McMillan v McMaster
[2021] NZHC 2628
•4 October 2021
IN THE HIGH COURT OF NEW ZEALAND WELLINGTON REGISTRY
I TE KŌTI MATUA O AOTEAROA TE WHANGANUI-A-TARA ROHE
CIV-2020-485-345
[2021] NZHC 2628
UNDER Section 284 of the Companies Act 1993 IN THE MATTER
of MARLBOROUGH COUNTRY LIMITED (IN LIQUIDATION)
BETWEEN
MARCUS JAMES McMILLAN and JOHN
HOWARD ROSS FISK, joint and several
liquidators of Marlborough Country Limited (in liquidation)
Applicants
AND
GARY RICHARD McMASTER, JAYNE MARIE GALE, PETER SCOTT MURPHY and STEPHEN JOHN GALE
First Respondents
continued….
Hearing: (On the Papers) Counsel:
S A Barker and B J Maltby for First to Fourth Respondents M M Edwards for Fifth Respondent
Judgment:
4 October 2021
JUDGMENT OF ASSOCIATE JUDGE LESTER
(Quantifying wasted costs)
McMILLAN v McMASTER [2021] NZHC 2628 [4 October 2021]
AND VUELTA INVESTMENTS LIMITED
Second Respondent
AND ANNIE CHAN and JACK CHAN
Third Respondents
AND H HAHN LIMITED
Fourth Respondent
AND FREDERICK PAUL PEREIRA
Fifth Respondent
AND DOMINIC CHANDRAN
Sixth Respondent
AND YOU SEO LIAN
Seventh Respondent
AND CHUAH KIM SENG
Eighth Respondent
AND SONIA JANE PEREIRA
Ninth Respondent
AND MARCUS PAUL PEREIRA
Tenth Respondent
AND YONG SIEW LENG
Eleventh Respondent
AND FRANCIS BRIGGED
Twelfth Respondent
[1] In a minute dated 10 September 2021, following a telephone conference the previous day, the fixture in this matter (scheduled to begin on 27 September 2021 for three days) was vacated for the reasons given in that Minute. A new hearing date commencing 29 November 2021 was allocated.
[2] While that Minute did not enter judgment for wasted costs, it clearly contemplated that wasted costs would be payable.
[3] In his memorandum of 24 September 2021, Mr Edwards, counsel for the fifth respondent, Mr Pereira, advised that his client recognised the adjournment of the September 2021 hearing dates was an indulgence that would have created wasted costs. I agree.
[4] Mr Barker, counsel for the applicants for wasted costs (that is, the first to fourth respondents) approached the quantification of wasted costs on two bases. The first category is costs wasted in respect of bringing the issue of timetabling for the vacated fixture to a head which led to the application for an adjournment by Mr Edwards. The short point is that all of those costs are wasted. That Mr Edwards encountered difficulty in instructing counsel and was not in a position to advance timetabling was not a matter he raised with Mr Barker, nor with the Court. All of the steps taken by Mr Barker on behalf of his clients to seek clarification of what was happening as regards timetabling and preparation for the hearing are wasted costs. None of that work will contribute to the hearing.
[5] I agree with Mr Barker that it is reasonable for the fifth respondent to pay his clients’ actual costs incurred in taking those steps. Those costs are quantified at
$3,633.25. I do not approach the costs in this issue on a scale basis as these costs are truly costs thrown away that should not have been incurred.
[6] The second category of wasted costs sought relates to wasted preparation. Mr Barker realistically acknowledged that the costs of preparing submissions and the bundle and preparing for hearing will not be wholly wasted. However, I accept there will be some wasted costs associated with counsel re-visiting trial preparation in two months’ time and a small recognition for this is included in the total award.
[7] Mr Barker submitted it is reasonable that the fifth respondent make a contribution to the applicants’ wasted costs in the amount of $2,509.50, comprising 50 per cent of scale costs for the preparation of submissions and the bundle. I am not convinced that the time spent on the preparation of the bundle was wasted in part.
[8] Mr Barker also sought the costs of preparing the memoranda as to wasted costs on a 2B basis in the amount of $956.
[9] Ultimately, the award of wasted costs is a matter of impression and best judgment.1 Including the costs award that was made at [5] above, and the scale costs incurred in the quantification of wasted costs (which are also truly wasted costs) in the sum of $956, I award a round sum of $5,000 in wasted costs against the fifth respondent, Mr Pereira. These costs are payable immediately.
[10] I made it clear at the telephone conference on 9 September 2021 that for these wasted costs to be real, that is, in the sense the award will compensate Mr Barker’s clients for their wasted costs, the costs needed to be payable before the hearing. That is all the more so given that Mr Pereira is not resident in New Zealand and enforcement of the costs award after the hearing will be problematic if Mr Pereira is not successful.
[11] Mr Barker sought an order that if the costs were not paid before the hearing, Mr Pereira will be barred from the hearing.
[12] In terms of efficiency, I prefer to fix a date that requires the costs to be paid a reasonable time before the hearing so that counsel know where they stand. Given the new hearing date is at the end of November 2021, the costs are to be paid on an unless basis by Friday 29 October 2021 (the last working day of October). If the costs are not paid, Mr Pereira will not be heard at the hearing commencing 29 November 2021.
Associate Judge Lester
1 Jeffreys v Morgensterm [2013] NZHC 1361 at [34].
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