Glover Trust Limited v Glover Trust Corporation Limited

[2014] NZHC 1712

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

CIV-2012-404-006931 [2014] NZHC 1712

IN THE MATTER OF

Part 18 of the High Court Rules

AND

IN THE MATTER OF

s 3 of the Judicature Amendment Act 1910

BETWEEN

THE GLOVER TRUST LIMITED, BAILEY TRUSTEE SERVICES LIMITED and

AUCKLAND WEST LEGAL SERVICES LIMITED

First Plaintiffs

CIT HOLDINGS LIMITED Second Plaintiff

AND

GLOVER TRUST CORPORATION LIMITED

First Defendant

GLOVER NO 2 LIMITED Second Defendant

Hearing:	[On the Papers]
Counsel:	M D Pascariu for the Plaintiffs R C Knight and T A Chubb for the Defendants
Judgment:	22 July 2014

JUDGMENT OF DUFFY J [Re Costs]

This judgment was delivered by Justice Duffy on 22 July 2014 at 4.30 pm, pursuant to

r 11.5 of the High Court Rules

Registrar/Deputy Registrar

Date:

GLOVER TRUST LTD and ORS v GLOVER TRUST CORPORATION LTD and ANOR [2014] NZHC 1712 [22 July 2014]

[1]      The second plaintiff, (“CIT”), seeks a costs award of indemnity costs or, if the Court is not persuaded to award indemnity costs, then an award of increased costs against the second defendant, (“Glover No 2”).

[2]      The application from which the costs application arises is a final stage of protracted litigation between the plaintiffs and the defendants in this proceeding.

[3]      CIT was the successful party in this application.  In principle, therefore, it is entitled to an award of costs.

[4]      Scale costs at category 2B would give CIT an award of $5,970, together with disbursements of $550, which brings the total to $6,520.

[5]      Indemnity costs would result in an award of $17,154.64, plus disbursements of $550.

[6]      Increased costs based on an uplift of 50 per cent above scale costs would result in an award of $8,955, together with disbursements of $550.

[7]      Glover No 2 submits that:

(a)       CIT is using the costs application as a punitive measure; (b)   that no award of costs is appropriate; but

(c)      if the Court is of a mind to make an award of costs, then it should be on a 2B basis and limited to the preparation of the enforcement application alone.

[8]      In relation to the appearances in Court on 17 and 18 February 2014 on the application, Glover No 2 submits that costs should lie where they fall.

[9]      By a judgment delivered on 20 March 2013 (as amended on 23 September

2013), Allan J ordered Glover No 2 to execute and deliver to CIT a registerable transfer of certain properties that were at issue in this proceeding.

[10]     No such steps were taken.  So on 3 February 2014, CIT applied for an order appointing  the  Registrar  of  the  High  Court, Auckland  Registry,  to  execute  and deliver to CIT attached registerable transfers for those properties.

[11]     What transpired next is set out in my Minute (No 7), dated 18 February 2014.

[12]     Suffice it to say that Glover No 2 did not act expeditiously to enable a speedy transfer of the properties.   There were delays and hitches along the way.   This resulted in me making a costs order against Glover No 2 for appearances on 10 and

12 February 2014.

[13]     Accordingly, any consideration of a further award of costs must commence after 12 February 2014.

[14]     I am satisfied that what transpired after 12 February 2014 was further delay on the part of Glover No 2.  The simple fact is that Glover No 2 failed to provide CIT with registerable transfers of the subject properties until the very last minute. Even then, it next registered caveats against the titles to those properties without first informing CIT, thus leading CIT to believe that it would be unable to register any transfers.    This  conduct  on  the  part  of  Glover  No  2  was  unreasonable  and unnecessary.

[15]     I record at [4] of Minute (No 7) that as at 18 February 2014, CIT was still experiencing delay and still needed to take further steps in Court to obviate that delay.

[16]     Whilst Glover No 2 maintained it was prepared to execute the transfers, it did not do so expeditiously.  Had it done so, there would have been no need for CIT to appear before the Court on 18 February, or for me to make the orders that CIT sought that day.

[17]     On 18 February 2014, I decided that CIT was entitled to costs: see [7] of Minute (No 7).   The only remaining question, therefore, is the quantum of those costs.

[18]     This is a case where Glover No 2’s conduct is not readily reconcilable with

its protestations of readiness to execute the transfers.

[19]     Viewed   objectively,   I   consider   that   Glover   No   2’s   conduct   can   be characterised as unreasonable.  A reasonable party in its circumstances would either have  acted  promptly  on  receipt  of Allan  J’s  decision,  or  applied  for  a  stay  of execution.  Glover No 2 did neither, leaving it to CIT to actively pursue the benefit of the judgment that was in its favour.

[20]     Such unreasonable conduct is not of itself enough to warrant an award of indemnity costs, but I consider it does establish the basis for an award of increased costs, especially as similar conduct on 10 and 12 February 2012 had earlier resulted in an award of scale costs.

[21]     I find, therefore, that CIT is entitled to an award of increased costs of $8.955, together with disbursements of $550.

Result

[22]     Glover No 2 is to pay CIT costs of $8,955 and disbursements of $550.

Duffy J

Counsel:      R B Stewart QC, Auckland

R C Knight, Auckland, and T A Chubb, Auckland

Solicitors:    Minter Ellison Rudd Watts, Auckland

Copy To:     Martelli McKegg (C A Atchison), Auckland