Saffioti v Auckland Council - [2013] NZHC 722

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

CIV-2012-404-002091 [2013] NZHC 722

IN THE MATTER OF a appeal against the decision of the
Weathertight Homes Tribunal at Auckland

BETWEEN CARL SANTO SAFFIOTI AND EIJA MARITA LINDEN SAFFIOTI Applicants

ANDAUCKLAND COUNCIL Defendant

Hearing: (on the papers)

Counsel: R J Hooker for the Applicants
D J Barr for the Respondent

Judgment: 11 April 2013

JUDGMENT OF WOODHOUSE J (Costs)

This judgment was delivered by me on 11 April 2013 at 3:00 p.m. pursuant to r 11.5 of the High Court Rules 1985.

Registrar/Deputy Registrar
……………………………………

Solicitors / Counsel:
Mr R J Hooker, Vallant Hooker & Partners, Solicitors, Auckland
Mr G J Christie / Mr D J Barr, Simpson Grierson, Solicitors, Auckland

SAFFIOTI V AUCKLAND COUNCIL HC AK CIV-2012-404-002091 [11 April 2013]

[1] The applicants’ leave to appeal against a decision of the Weathertight Homes Tribunal was dismissed.1 The respondent, in accordance with that judgment, is entitled to costs. The parties have been unable to agree on quantum and the Court is now asked to fix costs.

[2] The respondent seeks indemnity costs in a sum of $13,432 (inclusive of GST) and disbursements of $428.63 (inclusive of GST). The applicants oppose indemnity costs. They submit that costs should be fixed on a 2B basis. Costs on a 2B basis total $6,766.

[3] The respondent seeks indemnity costs on the basis that the applicants commenced or continued the proceeding “in wilful disregard of … clearly established law”. This is one of a number of circumstances listed by the Court of Appeal in Bradbury v Westpac Banking Corporation in which indemnity costs have been ordered.2 The respondent submits that the applicants persisted in seeking to advance what amounted to a hopeless case because the claims were clearly contrary to the statutory defence in s 50(3) of the Building Act 1991, the decision of the Supreme Court in McNamara v Auckland City Council,3 and the decision of the
Court of Appeal in Vining Realty Group v Moorhouse.4 These are matters discussed

in the substantive judgment and do not require elaboration here.

[4] For the applicants, Mr Hooker submitted that the issue on appeal, as summarised at [9] of the substantive judgment, was novel, and that it was therefore reasonable for the applicants to continue with their claim by seeking leave to appeal. Mr Hooker advanced other arguments in opposition to the application for indemnity costs, but this is at the heart of the submission.

[5] I am satisfied that the applicants persisted with their claim, by seeking leave to appeal, in the face of a statutory provision, s 50(3), and Court decisions binding
on the High Court, which indicated that the claim had little prospect of success.

1 Saffioti v Auckland Council [2012] NZHC 2394.
2 Bradbury v Westpac Banking Corporation [2009] NZCA 324, [2009] 3 NZLR 400 at [29].
3 McNamara v Auckland City Council [2012] NZSC 34, [2012] 3 NZLR 701.
4 Vining Realty Group Ltd v…

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.

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Details

Case: [2013] NZHC 722
Decision Date: 11 April 2013

CaseChat Overview and Summary

In the High Court of New Zealand, the applicants, Carl Santo Saffioti and Eija Marita Linden Saffioti, sought leave to appeal against the decision of the Weathertight Homes Tribunal. The Tribunal's decision was made in relation to a dispute with the respondent, Auckland Council, and the applicants were dissatisfied with the outcome. The primary legal issue before the court was whether the applicants were entitled to indemnity costs due to their persistence in pursuing a claim that was contrary to clearly established law. The court also needed to determine whether the applicants' conduct amounted to misconduct warranting indemnity costs.

The court found that while the applicants pursued their claim despite clear statutory provisions and binding court decisions indicating little prospect of success, this alone was not sufficient to justify indemnity costs. The court emphasised that indemnity costs should be awarded in exceptional circumstances where there has been flagrant misconduct. The court concluded that the applicants' conduct did not meet the threshold for misconduct as required by leading cases. Furthermore, the court highlighted the importance of the principle that cost determinations should be predictable and expeditious, especially when the actual costs incurred are modest.

In conclusion, the court declined the respondent's application for indemnity costs and fixed the respondent's costs on a 2B basis, totalling $6,766, along with disbursements of $437.52. This decision underscores the need for a higher threshold of misconduct to warrant indemnity costs and reaffirms the importance of predictable and efficient cost determinations.

Orders