Monticello Holdings Limited v Selwyn District Council

[2015] NZHC 2043

IN THE HIGH COURT OF NEW ZEALAND CHRISTCHURCH REGISTRY

CIV-2013-409-001521 [2015] NZHC 2043

BETWEEN

MONTICELLO HOLDINGS LIMITED

Plaintiff

AND

SELWYN DISTRICT COUNCIL Defendant

Hearing:	Dealt with on the papers
Judgment:	27 August 2015

JUDGMENT OF GENDALL J (As to costs)

[1]      On 17 July 2015 I gave judgment in this proceeding to the defendant Selwyn District Council with respect to the plaintiff’s claim against it.  In doing so, at para [112] of that judgment I noted:

[112]    The SDC [the defendant] has succeeded in defending this claim.  It is entitled to costs in the usual way.  Without deciding the matter, my initial view is that costs should follow the event on a 2B basis with certification for second counsel.  However, if the parties cannot agree on costs they are to file memoranda ...

[2]      Counsel have not agreed on the issue of costs and accordingly on 11 August

2015 counsel for the defendant filed his memorandum seeking costs.  Counsel for the plaintiff replied with his memorandum on costs dated 25 August 2015.

[3]      Those memoranda have now been referred to me.  Neither counsel indicate that they wish to be heard on the question of costs.  I now give my decision based on the papers filed and the material which is before the Court.

[4]      In his memorandum, Mr Cooke QC, counsel for the defendant, seeks costs here on a category 3B scale basis totalling $70,560 together with disbursements

totalling $10,646.28.

MONTICELLO HOLDINGS LIMITED v SELWYN DISTRICT COUNCIL [2015] NZHC 2043 [27 August

2015]

[5]      In response, Mr Dale, counsel for the plaintiff, in his memorandum notes that the plaintiff accepts liability for costs here on a category 2B scale basis (which it seems is accepted to be at the figure of $47,760) but not an award of costs on a category 3B basis.  As to the disbursements claim, Mr Dale indicates the plaintiff accepts the disbursement claim from the defendants with the exception of witness fees claimed for Mr Stephen Wright, an archivist, totalling $2,778.75.

[6]      I now turn to address those issues.

Costs

[7]      First, as to the work involved in this proceeding which has been outlined by Mr Cooke QC in his costs schedule attached to his memorandum, Mr Dale states that the plaintiff accepts this level of attendances which total some 24 days.

[8]      The issue for me so far as costs are concerned therefore is whether the award of costs here is to be on a category 3B basis as sought by the defendant or on a category 2B basis as the plaintiff maintains.

[9]      As I have noted at para [1] above, in my original judgment dated 17 July

2015 I indicated that my initial view was that costs in this case should be awarded on a 2B basis with certification for second counsel.

[10]     Mr  Cooke  QC,  however,  argues  strongly  that  this  proceeding  should  be properly categorised as a category 3 matter rather than a category 2 matter being a “proceeding that because of its complexity or significance requires counsel to have special skill and experience in the High Court.”

[11]     On this, Mr Cooke QC contends that this case involved complexity both in terms of the legal principles involved and also the facts.   He suggested that as to legal complexity the claim involved first, an allegation of the establishment of a duty of care for local authorities in a novel category (when an acquisition was made but no LIM was sought).   Secondly, he suggests the plaintiff’s allegations were also made on an extremely broad basis with the defendant being required to deal with all the issues arising from claims of negligence in what was a novel situation.  Thirdly,

Mr Cooke QC contended that the requirement to assess a novel category of duty of care in the particular statutory context prevailing in this case was also complicated, given that it involved consideration of the normal RMA related legislation, but also the reasonably elaborate statutory regime relating to land contamination and to the provision of information and keeping of records by local authorities.

[12]     As to factual complexity here, Mr Cooke QC maintained that in particular:

(a)      The  breadth  of  the  plaintiff’s  allegations  meant  that  all  of  the defendant’s officers who had any dealings with the plaintiff over the years of the developments were required to be briefed, as well as Council managers and officers in charge of archives.

(b)Difficult factual questions arose surrounding what had taken place once the historical landfill was unearthed.

(c)      The plaintiff’s damages claim, which involved what was said to be an elaborate assessment for the costs of remedying the land, further complicated these issues and required detailed expert evidence.

[13]     To summarise, Mr Cooke QC suggested that the plaintiff here had advanced a complex and legally novel set of allegations which, to an extent, were obscure both legally and factually and therefore it was no surprise that the defendant required senior counsel to respond to the allegations which were made.   On this basis he contends this is really a category 3 case rather than a category 2 proceeding.

[14]     On all of this, Mr Dale for the plaintiff submitted that this case was no different to a usual leaky home claim involving a local authority where it is usually necessary to traverse historical detail to determine the extent of a Council’s liability, arguments in relation to loss and the nature of duties owed by a local authority. Accordingly he contends this should be categorised as a category 2B proceeding and notes that I had given an initial view to this effect at para [112] of my judgment noted at para [1] above.

[15]     On this issue, McGechan on Procedure notes at para HR14.3.01 relating to the skill and experience category to be allocated:

HR14.3.01      Skill and experience category

…

(b)       Basis for categorisation:

The three categories respond to the skill and experience requirement of the proceeding, not to the skill and experience possessed by counsel acting, although the latter is generally some indication of the former.

…

[16]     In this case Mr Cooke QC, counsel for the defendant, is clearly a senior and experienced  member  of  the  Bar  with  a  high  degree  of  skill  and  experience  as counsel.   Notwithstanding this, and his suggestion that this proceeding involved novel and complex legal and factual issues, I remain of the view outlined in my earlier judgment that on balance, but perhaps only by a reasonably fine margin, this proceeding should be seen generally as one of average complexity which required counsel of skill and experience considered average in this Court.  I repeat that I form this view only by a reasonably slim margin but, nevertheless, I do remain of the view that category 2B costs are appropriate here.

[17]     Given  that  there  is  no  dispute  from  the  plaintiff  as  to  the  quantum  of category 2B costs to be awarded in this case, I now order that the plaintiff is to pay to the defendant costs on this basis amounting to $47,760.

Disbursements

[18]     Turning now to the disbursements claim advanced by the defendant, the only issue raised by the plaintiff is whether the witness fees of $2778.75 claimed for Mr Stephen Wright, an archivist, are properly claimed.

[19]     As I understand the position, Mr Wright was a previous employee of the defendant, the Selwyn District Council. As such he was engaged as an archivist, and then in a special project regarding identification of contaminated sites within the

defendant’s district.  He was called by the defendant as a witness and Mr Cooke QC contends that, although he was a former employee of the Council, the fees he has charged  here  for  his  time  in  providing  evidence  should  be  recognised  as  a recoverable disbursement because they were necessarily incurred and are reasonable in terms of r 14.12(2)(c) and (d) of the High Court Rules.

[20]     As to this aspect, however, I take the view that Mr Wright was clearly called by the defendant here as a witness of fact regarding his employment by, and the projects undertaken for, the defendant Council and not as an expert.  Being a witness on this basis, I find that this disbursement of $2778.75 is not properly claimed here.

[21]     This reduces the total disbursements claim advanced by Mr Cooke QC of

$10,646.28 down to $7867.53.  This amount is effectively undisputed and is properly claimed.

[22]     An order is now made that the plaintiff is to pay to the defendant, in addition to the costs outlined at para [17] above, disbursements totalling $7867.53.

...................................................

Gendall J

Solicitors:

Malley & Co, Christchurch

Adderley Head, Christchurch