Norrie v Crown Range Holdings Ltd - [2022] NZHC 898

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

I TE KŌTI MATUA O AOTEAROA TĀMAKI MAKAURAU ROHE

CIV-2021-404-1785

[2022] NZHC 898

IN THE MATTER of the Companies Act 1993

BETWEEN

KATIE NORRIE

Applicant

AND

CROWN RANGE HOLDINGS LIMITED

First Respondent

BASSETT RD HOLDINGS LIMITED

Second Respondent

Hearing: On the papers

Counsel:

J Nolen and K Puddle for the Applicant

A H Waalkens QC and S A Beattie for the Respondents

Judgment:

3 May 2022

JUDGMENT OF GAULT J

(Costs)

This judgment was delivered by me on 3 May 2022 at 10:30 am pursuant to r 11.5 of the High Court Rules 2016.
Registrar/Deputy Registrar

……………………………………

Solicitors / Counsel:
Mr J Nolen and Mr K Puddle, K3 Legal, Auckland
Mr A H Waalkens QC and Ms S A Beattie, Barristers, Auckland
Mr L Lamberg (respondents’ instructing solicitor), Lamberg & Co., Auckland

NORRIE v CROWN RANGE HOLDINGS LTD [2022] NZHC 898 [3 May 2022]

[1] Ms Norrie seeks costs following resolution of her originating application seeking orders for disclosure of information from the respondents pursuant to s 178 of the Companies Act 1993 (the Act).

[2] The respondents say that costs should lie where they fall. The costs issue is to be determined on the papers.1 Memoranda and affidavits have been filed.2

Background

[3] Ms Norrie is the Court appointed administrator of the insolvent estate of her father, who died on 4 August 2019.

[4]The estate is the owner of 7.5 per cent of the shares in each of the respondents.

[5] On 16 July 2021, Ms Norrie requested disclosure of information from the respondents. The respondents did not provide the information or their reasons for not doing so within the statutory timeframe in s 178 of 10 working days.

[6] The originating application was filed on 15 September 2021. Following service on 27 September 2021, a joint memorandum dated 30 September 2021 recorded that counsel for the respondents had only recently been instructed, and that the respondents acknowledged that the information needed to be provided but sought further time. The first call of the application was adjourned on the papers on 1 October 2021.

[7] Subsequent memoranda were filed for the adjourned call on 18 October 2021. Gordon J directed the respondents to serve the requested information by 2 November 2021, with the matter to be called again on 4 November 2021, and reserved costs.

[8] A joint memorandum of counsel dated 3 November 2021 updated the Court on progress with service of the requested information and proposed timetable directions for submissions and affidavit evidence on costs. Consent orders were made in terms of the joint memorandum.

1 The matter was referred to me as Duty Judge: minute dated 15 March 2022.
2 Sworn versions of the applicant’s affidavits were filed on 17 February 2022.

Submissions

[9] Ms Norrie submits that costs should follow the event. Section 178(9) of the Act provides that on an application for an order under that section the Court may make such order for the…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

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Details

Case: [2022] NZHC 898
Decision Date: 3 May 2022

CaseChat Overview and Summary

In this case, Katie Norrie, as the court-appointed administrator of her deceased father's insolvent estate, sought costs from Crown Range Holdings Ltd and Bassett RD Holdings Ltd following a request for information under the Companies Act 1993. The respondents did not provide the requested information within the statutory timeframe, leading to Norrie's originating application for disclosure. The court was required to determine the appropriate costs for Norrie, who sought indemnity costs and an uplift on scale costs.

The court considered whether the respondents' conduct justified an award of indemnity costs, which would require flagrant misconduct. Although the respondents were remiss in their initial response, their behaviour did not reach the level of flagrant misconduct needed for such an award. The court also considered whether increased costs were warranted under the specific circumstances outlined in the High Court Rules. It found that while the respondents' conduct warranted some increased costs, a 50 per cent uplift on scale costs was not justified. Instead, a 25 per cent uplift was deemed appropriate for the initial steps of the proceeding.

The court concluded that Norrie was entitled to costs on a 2B basis, including an uplift for the initial steps, and additional 2B costs for further attendances. The respondents were ordered to pay Norrie's costs and disbursements totaling $12,818.25. The court declined to award costs on costs, finding that both parties shared responsibility for the protracted discussion of the costs issue.

Orders