Murrell v Hamilton

[2014] NZHC 2863

IN THE HIGH COURT OF NEW ZEALAND DUNEDIN REGISTRY

CIV-2012-412-336 [2014] NZHC 2863

BETWEEN

JANE MAREE MURRELL

Plaintiff

AND

WILLIAM ELLIOTT HAMILTON First Defendant

GEOFFREY MIRKIN Second Defendant

WEH TRUSTEE LIMITED Third Defendant

Hearing:	13 November 2014 (By way of conference call)
Appearances:	L A Andersen for Plaintiff D R Tobin for First and Third Defendants M E Parker for Second Defendant
Judgment:	18 November 2014

JUDGMENT OF PANCKHURST J

Introduction

[1]      In June 2014 I awarded costs of $28,500 to the first defendant and $1,500 to the second defendant.   Ms Murrell’s constructive trust claim having failed in this Court.  However, in August the Court of Appeal upheld an appeal and awarded her

$37,500; a 15 per cent entitlement as assessed in this Court.   In consequence the previous costs award was quashed, with costs in the High Court to be re-determined.

[2]     Ms Murrell seeks 2B costs of $37,810, disbursements of $8,295.09, reimbursement of pre-discovery costs of $2,800 and substitution of an award in her

favour (but in the sum of $1,592) plus a filing fee of $725.

MURRELL v HAMILTON AND ORS [2014] NZHC 2863 [18 November 2014]

[3]      The first and second defendants challenge aspects of the 2B scale costs claim and also seek a 50 per cent reduction in the resulting award because Ms Murrell contributed unnecessarily to the time and expense of the proceeding by both overstating her claim and failing to accept an offer of settlement.  They also oppose reimbursement of the pre-discovery award met by Ms Murrell in 2012.

[4]      It is convenient to reconsider costs by reference to each topic in the order outlined above.

Scale costs

[5]      Scale 2B costs are appropriate.   The defendants, however, challenge three items of the claim on the basis that only a 2A allowance is appropriate in relation to each.  These are the allowances for a list of documents, inspection, and preparation of the plaintiff’s briefs.  I agree that a 2A allowance should apply in relation to the list and preparation of the plaintiff’s brief.   I shall explain why the 2B claim for inspection is allowed shortly.

[6]      Therefore the total scale costs is reduced to $32,238.00.  It is accepted that the disbursement claim is reasonable.  It is allowed.

A 50 per cent reduction?

[7]      I refuse the 50 per cent reduction contended for by the defendants.  While

Ms Murrell sought half of the profits from the house sale, but recovered only a

15 per cent share, this did not contribute unnecessarily to the time and cost of the proceeding.

[8]      In fact each element of the claim was disputed.  Ms Murrell had no option but to proceed to trial and establish her case.   That she recovered 30 per cent of the amount actually claimed made no material difference to the cost of the proceeding.

[9]      Reliance by the first defendant upon a Calderbank letter is misplaced.  The sum offered of $10,000 was but a fraction of the amount recovered.   Nor, in my view, is there merit in the submission that the costs sought exceed the amount of the

award and, therefore, the costs award should be diminished.   This case was hard fought over two days in this Court.  Given the first defendant’s stance, Ms Murrell had no option but to proceed and reasonable scale costs must follow the event.

Pre-trial discovery costs order

[10]     Associate Judge Osborne awarded $2,800 to the then intended defendants, Messrs  Mirkin  and  Hamilton,  as  the  trustees  of  the  relevant  family trust.    His decision, however, included this reservation:

(The order) is … without prejudice to the right of the plaintiff if successful,

to apply for recovery of the costs paid.

[11]     The defendants oppose any recovery of the $2,800 on the basis that the award related  to  two  house properties, only one of which featured  in  the  High  Court proceeding.   The other was the subject matter of an unsuccessful Family Court claim.   Moreover, they contend that the Associate Judge’s decision, properly understood, does not relate to Devon Street – rather the $2,800 award was limited to the other house property.  Mr Anderson was constrained to accept this in the course of a telephone conference. Accordingly, a refund of the $2,800 is not appropriate.

[12]     Mr Tobin, however, accepted that the 2B claim for inspection was justified once the work entailed in assessing the relevant documents was understood.  Hence my disallowance of a 2A award for inspection (para [5]).

[13]     Ms Murrell is, however, entitled to costs as sought in relation to pre-trial discovery pertaining to Devon Street in the sum of $1,592.00 plus the filing fee of

$725.

Solicitors:

L A Andersen, Dunedin

D R Tobin, Dunedin

M E Parker, Dunedin