Hamid v England HC Auckland CIV-2009-404-003697

[2011] NZHC 1737

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

CIV-2009-404-003697

BETWEEN  PIERS ANDREW THOMAS HAMID AS TRUSTEE OF PATH (NO.2) TRUST AND BENJAMIN NEALE HAMID AS TRUSTEE OF PATH (NO.2) TRUST

First Plaintiffs

ANDPAMELA ANNE HAMID AS TRUSTEE OF PA BEARDSMORE FAMILY TRUST Second Plaintiff

ANDBRUCE ENGLAND First Defendant

ANDJOANNE MARY SUCKLING, KEVIN MCDONALD TRUSTEE LIMITED AND ANTHONY RALPH PHILLIPS

Second Defendants

ANDBARFOOT & THOMPSON LIMITED Third Defendant

Hearing:         On the Papers

Counsel:        M Thornton for First and Second Plaintiffs A Hooker for First and Second Defendants R B J Hern for Third Defendant

Judgment:      29 November 2011

QUANTUM AND COSTS JUDGMENT OF WHATA J

This judgment was delivered by Justice Whata on

29 November 2011 at 4.30 p.m., pursuant to r 11.5 of the High Court Rules

Registrar/Deputy Registrar

Date:

Solicitors:

M Thornton, PO Box 91441, Victoria Street West, Auckland 1142

A Hooker, PO Box 4, Albany Village, Auckland 0755

McElroys, PO Box 835, Shortland Street, Auckland 1140

HAMID V ENGLAND HC AK CIV-2009-404-003697 29 November 2011

[1]      The plaintiffs apply for costs and disbursements as the successful litigant in this matter.  The quantum of costs incurred is not disputed.  The quantum of primary loss plus interest has also been largely agreed.

[2]      What is not agreed, and what is in dispute, is the portion that Barfoot & Thompson, the third defendant, ought to pay for costs.

[3]      Barfoot and Thompson submits that there should be a separate apportionment of liability for costs and disbursements as between the two unsuccessful defendants and that this should be on the same basis that the primary loss was found – namely Mr England 80 per cent and Barfoot and Thompson 20 per cent.

[4]      In support of this position Mr Hern cites the following passage from the judgment of Venning J at paragraph [29] of Body Corporate No. 189855 & others v North Shore City Council & others,[1] wherein it is stated:

[29]      When considering the position of costs in relation to the situation of multiple defendants, the Court must assess the overall justice of the matter as between the parties concerned:  Lane Group Limited v D I & Paterson Ltd [2000] 1 NZLR 129. In my judgment there must be some proportionality between the liability of the first and third (and fourth) defendants to the plaintiffs for costs that reflects the outcome and also reflects the overall responsibility for the plaintiffs’ losses.

[1] Body Corporate No. 189855 & others v North Shore City Council & others HC Auckland CIV-2005-

404-5561, 2 October 2008.

[5]      The plaintiffs meet this contention by observing:

(a)      That the claims against Mr England and Barfoot and Thompson were the same in nature, namely both claims were brought under s 9 of the Fair Trading Act 1986.

(b)The relative success against Barfoot and Thompson did not reflect a defect in the case against Barfoot and Thompson but rather reflected

the  particular  features  of  the  relationship  between  Barfoot  and

Thompson  and  Mr England  and  the  Court’s  assessment  of  their respective culpability for the Hamid’s loss.

[6]      The point is also made that Barfoot and Thompson actively defended the claim by the Hamids and put the Hamids to the proof and actively participated in providing evidence and undertaking cross-examination.

[7]      The plaintiffs also submit that Barfoot and Thompson has already benefited from the Court’s apportionment, noting that had the matter been dealt with in accordance with common law principles, Barfoot and Thompson would have been liable for the entire sum.   Reference is also made to the approach to a portion of

damages taken by Red Eagle Corporation Ltd v Ellis[2]  where a bankrupted third

party’s contribution to the loss was disregarded when the Court apportioned liability.

[2] Red Eagle Corporation Ltd v Ellis [2010] NZSC 20 at [29]-[30].

[8]      In this regard it is noted that Mr England now represents himself and I am advised by counsel that he has no assets or ability to meet the judgment.

Costs assessment

[9]      The aim of a costs order is, as the Court of Appeal has said, to endeavour to do justice to both sides, bearing in mind all material features of the case.[3]

[3] Packing In Limited (In Liquidation), formerly known as Bond Cargo Ltd v Chilcott (2003) 16 PRNZ 869 at [5].

[10]     In achieving justice between the parties I consider that I must have regard to the following matters:

(a)       The role played by the respective defendants in the proceedings.

(b)The  outcome  of  the  proceedings,  including  the  apportionment  of liability.

(c)       The general presumption that the successful litigant will get its costs.

[11]     As to the first matter, I observe that the cases presented by the defendants were focused on matters of particular importance to them, with the third defendant focusing on contesting the specific liability of the third defendant as an employer of the first defendant.  Plainly, there were aspects of the first defendant’s case that were supported  by  the  third  defendant,  but  I  am  of  the  view  overall  that  the  third defendant exercised due care in not repeating or unnecessarily adding to the evidence or argument presented by the first defendant.

[12]     I respectfully join with Venning J when he says that there must be some proportionality between the defendants as to costs that reflects the outcome and also reflects the overall responsibility for the plaintiffs’ losses.  In the present case, as I have found, the primary actor in this was the first defendant, not the third defendant. While that does not provide a defence for the third defendant, the policy drivers for the purposes of allocation of damages should logically and as a matter of principle, apply to the apportionment of costs.  Having said that, however, responsibility for the plaintiffs’ losses is not co-extensive with responsibility for the costs incurred by the plaintiffs.  Notwithstanding the focus that the third defendant brought to its case, there were areas of overlap that in my view made its contribution to the overall costs of the plaintiffs greater than the 20 per cent that I apportioned for the purposes of a damages outcome.

[13]     While, I cannot be precise about the extent of the overlap, in my view the

contribution to the plaintiffs’ costs was closer to the 35 per cent mark.

[14]     As  to  the  third  principle,  that  is  self-evident.    The  plaintiff  has  been successful in its specific claim, at least partially so, against the third defendant.  As I said in my judgment on costs in Mok and Ho v Bolderson[4] the ordinary presumption is that a successful litigant will get its costs.  But unlike  Mok and Ho, this is a multi- defendant case and the overall responsibility for the costs incurred must, as I have said, be relevant.

[4] Mok and Ho v Bolderson HC Auckland CIV-2010-404-007292, 9 August 2011.

[15]     On the foregoing basis, I therefore resolve costs as follows:

(a)       Mr England shall be responsible for 65 per cent of the plaintiffs’ costs

and disbursements.

(b)      Barfoot and Thompson shall be responsible for 35 per cent of the

plaintiffs’ costs and disbursements.

Quantum of loss

[16]     As  foreshadowed,  the  quantum  of  loss  is  largely  agreed  as  between  the plaintiffs and the third defendant.  That quantum is usefully summarised at paragraph

10 of the reply memorandum of the plaintiffs as follows:

(a)       Damages

Loss on sale  182,679.67

PLUS

Loss on rental paid

LESS

Savings on outgoings and interest earned on sale proceeds

LESS

25% contributory conduct    25,764.75

208,444.42

(b)      Interest

@ 8.4% 24.10.09 to 30.6.11

(643 days) = $47.97077063 per day  30,845.21

@ 5% 1.7.11 to 26.9.11

(88 days) = $28.55403013 per day      2,512.75

33,357.96

(c)       Costs and disbursements

As per previouis memorandum  64,949.36 (d)     General Damages    14,026.50

GRAND TOTAL  $320,778.24

[17]     Of that sum the third defendant accepts that its liability, excluding costs and disbursements, is $51,623.06.

Final order

[18]     There shall be judgment in the sums specified at [17], with liability for:

(a)       Damages, Interest and General Damages apportioned 80 per cent to the first defendant and 20 per cent to the third defendant.

(b)Costs  and  disbursements  apportioned  to  65  per  cent  to  the  first defendant and 35 per cent to the third defendant.

[19]     I note that there are slight arithmetic differences between the percentage calculations based on the plaintiffs’ summary and the third defendant’s identified liability. I will leave it to the parties to resolve this in accordance with my ruling at

[18].

Whata J