Haines v Memelink

In the High Court of New Zealand, Judge Grice was called upon to decide an application for an interim injunction to prevent Harry Memelink's trust, through its trustees, from selling Quentin Stobart Haines' residence. The property was owned by Haines' family trust and the trustees were the first and second applicants. The injunction was sought on the basis that there had not been appropriate provision of information of the amounts owing under the mortgage. The court granted the injunction on certain conditions, including that the applicants service the interest repayments on an amount attributable to the former Fico loan secured under the second mortgage.

The court had to decide whether the respondents were required to provide information to the applicants to enable them to redeem the mortgaged property. The court found that the respondents had taken an assignment of the relevant second mortgage and attempted to sell the house without the Official Assignee's consent, and without providing the applicants with information enabling them to redeem the mortgage if they chose to do so. However, the court also found that the applicants' claim that the amounts owing to them were offset by legal fees was not enforceable. The court concluded that the balance of convenience supported the granting of the interim injunction on conditions.

Judge Grice held that while the applicants were successful in obtaining the interim injunction, it was not appropriate for the respondents to pay the full amount of costs claimed. The material filed in support of the application for interim injunction and the hearing time was largely taken up with arguments that the respondents owed the applicants money and the alleged debt based on Haines' legal fees. The imposition of the conditions in favour of the respondents marked a success for the respondents as well. However, the applicants did succeed in obtaining an interim injunction following a defended hearing. Therefore, the court considered that the applicants were entitled to some costs.

Accordingly, the court ordered costs in favour of the applicants against the respondents in a sum calculated according to category 2B of the High Court Rules, but discounted by 50 per cent. The court reserved leave for the parties to apply for costs and set out a timetable for the exchange of submissions.