Public Trust v Ottow HC Auckland CIV 2009-404-3825

[2010] NZHC 1114

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

CIV-2009-404-3825

BETWEEN  PUBLIC TRUST Plaintiff

ANDHANS PETER OTTOW First Defendant

ANDANNA-MARIA OTTOW Second Defendant

Hearing:         Determined on the papers

Appearances: D Keen for Plaintiff

P McPherson for First Defendant

Judgment:      11 June 2010 at 11:30 am

JUDGMENT OF ASHER J [COSTS]

This judgment was delivered by me on 11 June 2010 at 11:30 am pursuant to Rule 11.5 of the High Court Rules

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Registrar/Deputy Registrar

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Date

Solicitors:

D Keen, Simpson Grierson, PO Box 2402, Wellington

P McPherson, Hesketh Henry, Private Bag 92093, Auckland Mail Centre, Auckland
M Vallant, Vallant Hooker & Partners, PO Box 47088, Ponsonby, Auckland 1011

Copy:

M Lenihan, Barrister, PO Box 1294, Shortland Street, Auckland 1140

F Joychild, PO Box 1294, Shortland Street, Auckland 1140

PUBLIC TRUST V OTTOW AND ANOR HC AK CIV-2009-404-3825  11 June 2010

[1]      In a decision of 4 November 2009, I entered judgment for the Public Trust against the first and second defendants in the sum of $323,678.62, together with interest  at  13.55 per cent.    The  defendants’  liability  stemmed  from  a  deed  of guarantee, executed by them.

[2]      The plaintiffs now seek indemnity costs on the basis that such costs are their contractual entitlement under the guarantee.  $54,885.50 is sought against the first defendant, together with disbursements of $1,641.63.  Costs are sought against the first defendant only, as the second defendant was on legal aid.

[3]      Indemnity costs are allowed under r 14.6 of the High Court Rules.  This rule provides at 14.6(1)(b) and (4)(e):

14.6     Increased costs and indemnity costs

(1)       Despite rules 14.2 to 14.5, the court may make an order—

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(b)that the costs payable are the actual costs, disbursements, and witness expenses reasonably incurred by a party (indemnity costs).

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

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(e)the party claiming costs is entitled to indemnity costs under a contract or deed; or

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[4]      The plaintiff relies on clause 6.1 of the guarantee, which provided:

You must pay us on demand all the costs, expenses and liabilities we incur in connection with, or in the actual or attempted exercise or enforcement by us of a power or a remedy under, this guarantee or any other security or document given to us by you, the borrower or any other guarantor.  These include administration costs and our legal fees and expenses on a solicitor and client basis.

[5]      I am satisfied that under this clause the plaintiff is entitled to costs not only in respect of costs relating to the first defendant, but also in respect of costs relating to the second defendant.  That is because under clause 6.1, the defendants are liable to

pay all costs incurred in connection with the enforcement of the guarantee, including “any other guarantor”.   The costs of proceeding against the second defendant are such costs.

[6]      I have read the affidavit sworn by Katherine Belton, which sets out copies of the relevant invoices.   I am satisfied that the fee of $54,885.50 was reasonably incurred, and related to attendances relevant to this proceeding.  The charge out rates appear to be reasonable.

Summary

[7]      Thus, I award costs in favour of the plaintiff to be paid by the first defendant in the sum of $54,885.50, together with disbursements of $1,641.63.

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Asher J