Openyd Limited v Lawrence - [2019] NZHC 583

IN THE HIGH COURT OF NEW ZEALAND WELLINGTON REGISTRY

I TE KŌTI MATUA O AOTEAROA TE WHANGANUI-A-TARA ROHE

CIV-2018-485-446

[2019] NZHC 583

UNDER section 261 of the Property Law Act 2007, Part 19 of the High Court Rules 2016

IN THE MATTER OF

an application for an order that the lessors renew the lease granted by Deed made on 5 April 2011

BETWEEN

OPENYD LIMITED

Applicant

AND

GARY JOHN LAWRENCE, AND JASON PETER SILK AS TRUSTEES OF THE G J LAWRENCE FAMILY TRUST, AND DIANE SHERYL LAWRENCE AND JASON PETER SILK, AS TRUSTEES OF THE D S LAWRENCE FAMILY TRUST, TOGETHER TRADING AS THE

LAWRENCE FAMILY TRUSTS

Respondents

Hearing: On the papers

Counsel:

C J Griggs for Applicant

A C Skelton for Respondents

Judgment:

26 March 2019

JUDGMENT OF CLARK J (COSTS)

Background

[1] In my judgment delivered 31 January 2019 I granted the respondents’ interlocutory application for an order dismissing the underlying proceeding for want

OPENYD LIMITED v LAWRENCE & ORS [2019] NZHC 583 [26 March 2019]

of jurisdiction.1 The underlying proceeding was brought by the applicant and sought an order requiring the respondents to renew a lease. The respondents succeeded and I confirmed costs followed the event.2

[2] The applicant, Openyd, applies to vary the costs order pursuant to r 14.8(2) of the High Court Rules 2016. Openyd proposes that the respondents, (who I refer to as the Lawrence Trusts, or Trusts) are awarded the cost of filing the interlocutory application,3 but that Openyd is awarded the costs of preparation of submissions, the bundle for the hearing and the appearance at the hearing.4 Openyd submits an award of reduced costs under r 14.7(f)(v) of the High Court Rules is justified because the Trusts failed, without reasonable justification, to accept Openyd’s offers to settle or dispose of the proceeding.

[3] The Lawrence Trusts oppose any variation of the order and seek a further order that particular costs, calculated on a 2B basis, are awarded.

Applicable principles

[4] Although r 14.1 provides that all matters relating to costs are at the discretion of the court, “it would almost invariably be wrong” to depart from the general principle that the party who fails with respect to a proceeding should pay costs to the party who succeeds.5 The longstanding principle that the losing party should pay the winning party’s costs is reflected in r 14.2(1) which provides:

The following general principles apply to the determination of costs:

(a)the party who fails with respect to a proceeding or an interlocutory application should pay costs to the party who succeeds:

As the Supreme Court said of the former r 47(a), the predecessor to r.14.2—6

… reflects the longstanding principle that, unless there are exceptional reasons, costs should follow the result. That is, the loser, and only the loser pays.

1      Openyd Ltd v Lawrence [2019] NZHC 46 [the interlocutory judgment].
2 At [58].
3      Item 2 of sch 3 to the High Court Rules 2016.
4      Items 24, 25 and 26 of…

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.

Continue reading Openyd Limited v Lawrence

Details

AGLC: Openyd Limited v Lawrence [2019] NZHC 583
Case: [2019] NZHC 583
Decision Date: 26 March 2019

CaseChat Overview and Summary

In the High Court of New Zealand, Openyd Limited sought an order for the respondents to renew a lease under the Property Law Act 2007. The respondents, Gary John Lawrence and others, opposed the application and successfully sought dismissal of the proceeding for want of jurisdiction. Openyd then applied to vary the costs order, arguing that the respondents should be awarded the cost of filing the interlocutory application, but that Openyd should be awarded the costs of preparation of submissions, the bundle for the hearing, and the appearance at the hearing. Openyd submitted that the award of reduced costs was justified because the respondents failed, without reasonable justification, to accept Openyd’s offers to settle or dispose of the proceeding.

The court assessed the reasonableness of the rejection of a settlement offer at the time the offer was made, without the benefit of hindsight. The court found that the respondents did not unreasonably reject the settlement offer as the rejection did not contribute unnecessarily to the time and expense of the proceeding. The court concluded that the rejection was reasonable as the respondents had a major issue with the order of arbitration proceedings and wanted to resolve fundamental underlying issues ahead of the "downstream disputes" regarding the lease. Therefore, Openyd’s application to vary the costs order was dismissed, and the respondents were awarded costs, calculated on a 2B basis, in respect of the steps taken in the proceeding.

The final orders were that Openyd’s application to vary the costs order was dismissed and the respondents were entitled to costs, calculated on a 2B basis, in respect of the following steps: notice of appearance with protest to jurisdiction, filing an interlocutory application, preparation of written submissions, preparation by applicant of bundle for hearing, appearance at hearing of defended application for sole or principal counsel, and sealing order or judgment.

Orders