Haskell Construction Limited v Alpine Prime Properties Limited

[2020] NZHC 1593

IN THE HIGH COURT OF NEW ZEALAND WELLINGTON REGISTRY

I TE KŌTI MATUA O AOTEAROA TE WHANGANUI-A-TARA ROHE

CIV-2020-485-16

[2020] NZHC 1593

UNDER

the Companies Act 1993

BETWEEN

HASKELL CONSTRUCTION LIMITED

Plaintiff

AND

ALPINE PRIME PROPERTIES LIMITED

Defendant

Counsel:	M Freeman for plaintiff F B Collins for defendant
Judgment:	7 July 2020

COSTS JUDGMENT OF ASSOCIATE JUDGE JOHNSTON

[On the papers]

[1]    This proceeding has been settled, but the parties have been unable to resolve costs issues.   They invite the Court to do so.   Mr Freeman for the plaintiff and     Mr Collins for the defendant have filed and served memoranda, for which I thank them. The background is fully canvassed in counsel’s memoranda, and not controversial. No useful purpose would be served by reiterating it here.

[2]At issue are:

(a)The costs award made in favour of the plaintiff in CIV-2019-485-465 on the defendant’s unsuccessful application to set aside a bankruptcy notice served by the plaintiff. The plaintiff seeks a reversal of that order;

(b)Costs on the discontinuance of this proceeding.

HASKELL CONSTRUCTION LIMITED v ALPINE PRIME PROPERTIES LIMITED [2020] NZHC 1593 [7 July 2020]

[3]Having had the benefit of counsel’s submissions, the view I take is that:

(a)The plaintiff is entitled to hold on to its costs award in respect of the defendant’s unsuccessful application to set aside the bankruptcy notice. At the point that that proceeding was commenced, there was an adjudication determination pursuant to the Construction Contracts Act 2015 requiring the defendant to pay to the plaintiff the sum of

$133,619.06. As I said in my judgment dated 13 December 2019, the overarching purpose of the provisions of the Construction Contracts Act relating to payment for construction work is to ensure that cashflow continues. In my view, the defendant’s application was contrary to established principle. In those circumstances, I cannot see that a subsequent adjudication determining that the plaintiff has an independent indebtedness to the defendant exceeding the amount of the adjudication determination should affect the costs outcome on that application. I decline the invitation to reverse that determination.

(b)The defendant is entitled to its costs on the discontinuance of this proceeding. I reject the submissions made by Mr Freeman on the plaintiff’s behalf that the defendant should not have costs because the discontinuance was necessitated by a change in circumstances. In my view, the references to changed circumstances rendering a proceeding unnecessary by the Court of Appeal in Kroma Colour Prints Ltd v Tribonicotco NZ Ltd1 (applied by this Court in FM Custodians Ltd v Pati2) was intended to apply to circumstances external to the dispute between the parties, not to a predictable development in the dispute. Mr Collins calculates the defendant’s costs and disbursements at

$4,980 and that calculation appears to me to be correct.

1      Kroma Colour Prints Ltd v Tribonicotco NZ Ltd (2008) 18 PRNZ 973.

2      FM Custodians Ltd v Pati [2012] NZHC 1902.

[4]    Accordingly, I order the plaintiff to pay to the defendant costs and disbursements totalling $4,980 on the discontinuance of this proceeding.

Associate Judge Johnston

Solicitors:

Thomas Dewar Sziranyi Letts, Lower Hutt for plaintiff Gibson Sheat, Wellington for defendant