Hitchcock v Murphy - [2025] NZHC 985

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

I TE KŌTI MATUA O AOTEAROA TĀMAKI MAKAURAU ROHE

CIV-2020-404-2227

[2025] NZHC 985

BETWEEN
STEPHEN LESTER HITCHCOCK

Plaintiff

AND

SUSAN KERRIE MURPHY

Defendant

Hearing: on the papers

Appearances:

G J Thwaite for plaintiff

K E Hogan and B J Lupton for defendant

Judgment:

29 April 2025

COSTS JUDGMENT OF JOHNSTONE J

This judgment was delivered by me on 29 April 2025 at 3pm pursuant to r 11.5 of the High Court Rules.

Registrar/Deputy Registrar

Solicitors:
G J Thwaite, Sunnynook Insight Legal, Warkworth

HITCHCOCK v MURPHY [2025] NZHC 985 [29 April 2025]

[1] By judgment dated 29 November 2024, I found that the defendant (Ms Murphy):1

(a)held $500,000 of the sale proceeds of the subdivided back half of her semi-rural Auckland property on constructive trust for her brother, the plaintiff (Mr Hitchcock);

(b)owed Mr Hitchcock a further sum of $75,000 by way of debt due; and

(c)should pay him those sums, together with interest from 23 June 2022 until the date of payment.

[2] Mr Hitchcock now seeks scale costs of $64,052, plus a 50 per cent uplift, and disbursements of $17,385. Ms Murphy opposes, and further applies for her own award of either scale costs of $62,498.50 or an uplifted amount.

Principles

[3] The Court’s discretion in costs matters, vested by r 14.1 of the High Court Rules 2016, requires generally to be exercised in accordance with the principles set out in r 14.2.2 As observed by the Court of Appeal in Water Guard NZ Ltd v Midgen Enterprises Ltd, “the first of those general principles is that the party which fails should pay the costs of the successful party”.3 This “formalis[es] the paramount rule that costs should follow the event.”4

[4] Thus, in Water Guard, a plaintiff was found not to lose its status as the successful party because it failed on most, but not all, of its claims. The Court noted that such failure “can be properly recognised in other ways, such as [by] reducing costs otherwise payable or ordering costs to lie where they fall.”5

1 Hitchcock v Murphy [2024] NZHC 3607.
2 Water Guard NZ Ltd v Midgen Enterprises Ltd [2017] NZCA 36 at [12].
3 At [13].
4 At [13].
5 At [13].

[5] Similarly, in Weaver v Auckland Council, the Court of Appeal described appellants who had succeeded to roughly half the extent of their claim as “the only party to have succeeded by any ‘realistic appraisal’”.6 As the Court put it:7
… success on more limited terms is still success.

[6] The prospect of reduced costs being payable to a partially successful party is confirmed by r 14.7, which provides:

Despite rules 14.2 to 14.5, the court may refuse to make an order for costs or may reduce the costs otherwise payable under those rules if—

…

(d) although the party claiming costs has succeeded overall, that party has failed in relation to a cause of action or issue which…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

Continue reading Hitchcock v Murphy

Details

AGLC: Hitchcock v Murphy [2025] NZHC 985
Case: [2025] NZHC 985
Decision Date: 29 April 2025

CaseChat Overview and Summary

In Hitchcock v Murphy, the plaintiff, Stephen Lester Hitchcock, sought to recover $500,000 of the sale proceeds from the defendant, Susan Kerrie Murphy, on constructive trust, as well as a sum of $75,000 by way of debt due, together with interest. The High Court of New Zealand found that Ms Murphy held the $500,000 on constructive trust for Mr Hitchcock and owed him a further $75,000 by way of debt, with interest accruing from 23 June 2022 until the date of payment. The Court now considers Mr Hitchcock’s application for costs and Ms Murphy’s application for her own award of costs.

The court was required to determine whether Mr Hitchcock or Ms Murphy was the successful party, and whether the costs to which they were entitled should be uplifted or reduced. The court also had to consider whether the award of costs exceeded the costs incurred by the successful party. The court found that Mr Hitchcock was the successful party, as he succeeded in his claims for constructive trust and debt, even though other claims failed. However, the court decided that Mr Hitchcock’s award of costs should be reduced because his unsuccessful claims significantly increased the costs of the party opposing costs. The court arrived at an award of costs in favour of Mr Hitchcock of $32,026, with disbursements of $8,692.50.

The court directed Mr Hitchcock to arrange for his counsel to file a memorandum confirming whether his actual costs exceeded $32,026 or stating the amount of his actual costs. Upon receipt of this memorandum, judgment is to issue awarding Mr Hitchcock costs in the sum of $32,026, or in the amount of his actual costs, and disbursements of $8,692.50.

Orders