Lam v Mo - [2018] NZHC 116

IN THE HIGH COURT OF NEW ZEALAND WELLINGTON REGISTRY

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

CIV-2013-485-1736 [2018] NZHC 116

BETWEEN
MAN FUNG LAM, YUET MING BETTY

WONG AND MORAL DRAGON LIMITED

Plaintiffs

AND

CHIU CHEUNG MO AND LILY YUET HA WONG

First Defendants

SUNLINK DEVELOPMENTS LIMITED Second Defendant

PLIMMERTON HEIGHTS CONSTRUCTION LIMITED Third Defendant

STEVEN WEE HONG LEE Fourth Defendant

Hearing: On the Papers

Counsel:

R J B Fowler QC and P W F W Cheng for Plaintiffs
J R Parker and D M Consedine for First, Second and Third
Defendants
P Barratt and S F W Learmonth for Fourth Defendant

Judgment:

13 February 2018

JUDGMENT OF CHURCHMAN J (COSTS)

Introduction

[1] This costs decision relates to an application by the fourth defendant for orders as to costs.

LAM, WONG AND MORAL DRAGON LIMITED v MO AND WONG [2018] NZHC 116 [13 February 2018]

Factual background

[2] On 15 December 2017, counsel for Steven Wee Hong Lee (the fourth defendant) filed a memorandum seeking costs. The memorandum said as follows:

(a) During a recent teleconference, it was agreed that the resolution of the fourth defendant’s costs need not wait until completion of the accounting exercise between the other parties.

(b)The fourth defendant’s schedule of costs and disbursements, calculated on a 2B basis, is for $73,639.69.

(c) The plaintiffs agree with the fourth defendant’s quantum. The first through third defendants are neutral in this matter.

(d) The fourth defendant seeks its costs and disbursements be fixed at

$73,639.69, that the $20,000 held in the plaintiffs’ solicitor’s trust account as security for costs plus any interest be paid to the fourth defendant, and that the plaintiffs pay the fourth defendant’s costs and disbursements within 14 days.

[3] On 18 December 2017, the plaintiffs filed a memorandum in response regarding the fourth defendant’s costs. The memorandum said as follows:

(a) The plaintiffs accept the schedule of fourth defendant’s costs and disbursements as an appropriate calculation.

(b)The plaintiffs do not object to fixing the fourth defendant’s costs and disbursements. There are, however, issues as to incidence and timing.

(c) The plaintiffs seek first a ‘Sanderson Order’. If that is not granted, a

‘Bullock Order’ is then sought.

(d) If the Court is unwilling to make a ‘Sanderson Order’ or a ‘Bullock

Order’ at this stage, the plaintiffs propose ordering a release of the total

security of $20,000 by way of part payment, with a stay of enforcement of the balance for the time being.

(e) It was not unreasonable to have included the fourth defendant in the proceedings given the plaintiffs distance and lack of understanding of New Zealand law and culture, and Mr Mo’s control of the information flow.

[4] On 19 December 2017, the first, second and third defendants filed a memorandum regarding the fourth defendant’s costs. The memorandum said as follows:

(a) It was not reasonable for the plaintiffs to join the fourth defendant, so they should bear the costs.

(b)Neither a ‘Sanderson Order’ nor a ‘Bullock Order’…

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 Lam v Mo

Details

AGLC: Lam v Mo [2018] NZHC 116
Case: [2018] NZHC 116
Decision Date: 13 February 2018

CaseChat Overview and Summary

The case before the court involves an application for costs by Steven Wee Hong Lee (the fourth defendant) against the plaintiffs Man Fung Lam, Yuet Ming Betty Wong, and Moral Dragon Limited. The matter arose from a complex dispute concerning a joint venture, where the fourth defendant's involvement was contentious. The primary issue for the court was to determine whether the plaintiffs' decision to join the fourth defendant in the proceedings was reasonable and whether the fourth defendant should bear any of the plaintiffs' costs. The court was also required to decide on the appropriate order to be made regarding the costs and disbursements claimed by the fourth defendant.

The court considered several factors in its decision, including the reasonableness of the original joinder of the fourth defendant, whether the unsuccessful defendants contributed to the joinder, the development of the proceedings, and whether the unsuccessful defendants were found liable for significantly less than the claim. The court found that the original joinder of the fourth defendant was unreasonable due to the sparse evidence supporting the claim against him and the operation of the Limitation Act, which barred any action regarding alleged breaches prior to 27 June 2007. The plaintiffs' argument that their lack of understanding of New Zealand law and culture, along with Mr Mo's control of the information flow, justified the joinder was not accepted. Given that the first, second, and third defendants did nothing to contribute to the joinder, the plaintiffs should bear the costs of the fourth defendant.

The court ordered the plaintiffs to pay the fourth defendant's costs and disbursements, which were fixed at $73,639.69. The $20,000 held in the plaintiffs' solicitor's trust account as security for costs, plus any interest, was to be paid to the fourth defendant immediately. The balance of the fourth defendant's costs and disbursements was to be paid by the plaintiffs within 14 days. This decision aligns with the legal principles governing costs in cases where one defendant is successful, and others are not, leaving the matter of costs to the discretion of the judge.

Orders