Memelink v Haines - [2024] NZHC 1093

IN THE HIGH COURT OF NEW ZEALAND WELLINGTON REGISTRY

I TE KŌTI MATUA O AOTEAROA TE WHANGANUI-A-TARA ROHE

CIV-2020-485-497

[2024] NZHC 1093

UNDER section 12 of the Senior Courts Act 2016

IN THE MATTER

of damages for breach of contract

BETWEEN

HARRY MEMELINK and

CISCA FORSTER as trustees of the
LINK TRUST (No.1) (in receivership) Plaintiffs

AND

QUENTIN STOBART HAINES

First Defendant

BPE TRUSTEES (No. 1) LIMITED

Second Defendant

QUENTIN HAINES PROPERTIES LIMITED

Third Defendant

Hearing: 6 May 2024

Appearances:

J D Haig for the Plaintiffs/Receivers Q S Haines in person

J D Dallas for the Second and Third Defendants

Judgment:

6 May 2024

JUDGMENT GRICE J

(Costs on quantum judgment)

[1] The plaintiffs seek costs following a quantum decision in which they succeeded in obtaining a judgment for the total sum of $2,387,536.13.1

1 Memelink v Haines [2024] NZHC 588 [the quantum judgment].

MEMELINK v HAINES (COSTS) [2024] NZHC 1093 [6 May 2024]

[2] Previously, judgment on liability was entered against the defendants in relation to various finance company loans assigned to the Link Trust (No. 1) (the plaintiff trust).2 That judgment was entered on an application for summary judgment. At the same time, I dismissed an application for striking out the counterclaim.3 The costs now sought relate to the reserved costs on the liability decision and the quantum judgment.

[3] The finance company loans were initially made to the Haines’ interests and were guaranteed by Mr Memelink and the plaintiff trust. The loan agreements were dated: 22 December 2016 (the first Fico Finance Ltd loan in which the first and third defendants are debtors), 21 February 2017 (the Bright Enterprise Holdings Ltd loan in which the first and second defendants are debtors) and 21 April 2017 (the second Fico loan in which the first, second (as trustee for the QSH Family Trust) and third defendants are debtors). The plaintiff trust paid the finance companies an amount equal to the total amount outstanding under the loans to purchase the loans using money raised from a third party finance company. The plaintiff trust took assignment of the finance company loans and then took recovery action under the loans against the defendants.

[4] These loans were assigned to the plaintiff trust on 7 December 2018. The plaintiffs seek indemnity costs pursuant to the provisions of the loan agreements.

[5] Until the plaintiff trust went into receivership, Mr Memelink was the representative of the Link Trust (No. 1) (the Trust) and the trustees in all relevant dealings. Following the receivership in May 2022, the receivers’ lawyers took over the conduct of this proceeding. Mr Memelink had earlier retained Mr Livingston to act for him. Mr Livingston filed the proceeding and appeared at the quantum hearing.

[6] Mr Haines admits that his interests took the benefit of the finance company loans apart from a relatively small amount advanced and used by Mr Memelink to buy a boat. Mr Haines raised defences relating to the validity of the assignments which I

2 Memelink v…

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 Memelink v Haines

Details

AGLC: Memelink v Haines [2024] NZHC 1093
Case: [2024] NZHC 1093
Decision Date: 6 May 2024

CaseChat Overview and Summary

In the High Court of New Zealand, the case of Memelink v Haines involves a dispute over costs associated with a previous judgment for damages for breach of contract. The plaintiffs, Harry Memelink and Cisca Forster as trustees of the Link Trust (No.1) (in receivership), are seeking indemnity costs following a successful judgment for $2,387,536.13 against the defendants, Quentin Stobart Haines, BPE Trustees (No. 1) Limited, and Quentin Haines Properties Limited. The costs sought relate to the liability decision and the quantum judgment.

The legal issues revolve around the entitlement to indemnity costs under the loan agreements and the reasonableness of the costs claimed. The plaintiffs argue that the indemnity costs are applicable under the contractual provisions of the loan agreements, which assign the right to recover costs from the debtors. They rely on specific clauses within the loan agreements that mandate the debtor to pay all costs incurred by the creditor in connection with the contract. The defendants challenge certain aspects of the costs, including the inclusion of fees charged by Mr. Livingston, who is now a creditor in the receivership, and the costs associated with the counterclaim and the appeal.

The court assesses whether the indemnity costs claim is appropriate under the contractual terms and whether the tasks undertaken were reasonably necessary and contemplated by the contract. The court acknowledges the defendants' concerns but ultimately allows the indemnity costs claim in general terms, finding the amounts claimed to be reasonable. The court makes specific adjustments to the costs claim, excluding double-counted costs, disallowing costs for the counterclaim and appeal, and deducting costs related to settlement negotiations. The court also allows costs for sealing the judgment and disbursements such as expert fees and filing fees.

In conclusion, the court awards indemnity costs as claimed with the necessary adjustments and reserves leave for any issues arising from the recalculation of the costs.

Orders