First Gas Limited v Gibbs - [2022] NZHC 742

IN THE HIGH COURT OF NEW ZEALAND NEW PLYMOUTH REGISTRY

I TE KŌTI MATUA O AOTEAROA NGĀMOTU ROHE

CIV-2021-443-000016

[2022] NZHC 742

BETWEEN
FIRST GAS LIMITED

Plaintiff

AND

RUSSELL VICTOR GIBBS, PARANI JOSEPHINE GIBBS and LEIGH JOSEPH

HORTON as trustees of the RV and PJ GIBBS FAMILY TRUST

Defendants

Hearing: 13 December 2021

Appearances:

L P Wallace and J E Atkin for the Plaintiff Defendants in Person

Judgment:

12 April 2022

JUDGMENT OF GRICE J

(Costs)

[1] This is an application for costs following a judgment in favour of the plaintiff delivered in December 2021.1 Earlier an interim injunction had been granted on the application of the plaintiff.2 Costs were reserved on that application and fall now to be determined as well. A variation of those interim orders enabling First Gas to commence repairs was also granted in a separate judgment.3

[2] The substantive claim was based in nuisance. First Gas operated the Maui Gas Pipeline which ran through the Gibbs Trust Farm.4 In 2018, an inspection by First Gas

1      First Gas Ltd v Gibbs [2021] NZHC 3309 (Substantive judgment).
2      First Gas Ltd v Gibbs [2021] NZHC 1722 (Interim injunction judgment)
3      First Gas Ltd v Gibbs [2021] NZHC 2794 (Variation judgment).
4      The defendants are trustees of a family trust.

FIRST GAS LIMITED v GIBBS [2022] NZHC 742 [12 April 2022]

indicated a “buckle” had developed in a five-metre portion of the pipeline on the Gibbs Trust Farm. As a result of that, urgent work was undertaken to bypass the pipeline. More extensive repairs were needed to the pipeline itself. These required the shutdown of the pipeline, which had considerable ramifications for the customers supplied by the pipeline, including the Huntly power plant, two methanol plants and commercial and domestic users. The pipeline supplied over 90 per cent of the natural gas used in the upper North Island.5

[3] Difficulties had emerged in the working relationship between First Gas and the Gibbs family, leading to a situation where First Gas felt its only option was to apply to the Court for an interim injunction prohibiting the defendants from restricting and interfering with the plaintiff’s access rights under various authorisations, registered easement certificates and the provisions of the Petroleum Act 1937.

[4] Following the grant of the interim injunction, the substantive proceeding was given priority and heard in New Plymouth over four days, including a site visit to the farm. I found for the plaintiff and issued declarations authorising First Gas to enter onto the land in order to inspect, maintain, repair or operate the pipeline and to deposit and store, inspection, maintenance, repair or operation store, for the purposes of machinery related to those works.6 I also issued a permanent injunction prohibiting the defendants from obstructing access.7 The declaration and orders were subject to conditions, including reasonable notice being given to the defendants of entry onto the land.8 The conditions were attached to the judgment.

[5] The parties have been unable to agree on costs…

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.

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Details

Case: [2022] NZHC 742
Decision Date: 12 April 2022

CaseChat Overview and Summary

First Gas Limited applied for costs following a judgment in its favour against the Gibbs family in relation to the Maui Gas Pipeline running through their farm. The substantive claim was based in nuisance. First Gas operated the Maui Gas Pipeline which ran through the Gibbs Trust Farm. Difficulties had emerged in the working relationship between First Gas and the Gibbs family, leading to a situation where First Gas felt its only option was to apply to the Court for an interim injunction prohibiting the defendants from restricting and interfering with the plaintiff’s access rights under various authorisations, registered easement certificates and the provisions of the Petroleum Act 1937. The Court found for the plaintiff and issued declarations authorising First Gas to enter onto the land in order to inspect, maintain, repair or operate the pipeline and to deposit and store, inspection, maintenance, repair or operation store, for the purposes of machinery related to those works. The plaintiff’s application for costs seeks an award based on a calculation according to schs 2 and 3 of the High Court Rules 2016 on a Category 2, Band 5 basis. The defendants oppose the costs application on the basis that their defence in the High Court was reasonable and that the issues involved are of national interest and public importance. The Court found that there is no reason in this case why costs should not follow the event. The claim proceeded in a timely manner and was brought on promptly. The issues between the parties were aired at the hearing and there is nothing in this case which would call for costs to be adjusted due to the various stances of the parties at the hearing or in the course of the proceedings. The Court found for the plaintiff and therefore costs should follow the event in the usual course. The Trust has applied for a stay of enforcement of the judgment pending appeal, which has been declined. Accordingly, an award of costs in favour of First Gas is made on a 2B basis as claimed together with reasonable disbursements. Awards of costs are made in favour of First Gas for the claim in relation to the substantive hearing and also the earlier interim injunction and variation applications which were successfully prosecuted by First Gas prior to the substantive decision which dealt with the permanent injunction.

Orders