Matamu v Si'Itia
[2016] NZHC 3137
•19 December 2016
IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY
CIV-2014-404-000170 [2016] NZHC 3137
BETWEEN TUAʼIMALO MATAMU, TALAOALIʼI
NASERI, MALIELEGAOI AUMUA, SAENI PITA AND TOFIA TOFA Plaintiffs
AND
VAʼAIMALU SIʼITIA, MARY MCEWING, REVEREND ALISA LASI, REVEREND ROY CHRISTIAN, FORBES WORN AND SALAPO RAPITI TUIA
First Defendants
THE PREBYSTERIAN CHURCH PROPERTY TRUSTEES
Second Defendant
Hearing: (On the papers) Counsel:
Olinda Woodroffe and Jeffrey Ussher for the Plaintiffs
Richard Pidgeon for the First, Second, Third and Sixth Named
First Defendants
Katie Hogan for the Fourth and Fifth Named First DefendantsJudgment:
19 December 2016
[COSTS] JUDGMENT OF MOORE J
This judgment was delivered by me on 19 December 2016 at 2:30 pm pursuant to Rule 11.5 of the High Court Rules.
Registrar/ Deputy Registrar
Date:
MATAMU & ORS v SIʼITIA & ORS [2016] NZHC 3137 [19 December 2016]
Introduction
[1] This is an application for costs following the judgment I delivered on
21 October 2016.1 The dispute in question was long and complex. Significant time and resources were expended by both parties.
[2] As I recorded in a footnote to my judgment, the case between the plaintiffs and the second defendants was settled prior to trial and an agreement was reached between the parties as to costs. This judgment relates only to the cost issues as between the plaintiffs and the first defendants.
[3] My decision was almost entirely in favour of all defendants, that is the first to sixth named first defendants. As I recorded in my decision I regarded these parties as being entitled to costs on a 2B basis. I directed the parties to file memoranda within 20 working days.
[4] Initially three sets of memoranda were filed on behalf of, the first, second, third and sixth named first defendants,2 Reverend Christian and Mr Worn (the fourth and fifth named first defendants) and the plaintiffs.
[5] Initially, the first to sixth named first defendants were all represented by Mr Pidgeon. However, after 9 May 2016, Reverend Christian and Mr Worn were separately represented by Ms Hogan.
[6] It is agreed between the defendants to separately apportion the costs incurred by the first to sixth named first defendants prior to the change of counsel3 on a two third/one third basis. Under this arrangement, the first, second, third and sixth named first defendants would be entitled to two thirds of any costs ordered and Reverend Christian and Mr Worn one third. This is the ratio which Mr Pidgeon and Ms Hogan
have used in their respective calculations and I see no good reason to depart from it.
1 Matamu & Ors v Si’itia & Ors [2016] NZHC 2516.
2 Mr Pidgeon has since filed a reply memorandum on behalf of the first, second, third and sixth named first defendants.
3 Ms Hogan submits this should be as at 9 May 2016 and Mr Pidgeon submits it should be as at
17 May 2016. It makes no difference in practice so I am satisfied it is appropriate to adopt
Ms Hogan’s date given that this was when the formal changeover took place.
[7] From 9 May 2016 onwards, the two defendant groups incurred costs separately and each claims separately from that point calculated on a 2B basis.
[8] Responsibly, the plaintiffs do not dispute the first to sixth named first defendants’ success nor do they challenge their entitlement to scale costs as a result. They do, however, argue that costs should not be awarded against them in respect of certain, identified steps in the proceeding and that some of the claimed disbursements should be disallowed.
[9] Ms Woodroffe structures her submissions to reply first to the claims made by the first, second, third and sixth named first defendants, and then she responds to those issues raised on behalf of Reverend Christian and Mr Worn.
[10] For convenience I shall adopt the same approach.
Costs in relation to the first, second, third and sixth named first defendants
[11] Ms Woodroffe accepts that costs are payable as calculated by Mr Pidgeon in the table contained in his memorandum of 18 November 2016 except for the steps referred to below.
Interlocutory application to vary injunction orders and associated counter applications (before Thomas J on 1 August 2014)4
[12] This was an application by all the first defendants to discharge or vary the interim orders that had been made by Courtney J on 31 January 2014 allowing the plaintiffs access to the church property. The plaintiffs also sought to vary the order by increasing their hours of access.
[13] The first defendants alleged that the injunction was obtained without notice on inaccurate and/or incomplete information.
[14] In a Minute issued on 1 August 2014, Thomas J reminded the parties of the application of r 7.49 of the High Court Rules, which states that a party which was
4 This forms part of step 22 and all of step 23 of Mr Pidgeon’s table.
not present at the time an interlocutory order was made, may make an application to vary or rescind it within five working days of receiving notice. The Judge reiterated that this was not an opportunity to litigate the substantive case. She strongly encouraged them all to pursue alternative methods of resolving the dispute.
[15] The plaintiffs’ application was ultimately resolved by consent and the plaintiffs’ hours of access were varied albeit only slightly. The earlier freezing orders, which related to funds held in the AUP’s bank accounts, were also extended by consent.
[16] Ms Woodroffe submits that the first defendants were unsuccessful and that the plaintiffs should be awarded costs in relation to this application pursuant to r 14.2(a). Mr Pidgeon, in his reply memorandum, argues that Thomas J’s Minute makes it clear that the result reached was a pragmatic compromise stemming from an injunction obtained on a without notice basis in reliance on material which was inaccurate both in fact and in law. He opposes the deduction.
[17] Ms Hogan does not claim costs on behalf of Reverend Christian and
Mr Worn in relation to these attendances.
[18] I consider that the appropriate course is for costs to lie where they fall. Both parties demonstrated a degree of goodwill and flexibility and, as a result, a responsible and sensible compromise was reached. In those circumstances it is inappropriate to make an assessment of relative success or failure.
The hearing before Duffy J and its associated preparation5
[19] The hearing before Duffy J was intended to be the substantive fixture but evolved into a hearing more akin to an issues conference. It led to the scope of the dispute being narrowed significantly. The result is best summarised in [3] to [6] of her Honour’s oral judgment:
“[3] [Prior to the hearing] the defendants accepted that no notice of the meeting was given to the persons identified by the plaintiffs as deserving of notice. However, the defendants contended that:
5 This encompasses steps 24, 25 and 26.
[i] No notice was required under the relevant procedures; and
[ii] The persons the plaintiffs claim were entitled to notice were not in fact members of the Parish Council.
[4] After the luncheon adjournment, when the defendants came to address the Court, as a result of an exchange between Bench and bar, the defendants’ counsel then responsibly and helpfully acknowledged that, in principle, notice of the meeting of 5 December 2013 should have been given to the members of the Parish Council.
[5] The plaintiffs also acknowledged that their claim was based on an assertion that notice was required to be given to members of the Parish Council.
[6] These acknowledgements removed a clear legal issue for this Court to determine. The resolution of the plaintiffs’ claim now hinges on whether the persons whom the plaintiffs assert were members of the Parish Council actually held that position as at 5 December 2013. If they did not, it would follow that they were not entitled to notice.”
[20] With the parties’ agreement, Duffy J adjourned the proceeding and made directions for the filing of additional pleadings. Costs were reserved pending final determination.
[21] Ms Woodroffe submits that this hearing was superfluous and unnecessary. She argues that the first defendants effectively altered their legal position during the hearing leading to significant delays. Had their statement of defence been pleaded consistently with their actual legal position from the outset there would have been no need for this hearing and the proceedings would have taken a different and more efficient course.
[22] Mr Pidgeon submits that the first defendants were simply responding to the plaintiffs’ case as pleaded and that membership of the Parish Council had always been, and remained after the hearing, the major issue in dispute. Mr Pidgeon adds that working through and refining issues is a crucial part of the usual lead up to trial.
[23] Ms Hogan on behalf of Reverend Christian and Mr Worn submits that this fixture was intended to address substantive issues. She thus suggests that the preparation for it should be included as part of the preparation for the final substantive hearing before me.
[24] Whatever formulation is adopted, I am satisfied that this hearing was necessary and helpful. It resulted in an appreciable narrowing of the issues for determination that likely would not have occurred at an earlier stage. As such I consider that the costs incurred in preparing for it, and in the appearance itself, can properly be claimed by the ultimately successful parties.
Application to adjourn the March 2015 fixture6
[25] This was an application by the first defendants to adjourn the March 2015 fixture. It was successful.
[26] Ms Woodroffe claims that costs have already been paid by the plaintiffs on
4 November 2014 in the amount of $3045.50. Mr Pidgeon’s submission on this point (at [3.4] of his reply memorandum) is a little unclear. However, I do not take him to challenge Ms Woodroffe’s assertion. Accordingly the costs incurred in relation to this application cannot be claimed a second time.
Counterclaims against the first to fourth counterclaim defendants7
[27] On 19 June 2014, the first, second, third and sixth first named first defendants filed a counterclaim against the plaintiffs and three other defendants. Several related interlocutory applications were made and a hearing took place before Woolford J on
26 March 2015. In the course of that hearing, the first, second, third and sixth first named first defendants discontinued the counterclaim. Costs were reserved.
[28] Ms Woodroffe submits that pursuant to r 15.23 a party who discontinues a proceeding must pay costs to the defendant up to and including the discontinuance. The plaintiffs thus seek costs in relation to this step. Mr Pidgeon accepts there is some room for set-off but notes that the counterclaim was discontinued so as to assist the timely resolution of the major issues between the parties. The financial issues
involved in the counterclaim are yet to be determined.
6 This also forms part of step 22.
7 This is referred to in step 4 but it does not form part of Mr Pidgeon’s overall costs assessment;
he specifically records it is excluded.
[29] I accept Mr Pidgeon’s submission. However, the counterclaim was filed and argued before the counterclaim plaintiffs took the tactical decision to withdraw. On this basis I am satisfied the plaintiffs are entitled to costs on the counterclaim.
The net result
[30] The net result of this analysis is that costs are awarded to the first, second, third and sixth named first defendants, against the plaintiffs, as calculated in the table set out in Mr Pidgeon’s memorandum of 18 November 2016, with the following deductions:
(a) the costs associated with the interlocutory application before Thomas J (on 1 August 2014) seeking to vary/discharge the interim orders referred to at step 22; and
(b)the costs associated with the interlocutory application before Venning J (on 25 February 2015) to adjourn the March 2015 fixture also referred to at step 22.8
[31] The reasonable costs associated with the discontinued counterclaim before Woolford J on 26 March 2015 are awarded in favour of the plaintiffs against the first, second, third and sixth named first defendants.
Cost in relation to Reverend Christian and Mr Worn
[32] Ms Woodroffe also accepts that costs are payable to Reverend Christian and
Mr Worn as calculated by Ms Hogan in the table contained in her memorandum of
18 November 2016, except in relation to three steps.
The strike out application of 19 June 20149
[33] This strike out was made on behalf of Reverend Christian and Mr Worn at the hearing with Woolford J before being discontinued. Ms Hogan does not seek costs
8 For the avoidance of doubt the costs associated with the interlocutory application related to the freezing order referred to in step 22 remain payable.
9 This is item 10 in the table contained in Ms Hogan’s memorandum.
in relation to this application recognising that Mr Pidgeon, who was acting on behalf of the Reverend and Mr Worn at the time, did not proceed with it. Ms Woodroffe goes further in that she claims costs on behalf of the plaintiffs pursuant to r 15.23 on the basis that the application was discontinued.
[34] Ms Hogan’s concession is responsible. However, the application was made and, to some extent at least, required preparation on the part of the plaintiffs. Having been discontinued, I accept Ms Woodroffe’s submission that the plaintiffs are entitled to costs in relation to it.
The strike out application of 27 May 201610
[35] Ms Hogan’s memorandum indicates that there is a degree of confusion about the effect of my judgment in relation to Reverend Christian and Mr Worn. This was discussed at footnote two of the judgment.
[36] A strike out application was filed by the Reverend and Mr Worn on 27 May
2016. Orders were made by Muir J that it be heard at the beginning of the substantive hearing. Accordingly, the parties made oral submissions before me on
7 June 2016 and filed further written submissions at a later date.
[37] At the beginning of the trial I heard oral submissions on the application. I decided not to make the orders sought at that point. This was not based on an assessment of the merits of the application. It was because the application was brought at such a late stage and because I would soon be hearing evidence as to substantive liability. To have considered the parties’ submissions and delivered a decision at that point would have introduced avoidable delays to the trial which had already been adjourned once.
[38] However, in the footnote to my judgment, I recorded that had the application been filed at an earlier stage I would have granted it. Furthermore, because the evidence overwhelmingly revealed neither defendant played any substantive role in the impugned meetings nor did they vote the case against them
necessarily failed. I did not strike out the claims against Reverend Christian and Mr Worn in the final judgment because, in the final analysis, I was of the view that a more complete assessment of their role was available on the evidence and judgment should be given in their favour as part of my comprehensive trial findings.
[39] The plaintiffs’ claims were not struck out in relation to Reverend Christian and Mr Worn. For that reason r 11.10 of the High Court Rules is not engaged and there is no basis for a correction because there has been no accidental slip or omission in my judgment.11
[40] That said, the application had merit and was properly brought. I thus consider it appropriate for costs to lie where they fall in relation to the strike out.
The hearing before Duffy J and its associated preparation12
[41] As I have already discussed, I consider that this hearing was a necessary and helpful part of the lead up to the final disposition of the claim. I consider that costs can properly be claimed by Reverend Christian and Mr Worn in relation to it.
The net result
[42] The net result of this analysis is that costs are awarded to Reverend Christian and Mr Worn, against the plaintiffs, as calculated in the table set out in Ms Hogan’s memorandum of 18 November 2016, with the costs associated with the interlocutory application (on 27 May 2016) to strike out the claims against Reverend Christian and Mr Worn (referred to as item 14) deducted.
[43] The reasonable costs associated with the discontinued strike out application before Woolford J on 26 March 2015 are awarded in favour of the plaintiffs against
Reverend Christian and Mr Worn.
11 I recognise that as it stands Reverend Christian and Mr Worn can be parties to the plaintiffs’
appeal.
Disbursements
[44] On the question of disbursements Ms Woodroffe makes several points. First, she notes that the disbursements claimed by Ms Hogan are subject to the agreed one third apportionment but that the full amount of some of the same disbursements has been claimed by Mr Pidgeon.13 I agree this appears to be an error by Mr Pidgeon and adjustments will need to be made.
[45] Secondly, she opposes filing fees being recovered in relation to the interlocutory application to vary/discharge the orders made by Courtney J. I have determined that costs should lie where they fall in relation to that application and I accept Ms Woodroffe’s submission that disbursements should not be paid in relation to it.
[46] Thirdly, Ms Woodroffe challenges the fee incurred for the Court-directed mediation. Ms Hogan estimates this to be in the region of $10,000 although she cannot yet provide an exact figure. As far as I can see this does not appear to be included in the table in Mr Pidgeon’s original memorandum. However, in his reply memorandum, Mr Pidgeon strongly resists Ms Woodroffe’s submission that mediation fees should not be paid as a disbursement and thus I infer from this that the first, second, third and sixth first defendants also seek to recover these fees.
[47] Ms Woodroffe points out that mediation fees are not expressly included in the list of payable disbursements under r 14.12(1)(b). To be allowed they must therefore be approved by the Court for the purposes of the proceeding and be:
(a) specific to the conduct of the proceeding; and
(b) reasonably necessary for the conduct of the proceeding; and
(c) reasonable in amount.
[48] Ms Woodroffe claims that the parties willingly entered into mediation after receiving encouragement from the Court to attempt to settle the dispute. She argues
13 This is in relation to courier fees, photocopying and filing fees.
that it would be contrary to the spirit of mediation and alternative dispute resolution in general to require the ultimately unsuccessful party to pay costs. This could only serve to discourage other parties from adopting what is undoubtedly a sensible, pragmatic and mutually beneficial course of action.
[49] I have been unable to locate any authority on this point but I do recognise the merit in Ms Woodroffe’s submission. Both Thomas J and Sargisson AJ strongly encouraged the parties to resolve this dispute amongst themselves without resorting to litigation in this Court. In the course of the trial I took a short adjournment in the ultimately forlorn hope the parties might use that opportunity to reach some kind of agreement which would put an end to this dispute which has been expensive in every sense. In engaging in mediation the parties adopted what was, undoubtedly, a practical and responsible option in recognition of the fact that Court proceedings would be lengthy and costly and socially damaging (as they have since proved). Regrettably the mediation process proved unsuccessful. Nevertheless all parties are to be commended for their willingness to attempt to engage in good faith.
[50] For these reasons I do not consider it is appropriate to allow the fee claimed as a disbursement. To do so would be contrary to policy and would operate as a disincentive for disputing parties to explore alternative and practical means to resolve their differences.
Net result
[51] The net result of this analysis is that the disbursements claimed on behalf of the first, second, third and sixth named first defendants are allowed as set out in Mr Pidgeon’s table, except for the following deductions:
(a) the filing fees related to the interlocutory application to vary/discharge the orders made by Courtney J; and
(b) the parties’ allocated portion of the mediation fee.14
14 Which, as I have said above, I understand Mr Pidgeon to be claiming.
[52] Mr Pidgeon’s calculations will also need to be corrected in the manner I have
referred to at [43].
[53] The disbursements claimed on behalf of Reverend Christian and Mr Worn are
allowed as set out in Ms Hogan’s table, except for the following deductions:
(a) the filing fees related to the interlocutory application to vary/discharge the orders made by Courtney J;
(b) these parties allocated portion of the mediation fee.
Final comments
[54] I trust this addresses all of the issues in relation to costs. There will obviously be a degree of setting-off required and I leave it to the parties to confer as to the best way to effect payment.
[55] If any party considers that there are any errors or outstanding issues on the question of costs or disbursements leave is reserved to file further memoranda. In
that event no memorandum is to exceed two pages.
Moore J
Solicitors/Counsel:
Ms Woodroffe, Auckland
Mr Pidgeon, Auckland
Kayes Fletcher Walker, Manukau