Marsman v Nijkrake

[2009] NZCA 461

IN THE COURT OF APPEAL OF NEW ZEALAND

CA267/2008
[2009] NZCA 461

BETWEENWILLEM ROBERT MARSMAN, UTA BLEIDISTEL AND THK TRUSTEES LIMITED

Appellants

ANDROLAND JOHANNES NIJKRAKE

Respondent

Court:Glazebrook, Hammond and O'Regan JJ

Counsel:D J King and C N King for Appellants

S A Barker and B R Balderstone for Respondent

Judgment:7 October 2009 at 4.00 pm

(On the Papers)

JUDGMENT OF THE COURT

AThe Court had jurisdiction to award usual disbursements, despite the repeal of r 48H of the High Court Rules.

BThe matter is referred to the Registrar to fix the amount of the witness fee disbursements in terms of r 53H(2)(b) of the Court of Appeal (Civil) Rules 2005.

____________________________________________________________________

REASONS OF THE COURT

(Given by Glazebrook J)

Introduction

1. On 23 February 2009, we dismissed an appeal by the appellants against a decision of Associate Judge Gendall sustaining a caveat: in [2009] NZCA 30. The appellants were ordered to pay the respondent’s costs and “usual disbursements”.

2. The respondent seeks to have the appellants meet the full amount of invoices rendered by his expert witness, Ms Peters, in connection with the appeal.  These total C$11,824.39 (about NZ$18,000). 

3. In a memorandum of 18 March 2009, the appellants maintain that there is now no jurisdiction to order an unsuccessful party to pay a successful party’s expert witness costs as a disbursement.  Alternatively, they argue that the amount that they should pay with regard to Ms Peters’ fees should be reduced.

Relevant provisions

1. Rule 53H of the Court of Appeal (Civil) Rules 2005 (the Court of Appeal Rules) provides as follows:

   53H     Disbursements

   (1)     The Court may direct the Registrar to exercise the Court’s powers to order a party (“party A”) to pay another party (“party B”) disbursements.

   (2)     If the Court orders party A to pay party B usual disbursements, the order—

   (a)   encompasses—

   (i)     party B’s disbursements as defined in rule 48H(1) of the High Court Rules; and

   (ii)     party B’s counsel's reasonable travelling and accommodation expenses; and

   (b)is taken to empower the Registrar to fix the types and amounts of disbursements if the parties are unable to agree on them.

2. Section 8(1) of the Judicature (High Court Rules) Amendment Act 2008 repealed r 48H of the High Court Rules (referred to in r 53H of the Court of Appeal Rules) and substituted, on 1 February 2009, r 14.12.  Rule 14.12, which is similar to r 48H, provides: 

   14.12   Disbursements

   (1)     In this rule,—

   disbursement, in relation to a proceeding,—

   (a)means an expense paid or incurred for the purposes of the proceeding that would ordinarily be charged for separately from legal professional services in a solicitor’s bill of costs; and

   (b)includes—

   (i)     fees of court for the proceeding:

   (ii)     expenses of serving documents for the purposes of the proceeding:

   (iii)    expenses of photocopying documents required by these rules or by a direction of the court:

   (iv)    expenses of conducting a conference by telephone or video link; but

   (c)does not include counsel’s fee.

   relevant issue, in relation to a disbursement, means the issue in respect of which the disbursement was paid or incurred.

   (2)     A disbursement must, if claimed and verified, be included in the costs awarded for a proceeding to the extent that it is—

   (a)     of a class that is either—

   (i)     approved by the court for the purposes of the proceeding; or

   (ii)     specified in paragraph (b) of subclause (1); and

   (b)     specific to the conduct of the proceeding; and

   (c)     reasonably necessary for the conduct of the proceeding; and

   (d)     reasonable in amount.

   (3)     Despite subclause (2), a disbursement may be disallowed or reduced if it is disproportionate in the circumstances of the proceeding.

   (4)     A Judge or an Associate Judge may direct a Registrar to exercise the powers of the court under subclause (2) or (3).

   (5)     When considering whether a disbursement paid or payable for an expert witness’s fee or expenses is reasonable for the purposes of subclause (2)(d), a Judge or an Associate Judge may—

   (a)call for a report or an assessment from a professional organisation or otherwise; and

   (b)make any incidental order considered just, including an order as to the cost of that report or assessment.

Assessment

1. The appellants claim that repeal of r 48H eradicates this Court’s jurisdiction to make an order that a party pay to another party any disbursements covered by r 53H(2)(a)(i) of the Court of Appeal Rules. This is not correct. Section 22 of the Interpretation Act 1999 states that the repeal of an enactment, which includes regulations (s 29 of the Interpretation Act), does not affect an enactment in which the repealed enactment is referred to. Instead, a reference in an enactment to a repealed enactment is a reference to an enactment that (with or without modification) replaces or responds to the enactment repealed. We thus accept the respondent’s submission that, although r 53H of the Court of Appeal Rules refers to the repealed r 48H of the High Court Rules, that reference is now to the substituted r 14.12.

2. This means that, in terms of the order in our judgment of 23 February 2009 and r 53H(2)(b) of the Court of Appeal Rules, any disbursements that cannot be agreed (including Ms Peters’ fee) should be fixed by the Registrar, taking into account the matters set out in r 14.12 of the High Court Rules.

3. For the assistance of the Registrar, we confirm that it was necessary for the purpose of the appeal for the respondent to instruct Ms Peters.  Therefore, it seems clear that the disbursement was reasonably necessary for the conduct of the proceeding and specific to the conduct of the proceeding in terms of r 14.12(2)(b) and (c). It makes sense for us specifically to approve the disbursement for the purpose of the appeal in terms of r 14.12(2)(a)(i).

4. The Registrar will, however, need to decide whether the quantum of the fee is reasonable and not disproportionate in terms of r 14.12(2)(d) and (3).  In this regard we note that this Court, in Air New Zealand Ltd v Commerce Commission [2007] 2 NZLR 494, stated that s 23 of the High Court Amendment Rules (No 2) 2002, which substituted the new r 48H, rendered inapplicable the earlier decisions on the recovery of expert witness expenses, which favoured the approach whereby a losing party made a contribution only to disbursements.

5. The same comment applies to r 14.12 of the High Court Rules, given its similarities to r 48H.  Indeed, r 14.12(3) contains an additional safeguard that was not contained in r 48H.  This strengthens the argument that any reduction to the actual disbursement cost must be because of one of the factors set out in r 14.12, which, like r 48H, is clear and makes no reference to having to pay a contribution only (Air NZ at [48]).

6. This means that there is no automatic discounting of disbursements.  The full amount of Ms Peters’ fee will be recoverable, provided that it is reasonable and not disproportionate in terms of r 14.12(2)(d) and (3). 

Conclusion

1. The Court had jurisdiction to award usual disbursements, despite the repeal of r 48H of the High Court Rules.

2. The matter is referred to the Registrar to fix the amount of the witness fee disbursements in terms of r 53H(2)(b) of the Court of Appeal Rules.

Solicitors:
Denis King Law, New Plymouth for Appellants
Buddle Findlay, Wellington for Respondent