Eastlight Asset Trading no.5 Ltd v Ribble Limited (in rec) fk/a Ground Support (Wgtn no.1) Limited

[2019] NZHC 3172

IN THE HIGH COURT OF NEW ZEALAND WELLINGTON REGISTRY

I TE KŌTI MATUA O AOTEAROA TE WHANGANUI-A-TARA ROHE

CIV-2019-485-416

[2019] NZHC 3172

UNDER

section 143 of the Land Transfer Act 2017

BETWEEN

EASTLIGHT ASSET TRADING NO. 5 LTD

Applicant

AND

RIBBLE LIMITED (in rec) formerly known as Ground Support (Wgtn No. 1) Limited

Respondent

Counsel:

J D Dallas for applicant

R B Hucker for respondent

Judgment:

4 December 2019

COSTS JUDGMENT OF ASSOCIATE JUDGE JOHNSTON

[On the papers]

[1]        Regrettably counsel have been unable to resolve costs following the issue of my judgment in this matter dated 4 October 2019.

[2]        I now have memoranda from Mr Hucker  for the  respondent  receiver and  Mr Dallas for the applicant company.

[3]        Counsel are agreed that as the successful party the respondent is entitled to an award of costs on a 2B basis against the applicant. I make the costs award sought being costs of $10,927. The respondent is also entitled to its disbursements. These are to include filing fees of $160. As Mr Hucker submits, this proceeding should properly have been commenced and dealt with in Auckland as opposed to Wellington and in those circumstances the respondent’s recoverable disbursements are also to include

EASTLIGHT ASSET TRADING NO. 5 LTD v RIBBLE LIMITED (in rec) [2019] NZHC 3172

[4 December 2019]

counsel’s reasonable — as determined by the Registrar — costs of travel for two hearings in Wellington.

[4]        The more difficult issue arises in relation to Mr Hucker’s submission that the respondent ought also to have a costs award against the applicant’s solicitor on the basis that she ought not to have facilitated the registration of the caveat when there was no proper caveatable interest. In this regard, Mr Hucker refers me to the judgment of Master Gambrill in Picar v Pavlovich1 in which such an award was made. There are significant differences between the fact situations of that case and this one. For a start, there, the solicitor was a party. Certainly it would not be appropriate to make any order without affording the solicitor in this case an opportunity to be heard. In any event, I have reached the view that a case has not been made for an order here.

[5]        As Mr Hucker submits, the Court only makes costs awards against non-parties in exceptional cases — cases that are outside the ordinary run of cases.

[6]        Mr Hucker refers me to r 2.3 of the Lawyers and Conveyances Act  (Lawyers: Conduct and Client Care) Rules 2008. Rule 2.3 proscribes lawyers using legal processes other than for proper purposes. A footnote to the Rule refers to the lodging of caveats but appears to apply to a situation in which a solicitor is instrumental in the registration of a caveat when he or she knows or ought to have known that there was no proper foundation for one. There is no evidence of the solicitor  in  this  case  having  any  actual  knowledge  that  the  caveat  was  bad.  Mr Hucker’s contention is that the applicant’s solicitor ought to have made further enquiries and ought to have concluded that there was no proper basis for the registration of the caveat. In my view, that is taking the argument too far. It is quite clear that Mr Kooiman as the shareholder and director of the applicant believed that there was a proper basis for the registration of the caveat. Although I have reached a different conclusion, it would be going too far to expect a solicitor engaged simply for the purpose of registering a caveat to make painstaking enquiries and go into the level of analysis and detail that was necessary to resolve this case against the backdrop of

1      Picar v Pavlovich (unreported) HC Auckland, Master Gambrill, 10 August 2000.

assuming the risk that if he or she were to reach a conclusion with which the court ultimately differed, he or she would be on the receiving end of a costs award.

[7]        In the absence of any evidence to the contrary I am prepared to accept that the applicant’s solicitor in this case made reasonable enquiries to satisfy herself that there was at least an arguable foundation for the registration of a caveat.

[8]I am not prepared to make any award of costs against her.

Associate Judge Johnston

Solicitors:

J D Dallas Law, Wellington for applicant Hucker & Associates, Auckland for respondent