Evans v Six Gen Limited

[2025] NZHC 476

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

I TE KŌTI MATUA O AOTEAROA TĀMAKI MAKAURAU ROHE

CIV-2023-404-2656

[2025] NZHC 476

BETWEEN

BELINDA ANNE EVANS

Plaintiff

AND

SIX GEN LIMITED

First Defendant

KARL JASON EVANS and TELLIC LOUISE EVANS
Second Defendants

AND

SIX GEN LLIMITED
Counterclaim Plaintiff

BELINDA ANNE EVANS

Counterclaim Defendant

On the papers:

12 March 2025

Appearances:

Carole G Smith for the Plaintiff and Counterclaim Defendant W G Manning and Georgia Bowker for the Defendants

and Counterclaim Plaintiff

Judgment:

12 March 2025

COSTS JUDGMENT OF ASSOCIATE JUDGE C B TAYLOR

This judgment was delivered by me on 12 March 2025 at 3:00pm

pursuant to Rule 11.5 of the High Court Rules

Solicitors:

………………………….

Registrar/Deputy Registrar

Mac & Co (Jan McNamara), Grey Lyn, for the Plaintiff and Counterclaim Defendant

Bell & Graham (Richard Smith), Matamata, for the Defendants and Counterclaim Plaintiff

Counsel:

Carol G Smith, FortyEightShortland Chambers, Auckland, for the Plaintiff and Counterclaim Defendant W G Manning/George Bowker, Park Chambers, Auckland, for the defendants and Counterclaim Plaintiff

EVANS v SIX GEN LIMITED [2025] NZHC 476 [12 March 2025]

Introduction

[1]    On 20 December 2024 the Court delivered a judgment in which the plaintiff’s application to set aside the defendant’s claim for privilege in respect of a number of documents was largely unsuccessful (the Judgment).1 At [64(b) of the Judgment, counsel were directed to endeavour to agree costs, failing which they were to file memoranda as to costs.

[2]    Counsel have been unable to agree costs. Counsel for the defendants filed a memorandum dated 13 February 2025, and counsel for the plaintiff filed a memorandum in reply dated 20 February 2025.

Defendants’ position

[3]    Counsel for the defendants, submits that the defendants were substantially successful in their opposition to the plaintiff’s interlocutory application, and they seek scale costs on a 2C basis, or alternatively on a 2B basis.

[4]    Counsel for the defendants submits that an award of costs on a 2C basis is appropriate given the significant time that was required to prepare for the application, and the number and complexity of the issues and points to the following:

(a)In an effort to avert the need for the plaintiff’s application, counsel for the defendants sent two letters to the plaintiff’s counsel addressing in some considerable detail the privileges claimed for each document and the reasons why the privilege was being asserted;

(b)the issues before the Court were relatively substantial. The plaintiff filed two affidavits (one in reply) which attached more than 100 pages

1      Evans v Six Gen Ltd [2024] NZHC 3944.

of exhibits. The defendants filed three affidavits and a total of 16 pages of exhibits;

(c)the defendants filed lengthy submissions (32 pages) reflecting the many issues raised on the application, and the substantial legal research and analysis required.

[5]    Costs on a 2C basis are assessed by counsel for the defendants at $13,742.50 plus disbursements of $143.00 totalling $13,885.50.

[6]    As an alternative, counsel for the defendants seeks costs on a 2B basis which are assessed at $6,811.50 plus disbursements of $143.00 totalling $6,954.50.

[7]    Counsel for the defendants opposes any reduction in costs. He submits that the defendants succeeded in defending the claims to privilege for legal advice/solicitor- client privilege, litigation privilege and common interest privilege, with only the claim for settlement privilege being the only unsuccessful privilege claimed. He submits the end result was that of the 18 privileged documents which the plaintiff challenged, the plaintiff succeeded in setting aside the privilege claimed for only three documents of which, in substance, two were the same document, namely a draft letter and a short covering email.

[8]    Counsel for the defendants also submits that the Court should note that the plaintiff relied for her challenge to the privileges asserted by the defendants under “the joint interest exception” based on the Supreme Court’s judgment in Lambie Trustee Limited v Addleman.2 He submits that this required extensive rebuttal from the defendants in their submissions (pages 12-14 of the defendant’s submissions) and then at the hearing itself the plaintiff abandoned this part of her challenge.

Plaintiff’s position

[9]    Counsel for the plaintiff opposes either 2C or 2B costs being awarded to the defendants and submits that costs should lie where they fall.

2      Lambie Trustee Limited v Addleman [2021] NZSC 54.

[10]   As to the defendants’ submission that 2C costs are justified, counsel for the plaintiff submits the defendants have not demonstrated why a comparatively large amount of time was reasonable for filing the opposition to the application, and submits:

(a)the defendants’ evidence was not voluminous;

(b)the exhibits attached to the plaintiff’s evidence consisted largely of the contested redacted documents, and approximately 30 pages of documents were relevant to settlement privilege being claimed by the defendants and on which the plaintiff was ultimately unsuccessful;

(c)with reference to correspondence between counsel prior to the application as referred to by the defendants, the defendants were repeatedly changing their position in respect of which privilege applied to which document, and refusing to accept that settlement privilege did not apply in relation to any of the documents in respect of which it was claimed;

(d)with reference to the defendants relying on the length of their submissions to argue an award of 2C costs is appropriate, in the decision in Minister of Education v James Hardie New Zealand3 the Court considered the length of submissions or other documents are not determinative of “or even a usual touchstone for” the appropriate banding.

[11]   As to the award of 2B costs, counsel for the plaintiff submits that the plaintiff succeeded in her claim for an order setting aside the defendants’ claim to settlement privilege and was in that sense the successful party. She submits that settlement privilege was claimed by the defendants in relation to many of the 18 documents and the Judgment found that privilege did not apply to any of the documents for which it was claimed.

3      Minister of Education v James Hardie New Zealand [2018] NZHC 2960.

[12]   Counsel for the plaintiff refers to the decision in Water Guard NZ Ltd v Midgen Enterprises Ltd4 in which the Court of Appeal overturned a High Court judgment ordering that costs would lie where they fall in a situation where the plaintiff had succeeded in relation to approximately 25 per cent of its claim (the High Court having considered the plaintiff was the unsuccessful party).

[13]   Counsel for the plaintiff submits that settlement privilege made up 25 per cent of the four privileges being claimed; the plaintiff succeeded in setting this claim aside; and on the basis of the reasoning in the Water Guard decision, the plaintiff was the successful party.

[14]   Counsel for the plaintiff submits that on the basis of the approach in Water Guard, costs should lie where they fall.

Result

[15]   I am of the view that 2C costs are not appropriate. In my view any complexity or volume of documents involved in the pleadings does not justify additional time claimed by the defendants in defending the application. Costs should be assessed on a 2B basis.

[16]   The defendants were largely the successful party and on that basis are prima facie entitled to 2B costs in opposing the application. The finding in the Judgment that settlement privilege did not apply resulted in three of the 18 documents for which privilege as claimed being set aside, justifies some reduction in 2B costs to be awarded to the defendants. Given privilege was set aside in relation to three documents out of 18 documents, in my view a 15 per cent reduction in 2B costs sought by the defendants is appropriate. This reduction takes into account the plaintiff‘s late abandonment of the “joint interest exception” at the hearing.

4      Water Guard NZ Limited v Midgen Enterprises Limited [2017] NZCA 36.

Orders

[17]   I order that the plaintiff is to pay the defendants $5,789.78 being costs assessed on a 2B basis reduced by 15 per cent, together with disbursements of $143.00, totalling

$5,932.78.

…………………………….. Associate Judge Taylor