Grant v CP Asset Management Limited

[2013] NZHC 3341

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

CIV-2012-404-005014 [2013] NZHC 3341

UNDER

sections 243(7) and 245A of the

Companies Act 1993 and Part 19 of the
High Court Rules

IN THE MATTER OF

the liquidation of NZ Properties Holding
Limited (in Liquidation)

BETWEEN

DAMIEN GRANT AND STEVEN KHOV AS LIQUIDATORS OF NZ

PROPERTIES HOLDING LIMITED (IN LIQUIDATION)

Applicants

AND

CP ASSET MANAGEMENT LIMITED First Respondent

ASIA PACIFIC HOTEL INVESTMENTS LIMITED

Second Respondent

C P RETAIL HOLDINGS LIMITED Third Respondent

RAISONS PACIFIC INVESTMENTS LIMITED

Fourth Respondent

SOUTH ISLAND HOTEL INVESTMENTS LIMITED Fifth Respondent

YEIL C & M LIMITED Sixth Respondent

BRIAN AND BRIDGIT LAWRENCE Seventh Respondents

Hearing:

(On the papers)

Counsel:

B J Norling for Applicants
R B Hucker for First to Sixth Respondents

G A Keene for Seventh Respondents

GRANT & KHOV AS LIQUIDATORS OF NZ PROPERTIES HOLDING LTD (IN LIQ) v CP ASSET MANAGEMENT LTD [2013] NZHC 3341 [12 December 2013]

Judgment:                12 December 2013

COSTS JUDGMENT OF VENNING J

This judgment was delivered by me on 12 December 2013 at 3.45 pm, pursuant to Rule 11.5 of the

High Court Rules.

Registrar/Deputy Registrar

Date……………

Solicitors:           Waterstone Insolvency, Auckland Hucker & Associates, Auckland Pidgeon Law, Solicitors, Auckland

Copy to:            G A Keene, Auckland

[1]      Following delivery of the Court of Appeal decision the applicants and the seventh respondents seek to have the previous orders of the Court in relation to costs set aside and seek costs on the proceedings in this Court.

[2]      Although the Court of Appeal did not directly address the issue, given the decision of that Court the costs order previously made cannot stand.  It is set aside.

[3]      The applicants seek costs on a 2B basis calculated at $11,343.00.

[4]     For the seventh respondents Mr Keene acknowledges that the seventh respondents are in receipt of legal aid but submits, nevertheless, the Court may be justified  in  awarding  the  seventh  respondents  scale  costs,  notwithstanding  they would be higher than the amount actually paid by the Legal Aid Unit.   He seeks further time to make submissions.

[5]      For the first to sixth respondents Mr Hucker submits that there should be no costs order made in favour of the seventh respondents but if there is to be an order then it should be limited to the costs paid by the Legal Services Agency.

[6]      Mr Hucker submits the applicant liquidators should not be awarded costs at all, but if they are, then bearing in mind r 14.2(f) the Court should effectively require the applicants to satisfy the Court that the costs they seek do not exceed the actual costs incurred bearing in mind that Mr Norling is in-house counsel.

[7]      I am not prepared to adjourn the matter for further submissions as sought by the seventh respondent.  I have a clear view on the issue of costs.  The matter has been before the Court for some time and there should be finality.

[8]      In terms of the seventh respondents’ position, they played a very limited role at the hearing before this Court.   Nevertheless, they are entitled to costs as their interests have led in part at least to the appeal being allowed.  Their costs are more than adequately compensated for, however, by recognition of the Legal Aid contribution.

[9]      The  seventh  respondents  are  to  have  costs  against  the  first  to  sixth respondents but limited to the payments made by Legal Services together with the seventh respondents’ contribution (if any).  When filing an order for costs for sealing Mr Keene is to certify as counsel the amounts received by the seventh respondents as costs from Legal Services Agency in relation to this application.

[10]     The applicants are entitled to costs given the outcome in the Court of Appeal. Those costs should ordinarily be on a 2B basis as suggested by Mr Norling.  I note Mr Hucker’s submission that bearing in mind r 14.2(f):

(f)       an award of costs should not exceed the costs incurred by the party claiming costs

the applicants should provide evidence of actual costs.

[11]     The  submission  Mr  Hucker  makes   has  recently  been   considered   by Courtney J in the case of Grant & Khov v Pandey & Ors.1   I agree with Courtney J that there is no reason in principle that the statutory regime ought not to operate effectively for both in-house and external counsel.  Mr Norling, as an officer of this Court, has an obligation to comply with r 14.2(f).  Again, in seeking to seal an order for costs on a 2B basis, Mr Norling is effectively certifying to the Court that the costs  as  sealed  are  less  than  the  actual  costs  incurred  by his  employer  for  his attendances on the file. That is a professional obligation resting on Mr Norling.

[12]     In relation to quantum Mr Hucker raises the issue of the length of the hearing. He notes the hearing only took a half day as opposed to the one day sought and he also objects to the inclusion of costs for a conference which was initiated by the applicants and  seventh  respondents.   They sought  an alteration to the timetable directions previously made by an Associate Judge.  In the event that application was rejected.

[13]     I accept Mr Hucker’s submission.  The hearing was a half day hearing.  There

is no entitlement to claim for one full day.   Further, the first to sixth respondents should not be responsible for payment of the costs associated with a conference

1      Grant & Khov v Pandey & Ors [2013] NZHC 3323.

which was only required because the applicants and the seventh respondents sought the  conference  and  the  applicants  and  seventh  respondents’ submissions  at  that conference were rejected.

Result

[14]     The  seventh  respondents  are  to  have  costs  against  the  first  to  sixth respondents but limited to the payments made by Legal Services together with the seventh respondents’ contribution (if any).

[15]     The applicants are to have costs against the first to sixth respondents on a 2B

basis, calculated at $9,950.

Venning J