Rogers v Kennedy

[2020] NZHC 2317

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

I TE KŌTI MATUA O AOTEAROA TĀMAKI MAKAURAU ROHE

CIV-2019-404-000284

[2020] NZHC 2317

IN THE MATTER

of the estate of Thomas James Kennedy

BETWEEN

PETER IOANE ROGERS

Plaintiff

AND

ROSALIE ANNIE KENNEDY

First Defendant

AND

ELIZABETH MARGARET GRAHAM

Second Defendant

AND

MICHAEL JOHN KENNEDY

Third Defendant

AND

SUSAN SHARON ROGERS

Fourth Defendant

AND

JOHN KINGSLEY by his litigation guardian, Michelle Pearce

Fifth Defendant

Hearing:

(On the papers)

Counsel:

David Wilson and James Donovan for the Plaintiff Greg Stringer for the First Defendant

No appearances for the Second to Fifth Defendants

Judgment:

7 September 2020

[COSTS] JUDGMENT OF MOORE J

This judgment was delivered by me on 7 September 2020 at 4:00 pm pursuant to Rule 11.5 of the High Court Rules.

Registrar/ Deputy Registrar Date:

ROGERS v KENNEDY & ORS [2020] NZHC 2317 [7 September 2020]

Introduction

[1]    Following the death of Thomas Kennedy in 2018, the plaintiff commenced proceedings, maintaining that the deceased had made a valid will rather than dying intestate. The first defendant, Ms Rosalie Kennedy (the deceased’s mother), claimed that the document was forged.

[2]    The proceeding was set down for trial on 29 and 30 June 2020. On 19 June 2020, the plaintiff discontinued the proceeding. This judgment deals with costs owed to the first defendant.

Submissions

First defendant

[3]Mr Stringer, for the first defendant, seeks indemnity or increased costs of

$67,586.45, on the basis that the plaintiff should have known his claim had no prospect of success.1 The first defendant had evidence from Linda Morrell, a forensic document examiner, questioning the handwriting said to be the deceased’s in the purported will. A report from the expert was annexed to affidavits of the first defendant, and a second report from December 2018 was released to the plaintiff as discovery. Accordingly, Mr Stringer states that the plaintiff should not have continued the proceeding when he was aware of Ms Kennedy’s position and Linda Morell’s evidence. The weight of evidence leads to the inference that the plaintiff sought to make financial gain from improperly pursuing the proceedings.

[4]    Alternatively, the first defendant seeks 2B costs of $28,441, plus disbursements of $8,267 as follows:

Steps	Allocated days
2	Commencement of defence	2
20	Discovery	2.5
21	Inspection	1.5
13	Case management conference	0.3
3	Reply	0.8

1      See Bradbury v Westpac Banking Corporation [2009] NZCA 234, [2009] 3 NZLR 400; Cross v Queenstown Lakes District Council [2016] NZHC 2772 at [12].

Steps	Allocated days
11	Preparing memorandum	0.4
11	Preparing memorandum	0.4
33	Preparing briefs	2
33B	Preparing for trial	2
11.9
x daily recovery rate $2390 = $28,441 (total costs) + $8,267 disbursements ($110 filling fee + $8,157 Linda Morrell fee)

Plaintiff

[5]    Mr Wilson, for the plaintiff, submits that it would be inappropriate to impose indemnity or increased costs. The evidence of Linda Morrell was not decisive; the plaintiff had his own handwriting expert giving contrary evidence. The proceeding was promptly discontinued after two witnesses to the creation of the will were re- interviewed and their evidence was assessed as being unreliable. The claim was not unmeritorious and the plaintiff acted properly throughout.

[6]    Mr Wilson also submits that scale costs claimed are too high. Linda Morell’s evidence was the centre of the defence case and the plaintiff is asked to pay her fees as disbursements. Mr Wilson submits it is not necessary for the first defendant to also claim full costs for preparing briefs and preparation for trial as this would involve duplication of her evidence. Further, it is not necessary to claim four days for discovery and inspection, given both sides had few discovered documents. “Some general reduction” is sought.

Issues

Can the first defendant claim indemnity costs?

[7]    I may make an order for increased or indemnity costs pursuant to r 14.6 of the High Court Rules 2016, including if a party has contributed unnecessarily to the time or expense of the proceeding by “taking or pursuing an unnecessary step or an argument that lacks merit”,2 or otherwise has acted “vexatiously, frivolously, improperly, or unnecessarily in commencing, continuing, or defending a proceeding

2      High Court Rules 2016, r 14.6(3)(b)(ii).

or a step in a proceeding”.3 However, where a proceeding is not completed, increased or indemnity costs may only be awarded on the basis of lack of merit where the lack of merit is obvious. There must be there is no possibility the Court would have formed a different view with the benefit of all the evidence and closing submissions.4

[8]    There has been no judicial finding on the validity of the will, or that the document was a forgery. Without testing the two sets of evidence as to the validity of the will, I cannot say that the plaintiff’s case was so flawed from the outset. Such a task would involve ‘difficult and detailed speculation” and therefore has no place in a costs ruling.5 On that basis, there is no sound basis for increased or indemnity costs.

Can Linda Morrell’s fees be claimed as disbursements?

[9]    Expert witness’s fees and expenses are a disbursement but must be approved by the Court under r 14.12(2)(a)(i).6 Having viewed Linda Morell’s invoices, I have no trouble concluding that her costs were necessarily incurred and reasonable in amount, considering her evidence formed the backbone of the defence case.

Can the first defendant claim 2B costs for preparing briefs, preparation for trial, discovery and inspection?

[10]   After considering the submissions, I will not reduce the costs for certain steps. The costs rules in the High Court Rules are designed to be “self-calculating”,7 and under r 14.2, so far as possible, the determination of costs should be predictable and expeditious. The proceeding has been categorised as 2B; any claim for a departure from the prescribed steps must be compelling, especially where a proceeding concluded prematurely. I am not satisfied by the plaintiff’s general suggestions as to reduction - it is not enough to broadly claim that “neither party had very many discovered documents”. The time allocations claimed are reasonable.

3      Rule 14.6(4)(a).

4      N-Tech Ltd v Abooth Ltd [2012] NZHC 1167 at [108].

5 At [108].

6      See Auckland Waterfront Development Agency Ltd v Mobil Oil New Zealand Ltd [2015] NZHC 470 at [50].

7      McGechan on Procedure (online looseleaf ed, Brookers) at [HR14.2.01(6)].

Result

[11]   The plaintiff is to pay the first defendant costs of $28,441 and disbursements of $8,267.

Moore J

Solicitors:

Mr Wilson, Auckland Mr Donovan, Auckland Inder Lynch, Auckland