Rural Fuel Limited v Tahau

[2012] NZHC 1111

IN THE HIGH COURT OF NEW ZEALAND NAPIER REGISTRY

CIV-2012-441-63 [2012] NZHC 1111

IN THE MATTER OF     the Insolvency Act 2006

AND IN THE MATTER OF the bankruptcy of HENRY TAHAU also known as HENRY TE HOEROA TAHAU trading as TAWA SUMMIT FARM

BETWEEN  RURAL FUEL LIMITED Judgment Creditor

Judgment:      23 May 2012

JUDGMENT AS TO COSTS

OF ASSOCIATE JUDGE D.I. GENDALL

This judgment of Associate Judge Gendall was delivered on 23 May 2012 at 3.30 pm under r 11.5 of the High Court Rules.

Solicitors:           Maude & Miller, Solicitors, PO Box 213, Wellington

RURAL FUEL LIMITED v H TAHAU HC NAP CIV-2012-441-63 [23 May 2012]

[1]      The creditor’s application in this proceeding seeking an order to adjudicate the judgment debtor Henry Tahau bankrupt came before this Court on 3 May 2012.

[2]      At  that  point  counsel  for  the  judgment  creditor  confirmed  that  the  final payment  of  the  basic  debt  had  just  been  made  and  leave  to  discontinue  the proceeding was sought and granted.

[3]      Costs, however, were sought by the judgment creditor.   These costs were sought on a 2B basis together with usual disbursements.

[4]      The judgment debtor appeared in person before me on 3 May 2012 and wished to have an opportunity to make submissions to this Court on the issue of costs. Accordingly, on 3 May 2012 I made directions allowing the judgment creditor and the judgment debtor time to file and serve memoranda on costs.

[5]      A memorandum on costs was then filed on 7 May 2012 by counsel for the judgment creditor.  A memorandum on costs in reply was served by the judgment debtor on 16 May 2012.

[6]      I have now had an opportunity to consider those memoranda and now give my decision on the question of costs.

[7]      At the outset it is clear to me that the judgment creditor is entitled to an award of costs here against the judgment debtor.   Judgment was obtained by the judgment creditor in the District Court at Napier on 22 June 2011 for the original sum of $43,017.53 plus costs and disbursements.

[8]      Subsequently, payments were made in reduction of this judgment debt by the judgment debtor.

[9]      A Bankruptcy Notice was then issued against the judgment debtor for the reduced sum of $30,989.82 to take into account part repayments of the debt which

had been made by the debtor.  This Bankruptcy Notice was served on the debtor on

14 February 2012.

[10]     No steps were taken by the debtor of any kind.

[11]     Then, on 20 March 2012 the judgment creditor filed an application for an adjudication order against the judgment debtor.  This application and the supporting material were served on the judgment debtor on 28 March 2012.

[12]     No opposition to the application was filed by the judgment debtor.  Instead, when the matter was called on 3 May 2012 the judgment debtor appeared in person and as I have noted above it was confirmed that the basic debt by that time had been paid.   Clearly payment of the debt was in response to the proceedings which had been issued.   Accordingly, although the proceeding was discontinued then, it was simply as a result of the core debt being paid.  Under these circumstances there is no question  that  the judgment  creditor is  entitled to an  award of costs  against  the judgment debtor with respect to this matter.   The judgment debtor does not really suggest otherwise here.

[13]     I am satisfied too that a usual costs award on a category 2B basis together with disbursements as fixed by the Registrar should be made here.

[14]     As to this quantum issue, the judgment debtor’s complaint appears to be that costs were described at para [5] of the standard form Summons to Debtor document served upon him by the judgment creditor in support of the liquidation application and specified at a figure of $1,385.40 “which includes a fee for filing this summons of $483.40 and a fee of $150.00 for serving this summons”.  Why he says should costs now exceed that figure?

[15]     That provision however is not the end of the matter.  Clearly the judgment creditor is entitled in this case to an award of reasonable costs and disbursements in bringing this application which effectively was necessary and has been successful as the core debt in question has been paid.

[16]     On the question of quantum, counsel for the judgment creditor has provided a schedule calculating category 2B costs on this matter at a figure of $1,880.00.  I am satisfied that this is an appropriate amount for costs here together with (if the order in this case is sealed) a further 0.2 day cost amounting to $376.00.

[17]     Disbursements are noted also in this Schedule at $1,267.33 and under the circumstances they are appropriate.   In addition, however, a sealing fee of $48.30 will be required when the order is sealed.

[18]     That said, I now award costs on this matter to the judgment creditor against the judgment debtor on a 2B basis totalling $2,256.00 together with disbursements totalling $1,315.63.

‘Associate Judge D.I. Gendall’