Ryan v Lobb

[2024] NZHC 1237

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

I TE KŌTI MATUA O AOTEAROA TĀMAKI MAKAURAU ROHE

CIV-2019-404-1591

[2024] NZHC 1237

BETWEEN

VERENA COLLEEN RYAN

Plaintiff

AND

STUART JAMES LOBB

Defendant

CIV-2023-404-2794

BETWEEN

DIGBY JOHN NOYCE
Applicant

AND

PENDRELL INVESTMENTS LIMITED

First Respondent

AND

REGISTRAR-GENERAL OF LAND

Second Respondent

AND

STUART JAMES LOBB

Third Respondent

AND

LOTHBURY MANAGEMENT LIMITED

Fourth Respondent

Continued overleaf

Hearing:	On the papers at Auckland
Judgment:	17 May 2024

JUDGMENT OF POWELL J

[Costs]

This judgment was delivered by me on 17 May 2024 at 4.00 pm pursuant to

r 11.5 of the High Court Rules

…………………..

Registrar/Deputy Registrar

VERENA COLLEEN RYAN v STUART JAMES LOBB [2024] NZHC 1237 [17 May 2024]

WAG TRUSTEES (2020) LIMITED

Fifth Respondent

MATTSON PARTNERSHIP
Sixth Respondent

WARWICK LOBB
Seventh Respondent

AND

STUART JAMES LOBB

First Defendant

LOCKHART TRUSTEE SERVICES NO.56 LIMITED

Second Defendant

WAG TRUSTEES (2020) LIMITED
Third Defendant

[1]        This judgment addresses costs issues arising out of the following three judgments:

(a)Ryan v Lobb (“the WAG stay judgment”).1 Issued on CIV-2019-404- 1591 (“the 1591 proceedings”), where I dismissed an application by the third defendant, WAG Trustees (2020) Limited (“WAG”), for a stay of execution of part of a judgment of Edwards J issued on 19 June 2023,2 which had concluded a mortgage purporting to be held by WAG did not secure any debt or the performance of any obligation.3

(b)Ryan v Lobb (No.2) (“the Stuart Lobb contempt judgment”)4 issued on the 1591 proceedings in which I determined, upon the application of the second plaintiff, the court-appointed receiver, Digby Noyce (“the receiver”) that the first defendant, Stuart Lobb, had acted in contempt of court in his efforts to prevent the sale of a property located at 23 Orakei Road, Remuera (“the Orakei Road property”).

(c)Noyce v Pendrell Investments Limited (“the caveat removal judgment”)5 issued on the 1591 proceedings and CIV-2023-404-2794 (“the 2794 proceedings”) in which I ordered the removal of six caveats current or pending on the title of the Orakei Road property.

[2]I now deal with the costs issues arising from each judgment in turn.

The WAG stay judgment

[3]        In ordering the WAG stay application be dismissed, I determined that increased costs (on a 2B basis uplifted by 20 per cent) were appropriately paid by WAG to the receiver.6

1      Ryan v Lobb [2023] NZHC 2452 [The WAG stay judgment].

2      Ryan v Lobb [2023] NZHC 1518.

3 At [94].

4      Ryan v Lobb (No.2) [2023] NZHC 3595 [The Stuart Lobb contempt judgment].

5      Noyce v Pendrell Investments Ltd [2023] NZHC 3778 [The caveat removal judgment].

6 The WAG stay judgment, above n 1, at [16].

[4]        In accordance with my timetabled directions the receiver has sought costs in the sum of $8,030.40 being costs of $6,692 together with the 20 per cent uplift. The receiver also seeks disbursements of $110, resulting in a total of $8,140.40 sought against WAG.

[5]        No submissions on the quantum of the costs sought by the receiver have been filed by or on behalf of WAG.

[6]        Having checked the receiver’s calculations I am satisfied the amount claimed is in order, and that the costs and disbursements sought are properly payable by WAG.

The Stuart Lobb contempt judgment

[7]        Having determined that Stuart Lobb had been in contempt of court following his sending of emails to real estate agents with the intention of undermining the sale process for the Orakei property,7 I concluded that Mr Lobb should pay the reasonable costs of the receiver on the application.8

[8]        The receiver has sought costs in the sum $30,107.50 (exclusive of GST). In addition, the receiver seeks disbursements in the sum of $572.45 for a filing fee and photocopying and printing. The sum claimed is based on an apportionment of time records for the solicitors for the receiver so as to identify the time spent on the application in whole or in part. The methodology acknowledged and allowed for an overlap with other attendances that were occurring at the same time.

[9]        No submissions opposing the costs sought have been filed by or on behalf of Stuart Lobb.

[10]      Having considered the time records provided by the receiver and in the absence of any opposition I consider the amount sought is reasonable. None of the attendances are exceptionable. The amounts claimed cover the taking of instructions from the receiver, legal research, preparation of affidavit evidence from the receiver, a locksmith, and the real estate agents, liaising with counsel for Stuart Lobb, liaising

7 The Stuart Lobb contempt judgment, above n 4, at [27].

8 At [31].

with witnesses and with the Court, the preparation of submissions and bundle, and preparation for and attendance at the hearing on 11 October 2023.

[11]      Taken together the amounts sought are appropriately payable by Stuart Lobb to the receiver.

The caveat removal judgment

[12]      The caveat removal hearings commenced with a call of a single caveat removal application, a caveat previously filed by Pendrell Investments Limited (“Pendrell”) against the title of the Orakei Road property.9 There was no dispute that Pendrell had previously held a caveatable interest as the result of purchasing the Orakei Road property at auction.10 Pendrell had, however, subsequently defaulted and failed to settle the purchase. The sale to Pendrell had been cancelled by the receiver and the receiver had arranged for a sale of the Orakei Road property with settlement set to occur one week after the call of the application, mediating before Christmas 2023. At the initial hearing on 13 December 2023 it became apparent that other caveats had been filed by Lobb Family Interests against the Orakei Road property. Given the urgency I issued directions treating the 2794 proceedings “as having been amended by oral application to include applications to remove all caveats currently lodged against

23 Orakei Road, Remuera by [Stuart] Lobb, Warwick Lobb, [WAG], Lothbury Management Limited (“Lothbury”) and the Mattson Partnership”.11

[13]I also directed:12

[6]     In addition the proceedings in CIV-2019-404-1591 (Ryan v Lobb) is  to be called at the same hearing in the event, that as foreshadowed Mr Noyce seeks to rely on the leave reserved provision in my most recent judgment so as apply to restrain Mr Lobb and/or other members of the Lobb family from interfering with the sale process of the Orakei Road property.13

[14]      Following further hearings on 15 and 18 December 2023 I ordered the removal of all six caveats and directed generally:

9      The caveat removal judgment, above n 5.

10 At [25].

11 Minute of Powell J dated 14 December 2023 at [5].

12 At [6].

13 The Stuart Lobb contempt judgment, above n 4, at [32].

[72] Mr Noyce is entitled to costs on the application. A memorandum  setting out the costs claimed and against which individuals and/or entities is to be filed by 1 February 2024. Any responses are to be filed by 15 February 2024. I will then determine the issue on the papers.

[15]      In accordance with the direction the receiver has filed a memorandum seeking in the first instance indemnity costs in the sum of $49,195 (excluding GST) jointly and severally against Stuart Lobb, Warwick Lobb, Lothbury, Pendrell, and WAG. In support of the application, Mr Thompson on behalf of the receiver noted the numerous hearings required and the rapidly expanding scope of the proceedings necessary to deal with all of the caveats that had been filed against the Orakei Road property. On behalf of the receiver, Mr Thompson noted that the amount sought is considerably more than costs on a 2B or indeed 2C basis but submitted that the costs were reasonable in the circumstances.14

[16]      No steps have been taken by any of the parties against whom costs are sought namely Stuart Lobb, Warwick Lobb, Lothbury, Pendrell, and/or WAG.

[17]      Having considered the position of each of the parties against whom costs are sought, I am satisfied it is appropriate to make them all jointly and severally liable for the costs sought by the receiver.

[18]      First, I note that Stuart Lobb was the only party represented by counsel and while I considered his argument to be “contrived”,15 it was argued efficiently and expeditiously by his counsel Mr Latton. By itself then Stuart Lobb’s assertion of a caveatable interest would not have warranted an award of indemnity costs. Stuart Lobb’s involvement did not, however, end there. Stuart Lobb lodged the caveat on behalf of Pendrell and Lothbury (of which he is the sole director), and together with Warwick Lobb, lodged the caveat on behalf of the Mattson Partnership. It was accordingly clear that Mr Lobb could have removed the caveat on behalf of Pendrell which clearly had no caveatable interest after its agreement for sale and purchase was

14 Mr Thompson submitted that based on an eight-hour day the hours claimed for actual and reasonable costs are less than the hours provided for on a 2C basis. However, scale costs are calculated on a day of 5.25 hours. See High Court Rules 2016, sch 3 item 57. Note that the reference to quarter days confirms that the daily recovery rate is limited to the court day and does not include preparation time or other attendances.

15 The caveat removal judgment, above n 5 at [37].

cancelled, but instead left it for the receiver and the Court to deal with. In relation to the caveat by Lothbury, the issue of Lothbury’s caveatable interest had been substantively considered at an earlier caveat removal hearing where Lothbury had been represented by counsel and affidavit evidence about its caveatable interest provided by Stuart Lobb and where ultimately the caveat was removed by consent with costs payable by Lothbury.16

[19]      As I noted in the caveat removal judgment, for Lothbury to file a further caveat claiming exactly the same interest and relying on the same submissions and evidence was an abuse of process.17 Likewise, the caveat lodged by Stuart Lobb on behalf of Mattson Partnership flew in the face of his evidence at the substantive hearing of the 1591 proceedings before Hinton J, which made it clear that the Mattson Partnership had no interest in the Orakei Road property, as it appeared to have been superseded by Lothbury.18

[20]      As a result of his wider involvement with the other caveats, which were not defended but acted as a form of legal minefield for others to clear and defuse, I am therefore satisfied it is appropriate for Stuart Lobb to be jointly and severally liable for the costs incurred by the receiver on the caveat removal applications in the context of those applications.

[21]      The involvement of Warwick Lobb was also significant. Warwick Lobb was responsible for placing a caveat personally on the property and together, with his son Blair Lobb, lodged a caveat on behalf of the “WAG Trust” and yet another with Stuart Lobb on behalf of the Mattson Partnership. Although suffering from COVID-19 at the time, Warwick Lobb took a full role in the hearing including filing an additional affidavit between the hearing on 15 December 2023 and the final hearing on 18 December 2023.

[22]      There was no merit whatsoever in any of the caveats for which Warwick Lobb was responsible. As noted in the caveat removal judgment Warwick Lobb’s claimed

16     At [39]–[44].

17 At [46].

18     At [65]–[68].

interest in the Orakei Road property had already been considered by Hinton J in the course of her substantive judgment.19 In addition, Warwick Lobb and WAG (as corporate trustee of the WAG trust) had previously lodged and then removed caveats following the earlier caveat removal hearing in October 2023. Like Stuart Lobb, Warwick Lobb was also responsible for the Mattson Partnership caveat notwithstanding that no interest on behalf of the Mattson Partnership had been raised in the substantive proceedings. Taking these matters together, I am satisfied that Warwick Lobb too should be jointly and severally liable for the costs of the caveat removal proceedings.

[23]      I likewise consider that Pendrell, Lothbury, and WAG should also be jointly and severally liable for the costs sought by the receiver. Each was clearly a vehicle acting under the directions of Stuart Lobb and/or Warwick Lobb, and formed part of a coordinated strategy to attempt to block the sale of the Orakei Road property notwithstanding the complete absence of any caveatable interest on the part of the Lobb family ot the entities controlled by them.

[24]      In the absence of any opposition, I consider the amounts claimed on behalf of the receiver are reasonable in the circumstances, noting in particular the urgency, the number of hearings required, and the changing nature of the applications as further caveats were identified.

Decision

[25]      For the reasons set out in this judgment I award costs on the three judgments as follows:

(a)On the WAG stay judgment WAG is to pay costs $8,030.40 together with disbursements of $110, a total of $8,140.40 to the receiver.

(b)On the Stuart Lobb contempt judgment Stuart Lobb is to pay costs in the sum of $30,107.50 to the receiver with disbursements in the sum of

$572.45 a total of $30,679.95; and

19     At [61]; Ryan v Lobb [2023] NZHC 689.

(c)On the caveat removal judgment Stuart Lobb, Warwick Lobb, Pendrell Investments Ltd, Lothbury Management Limited, and WAG Trustees (2020) Ltd are jointly and severally liable to pay costs to the receiver in the sum of $49,195.

Powell J