Hills v Public Trust HC Auckland CIV 2008-404-2217

[2010] NZHC 2039

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

CIV-2008-404-2217

BETWEEN  KATHLEEN WINNIFRED HILLS Plaintiff

ANDPUBLIC TRUST First Defendant

ANDTHOMAS IAN GANNON Second Defendant

ANDALEXANDRIA CATHERINE MEDCALF Third Defendant

ANDDOUGLAS GWILLIAM HILLS Fourth Defendant

ANDDONALD ROSS EAGLE Third Party

Judgment:      23 September 2010 at 2.30 P.M.

FURTHER JUDGMENT OF POTTER J As to costs

In accordance with r 11.5 High Court Rules

I direct the Registrar to endorse this judgment

with a delivery time of 2.30 p.m. on 23 September 2010.

Solicitors:           Taylor Grant Tesiram, P O Box 4039, Auckland 1141

Davenports, P O Box 47500, Ponsonby, Auckland 1144

Foley & Hughes, P O Box 6829, Auckland 1141

Meredith Connell, P O Box 2213, Auckland 1140
Public Trust, Private Bag 17906, Greenlane, Auckland 1546

Copy to:            S Grant, P O Box 4338, Auckland 1140

S R G Judd, P O Box 3320, Shortland Street, Auckland 1140

T Chubb, P O Box 1128, Auckland 1140

C Townsend, P O Box 47345, Ponsonby, Auckland 1144

H Fulton, P O Box 5577, Wellesley Street, Auckland 1141

HILLS V PUBLIC TRUST AND ORS HC AK CIV-2008-404-2217  23 September 2010

[1]      I refer to the memoranda from counsel for the Public Trust, Mr Fulton dated

10 June 2010 and counsel for the plaintiff dated 21 June 2010.

[2]      I  have  not  received  memoranda  from  the  third  and  fourth  defendants, residuary beneficiaries with the plaintiff in the estate of Norah Alexandra Charlotte Hills.  On the assumption that copies of counsels’ memoranda have been forwarded to the third and fourth defendants or their counsel, I proceed on the basis that they do not wish to address the Public Trust’s claim for costs set out in Mr Fulton’s memorandum of 10 June 2010.

[3]      In my judgment as to costs dated 30 April 2010 I said in relation to the Public

Trust’s costs at [8]:

The Public Trust did not take active steps in the proceedings and sought leave to be excused from the hearing.  It has acted throughout in accordance with its duties as trustee of the estate of Norah Hills.  In accordance with the determination at [202] of the judgment, the Public Trust’s proper and reasonable costs and disbursements are to be paid by deduction from the plaintiff’s share in the deceased’s estate.  In the event that the Public Trust’s costs exceed costs calculated on a 2B basis ($15,540) and are not accepted by the plaintiff, an itemised bill of costs may be submitted for my further ruling.  I trust this will not be necessary.

[4]      The Public Trust claims actual and reasonable costs as follows:

Counsel’s fees and disbursements in accordance with

invoices filed by Mr Fulton  $28,293.62

Costs of Public Trust’s solicitor and senior Trust

Officer in accordance with time recording records filed              $10,223.40

$38,517.02

(I note that no disbursements are claimed by the Public Trust).

[5]      The plaintiff does not accept the costs as claimed.   Essentially Ms Grant’s position on behalf of the plaintiff is that the costs of the Public Trust by comparison with the actual costs detailed by other parties are high given the limited role of the Public Trust in the proceedings, attendances are excessive, the costs claimed are two and a half times costs on a 2B basis and the costs include attendances which do not relate to this proceeding, but to the appeal filed by the plaintiff in the Court of Appeal.

[6]      The plaintiff was unsuccessful in the proceedings and is liable for costs.  In ruling as I did at [8] of the costs judgment I took into account that any costs incurred by the Public Trust in relation to the litigation which were not met by the plaintiff from  her  share in  the  estate would  fall  proportionately on  the  third  and  fourth defendants as residuary beneficiaries in the estate.   Accordingly to achieve a just outcome between the parties in relation to the Public Trust’s costs I considered it appropriate that they be paid by the plaintiff.  I confirm that approach.

[7]      I  accept  Mr  Fulton’s  submission  that  this  was  not  the  usual  case  of  an executor filing a financial statement for the estate and recording the will instructions of the testatrix.   It was required of the Public Trust as executor to be active at all stages of the litigation, to analyse the multiple causes of action (in respect of those that did not directly involve the estate, analysis and understanding of the cause of action and the factual background pertaining to it would be necessary for the Public Trust properly to  exclude it from further  consideration), and  to address matters affecting the estate that arose in relation to the litigation.

[8]      Although the Public Trust properly adopted a neutral role and appropriately sought leave of the Court to be excused from the hearing (thus avoiding a further burden of costs for the estate), it was appropriate and necessary that as executor, the Public Trust maintained close oversight of the proceedings.

[9]      I find counsel’s fees and disbursements totalling $28,293.62 to be proper charges.   Any duplication of which the plaintiff might be critical (I do not accept justifiably), is more than offset by the reduced hourly rates charged by Mr Fulton in the early stages of the proceedings.

[10]     The costs of the Public Trust’s solicitor and senior trust officer are fully detailed in the time recording records.  They appear appropriate except in relation to two classes of entries:

a)        Those which appear to relate to general attendances for the estate, e.g. “arrange   investment   of   Estate   funds”;   “attend   to   payment   of

accounts”; and possibly “arrange distribution chattels (on 7 December

2009).

b)Attendances   which   relate  to   matters   following   on   from   these proceedings, in particular the plaintiff’s appeal to the Court of Appeal. These attendances commence on 19 April 2010 with “peruse notice of appeal”.

[11]     The costs of the above attendances should be deducted from the amount claimed by the Public Trust thereby reducing the total of $10,223.40 accordingly.  I would expect any attendances which cannot be clearly attributed, to be resolved in favour of the plaintiff, as indicated in paragraph 4 of Mr Fulton’s memorandum. Subject to those deductions I find the charges of the Public Trust to be proper charges to be met by the plaintiff.

[12]     The costs payable by the plaintiff as above are to be paid from her share in the estate of Norah Hills by way of deduction prior to distribution.

[13]     I note that counsels’ memoranda filed in June were referred to me only this week.  The explanation is probably the plaintiff’s notice of appeal and the issue of security for costs which is the subject of a judgment of the Court of Appeal,[1] which caused this outstanding matter to be overlooked.

[1] Hills v Public Trust CA208/2010 [2010] NZCA 401 2 September 2010.