Goodhue v Butler HC Tauranga CIV 2011-470-848

[2011] NZHC 1735

IN THE HIGH COURT OF NEW ZEALAND TAURANGA REGISTRY

CIV 2011-470-848

BETWEEN  BILL KRISTIAN GOODHUE Appellant

ANDGRAEME JOHN BUTLER AND MARY AUDREY BUTLER

Respondents

Hearing:         23 November 2011 (Heard at ROTORUA)

Appearances: Appellant in person

L H Wiessing for respondents

Judgment:      23 November 2011

(ORAL) JUDGMENT OF LANG J [on appeal against award of costs]

GOODHUE V BUTLER HC TAU CIV 2011-470-848 23 November 2011

[1]      Mr  Goodhue  and  Mr  and  Mrs  Butler  are  neighbours.    They  have  been involved in a dispute that, in one form or another, has now been running for more than ten years.  The dispute relates to an agreement that the parties entered into under which Mr Goodhue was to acquire part of Mr and Mrs Butler’s property.  Located on that property was a building that Mr Goodhue considered to be of considerable charm.   Others, including the local authority, viewed it as being no more than an uninhabitable shed.

[2]      From  Mr  Goodhue’s  perspective  the  dispute  ultimately  contained  three separate elements.   First, he sought transfer of the property to him in accordance with the agreement that he believed he and the Butlers had reached.  Second, during

2008 Mr and Mrs Butler had demolished the building on the property in accordance with the requirements of the local authority.  Mr Goodhue sought to be reimbursed in respect of the value of the building.  Third, he had been arrested by the police whilst at the property on one occasion.  Mr Goodhue laid the blame for this at the feet of Mr and Mrs Butler, and sought damages against them for false imprisonment.

[3]      Mr and Mrs Butler, on the other hand, were concerned at the fact that they had  been  required  to  meet  the  cost  of  demolishing  the  building.    Under  the agreement they had reached with Mr Goodhue he ought to have demolished it at his own expense many years earlier.   They took the view that Mr Goodhue should reimburse them in respect of the costs of demolishing the building, because that was his responsibility under the agreement.

The hearing in the District Court

[4]      The claim and counterclaim eventually went to trial before Judge Wolff in the District Court at Tauranga on 18 and 20 July 2011.  At the commencement of the hearing Mr and Mrs Butler, through their counsel, provided Mr Goodhue with an irrevocable undertaking that they would transfer the property to him as soon as they were able to do so.  That removed the need for Mr Goodhue to proceed with his first cause of action, in which he sought specific performance of the agreement for sale and purchase.

[5]      The hearing then proceeded in relation to the other three issues.  These were Mr Gooodhue’s claims for damages equivalent to the value of the building at the time that Mr and Mrs Butler demolished it, and for false imprisonment.  Mr and Mrs Butler’s counterclaim was for the costs that they had incurred in demolishing the building in accordance with the local authority’s requirements.

[6]      In a decision delivered on 28 July 2011, the Judge dismissed Mr Goodhue’s claims.[1]     He also dismissed the counterclaim.  The Judge took the view that Mr and Mrs Butler were entitled to costs against Mr Goodhue because they had succeeded on the principal issues that went to trial.[2]    He discounted any suggestion that there should be a reduction in those costs to reflect the fact that the counterclaim had been unsuccessful.  He did so because he considered that the counterclaim had not added to the costs of the proceeding in any material way.  Mr and Mrs Butler then sealed judgment for the total sum of $8,432, together with disbursements of $132.50.

[1] Goodhue v Butler DC Tauranga CRI-2009-070-61, 28 July 2011.

[2] Goodhue v Butler DC Tauranga CRI-2009-070-61, 16 September 2011

[7]      Mr Goodhue now appeals against the Judge’s decision to award costs in this amount to Mr and Mrs Butler.

Grounds of appeal

[8]      Mr Goodhue contends that the Judge erred in failing to take into account the fact that his primary cause of action was the claim for specific performance.   He submits that Mr and Mrs Butler effectively conceded that aspect of his claim when they tendered the irrevocable undertaking at the beginning of the hearing.  By that stage, however, the trial had already commenced.  He therefore had little option but to continue with the remaining two claims.  Likewise, Mr and Mrs Butler elected to continue with their counterclaim.

[9]      Mr Goodhue submits that, had the irrevocable undertaking been provided much earlier, he could have made an election as to whether or not he wished to proceed with his remaining causes of action.  This, in turn, could have obviated the

need for him to proceed to a full defended trial.  In those circumstances Mr Goodhue

contends that no award of costs ought to have been made against him.  He seeks, in fact, an award of costs in his favour to reflect legal expenses that he has incurred, together with disbursements.

Issues

[10]     Two issues need to be determined on appeal.  They are:

1.Was the Judge correct to disregard the fact that Mr Goodhue did not receive the irrevocable  undertaking until  the commencement  of the hearing?

2.      Is the amount for which Mr and Mrs Butler sealed judgment correct?

Was the Judge correct to disregard the fact that Mr Goodhue did not receive the irrevocable undertaking until the commencement of the hearing?

[10]     In dealing with this issue the Judge said:[3]

[3] Fn 2 at [7].

…While Mr Goodhue contends that he succeeded on the major issue this could have been readily resolved without the issue of the proceedings against [Mr and Mrs Butler].

[11]     I am not sure of the evidential basis for this observation, because I have not had access to the transcript of the hearing in the District Court.  It is possible that the issue was touched on in the evidence and, if so, that might provide an explanation for the Judge’s comment.  What is clear, however, is that Mr Goodhue’s primary claim has always been for specific performance.   It is also common ground that Mr and Mrs Butler did not tender the irrevocable undertaking until immediately after the commencement of the defended hearing.

[12]     Counsel for Mr and Mrs Butler advised me from the bar that she endeavoured to provide Mr Goodhue with the undertaking prior to the commencement of the

hearing, but he was not prepared to accept it.  For that reason she was forced to bring

it to the attention of the Judge after the trial had commenced.  This apparently led the Judge to reassure Mr Goodhue that the relief that he was claiming under his first cause of action was no longer necessary.

[13]     During the hearing before me, counsel for Mr and Mrs Butler also frankly conceded that her clients had become frustrated with the overall approach taken by Mr Goodhue in relation to the dispute.  That frustration explains to a large extent their unwillingness to engage with him on the claim for specific performance.

[14]     I take the view that the provision of the irrevocable undertaking effectively amounted to a concession, or capitulation, by Mr and Mrs Butler in relation to the first cause of action.  It is a factor that needed to be taken into account, in my view, in assessing the costs payable in relation to the steps leading up to trial.  I consider that that factor can be adequately recognised if the amounts claimed in relation to steps leading up to trial are reduced by one-third to reflect the fact that the Butlers ultimately conceded Mr Goodhue’s claim.

[15]     Once the undertaking had been tendered, however, Mr Goodhue was left with a choice as to what to do.  Having succeeded on his primary argument, he could have elected not to proceed with the remaining two claims.   That would probably also have brought the counterclaim to an end.  Instead, however, Mr Goodhue elected to proceed to trial and was ultimately unsuccessful.   One of his claims, namely that based on false imprisonment, clearly had no prospect of success.   I am therefore satisfied that the Judge was correct to conclude that Mr and Mrs Butler were the successful parties at trial, and that Mr Goodhue should pay costs in relation to the trial itself.

Is the amount for which Mr and Mrs Butler have sealed judgment correct?

[16]     Mr and Mrs Butler have sealed judgment in respect of four steps that they took themselves, albeit with prior legal advice.   These include the cost of commencing the defence.  The statement of defence was actually filed by Mr and Mrs Butler personally, although they had taken legal advice about it.  Similarly, they

attended three judicial conferences in person, rather than through counsel.  Counsel had, however, earlier provided advice in relation to those events.

[17]     A party is only entitled to claim costs in respect of steps taken, or events attended by, solicitors and/or counsel.   Where a party attends to, or at, an event personally, costs are not claimable even though that party may earlier have sought legal advice.  For that reason this aspect of the appeal must succeed as well.

Result

[18]     The appeal is allowed to the extent that costs payable in respect of steps taken prior to the trial itself are to be reduced by one-third. The costs claimed in respect of item 2 (commencement of the defence) and item 9.9 (judicial conferences held on 15

December 2009, 14 December 2010 and 25 January 2011) are disallowed.

Costs

[19]     Mr Goodhue has represented himself in advancing the appeal.  As a result, there will be no order for costs on the appeal.  He is entitled to be reimbursed by Mr and Mrs Butler, however, in respect of any filing fees that he has paid.  The Registry is also to refund Mr Goodhue the amount that he has provided by way of security for

costs on the appeal.

Lang J

Solicitors:

Holland Beckett, Tauranga

Copy to:
Mr B K Goodhue, Napier 4110.