MacKenzie v MacKenzie - [2018] NZHC 2292

IN THE HIGH COURT OF NEW ZEALAND HAMILTON REGISTRY

I TE KŌTI MATUA O AOTEAROA KIRIKIRIROA ROHE

CIV-2014-419-415

[2018] NZHC 2292

BETWEEN
MALCOLM OWEN MACKENZIE

Plaintiff

AND

MALCOLM OWEN MACKENZIE, IAN SCOTT MACKENZIE, BARRY ANDREW MACKENZIE and MARION ANNE LINES

Defendants

Hearing: On the papers

Counsel:

R O Parmenter for the Plaintiff P J Wright for the Defendants

Judgment:

31 August 2018

JUDGMENT OF PALMER J

[Costs]

This judgment is delivered by me on 31 August 2018 at 3.00 pm pursuant to r 11.5 of the High Court Rules.

.....................................................
Registrar / Deputy Registrar

Counsel/Solicitors:
P J Wright, Barrister, Auckland Sellar Bone, Auckland
R O Parmenter, Barrister, Auckland Daniel Overton & Goulding, Auckland

MACKENZIE v MACKENZIE [2018] NZHC 2292 [31 August 2018]

Summary

[1] Mr Malcolm MacKenzie initiated proceedings against the executors of his father’s estate in 2014. He consented to judgment on the second day of trial, in July 2018, on the basis of his own testimony under cross-examination. I award indemnity costs to the executors from the point at which Mr MacKenzie’s brief of evidence was due to be served and costs on a 2B basis otherwise.

The proceeding

[2] In this proceeding, Mr Malcolm MacKenzie (Mr MacKenzie) alleged his late father, Mr Don MacKenzie (his father), made an unfulfilled testamentary promise to him:

(a)In order to protect ownership of his house from business risk in 1981, Mr MacKenzie sold his property to his father in a “warehouse” agreement for safekeeping.

(b)In 1991, his father sold the property without consulting Mr MacKenzie.

(c)His father later said Mr MacKenzie would get “like for like” under his will if not sooner, as long as Mr MacKenzie cared for him in his final years, which he did from 2006 to 2012.

[3] His father died in December 2013. In 2014, Mr MacKenzie issued two sets of proceedings against the executors of the estate, himself and his siblings, the defendants. They concerned a trust and the estate. The parties put the proceedings on hold pending investigations of transactions between the estate and Pencarrow trust established by their father. In 2016 the trust claim was settled and Mr MacKenzie discontinued one of the causes of action in the estate proceeding. He pursued the second cause of action in the estate proceeding, for damages for breach of the alleged testamentary promise. The executors defended the claim on the basis his father paid Mr MacKenzie full consideration for the property and he had been more than sufficiently compensated for the alleged testamentary promise.

[4] In 2017, there was an interlocutory dispute over discovery applications by both sides.1 Costs on the executors’ application were awarded to the executors on a 2B basis and costs were reserved on Mr MacKenzie’s application.2 Mr MacKenzie’s discovery application was dismissed in 2018. In 2018 there was also an interlocutory dispute which set aside Mr MacKenzie’s issuance of subpoenas to his siblings and awarded them costs on a 2B basis.3

[5] Both sides made “Calderbank” offers, without prejudice save as to…

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 MacKenzie v MacKenzie

Details

AGLC: MacKenzie v MacKenzie [2018] NZHC 2292
Case: [2018] NZHC 2292
Decision Date: 31 August 2018

CaseChat Overview and Summary

In MacKenzie v MacKenzie, the plaintiff, Malcolm MacKenzie, initiated proceedings against the executors of his father's estate in 2014, alleging an unfulfilled testamentary promise and seeking damages. The defendants defended the claim on the basis that the plaintiff had been fully compensated for the property in question and had not been promised anything in his father's will. The matter went through several interlocutory disputes and settlement offers before the trial commenced in July 2018. During the trial, the plaintiff conceded under cross-examination that he had been fully compensated for the property and that the alleged testamentary promise related only to the proceeds of sale of that property. He subsequently consented to judgment in favour of the defendants.

The court was required to decide the appropriate costs order in light of the plaintiff's decision to consent to judgment. The executors sought indemnity costs for the entire proceeding, while the plaintiff argued for a costs order on a 2B basis. The court found that the plaintiff had acted unnecessarily in continuing the proceeding after becoming aware of the key factors that undermined his claim. It also found that the plaintiff's rejection of two Calderbank offers which would have given him substantial payments constituted a failure to accept an offer of settlement. The court held that these grounds justified an order for indemnity costs from the point at which the plaintiff's brief of evidence was due to be served and costs on a 2B basis otherwise.

The court awarded indemnity costs to the executors from the point at which the plaintiff's brief of evidence was due to be served and costs on a 2B basis otherwise. Junior counsel's fees were not to be treated as disbursements for the period before the brief of evidence was due to be served. The court did not disturb the 2B costs awarded to the executors for their interlocutory discovery application. This decision highlights the importance of acting with reasonable care when pursuing legal proceedings and the potential consequences of unnecessarily prolonging a case.

Orders