McCormack v Stills

[2024] NZHC 3310

IN THE HIGH COURT OF NEW ZEALAND CHRISTCHURCH REGISTRY

I TE KŌTI MATUA O AOTEAROA ŌTAUTAHI ROHE

CIV-2023-409-661

[2024] NZHC 3310

IN THE MATTER

of the Insolvency Act 2006

IN THE MATTER

of the bankruptcy of ANDREW EDWARD STILLS

BETWEEN

ROBERT JAMES LOUIS McCORMACK and ELIZABETH ROBYN McCORMACK

Judgment Creditors

AND

ANDREW EDWARD STILLS

Judgment Debtor

Hearing:

(On the papers)

Counsel:

H A Evans and S Jung for Judgment Creditors G Riach for Judgment Debtor

Judgment Debtor in person with C Stokes (McKenzie Friend)

Judgment:

8 November 2024

JUDGMENT OF ASSOCIATE JUDGE LESTER

(costs judgment in respect of unsuccessful application to set aside bankruptcy notice)

McCORMACK v STILLS [2024] NZHC 3310 [8 November 2024]

[1]                 On 4 November 2024, costs were awarded to the judgment creditors in relation to their adjudication application.

[2]                 Mr Stills had applied to set aside the bankruptcy notice issued by the creditors. That application was  dismissed by Associate Judge Paulsen in a judgment dated    30 May 2024.1 Costs were reserved.

[3]                 Mr Stills filed costs submissions in relation to that unsuccessful application on 27 June 2024 in reply to the creditors cost memorandum of the same date.

[4]                 On 8 July 2024, I awarded costs to the creditors against Mr Stills as sought in their memorandum of 27 June 2024. Unfortunately, Mr Stills’ memorandum in respect of costs was not brought to my attention.

[5]                 On 25 September 2024, I set aside the 8 July 2024 costs award in order for costs in respect of Mr Stills’ unsuccessful application to be considered with the benefit of Mr Stills’ submissions.

Creditors’ submissions as to costs

[6]                 Mr Evans’, counsel for the creditors, submissions of 27 June 2024 are straightforward. With Mr Stills’ application to set aside the bankruptcy notice being dismissed, Mr Evans submits that the creditors as the successful party are entitled to costs on the basic principle that costs should follow the event.  Costs are sought on   a 2B basis covering the creditors’ opposition to the application to set aside the bankruptcy notice, the preparation of witness submissions for the hearing, preparation of the bundle for the hearing and appearing at the hearing itself. Costs on a 2B basis amount to $7,050.50.

Mr Stills’ memorandum of 27 June 2024

[7]                 Mr Stills, in his memorandum of 27 June 2024, does not dispute the basic principle that costs should follow the event. He submits that it is in the interests of justice that a decision on costs be stayed pending the outcome of related substantive

1      McCormack v Stills [2024] NZHC 1395.

proceedings. Mr Stills complains about what he perceives as the creditors’ mis-use of the Court system. Mr Stills does not dispute the scale cost calculation in Mr Evans’ memorandum.

Discussion

[8]                 I have already referred to the idea that costs should follow the event. This idea is captured in r 14.2(1) of the High Court Rules 2016 which sets out the general principles applying to the determination of costs and says:

(a)the party who fails with respect to a proceeding or an interlocutory application should pay costs to the party who succeeds.

[9]                 Accordingly, the creditors’ submission that costs should follow the event is consistent with that general principle.

[10]             It is now nearly six months since the dismissal of Mr Stills’ application. There is no basis for deferring the fixing of costs. Mr Stills did not suggest he wished to file any further material when I directed counsel confer as to whether there were outstanding discovery issues. Mr Riach, counsel recently instructed for Mr Stills, confirmed that costs could be dealt with on the existing papers.

[11]             It follows from what I have said that there is no basis not to award costs to the creditors in respect of Mr Stills’ unsuccessful application.

[12]             Accordingly, there is a costs award in favour of the creditors as sought by  Mr Evans in his memorandum of 27 June 2024 together with any disbursements, such to be fixed by the Registrar.

Associate Judge Lester

Solicitors:

Young Hunter, Christchurch

Copy to counsel:
G Riach, Barrister, Christchurch