National Auto Wholesalers Ltd v Gordon Place Developments Ltd
[2013] NZHC 135
•30 January 2013
IN THE HIGH COURT OF NEW ZEALAND WELLINGTON REGISTRY
CIV 2012-485-2173 [2013] NZHC 135
BETWEEN NATIONAL AUTO WHOLESALERS LIMITED
Applicant
ANDGORDON PLACE DEVELOPMENTS LIMITED
First Respondent
ANDSPINNAKER INVESTMENTS LIMITED Second Respondent
Hearing: On Papers
Counsel: J Langford for Applicant
M G Locke for Respondents
Judgment: 30 January 2013
COSTS JUDGMENT OF RONALD YOUNG J
[1] The applicant has discontinued these proceedings being an application to sustain a caveat. The respondents seek costs. The applicant accepts they are entitled to costs but disputes the respondent’s claim for increased costs. 2B costs are
$10,945. Total costs actually incurred by the respondents are $21,867.57. [2] The respondents seek increased or indemnity costs because they say:
(a) the applicants breached the rules of Court and breached timetable orders;
(b) their application to sustain the caveat lacked merit;
(c) the proceedings were conducted for a collateral motive.
NATIONAL AUTO WHOLESALERS LIMITED V GORDON PLACE DEVELOPMENTS LIMITED HC WN CIV 2012-485-2173 [30 January 2013]
[3] The applicant opposes any increased costs but accepts it should have costs awarded against it on a 2B basis. It says the caveat was not without merit and that the affidavits filed on behalf of the applicant “demonstrated an arguable case that a contract had been formed between the parties”. It says there is no basis for increased costs.
Breach of Court orders
[4] I agree with the respondents that the applicant did both breach the Rules of Court and breached timetable orders. As to the Rules of Court they failed to file affidavits in support of the originating application to sustain a caveat at the time of instituting proceedings. That meant that the respondents had less time to understand and respond to the applicant’s case.
[5] The original timetabling orders were “unless” orders made for the urgent hearing on 11 December 2012. The applicant breached the orders, failing to file their affidavits in time. This meant the respondents incurred additional costs in seeking to invoke the “unless” orders. In the end affidavits were filed but late. There were other failures to adhere to time limits by the applicant. This would justify some increase in costs payable.
Merit
[6] It seems the applicant’s case for a caveat was based on a claim that an unsigned agreement for sale and purchase was enforceable. The applicant points out, however, that there appeared to be one fatal obstacle to such a claim. The basis of the agreement was that the second respondent agreed to sell the property to the applicant only if the applicant had confirmed finance by a particular date. No such confirmation was ever obtained.
[7] On that basis it seems difficult to understand how the applicant’s had a caveatable interest. I am conscious, of course, that I have not had (it is not possible at a costs stage) full argument as to why the applicant thought it had sufficient to seek a caveat.
[8] The fact that the proceedings were discontinued provides considerable support for the applicant’s position. There is also a justification, therefore, for increased costs, in my view, based on lack of merit.
Collateral motive
[9] The respondents have set out why they believe the proceedings may have been vexatiously brought or for a collateral motive. On the information they have provided it would not be possible to reach such a conclusion.
[10] In the circumstances, therefore, I am prepared to allow increased costs. The actual costs incurred, as I have noted, were over $21,000. I allow costs against the applicant in favour of the respondents in the sum of $16,000 plus disbursements as approved by the Registrar. One set of costs only will be payable. It will be for the
respondents to decide how those costs are divided between them.
Ronald Young J
Solicitors:
J Langford, Langford Law, Wellington, email: [email protected]
M G Locke, Barrister, Nelson, email: [email protected]
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