Gibbston Downs Wines Limited v Perpetual Trust Limited HC Christchurch CIV 2010-409-1716

[2010] NZHC 1948

IN THE HIGH COURT OF NEW ZEALAND CHRISTCHURCH REGISTRY

CIV-2010-409-001716

BETWEEN  GIBBSTON DOWNS WINES LIMITED RFD FINANCE NO 2 LIMITED Plaintiffs

ANDPERPETUAL TRUST LIMITED First Defendant

ANDJOHN MAURICE LEONARD PAUL GRAHAM SARGISON Second Defendants

Judgment:      6 October 2010

JUDGMENT OF HON. JUSTICE FRENCH

as to Costs

[1]      In my judgment of 25 August 2010 I dismissed the plaintiffs’ application for an interim injunction.

[2]      As to costs, I stated:

[62]      … My provisional view is that these should be reserved and await the outcome of the substantive hearing.   However it is a provisional view only, and if counsel hold different views and seek an award, Mr Vautier is to file submissions, with Mr Forbes having an opportunity to file any reply argument within five working days.

[3]      Since then, counsel for the successful first defendant has filed an application seeking costs on a category 3B basis in the sum of $10,902 together with disbursements of $1429.

[4]      In support of the application for costs, Mr Vautier advanced the following arguments:

GIBBSTON DOWNS WINES LIMITED AND ANOR V PERPETUAL TRUST LIMITED AND ORS HC CHCH CIV-2010-409-001716  6 October 2010

a)        Costs should follow the event and be fixed now

b)The matters in issue involved complex interpretation of the Personal Property Securities Act and the proof and interpretation of various loan and general security agreements.

c)       The proceeding was of considerable importance to the parties and also to other non-parties.

d)The plaintiffs put the first defendant to avoidable additional expense by not being prepared when the matter was first called in the short cause list.

e)       The plaintiffs failed to address inadequacies in their documentation and their undertaking as to damages.

[5]      I have carefully considered all of the submissions made by Mr Vautier.

[6]      I accept that as a general rule costs should be fixed when an interlocutory application is determined and should follow the event: see r 14.8(1) and r 14.2(a).

[7]      The reason for my provisional view to the contrary was the fact that the plaintiffs had succeeded in establishing there was a serious question to be tried.  The outcome therefore  turned on  the  balance  of  convenience.    While  I rejected  the plaintiffs’ arguments regarding balance of convenience, the points raised were not completely devoid of merit.

[8]      In  those  circumstances,  notwithstanding  the  various  points  raised  by  Mr Vautier, I still consider that the interests of justice are best served by deferring the issue of costs until the outcome of the substantive hearing is known.  If the plaintiffs ultimately succeed in their substantive claim, the cost of their application for an interim injunction are likely to be viewed differently than if they ultimately fail, especially given their willingness at the interim injunction hearing to negotiate an agreement which would have enabled the receivers to continue selling the wine on terms.

[9]      I am therefore not prepared to grant the first defendant’s applications for costs to be fixed now.

[10]     Finally, I note that in declining the application I have not made any ruling as to whether or not the costs should be calculated on a category 2 or a category 3 basis. That is a matter that must await determination.

Solicitors:

Cousins & Associates, Christchurch

A J Forbes QC & K W Clay, Christchurch

Glaister Ennor, Auckland