Fzco v Financial Markets Authority

[2023] NZHC 2680

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

I TE KŌTI MATUA O AOTEAROA TĀMAKI MAKAURAU ROHE

CIV-2023-404-852

[2023] NZHC 2680

UNDER

the Financial Markets Conduct Act 2013 and Part 20 of the High Court Rules

IN THE MATTER

of an appeal under section 532(g) of the Financial Markets Conduct Act 2013

BETWEEN

VALIDUS FZCO

Appellant

AND

FINANCIAL MARKETS AUTHORITY

Respondent

Hearing:	On the papers
Appearances:	B A Keown and S R Hiebendaal for appellant N F Flanagan and Y Fu for respondent
Date of judgment:	27 September 2023

JUDGMENT OF JAGOSE J

[Costs]

This judgment was delivered by me on 27 September 2023 at 2.30pm.

Pursuant to Rule 11.5 of the High Court Rules.

………………………… Registrar/Deputy Registrar

Solicitors:

Bell Gully, Auckland Meredith Connell, Auckland

VALIDUS FZCO v FINANCIAL MARKETS AUTHORITY - Costs [2023] NZHC 2680 [27 September 2023]

[1]    My 4 July 2023 judgment, dismissing Validus’ appeal, reserved costs for determination on a timetable for submissions.1 Those were filed accordingly, but only brought to my attention this week. I regret the delay.

[2]    The FMA seeks 2B scale costs and disbursements, including costs on steps taken to oppose Validus’ interlocutory application for interim relief (ultimately accommodated between the parties), increased to address Validus’ unsuccessful expansion of its appeal grounds, totalling $14,957.88. Validus accepts 2B costs and disbursements in the amount of $12,069.50, but contends for effective success on its interlocutory application and resists any uplift.

[3]    Subject to my discretion, in general principle, “the party who fails with respect to a proceeding … should pay costs to the party who succeeds”.2 I consider 2B costs an appropriate classification of this averagely complex proceeding requiring counsel of average skill and experience, and in which a normal amount of time is considered reasonable for each step on the application.

[4]    Given the parties’ interim arrangements, I am unable to discern who appropriately may be described as ‘failing’ or ‘succeeding’ on the interlocutory application. I cannot infer either from the parties’ consensual accommodation, which is more consistent with achievement of an alternative result than any inevitable litigation consequence. Meanwhile the FMA justifiably took steps in opposition, on which it is entitled to costs on its overall success.

[5]    In my view, the undesirability of Validus’ belated expansion of its appeal grounds sufficiently is addressed by my substantive judgment.3 It does not overcome the competing desirability determination of costs be predictable and expeditious so as to justify increased costs.4 Nothing in that expansion is contended to have contributed unnecessarily to the time or expense of the proceeding. And costs are compensatory, not penal.

1      Validus FZCO v Financial Markets Authority [2023] NZHC 1701.

2      High Court Rules 2016, r 14.1–14.2.

3      Validus FZCO v Financial Markets Authority, above n 1, at [14].

4      High Court Rules, r 14.6(3)(d).

[6]I order Validus pay the FMA costs and disbursements in the amount of

$13,613.50.

—Jagose J