Mailley v Shaw

[2022] NZHC 1317

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

I TE KŌTI MATUA O AOTEAROA TĀMAKI MAKAURAU ROHE

CIV-2015-404-1185

[2022] NZHC 1317

BETWEEN

MARTIN MAILLEY

First Plaintiff

SABRINA NUTARELLI
Second Plaintiff

AND

ANTONY SHAW

First Defendant

TONY ELLIS (Discontinued) Second Defendant

THE NEW ZEALAND LAW SOCIETY

Third Defendant

On papers

Counsel:

First plaintiff self-represented

D A Cowan and J E G San Diego for first defendant T P Mullins and D A C Bullock for third defendant

Judgment:

7 June 2022

JUDGMENT OF TOOGOOD J

This judgment was delivered by me on 7 June 2022 at 10:30 am Pursuant to Rule 11.5 High Court Rules

Registrar/Deputy Registrar  Date……………………………..

Solicitors/Counsel:

Ord Legal, Wellington and
Doug Cowan, Auckland, for first Defendant

Lee Salmon Long, Auckland, for third defendant

Copy to:

The plaintiffs

MAILLEY v SHAW [2022] NZHC 1317 [7 June 2022]

[1]    On 24 November 2020, Associate Judge Andrew struck out the plaintiffs’ claims against the defendants (the strike-out decision).1 Mr Mailley applied for a review of that decision under s 26P(1) of the Judicature Act 1908. I reviewed and upheld the strike-out decision in a re-issued judgment dated 28 October 2021 (the strike-out review decision).2

[2]     On 14 December 2021, I issued a judgment refusing Mr Mailley leave to appeal against the strike-out review judgment; and reviewing the costs awarded by Associate Judge Andrew for steps taken in the strike-out application [the December judgment].3 On the same day, I issued a judgment awarding costs to the defendants on an aspect of the strike-out review decision.4

[3]    Since then, several memoranda have been filed by the parties on a number of different issues. I set them out below.

Leave to appeal costs review judgment

[4]    On 18 January 2022, Mr Mailley applied for leave to appeal the December judgment confirming the strike out costs awarded by Associate Judge Andrew. The application is opposed by the defendants.

[5]    The principles relevant to this application are those that I applied in the December judgment when I declined to grant Mr Mailley leave to appeal Associate Judge Andrew’s strike-out decision.5 Section 26P(1AA) of the Judicature Act 1908 provides that the determination of a High Court Judge on a review of any order or decision made by an Associate Judge under s 26P(1) is final unless the High Court grants leave or the Court of Appeal grants special leave to appeal.

1      Mailley v Shaw [2020] NZHC 3102.

2      Mailley v Shaw [2021] NZHC 2359.

3      Mailley v Shaw [2021] NZHC 3433.

4      Mailley v Shaw [2021] NZHC 3447.

5      Mailley v Shaw above n 3, at [8]-[9].

[6]    The principles for the grant of leave to appeal were set out in that judgment as follows:6

(a)The appeal must raise some question of law or fact capable of bona fide and serious argument in a case involving some interest, public or private, of sufficient importance to outweigh the cost and delay of the further appeal.

(b)On a second appeal, the Court of Appeal’s function is not to generally correct error but to clarify the law and determine whether it has been properly interpreted and applied by the court below;

(c)It is not every alleged error of law that is of such importance, either generally or to the parties, as to justify further pursuit of litigation which has already been considered twice and ruled upon by a court.

(d)The scarce time and resources of the Court of Appeal should not be used, nor additional expense incurred for the parties, without realistic hope of benefit.

(e)In theory, a wholly factual issue could justify allowing a second appeal, but issues of fact in a matter falling within the jurisdiction of this Court will seldom be of public importance.

[7]    The application for leave to appeal the review of the strike-out costs decision raises no question of law or fact, or matter of public or private importance, that justifies a second appeal on the issue of costs. The grounds raised by the application have already been thoroughly considered in two judgments.

[8]    On a second appeal, the Court of Appeal’s function is not to generally correct an error but to clarify the law and determine whether it has been appropriately applied. The law and principles of costs are well settled and were properly applied in this case. The time and resources of the Court of Appeal, and that of the parties should not be expended without realistic hope of success.

[9]    I dismiss the application for leave to appeal the review of Associate Judge Andrew’s costs decision.

6 At [9].

Costs from leave to appeal strike out and review of strike out costs

[10]   The principles relating to costs are set out Part 14 of the High Court Rules 2016 (the Rules), with the general principles set out at r 14.2. The starting point is the principle that “the party who fails with respect to a proceeding or interlocutory application should pay costs to the party who succeeds”,7 and that “so far as possible the determination of costs should be predictable and expeditious.”8

[11]   The first and third defendants were the successful parties in the December judgment. Each of them seeks an order for scale costs of $5,616.50 plus disbursements of $95.65.

[12]   Mr Mailley submits that the defendants are not entitled to costs. He refers to the fact that he has sought leave to appeal the costs review judgment. Mr Mailley further submits that the daily recovery rate for category 2B proceedings used by the first and third defendant is incorrect; he submits they should be using the daily recovery rate in force prior to 1 March 2017. Mr Mailley refers to Sutcliffe v Tarr where the Court of Appeal held that the transitional provisions of the Senior Courts Act 2016 mean that the former High Court Rules continue to apply in relation to proceedings commenced under s 26P of the Judicature Act.9 He submits that, as the former High Court Rules apply to this proceeding, the daily recovery rates in those rules apply.

[13]   Mr Mailley recently made a similar argument in the Court of Appeal. He submitted that the Registrar applied the wrong daily recovery rate when determining security for costs as she did not consider the transitional provisions of the Seniors Courts Act 2016.10 Collins J rejected this argument and held there is no indication that sch 5, cl 11(2) of that Act intended to preserve a particular daily recovery rate instead of using the daily recovery rate in force at the time the security for costs is set.11

7      High Court Rules 2016, r 14.2(1)(a).

8      Rule 14.2(1)(g).

9      Sutcliffe v Tarr [2017] NZCA 360.

10     Mailley v Shaw [2022] NZCA 180.

11 At [17].

[14]   Mr Mailley’s submission is incorrect and his intention to appeal the decision of Collins J is irrelevant. While the former High Court Rules apply to the proceeding, this Court has confirmed repeatedly that changes to the daily recovery rate apply prospectively from the date of the change.12 The applicable rate for a step in a proceeding is the rate in place at the time the step was taken. There is no issue with the amount of the costs claimed by the first and third defendant.

[15]   I will order that Mr Mailley shall pay costs and disbursements to the defendants as claimed in their respective memoranda.

Error in the December judgment

[16]In his memorandum of 9 February 2022, Mr Mailley identified an error in at

[56] of the December judgment where I awarded the third defendant $55,720.40 in costs and disbursements. Mr Mailley says that this was in error because I had intended to award the third defendant the same amount as awarded by Associate Judge Andrew less $717 for one step.13 Associate Judge Andrew ordered that the plaintiffs pay the third defendant $58,264.97 in costs.14 Therefore, as identified by Mr Mailley, the costs order at [56] should have been $57,547.97. It is to his credit that he has pointed out an error that increases his liability.

[17]   I propose to address the arithmetical error using the slip rule that appears, identically worded, in both r 11.10  of the High Court Rules (in force at the time    Mr Mailley issued this proceeding) and r 11.10 of the High Court Rules 2016 (in force at the time of the error).

[18]   Mr Mailley argues, on the same grounds as his argument regarding the daily recovery rate, that the Court should use the slip rule in r 11.10 of the former High Court Rules which were in force when the proceeding was commenced.15 That may be right, but whether the current or the former rules applies is immaterial as the

12     EA v Rennie Cox Lawyers (no 3) [2020] NZHC 1372, at [12] and [18]; citing Delegat v Norman

[2014] NZHC 1099, at [31] and FM Custodians Ltd v Pati [2012] NZHC 1902, at [39].

13     Mailley v Shaw, above n 1, at [55].

14     Mailley v Shaw [2021] NZHC 841, at [36].

15     Senior Courts Act 2016, sch 5 cls 10–11; Sutcliffe v Tarr [2017] NZCA 360.

language in r 11.10 of the High Court Rules 2016 is identical that in r 11.10 of the former High Court Rules.

[19]Accordingly, I will correct the error at [56] of the judgment in Mailley v Shaw

[2021] NZHC 3433 by deleting the sum of $55,720.40 and replacing it with a sum of

$57,547.97.

Stay of proceedings due to missing documents

[20]   On 2 May 2022, Mr Mailley applied for a stay of proceedings until documents said to be missing from the Court file were found. This application was appropriately discontinued by Mr Mailley on 23 May 2022.

Result

[21]I order and direct that:

(a)The application for leave to appeal the review of Associate Judge Andrew’s costs decision is dismissed.

(b)Mr Mailley shall pay each of the first and third defendants the sum of

$5,616.50 in costs plus disbursements of $95.65 in respect of the judgment in Mailley v Shaw [2021] NZHC 3433.

(c)I correct the error at [56] of the judgment in Mailley v Shaw [2021] NZHC 3433 by deleting the sum of $55,720.40 and replacing it with a sum of $57,547.97.

(d)The defendants are entitled to costs according to scale on the application for leave to appeal the costs review judgment.

Toogood J