IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY
CIV-2011-404-8144 [2012] NZHC 2223
BETWEEN MAYDANOZ NZ LTD Plaintiff
ANDIAN RONALD POPPELWELL AND DOROTHY POPPELWELL TRADING AS THE POPPELWELL PARTNERSHIP Defendants
Hearing: (On the papers)
Counsel: DL Schnauer for Plaintiff
SHN Chan for Defendants
Judgment: 30 August 2012
JUDGMENT OF BREWER J (Costs)
This judgment was delivered by me on 30 August 2012 at 4:30 pm pursuant to Rule 11.5 High Court Rules.
Registrar/Deputy Registrar
SOLICITORS
Schnauer & Co (Auckland) for Plaintiff
McVeagh Fleming (Auckland) for Defendants
MAYDANOZ NZ LTD V POPPELWELL HC AK CIV-2011-404-8144 [30 August 2012]
Introduction
[1] In my judgment delivered on 17 May 2012, I granted the plaintiff’s application for relief against cancellation of the lease it holds from the defendants. I now have to decide costs.
[2] On 13 December 2011, the defendants re-entered the leased premises from which the plaintiff operates a Turkish food takeaway business. The defendants had issued two default notices which had not been complied with. The first related to the absence of a type of fire extinguisher required by the defendants’ insurer and the second related to unpaid operating expenses in the sum of $2,805.41.
[3] The plaintiff commenced proceedings on 16 December 2011 and, on
22 December 2011, gained an interim injunction allowing the plaintiff to re-enter the premises. In my judgment, I ruled that the first default notice was invalid but that the second default notice was valid. I granted relief against cancellation on the basis of proportionality. The gravity of the default, in all the circumstances, was greatly outweighed by the destruction of the plaintiff’s livelihood which would have occurred if the relief was not granted.
[4] Both parties seek costs. The defendants seek their actual costs on a solicitor- client basis. The plaintiff seeks scale costs.
Submissions
[5] The costs sought by the plaintiff on a 1B basis amount to $11,375 plus disbursements of $6,319.92. The basis for the application is the submission that the defendants acted unreasonably in insisting on a defended hearing when there were several opportunities to resolve the dispute. It is submitted that the plaintiff was largely successful in the overall litigation in that the first default notice was found to be invalid and that relief against cancellation was granted.
[6] Counsel for the defendants submits that clause 6.1 of the deed of lease requires the plaintiff to pay the defendants’ costs on a solicitor-client basis.[1] These costs, supported by invoices, amount to $44,889.72 (GST exclusive). It is submitted that these costs are within the range of what is considered reasonable for a case such as this.
The Law
[1] Rule 14.6(4)(e) provides that the Court may order indemnity costs if the party claiming costs is entitled to indemnity costs under a contract or deed.
[7] The leading decision on costs in relief against forfeiture cases is Roses are Red Ltd v Methodist Church.[2] The Court of Appeal set out the policy considerations as follows:[3]
[2] Roses are Red Ltd v Board…
Keep reading for free
Create a free CaseChat account to read Maydonoz NZ Ltd v Poppelwell and more:
- Read every judgment in full
- Ask AI and get answers linked to paragraphs
- See how each paragraph was cited in later cases
- Download judgments as PDF or Word
One click creates your free account or signs you in.
By continuing you agree to the Terms and Privacy Policy.
- Case
- [2012] NZHC 2223
- Decision Date
CaseChat Overview and Summary
The legal issues before the court involved whether the defendants were entitled to indemnity costs as per clause 6.1 of the lease and, if so, whether these costs were objectively reasonable. The court considered the nature of the relief granted and whether the defendants' actions in pursuing the proceedings were reasonable and necessary. The court held that the defendants were entitled to costs as the clause applied and the steps taken were reasonably necessary, but limited the basis of costs to those relating to the second default notice. The court did not have sufficient information to assess the reasonableness of the costs directly but ordered the defendants to provide a detailed account for taxation, allowing the plaintiff to challenge the costs if necessary.
Orders
Orders of the court
Full text does not contain this section.
Background
Background to the litigation
Full text does not contain this section.
Evidence
Evidence Before The Court
Full text does not contain this section.
Decision
Reasons for decision
Full text does not contain this section.
Ratio Decidendi
Legal Principle Established
Full text does not contain this section.