Rutherford v Lyons
[2016] NZHC 2804
•23 November 2016
IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY
CIV-2016-404-1259 [2016] NZHC 2804
BETWEEN VICTOR ERNEST RUTHERFORD
Appellant
AND
PETER JOHN LYONS & SUSAN MARIE LYONS
Respondents
Hearing: 7 September 2016 Appearances:
P J Dale for Appellant
K A Muir for RespondentsJudgment:
23 November 2016
JUDGMENT OF PAUL DAVISON J
This judgment was delivered by me on 23 November 2016 at 11 am pursuant to r 11.5 of the High Court Rules.
Registrar/Deputy Registrar
Solicitors:
Chambers Craig Jarvis, Auckland
Morgan Coakle, Auckland
Counsel:
P J Dale, Barrister, Auckland
RUTHERFORD v LYONS [2016] NZHC 2804 [23 November 2016]
[1] This is an appeal against a refusal to make an award of costs.
Background
[2] The appellant, Mr Rutherford, and the respondents, the Lyons, are neighbours. They disagree about the use of a shared driveway. In a 2012 decision, this Court ruled that the occupants of the property at which Mr Rutherford resides have no legal rights to park vehicles on the right-of-way as to do so would interfere substantially with the Lyons’ rights.1
[3] The parties seemingly avoided each other until about 3 January 2015, when, as Judge Harrison described:2
[12] Mr Rutherford was unloading groceries from his vehicle at the end of the right of way. Mrs Lyons wanted to drive her vehicle down the right of way but was impeded from doing so by Mr Rutherford’s vehicle. She was delayed by some minutes while Mr Rutherford removed the final articles from his vehicle so that he could drive it out of the right of way. Before he could do so Mr Lyons appeared at the scene and proceeded to take a photograph of Mr Rutherford. Matters then deteriorated into expletive-laden invective directed by Mr Rutherford to Mr and Mrs Lyons. In his affidavit of 27 May 2015 Mr Rutherford accepted some but not all of the statements Mr Lyons alleged he made. A great deal of time was spent in cross-examination on this issue, but it is impossible for me to determine precisely what was said. I am of the view, however, that the statements acknowledged by Mr Rutherford to have been made by him could prima facie amount to harassment.
[13] That same day Mr Rutherford obtained paint and spray painted the words “Parking for” on the wooden paling fence at the edge of the right of way.
[14] On Sunday 4 January Ms Torbai-Golsefidi returned to the right of way with two carloads of clothes and belongings which were intended for charity, but which first had to be unloaded. This prevented Mrs Lyons from accessing her house by her vehicle and she parked on the street. As she walked past Mr Rutherford with her shopping he said “Welcome to my world” which I understood to be a reference by him to the necessity for him to walk from his car to his house with
1 Lyons v Breslin [2012] NZHC 366. The defendant in that case was Mr Breslin, who is the owner of the property at which Mr Rutherford resides as a tenant. Mr Rutherford has an option to purchase the property. The right of way easement grants the right to “pass and repass, through over and along” the right of way. Priestley J found that Mr Breslin had no legal right to use the right of way to provide off street parking for himself or any occupants of Mr Breslin’s (Mr Rutherford’s) property.
2 Lyons v Rutherford [2015] NZDC 19877.
groceries or other items. This was observed by a neighbour, Mrs Frost, who offered the opinion that Mr Rutherford had obstructed the right of way to seek a confrontation with Mr and Mrs Lyons although I do not accept that to be so. Mrs Frost’s primary concern was to have Mr Rutherford remove the graffiti. She and other local residents requested him to do so. Initially he refused. He later agreed to remove it if Mrs Frost intended marketing her house for sale but said that he would put it back on when free to do so.
[15] On 30 January Mr Lyons waterblasted the graffiti off the fence but, on
3 February, Mr Rutherford spray-painted more graffiti on it including the words “loading zone”, “we know what we bought, you just need educating”, “gym”, and “Peter Plumley, Dr Zira”.
[16] It seems that, when Mr and Mrs Lyons’ house was demolished, most likely the contractors sealed off a pipe to Mr Rutherford’s house which supplied water to a garden tap and outdoor shower. He has not been able to use it since and neither Mr Breslin nor he wished to incur the significant cost of remedying this situation. It seems, however, to be a principal motivation behind the graffiti.
[17] On 5 February Mr Rutherford painted over the wording “Peter Plumley, Dr Zira”. Mr Rutherford accepted that the use of these words could be interpreted as being insulting.
[18] On 12 February Mr Lyons’ solicitors wrote to Mr Breslin raising concerns about Mr Rutherford’s conduct, but no response was received. On 24 February Mr and Mrs Lyons had three security cameras installed, ostensibly to monitor the shared driveway, their property, and the boundary between the properties. This further annoyed Mr Rutherford. He was particularly concerned that one of the cameras appears to be trained on the rear of his house containing a patio and swimming pool. There is further verbal contact during March, particularly with Mr Rutherford complaining about the installation of the cameras.
[19] It was clear from evidence that the cameras no longer intrude into the rear of Mr Rutherford’s property. The installers have adjusted and fine-tuned their location and Mr Lyons’ evidence was that the image projected by the cameras is blocked digitally so as to obscure any view of the rare of Mr Rutherford’s property. It seemed common ground from the evidence that further screening could be added to the top of the common fence which would completely obscure the rear of Mr Rutherford’s property from any influence from the cameras.
[20] There were also suggestions by both factions in evidence of the poisoning of parts of their respective gardens. The evidence in this regard was not sufficiently clear for me to make any finding.
[21] On 17 April the application for orders under the Harassment Act was filed. No further incidents are complained of.
[4] Although Judge Harrison concluded that Mr Rutherford’s behaviour satisfied
the prerequisites for the making of an order, he nevertheless decided in the exercise
of his discretion, that an order was not necessary to protect the Lyons from further harassment, particularly as Mr Rutherford had given undertakings to the Court that he would remove the graffiti and that there would be no repetition of his conduct, and therefore no further harassment. The Judge said:
[38] On the other hand Mr Rutherford has to demonstrate his good faith and honour his undertakings to the Court. I therefore adjourn the application to a date to be advised to the parties at the end of January
2016 where I will review compliance with the undertakings, with a view to dismissing the application formally.
[5] In a second decision as to costs, Judge Harrison noted that Mr Rutherford has
“essentially” complied with his undertakings.3
[6] Judge Harrison said he was surprised that Mr Rutherford was seeking costs because “if his undertakings had not been given to the Court, it is highly likely that formal restraining orders would have been made against him.”4 In the Judge’s view, the Lyons had “largely succeeded in their application, particularly in the giving of undertakings to the Court by Mr Rutherford.”5
[7] He declined to make an award of costs, directing that costs should lie where they fall.
The basis of Mr Rutherford’s appeal
[8] Mr Rutherford appeals against Judge Harrison’s decision refusing costs, and
says the Judge was wrong to hold that costs should lie where they fall.
[9] He says he offered to give undertakings to the Lyons in the form of settlement offers both prior to the hearing and on the first day of the hearing, and that it was unreasonable for the Lyons not to have accepted them. He says the Judge failed to consider his offers when fixing costs.
[10] He further says:
3 Lyons v Rutherford DC Auckland CIV-2015-004-491, 11 May 2016 at [12].
4 At [7].
5 At [9].
(a) The Judge confused the offering of undertakings, as an admission of liability.
(b) He was the successful party as no orders were made against him.
Alternatively, the Judge failed to make findings of fact which, if properly made, would have been in his favour.
[11] The Lyons oppose Mr Rutherford’s appeal, saying he has shown no reason to disturb Judge Harrison’s exercise of his discretion in ordering that costs should lie where they fall.
Mr Rutherford’s appeal does not succeed
[12] This is an appeal against discretion.6 To succeed on appeal, Mr Rutherford must show that Judge Harrison acted on a wrong principle; failed to take into account some relevant matters; took into account some irrelevant matter; or that he was plainly wrong.7
[13] For the reasons that will shortly become apparent, Mr Rutherford has not done so.
[14] Dealing first, with the effect of the open settlement offers exchanged between the parties. The first settlement offer was made on 7 September 2016, wherein Mr Rutherford proposed to remove the graffiti and writings on the fence and undertake not to repeat that sort of behaviour, on the basis that the Lyons would agree to withdraw their application, with no order as to costs. The Lyons made a counter- offer on 9 September, on the basis that “the terms of any settlement can not [sic] be limited to dealing with the graffiti issue as Mr Rutherford proposes” because they “see the graffiti as simply being a manifestation of the underlying problem, being Mr Rutherford’s unpredictable and uninvited aggressive behaviour towards the Lyons.” Among the terms of their proposed undertaking, they requested Mr Rutherford to
agree:
6 Rule 14.1(1) of the District Court Rules 2014 provides that all matters relating to costs of or incidental to a proceeding, are at the discretion of the Court.
7 Kacem v Bashir [2010] NZSC 112, [2011] 2 NZLR at [32].
(e) To stop vehicles (or permit the stopping of vehicles) on the shared driveway only for reasonable loading and unloading. It is to be acknowledged that reasonable loading and unloading does not extend to leaving vehicles unattended on the shared driveway while putting groceries away inside the house or changing clothes.
[15] They also sought costs.
[16] On 8 September, Mr Rutherford declined their counter-offer and made a further offer, relevantly saying:
3. In addition Mr Rutherford suggests that one of the solutions to the troubling camera/privacy issues is for him to increase the cedar privacy screen, at his cost which he estimates will be $3,000.00 to $4,000.00. That will prevent the cameras looking up into his property and help solve the problem of the neighbours having to look at each other or having any further dealings.
4. Condition (e) of your proposal is unreasonable in so far as the second sentence purports to extend the definition of what is reasonable. There are bound to be circumstances when it is necessary to leave vehicles unattended and I do not see how you could hope to persuade a Court to make an order in the wide terms proposed by you.
5. Mr Rutherford will not agree to make any payment as to costs.
[17] The Lyons did not engage in further correspondence. There was a further offer made by Mr Rutherford on the first day of the hearing, but that was also rejected. Mr Lyons explained in his evidence that the Lyons wished to secure the certainty and formality of an enforceable Court order, rather than relying on Mr Rutherford who they considered to be unreliable.
[18] Mr Dale, for Mr Rutherford, submits that the Judge failed to give any weight to Mr Rutherford’s settlement offers when deciding the issue of costs. In my view, there was no error. Rule 14.11 of the District Court Rules 2014 relevantly states:
(1) The effect (if any) that the making of an offer under rule 14.10 has on the question of costs is at the discretion of the court.
…
(3) Party A is entitled to costs on the steps taken in the proceeding after the offer is made, if party A—
(a) offers a sum of money to party B that exceeds the amount of a judgment obtained by party B against party A; or
(b) makes an offer that would have been more beneficial to party B
than the judgment obtained by party B against party A.
[19] It is plain that the outcome the Lyons achieved in Court was “more beneficial” than what had been offered by Mr Rutherford. Rather than agreeing to give undertakings in the form of a bare agreement, Mr Rutherford became subject to the judicial oversight and strict liability in contempt which rests upon a person bound by an undertaking given to the Court.
[20] Next, Mr Dale says the Lyons’ counter-offer was improper because it sought to improve their legal position as regards the use of the driveway, and this went beyond the scope of what they could have hoped to achieve in these proceedings. I disagree. The Lyons explained in their counter-offer that they did not consider the undertakings Mr Rutherford proposed to give were sufficient to protect them from further harassment. In circumstances where disagreement about the ongoing use of the driveway was (at least in part) causing the behaviour complained of, the Lyons cannot be criticised for attempting to secure a resolution by way of an agreement as to the future use of the driveway, so as to avoid any further difficulties and confrontations. In any event, Mr Rutherford himself had sought to achieve similar gains. For example, his last offer would have required the Lyons to consent to an unparticularised extension to the cedar privacy screen between the properties, prior to the obtaining of the requisite building consent. This proposal also appears to have extended to matters beyond the scope of the harassment proceedings.
[21] I do not agree with Mr Dale’s submission that Judge Harrison treated Mr Rutherford’s undertakings to the Court as an admission of liability. That was not the case. The Judge recognised at the outset that Mr Rutherford’s undertakings “were not made as an admission of guilt on his part, but simply because he does not wish to speak to Mr and Mrs Lyons or have any dealings with them in any way.”8 Mr Rutherford has not established that the undertakings were approached in any other way.
[22] In any event, the undertakings had little to do with the Judge’s own assessment as to whether the requirements for making a restraining order were made. In Munro v Collection House (NZ) Ltd, Toogood J said:9
The exercise of the Court’s power to make a restraining order is governed by the provisions of ss 16 and 17 of the Act. They require the Court to make a five-stage inquiry:
·First, to determine whether the respondent has harassed, or is harassing, the applicant;
·Second, to find whether the behaviour in respect of which the application is made causes the applicant distress, or threatens to do so;
·Third, to make the mixed objective/subjective assessment of whether that behaviour would cause, or threaten to cause, distress to a reasonable person in the applicant’s particular circumstances;
·Fourth, to decide whether, in all the circumstances, the degree of distress caused or threatened by that behaviour justifies the making of an order; and
·Fifth, to decide whether the making of an order is necessary to protect the applicant from further harassment.
[23] Mr Rutherford’s undertakings are only relevant to the fifth point. The first to fourth points were matters determined by virtue of the Judge’s own assessment of the evidence.
[24] I deal briefly with the last ground. Mr Dale says that Mr Rutherford was, or would have been, the successful party in these proceedings, and that he ought to have been treated as the successful party for the purposes of determining costs. I disagree. The Judge was of the clear view that the Lyons had “largely succeeded in their application” so Mr Rutherford is simply wrong to consider himself as the successful party. Mr Dale submits Judge Harrison’s use of the words “prima facie” in his first decision (“I am of the view, however, that the statements acknowledged by Mr Rutherford to have been made by him could prima facie amount to harassment”) shows that the Judge did not make a definitive finding as to whether harassment had taken place. While I agree that Judge Harrison’s form of expression
was not exact, it can be safely discerned from his remarks that he considered that
9 Munro v Collection House (NZ) Ltd Auckland CIV-2010-404-8473, 10 June 2011 at [32] (footnotes omitted).
conduct of a kind that would amount to harassment had occurred which would otherwise warrant the making a restraining order, but that ultimately and in the exercise of his discretion, he had decided that it was unnecessary for the Court to make an order. The Judge’s approach was no doubt informed by the situation of the parties continuing to share the use of a common driveway and that “neighbourly
relationships, despite litigation, should be encouraged.”10
[25] In Packing In Ltd (in liq) v Chilcott, the Court of Appeal said:11
[5] In a case such as the present, where in broad terms each party has had similar success, we do not consider it helpful to focus too closely on the question which partly has failed and which has succeeded. Costs in a case such as this should rather be based on the premise that approximately equal success and failure attended the efforts of both sides.
[26] That is the principle applied by Judge Harrison. Having found that the Lyons had “largely succeeded in their application, particularly by way of the undertaking given to the Court by Mr Rutherford”,12 the Judge accepted the submission made by Mr Muir for the Lyons that:13
It would send an unfortunate message if a neighbour who behaved as Mr Rutherford admittedly did, can come away with a costs order in his favour by expressing contrition and agreeing not to repeat that behaviour at the doorstep of the Court. This is an appropriate situation for each party to bear their own costs.
[27] I agree.
[28] Lastly, I record that I have put aside Mr Dale’s submission that there was no factual basis for the Judge’s finding that Mr Rutherford had acted in a manner that could amount to harassment. This is an appeal against a costs decision. The Judge’s views and findings in respect of his decision not to make a restraining order are not susceptible to re-examination and review in the context of this appeal. Mr Dale relies on the decision of Bradbury v Westpac Banking Corp to say that the courts will
be prepared to look behind a substantive decision when considering an appeal
10 At [6].
11 Packing In Ltd (in liq) v Chilcott (2003) 16 PRNZ 958 (CA).
12 Bradbury v Westpac Banking Corp [2009] NZCA 234, [2009] 3 NZLR 400.
against a costs decision. But unlike that case, where the Court of Appeal received material de bene esse, this was not a complex case. Also, Mr Rutherford is not here alleging that the Lyons ran their case or conducted themselves in a certain way so as to justify increased or indemnity costs. He simply wants an award of costs. But as I have already said, the Lyons cannot be characterised as a losing party requiring them to pay costs.
Conclusion
[29] Accordingly, the appeal is dismissed.
[30] The Lyons are entitled to costs on this appeal on a 2B basis, as set by the
Registrar.
Paul Davison J
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