Frema Properties Limited v Shelf Company no.5 Limited

[2020] NZHC 2390

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

I TE KŌTI MATUA O AOTEAROA TĀMAKI MAKAURAU ROHE

CIV-2019-404-002669

[2020] NZHC 2390

BETWEEN

FREMA PROPERTIES LIMITED

Appellant

AND

SHELF COMPANY NO. 5 LIMITED

First Respondent

SHANE GALPIN and BALLU KHAN

Second Respondents

Hearing:	[On the Papers]
Counsel:	V Purusram for Appellant K F Gould for Respondents
Judgment:	14 September 2020

JUDGMENT OF EDWARDS J

[re Remission of Proceeding and Costs]

This judgment was delivered by me on 14 September 2020 at 3.30 pm pursuant to r 11.5 of the High Court Rules.

Registrar/Deputy Registrar

Solicitors/Counsel:

Victorian Lawyers, Auckland DMG Solicitors, Auckland

K F Gould, Auckland

FREMA PROPERTIES LTD v SHELF COMPANY NO. 5 LTD [2020] NZHC 2390 [14 September 2020]

[1]                 In my judgment dated 10 August 2020, I allowed an appeal  from  the  District Court. I found that s 233(1) of the Property Law Act 2007 did not prevent Frema Properties Ltd (Frema) from suing for unpaid rent and outgoings pursuant to the terms of a lease.1

[2]                 The parties were invited to submit memoranda on whether judgment for the outstanding rent and outgoings could be entered, or whether the proceeding should be remitted back to the District Court for determination of quantum. Submissions on costs were also sought. This judgment addresses both those issues.

Should the proceeding be remitted?

[3]                 In its statement of claim, Frema claims the sum of $53,004.89 in outstanding rent and outgoings. It also claims interest on this sum at the default interest rate of  15 per cent per annum. Counsel for Frema has calculated the total sum due as

$118,125.33.

[4]                 The terms of the lease relating to outstanding rent and outgoings are admitted in the statement of defence filed by Shelf Company No. 5 Ltd (Shelf). Shelf also admits the date it vacated the premises. However, a denial is pleaded in relation to the claim for $53,004.89. Counsel for Shelf has filed a memorandum of counsel indicating that it challenges the quantum of some outgoings and the claim to compound interest.

[5]                 The District Court Judge did not make any factual findings in terms of quantum given his finding that the appellant was precluded by s 233(1) of the Property Law Act 2007 from claiming any sum at all.

[6]                 In the circumstances of a dispute about quantum, I consider the appropriate course is to remit the proceeding back to the District Court to make the necessary factual findings as to Frema’s claim. I order accordingly.

1      Frema Properties Ltd v Shelf Company No 5 Ltd [2020] NZHC 1994.

Costs

[7]                 As Shelf accepts, Frema was successful on appeal and is entitled to costs according to the High Court scale, on a schedule 2B basis.

[8]                 Frema puts forward several grounds in support of a claim for increased or indemnity costs. These include: filing a strike-out application as opposed to attending a judicial settlement conference in the District Court, failing to respond to Calderbank offers, and failing to pay costs in breach of court orders.

[9]                 None of these grounds relate to the conduct of the appeal in this Court. Most of these grounds relate to the conduct of the proceeding in the District Court, except for the failure to comply with a High Court costs order.

[10]              Costs have yet to be determined in the District Court. The grounds raised by counsel should be considered in that Court and in accordance with the District Court scale. The failure to comply with a costs order of this Court does not give cause to apply an uplift to the costs related to the appeal. An award of increased or indemnity costs for the conduct of the appeal is not justified in this case.

[11]              Accordingly, Frema is awarded costs on a schedule 2B basis ($12,906), plus reasonable disbursements in the sum of $690.

Result

[12]              The proceeding is remitted back to the District Court to determine the quantum of Frema’s claim, and to fix costs.

[13]              Shelf shall pay Frema the sum of $12,906 being the costs of the appeal, plus disbursements in the sum of $690.

Edwards J