McLaughlin v McLaughlin - [2020] NZHC 144

IN THE HIGH COURT OF NEW ZEALAND NELSON REGISTRY

I TE KŌTI MATUA O AOTEAROA WHAKATŪ ROHE

CIV-2017-442-000052

[2020] NZHC 144

BETWEEN MARK JAMES McLAUGHLIN AND ANDREW ASHLEY McLAUGHLIN
Plaintiffs

AND

JOHN DAVID MANUEL McLAUGHLIN, GLASGLOW HARLEY TRUSTEE

LIMITED AND MARK WILLIAM RUSSELL AS TRUSTEES OF THE ASHLEY TRUST

First Defendants

AND

BRIAN JAMES MAURICE NELSON

Second Defendant

Hearing: On the papers

Appearances:

J W A Johnson and J R Halligan for Plaintiffs E D Peers for First and Second Defendants

D Turley for Edna McLaughlin

J W H Little for Respondents’/Plaintiffs’ Children J M McGuigan for Brett McLaughlin

Judgment:

12 February 2020

JUDGMENT OF DUNNINGHAM J RE: COSTS DECISION

This judgment was delivered by me on 12 February 2020 at 3.30 pm, pursuant to r 11.5 of the High Court Rules

Registrar/Deputy Registrar Date:

McLAUGHLIN v McLAUGHLIN [2020] NZHC 144 [12 February 2020]

Introduction

[1] These proceedings concern a dispute between beneficiaries of a family trust, the Ashley Trust (the Trust), and the trustees of that Trust.

[2] On 8 October 2019 I declined an application by the plaintiffs for an interim injunction restraining the trustees of the Trust from proceeding with the next stage of developing a large block of farm land in Stoke, Nelson (the Trust Property), until a new trustee was appointed to replace Glasgow Harley Trustee Ltd (Glasgow Harley).
I delivered my reasons on 11 October 2019 and I reserved the question of costs.1

[3]The parties have been unable to agree on costs and seek orders from the Court.

Submissions

Submissions for the defendants

[4] Mr Peers for the defendants submits that 2C rather than 2B scale costs are appropriate in this case. He says a comparatively large amount of time was required in taking steps to defend the interim injunction application. The application was heard on an urgent basis, was of “extremely far-reaching scope” as it sought to prevent any further steps in respect of the Trust Property, and as a result the trustees had no choice but to commit all resources necessary to defend the application within the relevant time frames.

[5] Mr Peers submits the scope of the defendants’ defence to the application was unnecessarily broadened by the unfocused nature of the evidence and arguments relied upon by the plaintiffs in their application. They sought to rely generally on all their evidence filed in the Beddoe application proceeding rather than to focus the arguments and evidence relevant to the test for the granting of an interim injunction.2 Mr Peers says the plaintiffs relied on their original evidence without reference to correcting and responding evidence filed in the Beddoe application, resulting in unnecessary time and expense. Further, Mr Peers submits significant time was also incurred in relation to

1 McLaughlin v McLaughlin [2019] NZHC 2597.
2 Re Beddoe [1893] 1 Ch 547 (CA).

the attempted introduction of information asserted by the trustees to be privileged. He says these assertions were substantially upheld by me in my rulings on those issues.3

[6] Mr…

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 [2020] NZHC 144
Case: [2020] NZHC 144
Decision Date: 12 February 2020

CaseChat Overview and Summary

This case involved a dispute between beneficiaries of a family trust, the Ashley Trust, and the trustees of that Trust. The plaintiffs sought an interim injunction to prevent the trustees from proceeding with the next stage of developing a large block of farm land in Stoke, Nelson. The High Court declined the application on 8 October 2019, reserving the question of costs. The parties have been unable to agree on costs and seek orders from the Court. The legal issues for the Court to decide were the appropriate scale for costs, whether increased costs were warranted, and whether the trustees were entitled to be indemnified for their costs. The Court accepted the plaintiffs' argument that mere urgency does not provide a basis for ordering costs on anything other than a 2B basis. However, a category 2C basis was warranted for the filing of the opposition to the interlocutory application and for the preparation of submissions. The defendants had to file extensive evidence in respect of the risk to the development if the subdivision of the trust property was brought to a halt. This was detailed and comprehensive evidence going beyond what might be required in a "normal" application for an injunction. The Court did not certify for second counsel. While both parties had second counsel, the determination of costs was objective and focused on the nature of the proceeding. The hearing itself was not so complex that it required two counsel. The categorisation of key steps in the proceedings as meriting costs on a 2C basis effectively answered the concerns raised to support the claim for increased costs. The Court held that the proceeding was complex and warranted a 2C categorisation for most costs purposes. There was no basis on which to increase costs beyond that. Finally, the trustees were entitled to be indemnified for the balance of the costs they incurred up to $39,182 plus GST in defending this application (after deducting the costs payable by the plaintiffs), from the assets of the Trust. Costs were to lie where they fell on this costs application. The Court made the following costs orders: (a) the plaintiffs were to pay the defendants costs calculated on a 2C basis for all steps, except for filing the memorandum of counsel dated 4 October 2019 where 2B costs apply; (b) costs on this application were to lie where they fall; and (c) the trustees were entitled to be indemnified for the balance of the costs they incurred up to $39,182 plus GST in relation to this application (after deducting the costs payable by the plaintiffs), from the assets of the Trust.

Orders