McLaughlin v McLaughlin - [2025] NZHC 353

IN THE HIGH COURT OF NEW ZEALAND CHRISTCHURCH REGISTRY

I TE KŌTI MATUA O AOTEAROA ŌTAUTAHI ROHE

CIV-2017-442-52

[2025] NZHC 353

BETWEEN MARK JAMES McLAUGHLIN and ANDREW ASHLEY McLAUGHLIN (as
beneficiaries of the Ashley Trust) Plaintiffs

AND

AND

JOHN DAVID MANUEL McLAUGHLIN

First Defendant

GLASGOW HARLEY TRUSTEE LIMITED

Second Defendant

Hearing: 19 February 2025

Counsel:

A A H Low for Plaintiffs

O D Peers for First Defendant

J N Bierre for Second Defendant J Forsey for Trustees

Judgment:

28 February 2025

JUDGMENT OF ASSOCIATE JUDGE LESTER

(Costs)

McLAUGHLIN v McLAUGHLIN [2025] NZHC 353 [28 February 2025]

[1] This costs judgment is hopefully the final chapter in a long running dispute described by Gendall J, in a judgment I refer to below, as “long running, bitter and acrimonious family litigation brought by the plaintiffs”.1

[2] The background to this and an earlier costs judgment can be found in the judgment of Gendall J dated 9 November 2021.2 At the risk of grossly over simplifying the dispute that led to his Honour’s 434 paragraph judgment, the plaintiffs asserted the first and second defendants mismanaged the subdivision of a rural property owned by the Ashley Trust (the Trust) which was settled by the plaintiffs and first defendant’s parents. It was alleged the first defendant, in acting as paid project manager for the development and through his personal involvement in the development, breached his fiduciary duties.

[3] As well as seeking damages and an account of profits, the plaintiffs sought the removal of the first defendant as a trustee of the Trust. He resigned as a trustee during the lengthy hearing before Gendall J.

[4] Save for obtaining the resignation of the first defendant, the plaintiffs’ claims failed in their entirety.

[5] Costs issues were considered by Gendall J in a judgment of 28 July 2022.3 The plaintiffs appealed Gendall J’s substantive decision and both parties appealed aspects of the costs decision.4

[6] The first defendant was awarded party and party costs against the plaintiffs along with disbursements totalling $456,442.81. There was also an order that the first defendant was entitled to be indemnified from the assets of the Trust for the difference between party and party costs along with disbursements and the first defendant’s actual paid solicitor and client costs of $1,104,778.38.5

1      McLaughlin v McLaughlin [2022] NZHC 1841 at [14(a)].
2      McLaughlin v McLaughlin [2021] NZHC 3015.
3      McLaughlin v McLaughlin, above n 1.
4      McLaughlin v McLaughlin [2023] NZCA 473.
5      Gendall J reduced the costs awards in the first defendant’s favour by 20 per cent to reflect that he resigned as trustee during the course of the trial, the 20 per cent deduction was reversed by the Court of Appeal,

[7] The second defendant sought indemnification from the Trust (the trustees of which were joined to the proceeding for the purposes of the costs judgment).6 Calculation of the second defendant’s costs was complicated by the fact that up until 16 April 2021, the first and second defendants…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

Continue reading McLaughlin v McLaughlin

Details

AGLC: McLaughlin v McLaughlin [2025] NZHC 353
Case: [2025] NZHC 353
Decision Date: 28 February 2025

CaseChat Overview and Summary

In McLaughlin v McLaughlin, the High Court of New Zealand considered outstanding costs issues arising from a long-running and acrimonious family dispute. The case involved the plaintiffs asserting that the first and second defendants mismanaged a rural property owned by the Ashley Trust. The plaintiffs sought damages, an account of profits, and the removal of the first defendant as a trustee of the Trust. The Court awarded costs to the defendants and ordered indemnification from the Trust. The present proceeding focused on further costs incurred by the defendants. The key issues were whether it was reasonable for the defendants to be separately represented, if there was duplication of costs, and if the defendants were entitled to indemnification from the Trust. The Court found that separate representation was reasonable due to potential conflicts of interest arising from the amended statement of claim. While some duplication of costs was inevitable, the Court held that it was not unreasonable or improper. The Court also ordered that the Trust further indemnify the first defendant for a shortfall in his costs and ordered that certain costs claimed by the second defendant be reduced. The plaintiffs ultimately abided by the Court's decision.

Orders