Fox v Hamilton
[2024] NZHC 3454
•19 November 2024
IN THE HIGH COURT OF NEW ZEALAND CHRISTCHURCH REGISTRY
I TE KŌTI MATUA O AOTEAROA ŌTAUTAHI ROHE
CIV-2023-409-123
[2024] NZHC 3454
UNDER Sections 327 and 328 Property Law Act 2007 IN THE MATTER
of an application in respect of landlocked land
BETWEEN
HENRY ALLAN FOX and MARIE PATRICIA MUHL
First Applicants
NATHALIE FREDERIQUE GIRAUDON and EMMANUEL STAUDER
Second ApplicantsJONATHAN ROBERT SMITH,
BEVERLEY ANN WALLS and PETER MARK WALLS
Third Applicants
MICHELLE HELEN SNAPE
Fourth ApplicantPHILIP LAURENCE LEES
Fifth ApplicantDONALD GORDON MICHAEL and KAREN HILDA MICHAEL
Sixth Applicants
AND
LISEL BRITTA HAMILTON
Respondent
Appearances: T C Daley for Applicants
L B Hamilton (Respondent) in person
Judgment:
19 November 2024
(Determined on the papers)
FOX v HAMILTON [2024] NZHC 3454 [19 November 2024]
JUDGMENT OF OSBORNE J
Introduction
[1] This was a proceeding under the Property Law Act 2007 (PLA) for an order granting access to landlocked land. The applicants were successful.1
[2] The applicants submit they are entitled to costs and disbursements on the basis they were the successful party. The applicants seek: their costs of the proceedings on a Category 2 basis, with an uplift of 50 per cent in respect of all steps taken during the proceedings ($27,125.50 plus $13,562.75); and disbursements in respect of the proceedings ($20,707.64).
The judgment
[3] The six applicants own hillside properties off Wainui Main Road overlooking Akaroa Harbour. Those properties have for many years been accessed by a shared driveway traversing up the slope and, at its start, passing over the lower portion of the respondent’s property. The respondent also accesses her (vacant) property via the driveway.
[4] It was discovered after the respondent purchased her property in September 2020 that the driveway was not fully within the formal right of way easements the respondent’s predecessors in title had granted over their property. It transpires that the driveway also passes over a very small portion of land within the title of one of the applicants with no easement in relation to it, whether in favour of the other applicants or the respondent.
[5] The applicants sought an order that right of way easements in accordance with a schedule of easements on a survey plan be granted on the same terms as the wording of the existing right of way easements.
1 Fox v Hamilton [2024] NZHC 2479.
[6] The respondent accepted at the hearing that the land was landlocked (contrary to her position until then). The only issue at the hearing was compensation. I was satisfied it was appropriate there be a payment of compensation by the applicants to the respondent as a condition of this Court’s order. The compensation was set at
$10,529.74. That figure had been in a settlement agreement reached by the parties in August 2023 (nine months before the hearing). The respondent subsequently refused to complete the $10,529.74 settlement. The respondent at the hearing, without calling valuation evidence, submitted the applicants should be required to pay a total of
$66,000. Previously she had maintained she was entitled to compensation exceeding
$400,000 (which may be contrasted with the $200,000 registered valuation of the respondent’s property itself).
Applicants’ submissions
[7] Mr Daley for the applicants submits there is no “fixed rule” concerning costs in applications under s 327 of the PLA. He relies on Lowe v Brankin.2 He also cites J T Jamieson & Co Ltd v Inland Road Ltd (J T Jamieson),3 where the Court in granting the successful applicant its full costs and disbursements took into account that the defendant (through its expert) had contributed unnecessarily to the time and expense of the proceeding. (The defendant had sought compensation of $238,180; the plaintiff had contended $40,000 was appropriate. The Court fixed compensation at $64,000).
[8] Mr Daley submits the applicants should have increased costs because they successfully obtained orders for relief; their argument that compensation should be fixed by reference to the August 2023 agreement was accepted; and the respondent, through her conduct, contributed unnecessarily to the time and expense of the proceedings.
2 Lowe v Brankin (2005) 6 NZCPR 607.
3 J T Jamieson & Co Ltd v Inland Road Ltd [2014] NZHC 1170.
Respondent’s submissions
[9] Ms Hamilton asks that there be no order for costs. She submits the “usual position” in respect of cases under the landlocked provisions of PLA is that costs are ordered against the applicants on a 2B basis.
[10] Ms Hamilton submits the starting point must be that the responsibility for the litigation and the costs which are incurred should lie with the applicants who are seeking the Court’s indulgence to overcome a legal problem. She observed Mallon J in Dooley v Sturgess Consulting Ltd adopted this principle.4 But the Judge recognised an adjustment might be necessary if the applicant made an offer (of compensation) for a sum greater than which had been awarded, in which case 2B costs would not be payable from that point.5
[11] Ms Hamilton submits the difference between the (December 2022) amount ($13,587.60) offered for compensation and the amount determined ($10,529.74) was minor, compared to in J T Jamieson (above at [7]) where the difference was significant. Ms Hamilton says this militates against any costs order being made against her.
[12] In the event costs are ordered, Ms Hamilton submits the quantum of costs sought by the applicant is excessive.6
Verification of disbursements
[13] Pursuant to a Minute issued by the Court following the filing of counsels’ initial submissions and documents, the applicants filed further evidence and a memorandum to verify the disbursements claimed as required by r 14.12(2) High Court Rules.
4 Dooley v Sturgess Consulting Ltd [2016] NZHC 1905 at [94]–[95].
5 At [95].
6 Part of this submission relates to the preparation of 16 memoranda. This has been addressed through a Minute I issued on 4 October 2024, and subsequent memorandum from Mr Daley.
Discussion
The discretion in relation to who pays costs
[14] The principles to be applied to the exercise of the costs discretion emerge principally from the Court of Appeal’s decision in Lowe v Brankin as the most recent authority binding this Court.
[15] The starting point for applications for costs is r 14.1(1) of the High Court Rules 2016, which provides that costs are discretionary.
[16] As identified in Lowe v Brankin, landlocked land cases are infinitely variable and not amenable to arbitrary costs rules. The Court stated that the general proposition—that costs are in the discretion of the Court—should therefore obtain at least in relation to litigation costs.7 In doing so, the Court rejected the appellants’ proposition that, as a matter of course, costs in proceedings of this character should be awarded in favour of the party who is “giving up” rights as against the landlocked party.8
[17] The general principle in relation to the exercise of the discretion in costs cases—that costs follow the event—is encapsulated in r 14.2(1)(a) of the Rules.
Increased costs
[18] Under r 14.6(3)(b) the court may award increased costs where the party opposing costs contributed unnecessarily to the time or expense of the proceeding, through unmeritorious arguments and through failing without reasonable justification to accept a settlement offer.
Discussion
[19] The applicants were the successful parties. They obtained the relief sought. Their argument that compensation be awarded by reference to the August 2023 agreement was accepted. The respondent was wholly unsuccessful. For material
7 Lowe v Brankin, above n 2, at [63].
8 At [4], [57], [61].
periods, she opposed the granting of any relief;9 unsuccessfully submitted the enjoyment and value of her land would be detrimentally affected if the relief sought was granted;10 denied that compensation should be determined by reference to the August 2023 agreement;11 and unsuccessfully sought compensation of $66,000.12
[20]I will therefore order the respondent to pay costs.
[21] I regard the respondent’s conduct as having contributed unnecessarily to the costs of these proceedings by filing inadmissible, irrelevant, or unreliable evidence; seeking numerous extensions to the timetable; filing numerous memoranda which contained irrelevant and repetitious material and filed memoranda late which necessitated duplication of judicial conferences or further memoranda in reply. This conduct unnecessarily prolonged the proceedings and caused the applicants to incur unnecessary costs.
[22] I also recognise the applicants made settlement offers which were better than, or equal to, the result which the respondent ultimately achieved at the hearing. Prior to filing their origination application on 31 March 2023, the applicants offered to settle the dispute on the basis that they pay the respondent $20,988 compensation, a figure almost double the compensation ultimately awarded. Further, the applicants made another offer of settlement in August 2023 (the August 2023 agreement) which was accepted by the respondent (via her counsel at that time). The respondent subsequently reneged on this agreement, but compensation was ultimately at the figure adopted in that agreement.
[23] I find the respondent’s conduct in relation to the proceeding unnecessarily increased the time and costs of the proceeding.
9 Respondent opposed the granting of relief in her Notice of Opposition, then withdrew her opposition in a memorandum dated 8 May 2023, then re-raised her opposition in her written synopsis of submissions dated 9 April 2024, before finally re-conceding the point on 6 May 2024, three days prior to the hearing.
10 Fox v Hamilton, above n 1, at [50].
11 At [17].
12 At [18].
[24] I will therefore order the respondent to pay increased costs. I set the level of uplift at 25 per cent.
Fixing of costs
[25]This is a Category 2 case.13
[26] Mr Daley initially presented a schedule of costs calculations uniformly referenced to band B for time allocation. I am satisfied band B is appropriate for all items other than certain of the memoranda filed by the applicants for case management conferences. While Mr Daley subsequently recategorised seven of those items as band A, I find the appropriate time allocation for ten of the 16 memoranda was band A.
[27] All other items having been appropriately calculated by Mr Daley, the appropriate costs total, before uplift, is $25,691.50.
[28] On the basis of an uplift of 25 percent ($6,422.87) the costs to be awarded will be $32,114.37.
Disbursements
[29] The applicants’ disbursements, as verified, total $20,707.64 (including GST). Of those disbursements, unsurprisingly significant sums were paid to the applicants’ experts (48 percent to engineers; 31 percent to valuers; and 18 percent to surveyors). I find the applicants’ claimed disbursements were reasonably necessary for the conduct of the proceeding and reasonable in amount.
Orders
[30]I order:
(a)the respondent is to pay to the applicants the costs of this proceeding fixed in the sum of $32,114.37; and
13 High Court Rules 2016, rr 14.3(1) and 14.5(2)(b).
(b)the respondent is to pay to the applicants their disbursements which I fix at $20,707.64.
Osborne J
Solicitors:
Anthony Harper, Christchurch
Copy to:
Mrs L B Hamilton (Respondent)
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