McQueen v Penn
[2017] NZHC 1959
•17 August 2017
NOTE: PURSUANT TO S 35A OF THE PROPERTY (RELATIONSHIPS) ACT 1976, ANY REPORT OF THIS PROCEEDING MUST COMPLY WITH SS 11B TO 11D OF THE FAMILY COURT ACT 1980. FOR FURTHER INFORMATION, PLEASE SEE
THE-FAMILY-COURT/LEGISLATION/RESTRICTION-ON-PUBLISHING- JUDGMENTS.
IN THE HIGH COURT OF NEW ZEALAND HAMILTON REGISTRY
CIV-2015-419-61
[2017] NZHC 1959
UNDER the Family Proceedings Act 1980 IN THE MATTER
of an appeal under s 174(1AA)(a) Family Proceedings Act 1980
BETWEEN
ELIJAH MCQUEEN
Appellant
AND
CHERYL PENN
Respondent
Hearing: On the papers Counsel:
S Jefferson QC, J Hawker and K Denhardt for the Appellant V Crawshaw and L Reed for the Respondent
Judgment:
17 August 2017
JUDGMENT OF WOODHOUSE J
((1) Quantum (2) Costs on appeal (3) Costs on recall application)
This judgment was delivered by me on 17 August 2017 at 11:00 a.m. pursuant to r 11.5 of the High Court Rules 2017.
Registrar/Deputy Registrar
……………………………………
Solicitors/Counsel:
Mr S Jefferson QC, Barrister, Auckland
Ms J Hawker (appellant’s instructing solicitor), Wynyard Wood, Solicitors, Auckland
MCQUEEN v PENN [2017] NZHC 1959 [17 August 2017]
Ms V A Crawshaw, Barrister, Auckland
Mr R Gubb (respondent’s instructing solicitor), Beattie Rickman Legal, Solicitors, Hamilton
Quantum
[1] In the substantive judgment on this appeal I made an order that the appellant pay maintenance to the respondent to be calculated as the difference between $382,959 and the sum of all payments already made by the appellant to the respondent for maintenance.1 If the parties were unable to agree on the amount paid by the appellant the issue was to be referred to the Court for determination.
[2] The parties were unable to agree on the amount that had been paid. The difference recorded in memoranda first filed for the parties was approximately
$18,000. The difference was steadily reduced following exchanges of affidavits and memoranda from counsel.
[3] As at 27 March 2017 the difference, on the figures as calculated by the parties was $4,962.52. The respondent contended that the balance owed to her was
$234,053.40. The appellant’s calculation was $229,090.88.
[4] A review of the detailed calculations has established that the difference between the parties, as at 27 March 2017, is only $2,995.10. The parties’ original calculations, and adjustments to them, are set out in a spreadsheet which is attached to this judgment and forms part of it.
[5] The recalculated difference of $2,995.10 relates almost entirely to one category of payment claimed by the appellant. This is the first category in the spreadsheet for payments claimed by the appellant (item (1)). He originally calculated this at a total of $9,152.74. It has been adjusted for a minor arithmetical error to $9,052.74. The corresponding calculation by the respondent was $6,321. The difference between those two figures is $2,831.74. The appellant produced bank statements and emails in support of this claim. The payments have been evidenced by documents produced by the appellant. The respondent’s lower figure is not based on a challenge to the evidence produced by the appellant but on a contention that the particular payments should not be categorised as spousal maintenance. The items are summarised in note
… in the spreadsheet.
1 McQueen v Penn [2016] NZHC 699 at [130]-[144], [160].
[6] In my judgment, assessing this in the overall context, it is appropriate to allow the appellant one-half of the amount in dispute; a sum of $1,415.92. The result is that, apart from a difference between the end figures for the appellant and those for the respondent of $163.26, the balance required to be paid by the appellant as at 27 March 2017 is $230,446.80. The sum of $163.26 is to be written off.
[7] There is a formal order that the provisional judgment sum of $382,959 is to be reduced by $152,512.20 resulting in a balance owing for maintenance as at 27 March 2017 of $230,446.80.
[8]Costs on this issue are to lie where they fall.
Costs on the appeal
[9] In the substantive judgment. I directed that submissions for the appellant on costs were to be filed within four weeks of the date of the judgment, which in the event was by 13 May 2016, with any submissions for the respondent to be filed within a further three weeks.2
[10] No submissions were filed for the appellant within the specified time. However, on 14 December 2016 a memorandum for the respondent was filed seeking costs on a 2B basis together with some disbursements. The total claimed is
$18,165.80, itemised in a schedule.
[11] The appellant opposed the application on two grounds: the application was “excessively out of time” and for that reason should be “disregarded” and, contrary to the respondent’s submission, the respondent had not succeeded on the appeal.
[12] I do not accept the first ground for opposing the application. Ms Crawshaw, counsel for the respondent, advised that the respondent had been “diverted from attending to the issue” because of ongoing matters between the parties which were set out in a chronology. I agree with the submission on this point of Ms Denhardt, counsel for the appellant, that the matters referred to cannot reasonably account for a delay of
2 McQueen v Penn, above n 1, at [158].
40 weeks. Nevertheless, it does appear that the respondent’s counsel was focused on other matters between the parties and this does provide some explanation for delay. Also, it was not a default by the respondent in relation to a timetable because the first step on the question of costs was to have been taken by the appellant, not the respondent. More importantly, it is not apparent that there is any prejudice to the appellant from the delay. In addition, the respondent was in receipt of legal aid for the appeal and was bound to make an application.
[13] I also do not agree with the appellant’s second ground for opposing the respondent’s application – the contention that the respondent is wrong in claiming that she succeeded on the appeal. It is correct, as the appellant submitted, that the appellant succeeded on the appeal to the extent that the award in the Family Court was reduced by $51,000, the respondent’s cross appeal on two matters was dismissed, and an application by the respondent for leave to adduce further evidence was dismissed. However, the appellant’s appeal was not simply directed to seeking a reduction of the amount awarded in the Family Court and to opposing the respondent’s cross appeal and application. The thrust of the appellant’s case on appeal, supported by nine main points on appeal, was that there should have been no maintenance award.
[14] On a broad assessment, not much time was spent on the matters which resulted in the reduction in the appellant’s favour of $51,000. And not much time was required on the cross appeal and evidence application of the respondent. This is reflected in the fact that the judgment runs to 162 paragraphs, but only 12 paragraphs are directed to the cross appeal.
[15] My overall assessment is that in substantial measure it was the respondent who succeeded. For this reason I am satisfied that there should be a costs order in favour of the respondent, but reduced to some extent to allow for the fact that there was some success by the appellant.
[16]The memorandum for the appellant contained the following submission:
The respondent’s claim appears to be based on her claimed success only, and no other matters are raised on her behalf. Counsel therefore makes no other submissions at this time on the issue of costs, however leave will be sought to
respond if a further attempt to claim costs on other grounds is made by the respondent.
There was a further memorandum for the respondent, but this did not contain new grounds for a costs order in favour of the respondent.
[17] There was no challenge by the appellant to the quantum itemised in the schedule to the respondent’s first memorandum. I will assess an allowance to the respondent using that schedule. The schedule itemised costs to 2 December 2016, but the costs I am assessing here are up to the conclusion of the main hearing on the appeal and some further steps through to 26 August 2015. The respondent’s schedule includes steps taken after 26 August 2015 through to 2 December 2016. The total of scale costs, excluding items after 26 August 2015, is $13,157. In my judgment the appropriate sum to allow to the respondent is $10,000 and $500 for disbursements.
[18] In consequence there is an order that the appellant pay the respondent costs in a sum of $10,500.
[19] There is a further costs application by the respondent arising out of an application by the appellant to recall my substantive judgment. That issue is dealt with next. Apart from that further costs issue, any other costs of the parties are to lie where they fall.
Costs on the recall application
[20] The appellant applied to recall the substantive judgment on the appeal. That application was dismissed.3 I also held that the respondent is entitled to costs and gave directions for memoranda to be filed.
[21]A memorandum was filed for the respondent seeking costs on a 2B basis of
$6,913.
3 McQueen v Penn [2016] NZHC 2700.
[22] The quantum was challenged for the appellant on the basis that the actual time likely to have been involved would have been less than the standard time allocation, and the legal aid hourly rate is less than schedule 2 rates.
[23] Counsel for the respondent produced a schedule of legal aid invoices rendered in respect of the recall application. The total for legal work is $2,398.90. There is also a claim of $2,242.50 for a fee charged by a forensic accountant, Mr White. Mr White had been engaged for the respondent in a relationship property proceeding. He provided an affidavit on the recall application in light of the appellant’s grounds for the application. The application for recall was directed to evidence Mr White had referred to in his original report for the relationship property proceeding.4
[24] The claim of $2,398.90 (which includes GST) for legal costs is reasonable and there will be an order that the appellant pay that sum.
[25] The claim of $2,242.50 (which also includes GST) for Mr White’s fee is not reasonable in relation to the recall application. (I express no opinion on the reasonableness of the fee in relation to the relationship property proceeding.)
[26] In my judgment the appellant should not be required to pay any part of this expense in this proceeding. This is for two reasons.
[27] The first reason is that Mr White’s affidavit in this proceeding was directed to a short point and one that did not engage his expertise. The central part of Mr White’s short affidavit simply contains an explanation for assumptions of fact in his original report, an acknowledgement that the appellant appeared to be correct in his contention that there was an inconsistency between two factual contentions (discussed in the recall judgment), and a statement that he had been asked to update his assessment for the relationship property proceeding to correct the error in the original report.
[28] The second reason for not allowing this part of the costs claim is that the respondent acknowledged that it was her misunderstanding which had led to Mr White’s statement in his original report. It was this which had in turn led to the
4 The background is fully set out in the recall judgment, above n 6, at [2]-[3].
appellant’s identifying the inconsistency in the respondent’s original evidence in the maintenance proceeding and what was apparently being advanced in the relationship property proceeding.
[29] There is accordingly an order that the appellant pay costs of the respondent on the recall application in a total sum of $2,398.90.
Woodhouse J
McQUEEN v PENN - ANALYSIS OF CLAIMS OF MAINTENANCE PAID AND RECEIVED
AS AT 27.3.J7:
Appe)Iartt's claim of balance owed at 13.3.17 {memo 14d.17) $231,090.88 less two fuMer Court ordered payments of $1,000 each to 27.3.17:
Respondent’s claim of balance owed at 27.3.17 (respondent’s 29.3.17 affTdavTt - excluding the interest calculation of G7,053.75):
52W,053.40
Difference. $4.9G2.s2
DETAILED ANALYSIS
Appellant's calcutation as at 13.3.17 (counsel’s memo 14.3.17): Judgment sum subject to deductions: Lese: (1) Ad hoc payments from Oct 2012 to 14 March 2014 "evidenced by banlr statements and emails" annexed to appellanfs 14.3.14 affidavfL (2) Further ad hoc payments to 14.3.1d - original claim $6,127.74 C›. Appellant conceded $4,337.74 - see note6 - reducing the claim to: 3,790 00
12,942.74
(3) Further ad hoc payments from 18.3.14 to 31.5.16 (annexure "A" to affidavit of 28.6.16)
(4) Court ordered weekly payments from 14.8.15 to 31.5.t6 (annexure "A’ of affidavit):
43 425.00
g7,769.21
(5) Payments from 27.5.16 to 13.3.17 (schedule attached to memo 14.3.17) Mr Court o+dered weeNy
382,959.00
payments of 6J,000 and "additionat payments":
(6) Respondent's eamings-
50,2 i6.81
897.36
161,868.12
151.868 12
BALANCE TO PAY: $834 .090.88
Appellant’s calculation updated tg 27.3.17 and amended for errors:
Judgment sum subject to deducôons•
Less:
(1) Ad hoc payments from Oct 201d to 14 March 2014 "evidenced by bank statements and emails" annexed to appellant's 14.3. 44 affidavit - adjustment of arithmetical error in the total:
(2) Further ad hoc payments to 14.3.14 - original daim $8,1Z7.74. There are errors in the caIcuIat+on of the appellant’s concession. See note6 below. The correm balance is:
(3) Further ad hoc payments from 18.3.14 to 31.5.16 (annexure "A" to affidavit of 28.6.16) :
(4)Court ordered weekly payments from 14.8.1g to 31.5.16 (annexure "A" of affidavit):
(5) Payments from 27.fi.16 to 13.3.17 (scnedu)e attached to memo 14.3.17) for Court ordered weekly payments of $1,000, updated for two fuMer payments to 27.3.17, and "additional payments':
(6)Respondenfs eamings:
(Z) Adjustment for correct chitdœre payment 1•4.10.15 - 6160 more than the appeltant reooröed: O
0,0ô2.74
3,600.00
44,344.21
43,42fi 00
12,8?'2.7#
87,Tb9.21
52,258.61
g97.36 150.00
382,9ô9.g0
153,928.12
ADJUSTED BALANCE TO PAY: 6Z29.030.88
Respondent's caîculation as at 27.*.17 (affidavit 29.3.17}:
Judgment sum subject to deductions:
Less:
Payments from Oct 2012 to 14 Marcn 2014 appellant’s claim (1): the main item in dispute - see note 0: the respondent accepted oart only at:
Additional payment to 14 March 2014 as agreed Payments made from 19.3.14 to 17.3.16
Payments made from 19.3.14 to 4.3.17 Payments made from 19.3.1d ts 27.3.17 Adjustment for earnings
Add back:
Total of payments in the above items which respondent contends were not for maintenance (respondenfs affidavit 29.3.17 at paras 2 27):
6,381.00
3,760.00
46,319.43
62,869.02
32,209.79
B97 36
152,\66.60
3,461.OO
382,959.00
BALANCE TO RECEL
Analysis of respondent's calculation based on affidavit of 1.7.16 and subsequent memoranda and aGdavits:
Judgment sum subject to deductÎons ‹ Less:
Ad Doc payments "over 2 year 3 month period'
Interim mainPenance (including s2,325.26 originally said by respondent to be for gifts, children expenses and on account of relationship property - now accepted as fat ling within definition of spousal maintenance (see nonations on annexure "B“ to 1.7.16 affidavit)
Court ordered weekly payments 14.8.156 28.6.16 (para 5(b) and annexure ”B" to 1.7.16 affidavit)
)nI'ormaI payments from Oct 2012 to 14 March 2014 "evidenced by bank statements and emails" annexed to appellanfs 14.3.14 affidavit - the main item in dispute - see note6
Informal payments between 28.6.13 and 18.3.14 (benk statements annexed to respondenfs 2.12.16 affidavit) - arithmet)caT error in affidavit when compared to bank statements
Payments from 31.5.16 to 23.3.17 Tor Court ordered weekly payments of 51,000 and "additional payments"
Add back:
Toml of peyrnents in 1:Vie above items whicn respondent contends were not for maintenance t pondenfs affidavû 29.3.17 at paras 2 27) - not disguted by appeJtant:
18,979.77
25,609.44
47 425.0O
6,321.00
S,800 00
9Ç014.24
10,121.00
52 250.B'I
154,394.02
3,464 .00
ADJUSTED BALANCE TO RECE)VE•
DIFFERENCE =
Notes:
6 Appellant in 14.3.14 affidavit (paras 4 and 5) says informel payments Oct 2012 to 14 March 2014 = S9,152.74, and "Annexed hereto marked ”A" are a selection of bank and creoit œrd satenlents and emails demonstæông that she has reœived $e,152.74 since October 2012" and “... there have been many occasions wheo I have also been prevailed upon by [the respondent] to help ... I estirnate el least a further 5500 can be acœunted for in this way in the 12 month period ...I ha've not been through a year's worth of text messages to ftemïse money lent and acknowledged, nor have I kept a reoord où cash given over frsm time to time when it was requested at handover times for various reasons (petrol, food), but there has been money given this way ... [the responderrt] has been given at least $0,127.74 that I can clearly verify, but in Fact, somewhat more than This".
@ See the appellant’s 2.6.16 afñdav it, para 1f.
6 of ne total claimed to have been paid by the appellant of 88,127.74, the respondent accepted a sum of $3,750 had been paid for maintenance. The appellant then withdrew his claim for the balance (memo 1.3.17, para 3). On those figures the concession wouId be $4,377.74 (erroneously recorded in the 1.3.17 memo, note 2, as s4,337.74). The detail is as follows:
Respondent eays
received Actual Ty received
Received payments into Westpac Bank account no. 03-...-002: 1,2€ 0.00 1,000.00
Received payments into ASB account no. 12-...-00: 2,500.00 2 800 00
4,3T7.74 4,327.74
8,127.74 8,127 74
@ Appellant's schedule (almost illegible) attached to respondent's a)Tidavit 1.7.16 records a child care payment of $500 on 14.10.1s. Responden in her schedule (annexure "B\, records the actual payment as $650 - see notation ”correct cre...".
Q)The respondent recorded the items disputed in her affidavit of 1.7.16, at para 7. This represents almost all of the difference between the parties of 62,99d.10. The disputed items are as follows:
- poable hanging raids from Freedom Furniture zoo.oo
-à\'s birthday party at Creamery Café 6 F)oris, Ohaupo 519.20
• pñvate dentist (Dr ...) 327.90
• vaccifla tî0rls (Or ...) 284.00
- shoes from "H ikoi" Cambridge s3s.7s
- school fees and öenatioos ,107 00
0