Purdie v Truckell
[2018] NZHC 149
•15 February 2018
IN THE HIGH COURT OF NEW ZEALAND CHRISTCHURCH REGISTRY
I TE KŌTI MATUA O AOTEAROA ŌTAUTAHI ROHE
CIV-2014-409-000802 [2018] NZHC 149
BETWEEN JUSTIN EUAN PURDIE and TRACEY
ANNE PURDIE Applicants
AND
NEIL ADRIAN TRUCKELL First Respondent
AND
SUSAN LUCY NIKOLAOU Second Respondent
AND
KAREN MAREE POWERS Third Respondent
AND
TERRANCE JOHN POWERS Fourth Respondent
AND
CHRISTCHURCH CITY COUNCIL Fifth Respondent
Hearing: On the papers Counsel:
H C Matthews for the Applicants
D M Lester for the First, Second, Third & Fourth RespondentsJudgment:
15 February 2018
JUDGMENT OF NATION J AS TO COSTS
[1] With a judgment of 9 June 2016, the applicants were successful in proceedings seeking cancellation of a covenant over their land, although that success was through the Court accepting there should be a modification to that covenant. There had to be
a further hearing over the precise terms of that modification. At one time, it seemed
PURDIE v TRUCKELL [2018] NZHC 149 [15 February 2018]
agreement would be reached over those terms. Ultimately, a further hearing was required to deal with outstanding issues. The remaining issues were resolved with my judgment of 4 August 2017.
[2] After that, the Court was involved in further communications with counsel over the precise form of the orders giving effect to the judgments.
[3] In my judgment of 4 August 2017, I expressed the tentative view that, although the applicants were successful with their application on terms, in their proceedings they had sought to interfere with the respondents’ property rights as provided for in the covenant over the applicants’ land. I expressed the tentative view that costs should lie where they fell but reserved leave to the parties to file memoranda as to costs if they wished to pursue that issue further.
[4] Counsel for the applicants subsequently filed a memorandum seeking costs on a 2B basis.
[5] Mr Matthews acknowledged that previous authorities had suggested that costs would not be granted to a successful applicant wherein the proceedings they were seeking some indulgence against established property rights.1 He also referred to recent Court of Appeal authority, recognising that this approach has not been invariably taken since the new costs regime came into force on 2 January 2000. The award of costs remains discretionary.2
[6] The applicants seek costs on the basis they had been successful in the proceedings. They submitted the terms on which they succeeded were ultimately broadly consistent with a proposal they had made before filing the proceedings to resolve issues which had then arisen between the applicants and the second respondent, Ms Nikolaou. The issue then raised by Ms Nickolaou was that the applicants were allowing trees on their property to exceed the height of five metres, in breach of the 2005 covenant. The issue for the applicants was that they wanted to
build on their property in accordance with the 2010 covenant and a decision of the
1 Holdgate v Holdgate HC Auckland CP303/96, 24 September 1996.
2 Cunningham v Butterfield & Ors [2014] NZCA 213 at [56]-[57] and [70].
Environment Court which required then to have trees on the property in excess of five metres.
[7] In response, counsel for the respondents filed a memorandum seeking costs on a 2B basis in their favour. The respondents submit:
(a) as the case developed, the relief the applicants sought moved away from what was sought in their original application;
(b)the final orders included voluntary concessions made by the respondents in an attempt to settle all outstanding matters in light of the first substantive judgment;
(c) these proceedings were necessary because of the difficulties the applicants faced for which they or their solicitors were responsible;
(d)the applicants had not joined Mr Dorrance as a party to the proceedings in circumstances where they should have done so;
(e) the respondents have lost property rights for which the Court has decided there should be no compensation. In these circumstances, it would be unjust for them to have to meet their own costs or implicitly have to contribute to the applicants’ costs;
(f) it is likely the applicants will be able to recover costs from other parties given the way it might be claimed these proceedings were necessary to deal with difficulties that they faced because of their solicitor’s negligence.
Discussion
[8] I do not consider this was a situation where it can be said the respondents were responsible for the applicants having to issue these proceedings or that, with the offer originally made by the applicants, the need for these proceedings could have been avoided.
[9] The respondents had the benefit of the 2005 covenant over Lot 2. It was through no fault of the respondents that the 2010 covenant over Lot 2 conflicted with the terms of the 2005 covenant and that this meant the applicants had purchased their property when to be able to build a home as they hoped to would put them in breach of the 2010 covenant. As parties with the benefit of the 2005 covenant, the respondents were entitled to require the applicants to satisfy the Court that they were entitled to the relief they were seeking.
[10] Although the proposal, which was made for resolution of issues on behalf of the applicants before proceedings commenced, was in some respects consistent with the variations that were ultimately made, the detail of what was put in place, reflecting both the judgments of the Court and other agreements reached between the parties, was significantly more detailed than the applicants had initially proposed. With it, there was some particular protection for the respondents consistent with what they had been entitled to in terms of the 2005 covenant. That detail was achieved through matters being resolved through Court proceedings.
[11] As matters have transpired, and given the costs and stress that all parties must have had to bear through these proceedings, it would have been better for all concerned if there had been constructive dialogue between all parties to try and achieve what has been the ultimate outcome without the need for Court proceedings. Nevertheless, the proceedings were necessary because of legal difficulties which the applicants faced for which the respondents were not responsible.
[12] I also consider it is overly simplistic to say that the respondents consistently through the proceedings opposed the application. Their objection was primarily to the variation that was required with regard to the height of trees on Lot 2. They were accepting of the proposed site for the applicants’ home and also to the height of that building.
[13] I note also that the first and third respondents only became involved with these issues after the proceedings commenced. The initial proposals made by the applicants for settlement were made to the second respondent. It was her response, through her solicitors, that made the commencement of proceedings inevitable.
[14] In obtaining the initial judgment, the applicants were successful with their application but, given the matters I have just mentioned and the fact they were seeking relief from the Court in a way that interfered with the respondents’ property rights, I would have declined to make an order for costs in the applicants’ favour with regard to the proceedings up to that point. Because the applicants were largely successful and because of the initial attempts which were made on their behalf to at least begin discussions over a potential basis for settling all issues, there would not have been any order for costs in favour of the respondents.
[15] After that, there was a considerable delay in finalising the orders which had to be made and, in the end, the further hearing was necessary. During that time, the parties did take a more constructive approach towards settlement. The respondents did agree to certain variations to the 2005 covenant which went beyond what the applicants had original sought. However, the further hearing was necessary primarily because the respondents would not agree to a variation of the 2005 covenant in a way that would allow trees over 10 metres to be on Lot 2. In adopting that position, they were effectively seeking to modify an essential aspect of the initial judgment in which I had held the 2005 covenant had to be modified so as to be consistent with the terms of the 2010 covenant.
[16] The respondents also sought to reserve the right to seek compensation in return for any variation of the 2005 covenant. That had not been their position when the full dispute was before the Court.
[17] In arguing there should be a limit of two additional sheds on Lot 2, they also withdrew from the position they said they would accept in the further discussions which had taken place before the second hearing.
[18] For those reasons, the respondents must bear a significant measure of responsibility for the fact the further hearing was necessary.
[19] The hearing was however necessary to enable the Court to detail the precise way in which the 2005 covenant should be modified to allow the respondents to retain the protection afforded by the 2005 covenant, to an extent possible, and consistent
with the terms of the 2010 covenant. Through that hearing, and because of concessions made by the respondents, the applicants also obtained the benefit of a modification as to the number of sheds that might be built on the property in a way that was in excess of what had been allowed for with the first judgment. Ultimately, the second hearing was necessary because of the way the modification to the 2005 covenant interfered with the respondents’ property rights provided for with the 2005 covenant.
[20] In all these circumstances, and in the exercise of my discretion, I have decided that costs should lie where they fall. Neither the applicants nor the respondents are entitled to costs against the other party.
Solicitors:
White Fox & Jones, Christchurch
GCA Lawyers, Christchurch.
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