Hellaby Resource Services Limited v Body Corporate 197281

[2020] NZHC 2347

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

I TE KŌTI MATUA O AOTEAROA TĀMAKI MAKAURAU ROHE

CIV-2019-404-869

[2020] NZHC 2347

BETWEEN

HELLABY RESOURCE SERVICES LIMITED
First Plaintiff

TBS REMCON LIMITED
Second Plaintiff

AND

BODY CORPORATE 197281

Defendant

Hearing:

On the papers

Appearances:

J Q Wilson and RDH Massey for the Plaintiffs

R J Hollyman QC and W J Revell for the Defendant

Judgment:

9 September 2020

JUDGMENT OF GAULT J

(Costs)

This judgment was delivered by me on 9 September 2020 at 3:30 pm pursuant to r 11.5 of the High Court Rules 2016.

Registrar/Deputy Registrar

……………………………………

Solicitors / Counsel:

Mr J Q Wilson and Mr RDH Massey, Bell Gully, Auckland
Mr R J Hollyman QC and Mr N Lawrence, Barristers, Auckland

Mr W J Revell (defendant’s instructing solicitor), Farry and Co., Auckland

HELLABY RESOURCE SERVICES LTD v BODY CORPORATE 197281 [2020] NZHC 2347 [9 September

2020]

[1]The plaintiffs seek costs on the application for joinder of the second plaintiff.

[2]        As recorded in my minute of 4 August 2020, the parties consent to costs being determined on the papers and based on the memoranda already filed. The parties agree that costs should be calculated on a 2B basis. The main disagreement relates to an allowance for preparation of submissions and a bundle given the defendant’s consent was forthcoming one day before those steps were due. I gave the parties a further opportunity to reach agreement.

[3]        At a further mention of the plaintiffs’ second application for summary judgment on 1 September 2020, Mr Wilson indicated that the parties had been unable to agree. Mr Wilson also indicated that the plaintiffs had proposed splitting the difference. I gave Mr Lawrence, who appeared for the defendant, an opportunity to respond but as he did not have instructions his position quite fairly was that costs should be determined on the basis  of the memoranda previously filed,  as agreed.     I proceed on that basis.

[4]        On 2 September 2020 counsel for the defendant filed a memorandum seeking costs on the first plaintiff’s earlier unsuccessful application for summary judgment. The memorandum acknowledges that costs on that application were reserved, as is normal practice on unsuccessful summary judgment applications, but submits this is a case where it is appropriate to award costs on the basis that the application for summary judgment could never succeed because the first plaintiff was not the correct party to bring the application – the Judge found that the inability for the contract to be assigned was fatal to the application for summary judgment.1 I consider that any attempt to have costs fixed now in relation to the earlier summary judgment application should be addressed by Associate Judge Lester. He heard and dismissed the application for summary judgment, and reserved costs. The 2 September 2020 memorandum is to be referred to him.

1      Hellaby Resource Services Ltd v Body Corporate 197281 [2019] NZHC 2641.

Costs on joinder

[5]        The plaintiffs seek costs and disbursements totalling $6,887.78 with costs calculated on a 2B basis including $3,585 for preparation of written submissions and

$1,434 for preparation of a bundle for hearing. Although submissions and a bundle were not filed, the plaintiffs submit it was necessary to prepare them.

[6]        The defendant first said that costs should be reserved and incorporated as ‘costs in the cause’ as there is no explanation as to why the second plaintiff did not initially join as a plaintiff and consent to joinder was not sought. It also says its ability to respond was affected by the COVID-19 lockdown.

[7]        Costs on interlocutory applications should be determined rather than reserved, unless there are special reasons.2 I do not consider there are special reasons here. While the failure to join the second plaintiff may ultimately be relevant to costs on the earlier summary judgment application (which were reserved), it is not a reason to defer fixing costs on the successful joinder application. Nor is the fact that consent was not sought, especially since consent was not forthcoming when the application was made.

[8]        I accept that the defendant’s ability to respond was affected by the COVID-19 lockdown in March/April 2020. The joinder application was filed on 4 March 2020. By consent, on 10 March 2020 Associate Judge Sargisson directed that any documents in opposition were to be filed and served by 26 March 2020. That coincided with the lockdown. However, the hearing was scheduled for 16 July 2020, some four months away.

[9]        In the event, no documents in opposition were filed. On 29 June 2020 the registry requested that the parties confirm whether the fixture would still proceed.  On 6 July 2020 a memorandum on behalf of the plaintiff and intended second plaintiff (applicants) recorded that the defendant had not filed any opposition and supporting evidence, referred to correspondence between counsel, and advised that having had no further contact from the defendant’s counsel since advice on 19 June 2020 that they were seeking instructions, the applicants would file submissions on 9 July 2020

2      High Court Rules 2016, r 14.8(1).

in accordance with the Court’s directions. On 8 July 2020 a memorandum of counsel for the defendant advised that the defendant did not oppose joinder.

[10]      In those circumstances, I consider that it was necessary for the preparation of the applicants’ submissions and bundle to occur given the defendant’s delay in advising of its consent until the day before the applicants’ submissions and bundle were due. I consider that a partial allowance should be made for these steps. The relevant steps are for preparation (not filing) of submissions and bundle. Even if counsel had no other commitments, the time allocation for these two steps at band B (1.5 days for submissions and .6 for the bundle) indicates that preparation would need to commence in advance of the day they were due. I consider that a 50 per cent allowance for these two steps is appropriate.

Result

[11]      The plaintiffs are entitled to costs on the joinder application of $3,943.50 plus disbursements of $434.78.

Gault J