Lee v Lee - [2016] NZHC 2357

IN THE HIGH COURT OF NEW ZEALAND ROTORUA REGISTRY

CIV-2010-463-000430 [2016] NZHC 2357

BETWEEN
ROBERT LEE

First Plaintiff

HELEN HEARD Second Plaintiff

AND

GREGORY LEE Defendant

Hearing: On the papers

Appearances:

First Plaintiff in person
D Chambers QC for Defendant

Judgment:

6 October 2016

JUDGMENT OF ASHER J

This judgment was delivered by me on Wednesday, 6 October 2016 at 1 pm pursuant to r 11.5 of the High Court Rules.

Registrar/Deputy Registrar

Solicitors:
Lance Lawson, Rotorua.
D Chambers QC, Auckland.

Copy to:
First Plaintiff.

LEE v LEE [2016] NZHC 2357 [6 October 2016]

Introduction

[1] This is a costs judgment, arising from an unsuccessful strike-out application. The statement of claim contains challenges to transactions where the parents of the sibling plaintiffs transferred shares in a family plastic manufacturing business to the plaintiffs’ brother, the defendant Mr G Lee. The claim brought by Mr R Lee and Ms Heard, is that Mr G Lee improperly benefited from the transactions which he procured, by exercising undue influence over their parents, and acting in breach of his fiduciary duties. In doing so he had gained an unconscionable bargain.

[2] Mr G Lee applied to strike out the High Court proceedings on the basis they were statute-barred under the Limitation Act 1950 (the 1950 Act) as they had been commenced out of time. Associate Judge Christiansen granted that application.1
Mr R Lee and Ms Heard challenged that decision in review proceedings.2 Collins J

dismissed that challenge,3 and subsequently declined Mr R Lee and Ms Heard’s

application for leave to appeal.4

[3] Mr R Lee and Ms Heard applied for and were granted special leave by this Court for a second appeal.5 The second appeal was successful and the appeal was allowed.6 The decision striking out the High Court proceeding was quashed. The High Court proceedings are now continuing and a fixture is allocated for next year.

[4] After the successful strike-out in the High Court, costs were ordered in favour of the defendant, Mr G Lee.7 Mr R Lee, the first plaintiff, having obtained the reversal of the strike out, has now filed submissions seeking a reversal of the costs order, and for the Court to exercise its discretion to order costs in favour of the plaintiffs. The power to do so is contained in r 14.2(a) and r 14.8(2) of the High
Court Rules.

1      Lee v Lee [2012] NZHC 3283.
2      Under s 26P of the Judicature Act 1908.
3      Lee v Lee [2013] NZHC 1069.
4      Lee v Lee [2013] NZHC 1820.
5      Lee v Lee [2014] NZCA 403.
6      Lee v Lee [2015] NZCA 514.
7      Lee v Lee [2013] NZHC 1565.

[5] Mr R Lee who has filed a submission on behalf of himself and Ms Heard, now seeks costs on a scale 2B basis. The sum he seeks is $22,288.00 which he has set out in a schedule. It includes disbursements.

[6] Ms Chambers QC for the defendant does not contest…

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 Lee v Lee

Details

AGLC: Lee v Lee [2016] NZHC 2357
Case: [2016] NZHC 2357
Decision Date: 6 October 2016

CaseChat Overview and Summary

In the High Court of New Zealand, the case of Lee v Lee dealt with a dispute concerning transactions where the parents of the sibling plaintiffs, Robert Lee and Helen Heard, transferred shares in a family plastic manufacturing business to their brother, the defendant Gregory Lee. The plaintiffs contended that Gregory Lee improperly benefited from the transactions by exercising undue influence over their parents and acting in breach of his fiduciary duties, thus gaining an unconscionable bargain. Gregory Lee applied to strike out the proceedings on the basis that they were statute-barred under the Limitation Act 1950. Associate Judge Christiansen granted the application, but this decision was successfully challenged, leading to a second appeal which reversed the strike-out.

The court was required to decide the appropriate quantum of costs to be awarded to the plaintiffs following the successful appeal. The plaintiffs sought costs on a scale 2B basis, totaling $22,288.00, which included disbursements. Gregory Lee did not contest the entitlement to claim costs but challenged the amount, arguing for a lower total of $10,348.00 based on the applicable daily rates for interlocutory applications and questioning the quantum of disbursements. Additionally, he contended that Robert Lee should only be awarded half the costs as he represented both plaintiffs and filed submissions on Helen Heard’s behalf without her separate submissions.

The court found that the plaintiffs were entitled to costs of $10,348.00 as calculated by Gregory Lee, using the interlocutory application cost scale. It rejected Robert Lee’s claim for additional costs associated with affidavits filed in opposition to the strike-out application. Regarding disbursements, the court determined that the plaintiffs were entitled to the claimed expenses, subject to a minor correction in the filing fee amount. The court also ruled that both plaintiffs were entitled to full costs, as the success in the appeal benefitted both of them equally, regardless of whether Robert Lee represented Helen Heard in filing submissions.

The court ordered that Gregory Lee should pay the plaintiffs’ costs in the High Court on a 2B basis, totaling $10,348.00, along with reasonable disbursements of $2,428.10. The decision concluded that while both parties had experienced some success, no additional costs were to be ordered in respect of this decision.

Orders