to the trouble of doing so. However, as the plaintiff responds, it did address them in opening submissions.
[18] Band B allows one day for the notices to answer interrogatories whereas band C allows for four days. As there were three notices, the difference becomes three days versus 12. Having reviewed the interrogatories, I consider the three days inadequate but the 12 days is excessive. Taking into account that there would be some overlap in the preparatory work for each notice, I consider the appropriate allocation is band C for two of the notices and band B for the other one. That would mean an allowance of nine days rather than the 12 claimed. As between the NZDF defendants and the WoW defendants, this should be allocated four days to NZDF and five days to WoW.
Steps claimed
[19] The WoW defendants submit that no award should be made for the notice to give particulars. The WoW defendants submit the notice was given late and in any event was more in the nature of seeking further interrogatories than it was a valid request for particulars. Both of these points are disputed by the plaintiff. I do not think a costs decision is the place to delve into the detail of whether steps were necessary or not. The fact is that a notice for particulars was given and a response was provided. The plaintiff should have costs for this step at the band B allocation.
[20] The defendants also submit that there should be no allowance for “application by AVL” as claimed. This claim relates to evidence given by the plaintiff’s expert on quantum which was given by AVL. In fact no application was made. Rather the defendants agreed to this and the plaintiff sent a brief email to the Court for approval. The plaintiff responds that arranging AVL for this witness (checking the rules, checking the availability of facilities and corresponding with solicitors) easily exceeded the claimed time allocation of 0.6 days. The plaintiff also says that the WoW defendants unnecessarily challenged quantum and, if they had not done so, then the cost in arranging AVL approval would not have been incurred.
[21] I consider no allowance is available for this. With the exception of the allocation for “preparation for hearing”, the steps relate to formal steps taken with the Court. Reflecting this, the 0.6 allocation for civil proceedings that is claimed relates to “filing interlocutory application”. No application was filed in this case because the
defendants not only consented to it, they facilitated it and at their cost. It is true that the WoW defendants could have accepted the quantum claim, as the NZDF defendants did, but they were also entitled to put the plaintiff to proof on the issue.
[22] Lastly, the WoW defendants say that the plaintiff has claimed twice for step 10 of Schedule 3, and is seeking costs for its memorandum for and attendance at the case management conference on 4 June 2019 for which the plaintiff has already been awarded and been paid costs. The plaintiff has not replied on this issue so it may be that it is accepted. However, if it is not, I expect counsel can resolve this by identifying precisely what memoranda are claimed for and which number in the schedule the claim is based upon.
Uplift
[23] The plaintiff seeks a 25 per cent uplift on the scale costs on the ground that prior to trial, in Calderbank correspondence, counsel for the WOW defendants accepted that the Saturday pilot briefing “could have been clearer”.6 The plaintiff submits that the WoW defendants should have defended the claim only on the basis of contributory negligence in which case the trial could have been confined to one week rather than three. The plaintiff also says the WoW defendants refused to accept the quantum claim without reasonable justification.
[24] I do not accept that the WoW defendants accepted in the Calderbank correspondence that they had breached a duty of care in relation to the pilot briefing. That the briefing could have been clearer was part of the defence theory that briefing the centre grass as “available” meant it potentially could be used for take-off and landing but it would require permission. On this theory, the lack of clarity in the briefing was in not expressly adding the requirement to obtain permission but, on this theory of the case, compliance with other “conventions” would have meant that Mr Dovey would not have landed on the centre grass. I did not accept that theory. I found that the centre grass was available to the pilots without permission and the assumptions or conventions relied on were an insufficient basis on which to conclude that Mr Dovey would land on the grass.
6 The plaintiff relied on r 14.6(3)(b)(ii) and (iii).
[25] Additionally, there were a number of other breaches alleged and established that presented the full picture against which causation and contributory negligence could properly be assessed. For example, with a full understanding of how the airshow operated, and was intended to operate, for the safe conduct of the show it became clear that a crucial safety aspect was the necessity to keep runways made available to pilots free of obstructions and to alert pilots to obstructions if and when that was not the case.
[26] I was provided with copies of settlement correspondence and correspondence about the possibility of mediation. They were not helpful to the costs issue. I did not form a view from this correspondence that either party had acted unreasonably in this process. It was apparent that both sides wished to settle if they could agree the appropriate level of settlement but they were just too far apart in their respective assessments of their case and, once that point was reached, neither side continued to pursue settlement efforts.
[27] In my view, therefore, the grounds for an uplift on this basis are not made out. The same applies to the quantum issue. The WoW defendants were entitled to put the plaintiff to proof on quantum. The issue was a narrow one and occupied a small amount of time. The defendants facilitated the AVL for the witness. This issue does not warrant an uplift in the costs award.
[28] It follows that it is unnecessary to consider the matters the WoW defendants refer to about the plaintiff’s conduct in the proceeding. These were in response to the claimed uplift that I have not allowed.
Result
[29] The plaintiff is entitled to a costs order as claimed, on a category 2B basis, but subject to the adjustments discussed in this judgment. It is also entitled to disbursements as agreed.
[30] The costs order will be joint and several except where the NZDF and WoW defendants agree as to the portion that should be ordered severally against each of them (including as indicated in relation to the allowance for the notice to answer
interrogatories). It appears from the NZDF and WoW submissions that there will be no difficulty between them in reaching agreement about this.
Mallon J
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