Sadat v Earthquake Commission - [2018] NZHC 2375

IN THE HIGH COURT OF NEW ZEALAND CHRISTCHURCH REGISTRY

I TE KŌTI MATUA O AOTEAROA ŌTAUTAHI ROHE

CIV-2014-409-000207 [2018] NZHC 2375

BETWEEN
SAYAD MOSTAFA SADAT AND MASTOREH SADAT

Plaintiffs

AND

TOWER INSURANCE LIMITED

First Defendant

AND

EARTHQUAKE COMMISSION

Second Defendant

Hearing: On the papers

Counsel:

K T Dalziel, J R Pullar and K L Wright for Plaintiffs M C Harris and S F Alawi for First Defendant

N S Wood and J W Upson for Second Defendant J Moss for Claims Resolution Service

Judgment:

10 September 2018

JUDGMENT OF NATION J AS TO COSTS

[1] After a hearing that concluded on 7 April 2017, through a judgment of 6 July 2017, the plaintiffs (the Sadats) failed on their claim against the first and second defendants.1 They had been unable to prove that their home suffered material damage as a result of the September 2010 earthquake that resulted in any liability on the first defendant (Tower) for the cost of repairs or a rebuild. They had not proved there was damage for which the second defendant (EQC) could be liable, in excess of the $43,000 EQC had already paid to the Sadats.

1 Sadat v Tower Insurance Ltd [2017] NZHC 1550.

SADAT v TOWER INSURANCE LTD [2018] NZHC 2375 [10 September 2018]

[2] The trial of the proceedings was originally scheduled to begin on 20 March 2017. The Sadats’ reply briefs were to be served by 10 March 2017 at the latest. The defendants sought urgent telephone conferences prior to trial because of difficulties they faced due to the Sadats’ geotechnical engineer, Mr Thompson, serving an extensive brief of evidence with significant new material on 16 March 2017 and extensive further evidence from a structural engineer, Dr Wu, on 17 March 2017.

[3] As a result of conferences with counsel on 17 and 21 March 2017, various steps were taken by the Sadats’ experts to enable the defendants’ experts to deal with this new evidence. Certain modifications were made to the evidence to be presented by Dr Wu. On that basis, leave was granted for further evidence to be admitted but the start of the trial was delayed to 22 March 2017. In a minute of 21 March 2017, I noted that significant cost issues had arisen as a result of these developments but reserved those issues for consideration in due course.

[4] In my judgment of 6 July 2017, I noted the defendants would be entitled to costs. I said:2

There may be an issue as to whether the Sadats’ experts, Mr Thompson and Dr Wu, should have to personally make a contribution towards the defendants’ costs, particularly so because of the new evidence they presented just prior to the hearing. Earthquake Services Limited was a litigation funder for these proceedings.

[5] Both then and in a later minute, I made certain directions for all parties to progress any costs applications and to respond to those that were made.

[6]All costs issues as between Tower and other parties have…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

Continue reading Sadat v Earthquake Commission

Details

AGLC: Sadat v Earthquake Commission [2018] NZHC 2375
Case: [2018] NZHC 2375
Decision Date: 10 September 2018

CaseChat Overview and Summary

The plaintiffs, Sayad Mostafa Sadat and Mastroeh Sadat, brought an action against the defendant, Earthquake Commission (EQC), seeking damages for alleged earthquake damage to their home. The claim against the defendant, Tower Insurance Limited, was also dismissed. EQC sought costs against the plaintiffs and their litigation funder, Claims Resolution Service Ltd (CRSL). The plaintiffs' experts, Dr Wu and Mr Thompson, were also named in the costs application. The court considered whether the late provision of supplementary evidence by the plaintiffs' experts justified an award of increased costs against them personally. The court also considered whether CRSL was liable for costs as a non-party funder.

The court held that while the late provision of supplementary evidence by the plaintiffs' experts caused issues for EQC, it was not egregious conduct that justified an award of increased costs. However, the court held that the late provision of expert evidence was not conducive to the efficient and economical progression of court proceedings and warranted an increase in the allowance for preparation for hearing. The court also held that CRSL was liable for costs jointly and severally with the plaintiffs.

The court held that while the high threshold for an award of costs against expert witnesses had been met, it was not making any award for costs against Dr Wu and Mr Thompson personally. The court considered it important that expert witnesses and counsel understand the obligations they have to assist the court, but it was also important that those who have the expertise to assist the court not be deterred from doing so through a fear of their exposure to a costs order if their evidence was not ultimately accepted.

The court ordered that the plaintiffs and CRSL were jointly and severally liable to pay costs to EQC on a 2B basis in the sum of $79,042.50, together with disbursements in the sum of $96,201.58. EQC was also entitled to costs against the plaintiffs and CRSL jointly and severally on the costs application in the sum of $3,000.

Orders