Lim-Yip v Lim

[2023] NZHC 1551

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

I TE KŌTI MATUA O AOTEAROA TĀMAKI MAKAURAU ROHE

CIV-2020-404-528

[2023] NZHC 1551

UNDER

Part 18 of the High Court Rules, section 66 and 51 of the Trustee Act 1956 and the High Court’s inherent supervisory jurisdiction in relation to trusts

IN THE MATTER

Of the C N Lim Family Trust, a trust established by deed dated 1 July 1981

BETWEEN

HONG LIM-YIP (previously known as Hong Lim Yip) and MING LIM-YIP (previously known as Ming Yip Lim) as trustees of the C N Lim Family Trust

Plaintiffs

AND

STEVEN YIP LIM as trustee of the C N Lim Family Trust

Defendant

Hearing:	On the papers at Auckland
Judgment:	21 June 2023

JUDGMENT (NO.2) OF POWELL J

This judgment was delivered by me on 21 June 2023 at 1.00 pm pursuant to

R 11.5 of the High Court Rules

…………………..

Registrar/Deputy Registrar

HONG LIM-YIP and MING LIM-YIP v STEVEN YIP LIM [2023] NZHC 1551 [21 June 2023]

[1]    On 12 October 2022, I dismissed an application brought by the defendant, Steven Yip Lim (“Steven”).1 Steven had sought orders requiring that he and the plaintiffs (Hong Lim-Yip and Ming Lim-Yip), as the trustees of the C N Lim Family Trust, determine whether any amounts were owed under a particular mortgage, and if so, that the amounts still owing be paid out to their mother’s estate.2

[2]    Steven’s application was made pursuant to a leave reserved clause contained in consent orders made by me in 2021, to implement a settlement reached by the parties during the substantive hearing of these proceedings.3 In my judgment I concluded Steven’s application was “simply untenable” and outside the ambit of the leave reserved clause,4 and that any suggestion that Steven thought such an enquiry would take place lacked credibility.5

[3]    Given my conclusions I awarded indemnity costs against Steven in favour of both the plaintiffs and Vicki Ammundsen Trust Law (“VATL”), the latter being a firm of solicitors who had been appointed by the Court to complete the sale of a property at Hobsonville.6 While there was sufficient information to make the costs order in favour of VATL,7 there was no detail of the actual costs claimed by the plaintiffs. Accordingly, a further timetable order was made to enable those details to be provided and for Steven to be given the opportunity to respond.

[4]    Although the parties complied with those directions, other commitments have prevented me from finalising the costs payable for which I apologise to the parties.

The positions of the parties

[5]    The plaintiffs seek an order for payment of their costs incurred in relation to Steven’s application in the total sum of $35,612.33 including disbursements of

1      Lim & Ors v Yip [2022] NZHC 2631.

2 At [1].

3 At [4].

4 At [9].

5 At [13].

6      At [24] and [25].

7 At [25].

$207.28. In addition, an order is also sought authorising VATL to deduct monies held on trust for the defendant to meet any award of costs.

[6]    The plaintiffs submit that the time spent by their solicitor and acting counsel to respond to the application was reasonable and incurred as a result of the defendant’s conduct. The plaintiffs note that accusations made and later withdrawn required the review of correspondence and the filing of separate memoranda. Further, accusations made by the defendant required additional affidavits to be filed which required legal advice and services.

[7]    In response, Steven submitted that the costs sought by the plaintiffs are excessive and that reasonable indemnity costs would be $18,000. In support of this submission, the defendant maintains that the plaintiffs should not be entitled to costs relating to without prejudice discussions or unilateral communications with VATL, which the defendant submits were not permitted under the consent orders and were unnecessary in any event. Further, Steven argues there was a duplication in attendances between the plaintiffs’ counsel and instructing solicitor.

Discussion

[8]    Determining whether a claim for indemnity costs is reasonable is an exercise in judgment informed by a judge’s participation in the hearing.8 It is a necessarily impressionistic, imprecise, and unscientific assessment.9 In considering whether a  fee is reasonable, the Court should not regard what is objectively necessary as the test for reasonableness. And the Court should not, with the benefit of hindsight, scrutinise every decision of counsel and the applicant concerning legal advice and their approach to proceedings. Moreover, clients should not be punished for engaging, within reason, experienced and more expensive legal counsel.

[9]    I have examined the summary of the plaintiffs’ legal costs and relevant invoices from the counsel acting and the solicitors and I am not satisfied that there is any basis for doubting that the invoiced costs were reasonably incurred and not excessive. No

8      Bradbury v Westpac Banking Corporation (2008) 18 PRNZ 859 (HC) at [206].

9 At [206].

issue was taken with the charge out rates of the plaintiffs’ counsel and instructing solicitor. I am also satisfied there is no obvious duplication.

[10]   There is likewise no dispute that costs were incurred attempting to settle the issues between the parties. It is difficult to see why those should not be regarded as reasonably incurred for present purposes, given they were an integral part of dealing with the application. For example, the plaintiffs had to be kept informed of these discussions and instructions obtained. Finally, I consider that there is no basis for excluding communications with VATL given the subject matter of the application.

Decision

[11]   Steven is to pay the plaintiffs $35,612.33 out of his share of the Trust funds, being costs of $35,405.05 and disbursements of $207.28.

[12]   VATL may deduct monies held on trust for Steven to meet the outstanding award of costs and disbursements in favour of VATL.

Powell J