Mills v Dalzell

[2025] NZCA 91

IN THE COURT OF APPEAL OF NEW ZEALAND

I TE KŌTI PĪRA O AOTEAROA

 CA186/2024
 [2025] NZCA 91

BETWEEN

LYNETTE JOY MILLS First Applicant CARL JAMES PETERSON Second Applicant THE PETERSON/MILLS PARTNERSHIP Third Applicant

AND

KELLY DALZELL First Respondent TRACY HOWARD LEVENBACH (deceased) Second Respondent ASB BANK LIMITED Third Respondent GRAHAM HOWARD-MILLS Fourth Respondent JOHN LEVENBACH Fifth Respondent CAROL KRAMMER Sixth Respondent HOLLAND BECKETT Seventh Respondent MINTERELLISONRUDDWATTS Eighth Respondent MORGAN COAKLE Ninth Respondent ASSOCIATE JUDGE JOHNSTON Tenth Respondent JEREMY RUSSELL SPARROW Eleventh Respondent SEBASTIAN THOMAS HARTLEY Twelfth Respondent STACEY LEE MICHELSEN Thirteenth Respondent SEAN CHRISTOPHER DAVID ALBERT GOLLIN Fourteenth Respondent BRIAR RENEE WEBSTER Fifteenth Respondent KIRSTY BRONWYN PERRETT Sixteenth Respondent WALDO ABRIE Seventeenth Respondent

CA318/2024
BETWEEN	LYNETTE JOY MILLS Applicant
AND	GRAHAM HOWARD-MILLS Respondent

Court:	Courtney and Cooke JJ
Counsel:	Applicants in person S C D A Gollin and S L Michelsen for First, Third, Eighth, Thirteenth and Fourteenth Respondents in CA186/2024 No appearance for Second Respondent in CA186/2024 T J Conder for Fourth, Seventh, Eleventh and Twelfth Respondent in CA186/2024 and Respondent in CA318/2024 B R Webster and K B Perrett for Fifth, Sixth, Ninth, Fifteenth, Sixteenth and Seventeenth Respondents in CA186/2024 No appearance for Tenth Respondent in CA186/2024
Judgment: (On the papers)	3 April 2025 at 10.30 am

JUDGMENT OF THE COURT

AThe applicants in CA186/2024 must pay costs to the first, third, eighth, thirteenth and fourteenth respondents in the sum of $3,992.80.

BThe applicants in CA186/2024 must pay costs to the fifth, sixth, ninth, fifteenth, sixteenth and seventeenth respondents in the sum of $2,361.60.

CThe applicants in CA186/2024, and the applicant in CA318/2024, must pay costs to Graham Howard-Mills in the sum of $2,189 in respect of CA186/2024, and the sum of $3,729 in respect of CA318/2024.

____________________________________________________________________

REASONS OF THE COURT

(Given by Cooke J)

1. By judgment dated 17 December 2024 this Court struck out the applicants’ proposed appeal in CA186/2024, and declined an application for an extension of time in CA318/2024.[1]  When doing so it awarded indemnity costs against the applicants.[2]  In relation to CA186/2024 the Court said:[3]

   [36]     Indemnity costs are awarded only in exceptional cases.  Flagrant misconduct is generally required.  We consider this case meets the threshold for an award of indemnity costs.  Ms Mills’ and Mr Petersen’s claims are clearly an attempt to relitigate matters which have been determined conclusively already.  The applicants are unduly prolonging a case by groundless contentions and meet the threshold for an award of indemnity costs.

And in relation to CA138/2024:[4]

[37]     Mr [Howard-]Mills sought increased or indemnity costs in relation to CA318/2024.  We are satisfied that this is an appropriate case for indemnity costs.  For the reasons already discussed, we consider that Ms Mills has acted vexatiously, frivolously, improperly, and unnecessarily in commencing the proceedings and pursuing her appeal.

[1]Mills v Dalzell [2024] NZCA 675 [strike-out judgment] at [38] and [40].

[2]At [41] and [42].

[3]Footnotes omitted.

[4]Footnotes omitted.

1. In relation to CA186/2024, the Court ordered the applicants to pay indemnity costs and usual disbursements to the three groups of respondents referred to below.[5]  In relation to CA318/2024 the Court directed that Ms Mills pay Mr Howard-Mills indemnity costs and usual disbursements.[6]

   [5]At [41].

   [6]At [42].

2. The orders required those entitled to indemnity costs to file memoranda supporting the quantum of the indemnity costs by 31 January 2025, with memoranda in response by 14 February 2025.[7]  Memoranda from the respondents entitled to indemnity costs have duly been filed.  No response has been filed by the applicants.

   [7]At [41] and [42].

3. On review of the claims, an issue was identified by the Court in relation to GST.  The amount of GST should generally only be included if the claimant is not GST registered.[8]  We invited the claimants to clarify their claims as a consequence, and they filed memoranda in response.

   [8]New Zealand Venue and Event Management Ltd v Worldwide NZ LLC [2016] NZCA 282, (2016) 23 PRNZ 260 at [13].

4. We have considered the quantification of the indemnity costs against that background.  An award of indemnity costs does not indemnify the person fully for all costs — only reasonable costs.[9]  We have considered the information associated with the actual legal expenditure to assess whether it was reasonable in the circumstances.  Whilst there is no single approach to determining the reasonableness of actual legal expenditure, it will usually require a review of the amount of time spent on each step in the litigation, the reasonableness of the charge-out rates used, and most importantly the overall reasonableness of the fee.[10]

   [9]Bradbury v Westpac Banking Corp (2008) 18 PRNZ 859 (HC) at [209]; and Edel Metals Group Ltd v Geier Ltd [2018] NZCA 494 at [62].

   [10]Bradbury v Westpac Banking Corp, above n 9, at [209]; and Edel Metals Group Ltd v Geier Ltd, above n 9, at [62].

5. The first, third, eighth, thirteenth and fourteenth respondents seek an award of $3,992.80.  They have provided schedules setting out details of the steps taken in relation to the proceeding, the amount of time spent, and the hourly rate used.  We accept that the amount of time and the hourly rates used are reasonable, and that the overall costs involved are reasonable.  We accordingly allow this claim.

6. The fifth, sixth, ninth, fifteenth, sixteenth and seventeenth respondents seek an award of $2,361.60 by way of indemnity costs.  They have also provided schedules identifying the steps taken and the actual time recorded for each step, with reference to average hourly rates.  The time spent and the hourly rates used appear to us to be reasonable, as does the total amount involved.  We accordingly allow this claim.

7. The respondent in CA318/2024, who is also the fourth respondent in CA186/2024, seeks an award of indemnity costs of $2,464 in CA186/2024 and $4,004 in CA318/2024.  Counsel explains that separate time recording and invoicing was not applied across the various proceedings initiated by the applicants, so that counsel have had to engage in an apportionment of the actual costs attributable to the proceedings in which the award of indemnity costs arises.  In the memorandum, counsel addresses each of the invoices and identifies the portion of the amount in those invoices attributable to the proceedings.  In each case we accept that the apportionment engaged in, the time allocated, the hourly rates and claims for disbursements are reasonable.  We also accept that the overall costs involved are reasonable.  Given Mr Howard-Mills was the sole respondent in CA318/2024, the costs are higher in that proceeding for understandable reasons.  There is one exception to that conclusion, which is the claim for $550 allocated across both appeals, for the cost of the indemnity costs memorandum.  We do not think that that amount can be considered to be within the current award for indemnity costs, and we deduct that amount from the amount claimed. 

8. The applicants’ liability for costs in CA186/2024 is joint and several.[11]

Result

[11]Court of Appeal (Civil) Rules 2005, r 53I.

1. The applicants in CA186/2024 must pay costs to the first, third, eighth, thirteenth and fourteenth respondents in the sum of $3,992.80.

2. The applicants in CA186/2024 must pay costs to the fifth, sixth, ninth, fifteenth, sixteenth and seventeenth respondents in the sum of $2,361.60.

3. The applicants in CA186/2024, and the applicant in CA318/2024, must pay costs to Graham Howard-Mills in the sum of $2,189 in respect of CA186/2024, and the sum of $3,729 in respect of CA318/2024. 

Solicitors:
MinterEllisonRuddWatts, Auckland for First, Third, Eighth, Thirteenth and Fourteenth Respondents in CA186/2024
Holland Beckett, Tauranga for Fourth, Seventh, Eleventh, Twelfth Respondents in CA186//2024 and Respondent in CA318/2024
Morgan Coakle, Auckland for Fifth, Sixth, Ninth, Fifteenth, Sixteenth and Seventeenth Respondents in CA186/2024