Leeds v Richards - [2022] NZHC 1389

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

I TE KŌTI MATUA O AOTEAROA TĀMAKI MAKAURAU ROHE

CIV-2016-404-140

[2022] NZHC 1389

UNDER the Insolvency (Cross-Border) Act 2006

IN THE MATTER

of request for assistance to facilitate the enforcement of an order dated 19 December 2014 of the High Court of Justice of England and Wales

BETWEEN

MICHAEL THOMAS LEEDS and NICHOLAS STEWART WOOD as joint

trustees in bankruptcy of the estate of MURRAY RICHARDS

Applicants

AND

MURRAY RICHARDS (DECEASED)

First Respondent

STEINDLE WILLIAMS LEGAL LIMITED

Second Respondent

Hearing: On the papers

Counsel:

S M Bisley and LWD Kibblewhite for the Applicants P Davey for the Second Respondent

Judgment:

14 June 2022

JUDGMENT OF GAULT J

(Costs)

This judgment was delivered by me on 14 June 2022 at 3:00 pm pursuant to r 11.5 of the High Court Rules 2016.
Registrar/Deputy Registrar

……………………………………

LEEDS and WOOD v RICHARDS [2022] NZHC 1389 [14 June 2022]

[1] Following the applicants’ notice of discontinuance, the second respondent Steindle Williams Legal Limited (SWL) seeks costs on a solicitor/client basis totalling
$28,009.40 (including GST).

[2] The applicants say that SWL is entitled at most to $5,545.25 (plus GST if any), being the sum of its actual costs for steps it was required to take in order to assist with Mr Richards’ bankruptcy and scale costs for other steps that it took reasonably.

Factual background

[3] The applicants were appointed joint trustees in bankruptcy of the estate of the first respondent, Mr Richards. Mr Richards was a former client of SWL.

[4] In February 2015, the applicants requested SWL to provide information relating to Mr Richards who had been adjudicated bankrupt in England. SWL responded that it was bound by confidentiality and could not provide the information without Mr Richards’ consent or an appropriate order of the Court.

[5] The applicants filed an originating application dated 29 January 2016 seeking orders in accordance with a letter of request from the County Court at Croydon to permit the applicants to use the Official Assignee’s powers to obtain information. SWL filed a notice of appearance advising that it neither opposed nor consented to the orders.

[6] Mr Richards then applied for a stay of the proceeding. On 3 June 2016, Associate Judge Bell dismissed that application and made an order requiring SWL to prepare an affidavit setting out the matters where it acted for Mr Richards or any “entities associated with Mr Richards”.1 An order was made that the applicants pay SWL’s actual and reasonable legal costs in preparing, filing and serving that affidavit.

[7] Mr Richards then filed an application out of time to review that judgment. On 1 August 2016 Associate Judge Bell directed SWL to file the affidavit by 19 August 2016. SWL instructed counsel and sought further directions as to what was

1 Leeds v Richards [2016] NZHC 1191 at [44].

meant by “entities associated with Mr Richards” together with a request that SWL be allowed further time to file and serve the affidavit…

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 Leeds v Richards

Details

AGLC: Leeds v Richards [2022] NZHC 1389
Case: [2022] NZHC 1389
Decision Date: 14 June 2022

CaseChat Overview and Summary

The High Court of New Zealand was asked to determine the costs incurred by Steindle Williams Legal Limited (SWL), a law firm, in relation to the bankruptcy proceedings of Murray Richards. Leeds and Wood, as joint trustees in bankruptcy of the estate of Murray Richards, had sought to enforce an order from the High Court of Justice of England and Wales. They requested SWL to provide information relating to Murray Richards, who was a former client of SWL. SWL refused to provide the information without Murray Richards’ consent or an appropriate order from the Court. The dispute arose over the amount of costs that SWL was entitled to claim from Leeds and Wood.

The legal issues the court needed to decide were whether SWL was entitled to its reasonable costs of complying with the obligations as a result of the letter of request and, if so, the amount of those costs. The court also had to determine whether SWL was entitled to indemnity costs for other attendances in the proceeding.

The court found that SWL was entitled to its actual and reasonable costs of complying with its obligations as a result of the letter of request. The court held that the reasonable costs should not make an arbitrary deduction for SWL’s unknown profit margin. However, the court considered that SWL had not made out a claim for indemnity costs for other attendances. The court decided that 2B costs were appropriate for the allowed steps, rather than 1A as submitted by Leeds and Wood. The court did not consider it appropriate to reduce SWL’s costs on the basis of the without prejudice save as to costs letter.

The court ordered that the applicants pay SWL’s actual and reasonable legal costs in preparing, filing and serving the affidavits and to provide the documents listed in those affidavits to Mr Whale. The court also ordered that SWL was entitled to scale costs for other attendances in the proceeding, except for the costs of three memoranda, which the court considered fairly reflects a degree of unnecessary involvement.

Orders