Eden Property Developments Limited v Williams - [2016] NZHC 1579

IN THE HIGH COURT OF NEW ZEALAND NAPIER REGISTRY

CIV-2015-441-133 [2016] NZHC 1579

UNDER the Companies Act 1993

BETWEEN

EDEN PROPERTY DEVELOPMENTS LIMITED

Applicant

AND

STANLEY DAVID WILLIAMS Respondent

On the Papers

Counsel:

T R Wano for the Applicant
J McDowell for the Respondent

Judgment:

12 July 2016

COSTS JUDGMENT OF ASSOCIATE JUDGE SMITH

[1] Further to the judgment I gave on this matter on 10 May 2016,1 counsel have now filed memoranda on costs.

[2] Eden Property asks for costs on a 2B basis, together with disbursements totalling $1,155.32. Mr Williams submits that costs should lie where they fall.

[3] For Eden Property, Mr Wano relies on the principle that an unsuccessful party should be liable to pay the successful party’s costs.2 He relies on Eden Property’s success in the proceeding, and refers to the observations made in the judgment that there were far too many “grey areas” in Mr Williams’ claim for the debt demanded,
particularly on the question of what were the terms of the loans (and indeed whether

1 Eden Property Developments Ltd v Williams [2016] NZHC 939.
2 High Court Rules, r 14.2(a).

in fact they were loans).3 He refers to my finding that the dispute was not one which was suitable for determination on a setting aside application.

[4] Mr Wano also refers to the fact that Mr Williams had issued an earlier statutory demand on 23 April 2015, for the same amount of money, and that Eden Property had contended in correspondence from 27 May 2015 that the matter was not suitable for the issue of a statutory demand. At that time Eden Property’s solicitors urged Mr Williams to reconsider the demand and consider dealing with all the issues, including related relationship property issues between Mr and Mrs Eden. Mr Wano submits that Eden Property’s solicitors had advised as early as 21
September 2015 that any claim by Mr Williams would be “effectively a constructive trust claim”, and the lack of clarity over the details of the alleged debts was also referred to in correspondence from Eden Property’s solicitors prior to the issue of the second statutory demand.

[5] Mr Wano refers to the case of Greys Avenue Investments Ltd v New Zealand Mint Ltd, a case in which the creditor withdrew the statutory demand before the hearing. The Court made the following observations in that case:4

If a statutory demand is set aside under s 290, the company will have costs from having succeeded, even if the creditor has acted properly in accordance with [the principle that there is no reasonable argument against the amount demanded]. The company’s right to costs follows its success, regardless of these principles…Again, the right to costs does not require findings in its favour…Instead, arguments as to improper use of the statutory demand have a different place: they may go to whether the court should order increased or indemnity costs under r 14.6(3) and (4) of the High Court Rules.

[6] In reliance on Greys…

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 Eden Property Developments Limited v Williams

Details

AGLC: Eden Property Developments Limited v Williams [2016] NZHC 1579
Case: [2016] NZHC 1579
Decision Date: 12 July 2016

CaseChat Overview and Summary

Eden Property Developments Limited was the applicant in a proceeding against Stanley David Williams, the respondent, seeking costs following a decision on a statutory demand application. The applicant sought costs on a standard basis, along with disbursements. The respondent argued that costs should lie where they fell. The central legal issue was whether the unsuccessful party should be liable for the successful party’s costs, considering the applicant’s success in the proceeding. The court referred to the principle that an unsuccessful party should pay the successful party’s costs and highlighted the numerous uncertainties in the respondent’s claim for debt, particularly regarding the nature and terms of the loans. The court found that the dispute was not suitable for a setting aside application and noted the applicant's early advice that the statutory demand was not appropriate. The court ultimately decided in favour of the applicant, awarding costs on a standard basis, plus disbursements.

Orders