Grant v Ridgway Empire Limited

[2018] NZHC 3399

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

I TE KŌTI MATUA O AOTEAROA TĀMAKI MAKAURAU ROHE

CIV-2015-404-1892

[2018] NZHC 3399

BETWEEN

JILL GRANT

Plaintiff

AND

RIDGWAY EMPIRE LIMITED

Defendant

Hearing:	On the papers
Counsel:	G P Blanchard QC and E E Hill D W Grove
Judgment:	19 December 2018

JUDGMENT NO 2 OF PALMER J

(Costs)

This judgment is delivered by me on 19 December 2018 at 11.30 am pursuant to r 11.5 of the High Court Rules.

.....................................................

Registrar / Deputy Registrar

Counsel/Solicitors:

G P Blanchard QC, Auckland D R Bigio QC, Auckland

Blackwells, Auckland Quay Law, Auckland

GRANT v RIDGWAY EMPIRE LTD [2018] NZHC 3399 [19 December 2018]

The judgment

[1]                  On 11 October 2018, I issued judgment in this proceeding.1 In summary, I held:

[1]        In 2009, Ms Jill Grant bought a townhouse at 37 Clifton Road, Hauraki, Auckland with a lovely view overlooking the Hauraki Gulf and Takapuna Beach. When purchasing it, she asked the vendor, Mr Aaron Ridgway, whether it was leaky. He said it was not; but it was leaky. Ms Grant claims damages for pre-contractual misrepresentation and breach of a warranty that work Mr Ridgway did on the property had Council consent where required. Mr Ridgway submits there was no misrepresentation or breach of warranty and there is insufficient evidence the damages claimed reflect remediation rather than renovation. He submits he did not need a consent for the work Ms Grant claims was in breach of the warranty.

[2]        Mr Ridgway did not know the unit was leaking; only that it had suffered from three water issues he had repaired. But he made a representation of fact to Ms Grant that it did not leak, when it did. That was a pre-contractual misrepresentation which was one of the reasons Ms Grant bought the unit. She acted reasonably in relying on that misrepresentation. Mr Ridgway did not breach the warranty as I do not consider the work he did in 2004 required Council consent. Ms Grant is entitled to damages for the misrepresentation. I award her damages of $474,101 for the misrepresentation on the basis of her builder’s estimate of the cost of repair, which was not challenged by contrary evidence.

[2]If costs were not agreed, I gave leave for memoranda to be filed.2 They were.

Relevant law of costs

[3]                  At New Zealand law, costs are awarded to the successful party and against the unsuccessful party.3 The definition of success can be opaque and is guided by the interests of justice and “who in reality has been the successful  party”.4     Under        r 14.7(d), a costs award may be reduced if, “although the party claiming costs has succeeded overall, that party has failed in relation to a cause of action or issue which significantly increased the costs of the party opposing costs”.

1      Grant v Ridgway Empire Ltd [2018] NZHC 2642.

2 At [62].

3      High Court Rules 2016, r 14.2(a); and Manukau Golf Club Inc v Shoye Venture Ltd [2012] NZSC 109, [2013] 1 NZLR 305 at [8].

4      Waihi Mines Ltd v AUAG Resources Ltd (1999) 13 PRNZ 372 (CA) at [5]. See also Packing in Ltd (in liq) formerly known as Bond Cargo Ltd v Chilcott (2003) 16 PRNZ 869 (CA) at [6] (calling for “a realistic appraisal of the end result”).

Submissions

[4]                   Mr Blanchard QC, for the plaintiff, submits Ms Grant was successful and seeks costs on a 2B basis and disbursements totalling $99,378.70. He submits the second cause of action, for breach of warranty, would not have significantly increased the costs to the defendant and many of the issues, evidence and facts were the same for each cause of action. He submits an abandoned cause of action of negligent misstatement was largely similar to the misrepresentation claim.

[5]                  Mr Grove, for the defendant, agrees with the 2B categorisation. But he submits there should be a 10 per cent discount in the costs awarded because of the abandoned negligent misstatement cause of action which he submits took up the majority of the evidence and legal submissions. He also submits there should be a further 50 per cent discount because the breach of warranty cause of action failed.

Decision on costs

[6]Ms Grant was successful in the proceeding. She was awarded damages of

$474,101 for misrepresentation. In the context of this case, her success or failure on the breach of warranty claim would not have altered who was, in reality, the successful party. The breach of warranty cause of action failed because I was not satisfied a building consent was required for the relevant work. But I am not persuaded that cause of action significantly increased the defendant’s costs. Counsel on both sides were efficient and the hearing took less than four days. Argument about the breach of warranty cause of action did not take much of this and the joint memorandum filed after the hearing was not particularly involved. Neither do I consider the abandoned cause of action made any difference to the cost of the claim as it would have involved similar issues to the misrepresentation cause of action.

[7]                  Overall, I am satisfied that awarding costs to Ms Grant on a 2B basis and reasonable disbursements, as sought, properly reflects the relative success of the parties and is in the interests of justice. I award costs to Ms Grant accordingly.

Palmer J