Grant v Restructuring Insolvency & Turnaround Association New Zealand Incorporated

[2021] NZHC 801

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

I TE KŌTI MATUA O AOTEAROA TĀMAKI MAKAURAU ROHE

CIV-2020-404-1367

[2021] NZHC 801

UNDER

The Judicial Review Procedure Act 2016 Part 30 of the High Court Rules 2016

BETWEEN

DAMIEN MITCHELL GRANT

Applicant

AND

RESTRUCTURING INSOLVENCY & TURNAROUND ASSOCIATION NEW ZEALAND INCORPORATED

Respondent

Hearing:

On the papers

Counsel:

R J Hollyman QC, J K Grimmer and N G Lawrence for the Applicant

S M Hunter QC and R M Stewart for the Respondent

Judgment:

14 April 2021

JUDGMENT OF MUIR J

(Costs)

This judgment was delivered by me on Wednesday 14 April 2021 at 4.30 pm Pursuant to Rule 11.5 of the High Court Rules.

Registrar/Deputy Registrar  Date:…………………………

Counsel:

R J Hollyman QC, Auckland J K Grimmer, Auckland

N G Lawrence, Auckland S M Hunter QC, Auckland

Solicitors:

Waterstone Insolvency, Auckland Fee Langstone, Auckland

GRANT v RESTRUCTURING INSOLVENCY & TURNAROUND ASSOCIATION NEW ZEALAND INCORPORATED [2021] NZHC 801 [14 April 2021]

Introduction

[1]                 In my judgment dated 3 November 2020 I noted that I had not been addressed on costs but that (provisionally) I considered these appropriately payable to Mr Grant on a 2B basis.1 I invited memoranda in the event the parties were unable to resolve their differences. Such memoranda are now to hand.

[2]                 In respect of costs, the parties are substantially agreed but differ in respect of an allowance for second counsel ($1,195.00) and the applicant’s claim for preparation of a memorandum relating to a media application by Ms Victoria Young of BusinessDesk ($956.00).

[3]                 In respect of disbursements, the respondent opposes the applicant’s claim for the costs associated with professional evidence by Dr Ian Goodwin and Mr Bruce Sheppard.

[4]I deal with each of these issues in turn.

Second counsel

[5]                 Mr Grant says that the case involved an urgent one day judicial review proceeding with a significant volume of evidence. He says that second counsel was necessary for the efficient and effective conduct of the hearing and notes that the respondent also appeared with supporting counsel.

[6]                 Allowance for second counsel is not automatic. The key question is “whether the nature of the proceeding was such as to justify requiring the losing party to contribute to the winning party’s costs in having a junior counsel present”.2

[7]In ZYXCBA Developments Ltd v Auckland Council, I noted:3

I do not, having regard to the decision in Nomoi Holdings Ltd,4 regard there as being anything so atypical about this litigation as to warrant an allowance

1      Grant v Restructuring Insolvency & Turnaround Assoc of New Zealand Inc [2020] NZHC 2876 at [106].

2      SKP Inc v Auckland Council [2020] NZHC 2215 at [5].

3      ZYXCBA Developments Ltd v Auckland Council [2015] NZHC 2224 at [16].

4      Nomoi Holdings Ltd v Elders Pastoral Holdings Ltd (2001) 15 PRNZ 155 (HC) at [21].

for second counsel. It was conducted on sworn affidavits with reasonably limited cross-examination and was fundamentally a legal argument based (in large measure) on uncontentious facts. … The case is not in my view one where the analogy with “former trial practice” referred to by Chambers J in Nomoi Holdings is sufficiently strong to warrant allowance for second counsel.

[8]                 I regard this case as being in the same category. Although Mr Grant’s application referenced a significant amount of material, it was conducted on sworn affidavits with no cross-examination and was completed within one day. Essentially it involved a legal argument on substantially agreed facts.

[9]                 I do not regard the proceedings as having any sufficiently unusual features to warrant allowance for second counsel.

[10]I disallow this item accordingly.

Preparation of memorandum on media application

[11]              Mr Grant seeks an allowance of $956.00 by analogy with step 10 (preparation for first case management conference) in respect of a memorandum filed in response to Ms Young’s application for access to the court file.

[12]              In respect of that application RITANZ did not object to access to the pleadings and various memoranda and minutes relating to timetable directions. It did, however, object to the provision of affidavits (and associated memoranda) where admissibility of those affidavits was in issue.

[13]              In response to RITANZ’s memorandum Mr Grant submitted (with one limited exception) that access to the court file be on the basis BusinessDesk proposed.

[14]              In a detailed minute dated 9 October 2020, Davison J accepted RITANZ’s submission and granted limited access to the court file on the terms it suggested.

[15]              The claim is in respect of a matter not provided for in sch 3 to the High Court Rules 2016. Nor did the memorandum relate to the proceeding as such. I accept, however, that r 14.1(1) allows for costs not only “of” a proceeding but “incidental” to

a proceeding. Something is “incidental” if it is “not essential … following as a subordinate event”.5 This is a broad definition which must be considered to capture ancillary matters such as that in issue.

[16]              However, in my view the corollary is that the costs implications of any such ancillary matter should be approached, as best possible, by analogy with interlocutory applications. In that respect costs are typically decided on the basis of immediate success and without reference to the ultimate result in the proceedings.

[17]              In the present case the applicant and respondent had divergent views. Those of the respondent ultimately prevailed. Its submission that costs should lie where they fall in respect of this step in my view represents an appropriate exercise of the Court’s discretion under r 14.1(1).

[18]Accordingly, I disallow this item also.

Dr Goodwin’s fees

[19]              Dr Ian Goodwin, who is a consultant psychiatrist, provided evidence essentially directed to the likelihood of re-offending by Mr Grant. Admission of that evidence (in addition to numerous further affidavits attesting to Mr Grant’s character) was opposed by RITANZ on the primary basis that such information was not before the Committee when it made its decision on Mr Grant’s application and was therefore irrelevant to the exercise of this Court’s powers on judicial review.

[20]              I admitted all such evidence de bene esse with the agreement of both parties and on the basis that I would address the evidentiary issues as required in my reserved judgment.6

5      Tony Deverson and Graeme Kennedy (eds) The New Zealand Oxford Dictionary (Oxford University Press, Melbourne, 2005) at 549.

6      De bene esse in this context means to allow the evidence as acceptable at the time it was given, on the basis that, when later more fully examined, it may be allowed or disallowed, depending on the merit of it.

[21]              In the final analysis I held that it was unnecessary for me to resolve any of the evidential challenges, because the proposed evidence was irrelevant to the approach I adopted.

[22]              Rule 14.12(2)(c) provides that to be claimable a disbursement must be “reasonably necessary for the conduct of the proceeding”.7

[23]              My assessment of the evidence is  that its primary purpose was to  support  Mr Grant’s submission that, in the event reviewable error was identified, this Court should make its own good character assessment  with  a view to  orders  admitting Mr Grant to RITANZ membership. At [95]–[97] of my principal judgment I explained that only in rare and clear cases would this Court ever assume ultimate decision- making authority to this extent.8 I said that Mr Grant’s application could never be described in such terms. I concluded:9

[97]     As I said at the outset of this judgment the question  of whether     Mr Grant is admitted to membership is and always was a difficult one. It is far from the clear-cut case the authorities require before the Court should substitute its own decision on the “headline” issue.

[24]              This disbursement therefore arises in the context of an aspect of Mr Grant’s claim which was unsuccessful. I do not consider there to have ever been a sufficiently tenable argument for this Court to substitute its own assessment of good character such that Dr Goodwin’s evidence could be considered “reasonably necessary for the conduct of the proceeding”.

[25]I decline therefore to allow the disbursement.

Mr Sheppard’s fees

[26]              Mr Sheppard’s evidence was not prepared for the purposes of the proceedings which were before me. Mr Grant filed earlier proceedings for judicial review under CIV-2020-404-862 which were settled (with no issue as to costs) by RITANZ’s agreement to conduct a rehearing of his application. Mr Sheppard’s evidence was

7      High Court Rules 2016, r 14.12(2)(c).

8      See Grant, above n 1, at [95]–[97].

9 At [97].

originally intituled in that proceeding. It was sworn on 22 July 2020 which was 12 days after RITANZ’s agreement to the rehearing. Mr Hollyman QC says it was sworn for the purposes of that rehearing.10 He is incorrect, however, in submitting that the evidence was “finalised after [the first judicial review] had been resolved”.11 Such resolution occurred on 28 July 2020 when a Notice of Discontinuance was filed.

[27]              In my view Mr Sheppard’s fees are unrecoverable as a disbursement in this proceeding. They were either potentially recoverable as a disbursement in the previous proceedings (which were however resolved without an award of costs) or they must be considered part of the cost of the rehearing (as opposed to the judicial review proceedings brought in respect of the rehearing result).

[28]I decline this disbursement accordingly.

Result

[29]              I award costs and disbursements against the respondent and in favour of the applicant in the amount of $23,731.00 as calculated in the schedule annexed hereto.

Muir J

10 Applicant’s reply memorandum as to costs dated 12 April 2021 at [6].

11 Applicant’s memorandum as to costs dated 29 March 2021 at [11].

ANNEXURE

Costs

Disbursements