Peebles v Attorney-General - [2014] NZHC 3040

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

CIV-2014-404-1196 [2014] NZHC 3040

IN THE MATTER of the Judicature Amendment Act 1972

BETWEEN

GREGORY ALAN PEEBLES and CLIVE RICHARD BRADBURY

First Plaintiffs

BEN NEVIS FORESTRY VENTURES LIMITED (in liquidation) and BRISTOL FORESTRY VENTURE LIMITED (in liquidation)

Second Plaintiffs

AND

ATTORNEY-GENERAL First Defendant

COMMISSIONER OF INLAND REVENUE

Second Defendant

Hearing: On the papers

Counsel:

G J Judd QC for Plaintiffs
R L Roff and S J Leslie for Second Defendant

Judgment:

02 December 2014

COSTS JUDGMENT OF PETERS J

This judgment was delivered by Justice Peters on 2 December 2014 at 10 am pursuant to r 11.5 of the High Court Rules

Registrar/Deputy Registrar
Date: ...................................

Solicitors: Wynyard Wood, Auckland
Crown Law, Wellington

Counsel: G J Judd QC, Auckland

Copy for: Anderson Creagh Lai Ltd, Auckland
R A Edwards, Auckland

PEEBLES v ATTORNEY-GENERAL [2014] NZHC 3040 [2 December 2014]

[1] In October 2014 I dismissed the Plaintiffs’ application for review of a decision by the Defendant Commissioner (“October judgment”).1 I said that my decision as to costs would follow, as it now does.

[2] As the successful party, the Commissioner is entitled to an award of costs against the Plaintiffs.2 The Commissioner, however, seeks an award of indemnity costs, relying on High Court Rules, r 14.6(4)(a):

...

(4) The court may order a party to pay indemnity costs if—

(a) the party has acted vexatiously, frivolously, improperly, or unnecessarily in commencing, continuing, or defending a proceeding or a step in a proceeding; or

...

[3] The Commissioner submits that the Plaintiffs’ conduct is within r 14.6(4)(a) because they commenced this proceeding for an ulterior motive, misconducted themselves and their case was hopeless from inception.3 The Plaintiffs oppose an award of indemnity costs and contend that their conduct does not fall within r 14.6(4)(a).

[4] After the hearing before me the Court of Appeal issued several judgments in other litigation between participants in the “Trinity scheme”, including the Plaintiffs, and the Commissioner.4 One of these, Ben Nevis Forestry Ventures Ltd v Commissioner of Inland Revenue [2014] NZCA 348, is of particular relevance because the Court discussed awards of indemnity costs. The parties filed written submissions regarding these judgments, which I have taken into account in this
decision.

1      Peebles v Attorney-General [2014] NZHC 2635, (2014) 26 NZTC 21-107.
2      High Court Rules, r 14.2(a).
3      Bradbury v Westpac Banking Corporation [2009] NZCA 234, [2009] 3 NZLR 400 at [29].
4      Ben Nevis Forestry Ventures Ltd v Commissioner of Inland Revenue [2014] NZCA 348, (2014)
26 NZTC 21-084; Redcliffe Forestry Venture Ltd v Commissioner of Inland Revenue [2014] NZCA 349, (2014) 26 NZTC 21-085; Ben Nevis Forestry Ventures Ltd v Commissioner of Inland Revenue [2014] NZCA 350, (2014) 26 NZTC 21-086; and Accent Management Ltd v Attorney- General [2014] NZCA 351, (2014) 26 NZTC 21-087.

Background

[5] The background to the proceeding is set out in my October judgment.5 What follows is sufficient to give 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.

Continue reading Peebles v Attorney-General

Details

AGLC: Peebles v Attorney-General [2014] NZHC 3040
Case: [2014] NZHC 3040
Decision Date: 02 December 2014

CaseChat Overview and Summary

In the High Court of New Zealand, Justice Peters was tasked with deciding on a costs application in the matter of Peebles v Attorney-General. The Plaintiffs, Peebles and Bradbury, sought a review of a decision by the Commissioner of Inland Revenue. The Commissioner sought indemnity costs under High Court Rules, r 14.6(4)(a), arguing that the Plaintiffs' proceeding was vexatious, frivolous, or improperly brought. The Plaintiffs opposed this claim, asserting that their conduct did not meet the criteria for such an award. The Court considered recent Court of Appeal judgments in other related litigation, particularly Ben Nevis Forestry Ventures Ltd v Commissioner of Inland Revenue, which discussed indemnity costs.

Justice Peters found that the Plaintiffs' case was hopeless from the outset and was brought with an ulterior motive to delay the Commissioner. The Plaintiffs were aware of the 2008 Supreme Court judgment, which confirmed the tax liabilities in question, and the provisions of the Tax Administration Act 1994. The Court concluded that it was hopeless for the Plaintiffs to argue that the Commissioner had a duty to consider the assessed amount before commencing recovery proceedings, especially given the Plaintiffs' default in payment. As such, the Plaintiffs' proceeding was vexatious, frivolous, or improperly brought, warranting an award of indemnity costs against them.

Justice Peters awarded indemnity costs to the Commissioner, emphasizing that the Plaintiffs' litigation was brought with an ulterior motive and was without merit. The Second Plaintiffs, now in liquidation, were to be served with a copy of the judgment.

Orders