Forward Specialties 1988 Limited v Alexander HC Auckland CIV-2008-404-002981

[2011] NZHC 68

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

CIV-2008-404-002981

BETWEEN  FORWARD SPECIALTIES 1988

LIMITED Plaintiff

ANDWILLIAM JOHN ALEXANDER AND COLLEEN ELIZABETH ALEXANDER Defendants

Hearing:         On the papers

Counsel:         L Ponniah for Plaintiff

RE Harrison QC for Defendants

Judgment:      4 March 2011 12:00:00

JUDGMENT OF RODNEY HANSEN J As to costs

This judgment was delivered by me on 4 March 2011 at 12.00 p.m., pursuant to Rule 11.5 of the High Court Rules.

Registrar/Deputy Registrar

Date: ………………………….

Solicitors:           Corban Revell, DX DP92558, Auckland for Plaintiff

Sione Fonua, P O Box 91787, Auckland for Defendants

FORWARD SPECIALTIES 1988 LIMITED V WILLIAM JOHN ALEXANDER AND COLLEEN ELIZABETH ALEXANDER HC AK CIV-2008-404-002981 4 March 2011

[1]      The plaintiff sought specific performance of an agreement for the sale of a workshop business sold to the defendants which the defendants had purported to cancel.  In the alternative, they sought an enquiry into damages.  In my judgment of

30 October 2009 I found the defendants wrongfully repudiated the agreement.   I decided that an order for specific performance was not appropriate in the circumstances and that the plaintiff’s remedy should be by way of damages.   A further hearing to determine quantum was arranged but did not proceed as the parties were able to agree on the damages to be paid.

[2]      The plaintiff seeks an order for costs.   The defendants oppose the order sought.   They contend that the way in which the plaintiff approached the claim warrants either a reduction in the costs overall awarded in respect of the liability hearing or a refusal to award costs in relation to the damages hearing.  In addition, the plaintiff takes issue with individual items claimed.

Overall approach

[3]      Mr Harrison questions whether the plaintiff should be entitled to costs on the basis that there were two separate stages to the proceedings, one directed to liability and the other directed to quantum.  He challenges that approach on the ground that the defendants successfully opposed the plaintiff’s claim for specific performance of the agreement for sale and purchase and an agreement to lease workshop premises that was associated with it.  He submits that had the plaintiff pursued the relief to which it was held to be entitled (damages) from the outset, there would have been no need for a further stage in the proceeding.  Mr Harrison says that should be reflected in the costs outcome, either by awarding costs only in relation to the first hearing or by reducing the award in respect of that hearing by one-third or by some other appropriate measure.

[4]      Mr Harrison’s argument overlooks the savings in time and cost that flowed from the decision to confine the first hearing to liability and the availability of

the considerable additional costs that would have been incurred if evidence bearing on  damages  had  been  called.   The  evidence would  have been  redundant  if  the plaintiff had failed on liability or succeeded on its claim for specific performance.  I see no reason to deny the plaintiff the full costs of the hearing and those costs to which it is entitled in relation to the proposed damages hearing.

Other issues

[5]      Mr Harrison submits that the allowance for preparation and hearing time should be based on 4.5 hearing days, not 5 days.  As I understand it, the hearing did not finish until 2.00 p.m. on the fifth day.  On that basis, an allowance for the full day is warranted.   Nor do I find, contrary to Mr Harrison’s submission, that the hearing was unnecessarily prolonged by the plaintiff.

[6]      The defendants complain that the time claimed for the second hearing for preparation of briefs (2.5 days) and, under item 7.2 of Schedule 2, for preparation of lists of issues and bundles of documents (also 2.5 days) is out of all proportion.  I agree.  It is not disputed that the plaintiff provided only one brief of evidence, of 5½ pages, which largely recited the previous history of the proceedings and updated the financial position of the business.  The bundle of documents consisted of an index, plus ten pages of documents comprising two sets of trading accounts and a series of invoices.   In my view, an allowance of half a day for each of these items is appropriate.

[7]      The final matter concerns claims under both item 4.10 and item 6 of Schedule

2, respectively a memorandum in relation to a consent judgment and the allowance for obtaining a judgment where no  appearance is necessary.   As judgment was obtained by means of the consent memorandum, there is no basis for an allowance under item 6.

[8]      Costs are allowed in accordance with the amended schedule annexed to the

memorandum of plaintiff’s counsel of 1 October 2010, amended in accordance with

in the sum of $1,795.16.