Hellaby Resource Services Limited v Body Corporate 197281

[2023] NZHC 1684

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

I TE KŌTI MATUA O AOTEAROA TĀMAKI MAKAURAU ROHE

CIV-2019-404-000869

[2023] NZHC 1684

BETWEEN

HELLABY RESOURCE SERVICES LIMITED
First Plaintiff / Fourth Counterclaim Defendant

SRG GLOBAL REMEDIATION SERVICES (NZ) LIMITED
Second Plaintiff / First Counterclaim Defendant

AND

BODY CORPORATE 197281

Defendant / Counterclaim Plaintiff

MAYNARD MARKS LIMITED
Second Counterclaim Defendant

HOBANZ PROJECT ASSIST LIMITED

Third Counterclaim Defendant

CIV-2023-404-000649

BETWEEN

SRG GLOBAL REMEDIATION SERVICES (NZ) LIMITED

Applicant

AND

BODY CORPORATE 197281

Respondent

Hearing:

On the papers

Appearances:

J McBride / N Gillies for SRG

J W A Johnson / N G Lawrence for Body Corporate 197281 W R Potter for N Pillay

Judgment:

4 July 2023

HELLABY RESOURCE SERVICES LIMITED v BODY CORPORATE 197281 [2023] NZHC 1684 [4 July
2023]

COSTS JUDGMENT OF ASSOCIATE JUDGE GARDINER

This judgment was delivered by me on 4 July 2023 at 4.00 p.m. pursuant to Rule 11.5 of the High Court Rules.

Registrar/Deputy Registrar Date.......................................

Introduction

[1]    In an application dated 10 March 2023, SRG applied for an ‘unless’ order in respect of its requirement that the Body Corporate provide further particulars of the Second Amended Statement of Claim (Second ASOC) (Further Particulars Application). In an application dated 6 April 2023, SRG applied for security for costs.

[2]    The two applications were scheduled to be heard on 1 May 2023. Before the hearing the parties reached agreement, save for costs on the Further Particulars Application. Orders were made by consent, and the hearing vacated.

[3]    On 1 May 2023, I heard submissions on costs associated with the Further Particulars Application during a telephone case management conference.

[4]    I issue this judgment despite there being a costs hearing scheduled for the substantive proceeding. Costs on interlocutory applications are determined with reference to the outcome of the application (except in the case of summary judgment).

Submissions

[5]    Mr McBride submits that SRG’s application was rendered otiose by the Body Corporate filing its Third Amended Statement of Claim (Third ASOC). He says that the two paragraphs that were the subject of SRG’s application were removed altogether from the statement of claim. Accordingly, he submits that SRG is the successful party and should receive its 2B costs and disbursements.

[6]    Mr Johnson submits that SRG’s application for an ‘unless’ order was premature. He says that it was made clear to SRG in correspondence that the Body Corporate could not answer the requests for particulars until it had received SRG’s discovery. He says that SRG was late in providing its discovery, and that delay prevented the Body Corporate from being able to respond to SRG’s requests. He says that shortly after receiving SRG’s discovery, the Body Corporate provided the remaining particulars within the Third ASOC, according to the Court-ordered timetable.

Assessment

[7]In my view, SRG should not be awarded costs. I have two reasons.

[8]    First, the Court makes ‘unless’ orders when a party is in default of an interlocutory order or case management direction.1 ‘Unless’ orders are properly only made when there is a history of non-compliance with earlier Court orders.2 Here, there was no extant order which the Body Corporate was in default of; and there was no history of non-compliance with the Court’s directions.

[9]    The background is that on 22 December 2022 the Body Corporate filed and served the Second ASOC. On 17 February 2023, SRG served a notice requiring further particulars from the Body Corporate.3 That request involved 230 questions. SRG required an answer within five working days, by Friday 24 February 2023.

[10]   On Monday 27 February 2023 SRG’s application to adjourn the July trial was heard. At the hearing, counsel for the Body Corporate advised SRG and the Court that the response to particulars would be provided the following day. On 28 February 2023, the Body Corporate answered 213 of the 230 questions, and served those answers on SRG.

1      High Court Rules 2016, r 7.8.

2      SM v LFDB [2014] NZCA 326, [2014] 3 NZLR 494 at [31].

3      High Court Rules, r 5.21.

[11]   On 10 March 2023, SRG applied for an order requiring the Body Corporate to provide particulars of the Second ASOC, and a direction that if those particulars were not provided within seven days the paragraphs concerned would be struck out.

[12]   On 13 March 2023, the Body Corporate advised SRG by letter that it was abandoning the causes of action to which the remaining 17 questions related.

[13]   On 14 March 2023, SRG wrote to the Body Corporate stating that the answers provided were inadequate and did not address the particulars requested, and requiring the Body Corporate to answer the requested further particulars within five working days, by 21 March 2023.

[14]   In a minute issued on 15 March 2023, Lang J addressed SRG’s application. He said:4

[3]        SRG has filed an application seeking “unless” orders by virtue of the fact that the body corporate failed to respond to SRG’s notice of particulars following the hearing on 27 February 2023. I consider it premature to determine this application at this point.

[4]        The body corporate provided SRG with further particulars on 28 February and 13 March 2023. SRG considers further particulars remain outstanding. I have directed that the body corporate is to provide these particulars, so far as it is presently able, no later than 22 March 2023. To  review compliance with this direction the proceeding is to be listed for mention before an Associate Judge in the Chambers List on Friday 24 March 2023 at 2.15 pm.

(emphasis added)

[15]   On 17 March 2023, the Body Corporate responded to SRG. SRG was not satisfied with this response, and on 24 March 2023 SRG again wrote to the Body Corporate. The Body Corporate responded on 28 March 2023. SRG filed the ‘updated’ interlocutory application for ‘unless’ orders on 6 April 2023.

[16]   It is apparent from this review that there was no extant Court order to say that the Body Corporate’s particulars were inadequate. Lang J did not hear submissions on whether the particulars requested by SRG were required or appropriate and did not

4      Hellaby Resource Services Ltd v Body Corporate 197281 HC Auckland CIV-2020-404-869, 15 March 2023 (Minute of Lang J re pleadings issue).

make any judgment on that issue. His direction that the Body Corporate provide the particulars sought by SRG was qualified by the words “so far as it is presently able.” The Body Corporate provided a response on 17 March and again on 28 March 2023. I do not consider that it can reasonably be said that the Body Corporate failed to comply with an order of the Court justifying an ‘unless’ order.

[17]   Second, the Body Corporate told SRG in its 17 and 28 March responses that it could not provide the remaining particulars sought until it received SRG’s discovery. The Body Corporate’s responses do not read as evasive. It gave specific explanations for why it could not provide the particulars until it received SRG’s discovery.

[18]   On 6 April 2023 SRG provided its discovery which involved around 11,000 documents. On 26 April 2023, the Body Corporate provided the remaining particulars within the Third ASOC, with its amended briefs of evidence.

[19]   Accordingly, I consider that SRG’s interlocutory application for ‘unless’ orders was premature and misconceived. SRG should pay the Body Corporate’s costs in relation to the application.

Result

[20]   The Body Corporate is entitled to its costs on a scale 2B basis, and reasonable disbursements.

Associate Judge Gardiner

Solicitors:

Farry Law Limited, Auckland Hesketh Henry, Auckland

J McBride, Auckland J Johnson, Auckland