Nagra v Sri Guru Singh Sabha Auckland Incorporated (1229571)
[2023] NZHC 852
•20 April 2023
IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY
I TE KŌTI MATUA O AOTEAROA TĀMAKI MAKAURAU ROHE
CIV-2021-404-1178
[2023] NZHC 852
IN THE MATTER of an application under the Judicial Review Procedure Act 2016 BETWEEN
DALJIT SINGH NAGRA AND GURNEK SINGH NIJJAR
Plaintiffs
AND
SRI GURU SINGH SABHA AUCKLAND INCORPORATED (1229571)
Defendant
Hearing: On the papers Appearances:
P Amaranathan for Applicant/Defendant M S Khan for Respondents/Plaintiffs
Judgment:
20 April 2023
JUDGMENT OF PAUL DAVISON J
[Re: Costs]
This judgment was delivered by me on 20 April 2023 at 4:30pm pursuant to r 11.5 of the High Court Rules.
Registrar/Deputy Registrar
Solicitors:
Rice Craig, Auckland
Fortune Manning, Auckland
NAGRA v SABHA AUCKLAND INCORPORATED (1229571) [2023] NZHC 852 [20 April 2023]
Introduction
[1] Daljit Singh Nagra (Daljit) and Gurnek Singh Nijjar (Gurnek), the plaintiffs, were formerly members of Sri Guru Sabha Auckland Inc, the defendant.
[2] The plaintiffs claim that the defendant has acted in breach of its own rules, and in breach of natural justice in carrying out the actions by which Daljit has been excluded from membership and both plaintiffs have been issued with trespass notices. The plaintiffs apply for judicial review seeking relief by way of declarations that: the defendant has acted unlawfully by purporting to remove members of the defendant; any person whose membership of the defendant has been terminated for non-payment of subscriptions remains members of the defendant; and the decision to issue the plaintiffs with trespass notices was unlawful.
[3] By judgment dated 27 January 2023 I determined an interlocutory application by the defendant seeking pre-trial orders that a large number of statements made by the plaintiffs in their affidavits and in the affidavit of another plaintiff witness are inadmissible as evidence in the proceeding.1 The defendant succeeded in a limited number of its 88 separate objections to the plaintiffs’ evidence.2 Taking into account the modest success of the defendant, and by comparison the substantial success of the plaintiffs in resisting the defendant’s objections, I considered the plaintiffs to be entitled to an award of costs.3 The parties were directed to file memoranda as to costs.4
Submissions
Plaintiffs’ submissions
[4] The plaintiffs seek 2B scale costs of $7,050.50 and disbursements of $115.22. The plaintiffs seek a 20 per cent uplift on the scale costs, amounting to $8,460.60.
[5] Mr Khan, counsel for the plaintiffs, submits that 61 of the defendant’s 88 evidential challenges failed and therefore the plaintiffs are clearly the successful party.
1 Nagra v Sri Guru Singh Sabha Auckland Inc (1229571) [2023] NZHC 34.
2 At [93]–[94].
3 At [96].
4 At [97].
He says a 20 per cent uplift is warranted due to the lack of merit in many of the challenges advanced by the defendant, which needlessly prolonged the determination of both this application and the substantive proceeding. Mr Khan says the plaintiffs were put to the cost of responding to the meritless challenges and the costs award should reflect this.
[6] Mr Khan submits the Court should increase costs because the defendant has contributed unnecessarily to the time and expense of the proceeding, or a step in it, by pursuing an unnecessary step or argument that lacks merit. He says the application has caused a delay of at least 18 months. This is because a two-day substantive hearing was set down for 13 June 2022. The defendant’s application regarding evidence admissibility was filed on 12 April 2022. A one-hour hearing was allocated for the application to be heard on 18 May 2022. However, counsel contracted Covid-19 a few days before the 18 May 2022 hearing which was then adjourned. The substantive hearing was no longer able to be accommodated before the 13 June 2022 date, which was therefore vacated. No new substantive hearing date has been allocated. Mr Khan says were it not for the defendant’s application or had the defendant adopted a more pragmatic approach the parties could have resolved the issues and not vacated the 13 June 2022 substantive hearing.
Defendant’s submissions
[7]The defendant says costs should lie where they fall.
[8] Ms Amaranathan, counsel for the defendant, submits that each party had mixed success and therefore there should be no award of costs. Ms Amaranathan says Daljit was the key plaintiff and a significant number of the objections to his evidence had merit. Further, she says Gurnek’s evidence contained admissibility issues that the defendant did not want left for the trial judge to determine.
[9] In response to the plaintiffs’ submission that the substantive hearing would have proceeded in June 2022 had the defendants taken a different approach, Ms Amaranathan says the substantive hearing was unlikely to proceed regardless of admissibility issues. Once the defendant received the plaintiffs’ briefs of evidence on 16 and 17 March 2022, it was apparent that if the Court was going to make factual
findings about all the matters raised in the briefs of evidence the substantive hearing would take more than two days. She says the defendant attempted to informally and promptly resolve the admissibility issues. On 23 March 2022 the defendant gave notice to the plaintiffs of the evidence challenges and followed up after that seeking to resolve the issues. The application objecting to evidence was required to be filed within 10 working days, so in the absence of a substantive response from the plaintiffs the defendant filed their application.
[10] Ms Amaranathan also submits that the real reason the substantive hearing was vacated was that both counsel contracted Covid-19 the week the admissibility hearing was to be heard. The admissibility hearing was adjourned by consent because Mr Khan was unable to instruct alternative counsel.
Discussion
[11] Costs on interlocutory applications are to be fixed when the application is determined and become payable when they are fixed.5 There being no special reasons to depart from this rule I shall determine costs in regard to the defendant’s pre-trial application.
Successful party
[12] A party who fails with respect to an interlocutory application should pay costs to the party who succeeds.6
[13] In my judgment I noted the plaintiffs had achieved substantial success in resisting the defendant’s objections, and also noted the defendant’s comparatively modest success in objecting to the plaintiffs’ evidence. The plaintiffs were put to the expense of defending the defendant’s application that involved 88 separate objections that in many instances I found to be meritless and repetitious.
[14] The Court of Appeal in Middeldorp v Avondale Jockey Club Inc upheld a costs award against the plaintiff in judicial review proceedings who succeeded on one of
5 High Court Rules 2016, r 14.8.
6 Rule 14.2(1)(a).
three challenges made and failed on the other two.7 The Court found that on a realistic appraisal, the respondent had greater success because it had successfully resisted relief in relation to two of the challenged matters, and the plaintiff had only succeeded in obtaining relief on one challenge.8
[15] Adopting a realistic appraisal of the current case, in which the plaintiffs successfully defended a much greater proportion of the defendant’s challenges and achieved substantive success viewing the application as a whole, the plaintiffs are clearly the successful party.
[16] I therefore reject the defendant’s submission that because of its partial success costs should lie where they fall. As the successful party, the plaintiffs are entitled to an award of costs.
Scale costs
[17] The plaintiffs have correctly determined the appropriate costs category for this application. This application falls within category 2 as it is of average complexity.9 The reasonable time for the steps taken by the plaintiffs fall within band B.10
[18] In the costs memorandum for the plaintiffs, Mr Khan has set out the steps taken and the disbursements claimed, attached to this judgment as “Table A”. I consider the steps taken and disbursements claimed of the court filing fee for the plaintiff’s notice of opposition and parking to be reasonable.
Should scale costs be increased?
[19] Pursuant to r 14.6(3) of the High Court Rules 2016, the Court has the power to make an order for increased costs. The Court may order a party to pay increased costs if the party opposing costs has contributed unnecessarily to the time or expense of the proceeding, or a step in the proceeding, by pursuing an unnecessary step or an
7 Middeldorp v Avondale Jockey Club Inc [2021] NZCA 238.
8 At [26].
9 High Court Rules, r 14.3(1).
10 Rule 14.5(2)(b).
argument that lacks merit.11 As the party claiming increased costs, the plaintiffs carry the onus of persuading the Court that an award of increased costs is justified.12
[20] The Court of Appeal commented on the distinction between the three broad options for costs:13
(a)standard scale applies by default where cause is not shown to depart from it;
(b)increased costs may be ordered where there is a failure by the paying party to act reasonably; and
(c)indemnity costs may be ordered where that party has behaved either badly or very unreasonably.
[21]At the conclusion of my judgment delivered on 27 January 2023, I said:14
[93] The defendant’s numerous and detailed challenges to the plaintiffs’ evidence demonstrate the nature of the dispute between the parties which is characterised by dogged opposition, and in many instances meritless challenges to the admission of evidence on the part of the defendant. As a result the Court has had to consider and determine in the order of 88 separate objections to the plaintiffs’ evidence.
[94] The defendant has nevertheless succeeded in a limited number of its objections. …
[22] I agree with the plaintiffs’ submission that the defendant raised numerous meritless challenges to the admission of evidence that contributed unnecessarily to the determination of the present application. The plaintiffs were put to the expense of defending the defendant’s 88 separate objections, of which a limited number were successful.
[23] However, I cannot accept, as the plaintiffs have submitted, that the delay caused by the vacation of the June 2022 substantive hearing date was due to the defendant’s conduct regarding this application. The defendant was entitled to challenge evidence before the substantive hearing. While a more pragmatic approach
11 Rule 14.6(3)(b)(ii).
12 Strachan v Denbigh Property Ltd HC Palmerston North CIV-2010-454-232, 3 June 2011 at [27], citing Radfords Ltd v Advertising Work New Zealand Ltd, HC Auckland CIV-2006-404-325, 26 April 2006.
13 Bradbury v Westpac Banking Corporation [2009] NZCA 234, [2009] 3 NZLR 400 at [27].
14 Nagra v Sri Guru Singh Sabha Auckland Inc, above n 1.
to its evidential challenges would have aided in determining this application more expeditiously, the substantive proceeding could not go ahead in June 2022 due to the fact that counsel contracted Covid-19 before the admissibility hearing. This is an unfortunate reality that impacted the timeline of this proceeding and that was not at the fault of the defendant.
[24] The determination of costs, so far as possible, should be both predictable and expeditious.15 As MacKenzie J stated:16
[24] The ordinary consequence of advancing an unsuccessful claim or defence is an adverse award of scale costs. An important principle, expressed in r 14.6(3)(d), is that the determination of costs should be predictable and expeditious. That principle would not be promoted if it was routinely necessary to embark on a further analysis of the overall position taken by the unsuccessful party, to decide whether that position was unmeritorious. An award above scale because of an overall lack of merit is, in general terms, justified only in an obvious case, which falls to be considered under r 14.6(4)(a) for indemnity costs
[25] It was not unreasonable for the defendant to bring the application in itself, which was not the cause of the delay to the substantive hearing but rather due to circumstances beyond the parties’ control.
[26] Nevertheless, in my view a significant number and proportion of the objections taken by the defendant were obviously unmeritorious such that a moderate award of increased costs is warranted. I find the defendant’s unmeritorious arguments did contribute unnecessarily to the time or expense of a step in the proceeding and justify a 20 per cent uplift from scale costs.
[27] Accordingly, I shall make an order for 2B scale costs in favour of the plaintiffs of $8,460.60 which includes the 20 per cent uplift, together with $115.22 in disbursements.
15 High Court Rules, r 14.2(1)(g).
16 Gough v Strahl [2014] NZHC 1038 at [23].
Result
[28] For the reasons set out above I make an order that the defendant Sri Guru Singh Sabha Auckland Inc (1229571) pay costs (including disbursements) to Daljit Singh Nagra and Gurnek Singh Nijjar (jointly) of $8,575.82.
Paul Davison J
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