Santos v Santos

[2012] NZHC 2918

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

CIV-2011-404-1469 [2012] NZHC 2918

UNDER  the Property Law Act 2007

BETWEEN  JOAN MARY CATHERINE SANTOS Plaintiff

ANDALFRED SANTOS Defendant

Hearing:         On the papers

Counsel:         J E M Lethbridge for plaintiff

Judgment:      6 November 2012

COSTS JUDGMENT OF ASSOCIATE JUDGE ABBOTT

This judgment was delivered by me on 6 November 2012 at 1.30 pm, pursuant to Rule 11.5 of the High Court Rules.

Registrar/Deputy Registrar

Date……………

Solicitors:

Grove Darlow & Partners, PO Box 2882, Auckland

JOAN MARY CATHERINE SANTOS V ALFRED SANTOS HC AK CIV-2011-404-1469 [6 November 2012]

[1]      The plaintiff is the executor of the estate of the late Ofa Santos.  The estate owned a property at 18 East Street, Newton, Auckland.  The defendant, who is the plaintiff’s brother, had been living in the property.   The plaintiff entered into an agreement to sell the property.   After endeavouring unsuccessfully to get the defendant to vacate the property voluntarily, the plaintiff applied for an order for possession.

[2]      On 19 April 2011 I entered summary judgment for the plaintiff for an order for vacant possession and ordered further that:

(a)      all costs associated with getting the defendant to vacate the property were to be paid from his share of the proceeds of the estate, and

(b)the claim for solicitor/client costs on the application was reserved for determination following filing and service of a memorandum setting out the basis of the claim and an affidavit supporting it (which were to be filed and served by 17 May 2011).

[3]      The defendant was given an opportunity to challenge or respond to those orders but has not done so.

[4]      The plaintiff had previously entered into an agreement to sell the property, subject to obtaining vacant possession.  Following entry of judgment, and through her solicitors, she engaged a licensed private investigator to effect service of the sealed  order  for  possession  on  the  defendant,  and  to  effect  his  removal.    The defendant initially resisted, but was eventually persuaded to leave on Thursday 26

May 2011 (by the investigator, supported by a number of security guards who had been engaged to minimise the prospect of physical confrontation).  The property was found to be in an appalling state, full of the defendant’s possessions and a huge amount of rubbish.  Arrangements were made for the security guards to remain over the weekend, and for the defendant to remove his property through that time under supervision of the guards.  The defendant took some of his property that weekend,

but came back on several occasions to complete the exercise.  He removed the last of his property on 16 June 2011, shortly before settlement of the sale.

[5]      In January 2012 counsel for the plaintiff filed a memorandum seeking an order  fixing  solicitor/client  costs  and  the  costs  of  removal  totalling  $46,876.00 (which I had previously ordered were to be deducted from the defendant’s share of the estate), together with a supporting affidavit.  Those documents, together with a copy of the reasons for judgment and further Court minutes, were served on the defendant on 7 March 2012.  He has not challenged the amount being sought.

[6]      The plaintiff was required to provide proof of service on the defendant of the claim, and further information to allow the Court to determine whether the costs claimed for solicitor/client costs were reasonably incurred.[1]   She has since done so.

[1] Bradbury v Westpac Banking Corp (2008) 18 PRNZ 859 (HC) at [205].

[7]      The  information  provided  includes  the  invoices  rendered  to  her  by  her solicitors together with a supporting schedule showing the attendances involved and the actual time engaged on each aspect. This itemises extensive attendances between

12 May 2011 and settlement of the sale on about 17 June 2011 to secure possession of the property, and to arrange and supervise removal of the extraordinary amount of the defendant’s  personal  property and  rubbish  prior to  giving possession  to  the purchaser.   These arrangements included ordering and arranging delivery of large bins (skips) to take the rubbish, obtaining a permit of some nature from the Auckland City Council, arranging a removal company and arranging storage for some of the defendant’s property.

[8]     The total costs comprise the estate’s solicitor’s costs of $4,312.50, the investigator’s costs (presumably inclusive of security charges) of $8,946.25, a water account and final rates account together totalling $2,393.30, and the costs and disbursements of the plaintiff’s solicitors in this litigation totalling $31,231.92 (although the estate’s solicitor’s statement of sums to be deducted from the defendant’s share states that these costs total $31,223.95, the invoices before me total

$31,231.92 and  I have used the figures as billed on these invoices).   All these amounts are inclusive of GST, and the total amount actually claimed is $46,883.97.

[9]      I have not been given details of any of the costs other than those of the solicitors acting in the litigation, but I regard those other costs as justifiable given the history of this matter, the nature and amount of the accounts and the defendant’s failure to challenge them.  I take the same view of the disbursements charged by the solicitors  ($5,903.17).    That  leaves  just  the  costs  charged  by  the  solicitors  –

$7,503.75 for the issue and service of the proceeding, obtaining and sealing of the judgment, and $17,825.00 for the costs incurred from 12 May 2011 in serving the order for possession, getting the defendant to vacate, and effecting removal of the defendant’s property and the rubbish (as mentioned above).

[10]     I am satisfied that the costs claimed up to point of sealing of the judgment are reasonable, save for two minor aspects of the bills which have not been adequately justified.  First, in the first invoice there is a charge for attendances on the Disputes Tribunal in February 2011.  It is difficult to see any reason for that – the notice under the Property Law Act 2007 served on the defendant at that time states that the plaintiff would apply for possession, which is not within the jurisdiction of the

Disputes Tribunal.[2]   Secondly, in the second and third invoices a total of 1.7 hours is

charged  for  receiving  a  process  server’s  report,  and  drafting  and  checking  an affidavit of service.  It is difficult to see how the document filed could have taken that amount of time.   There may be an explanation, but if so, it is not before the Court.  I consider, therefore, that $7,130 of these costs are reasonable, but with leave reserved to the plaintiff to file further evidence to justify the two items that I have identified.

[2] Disputes Tribunals Act 1988, s 11(5)(a).

[11]     The costs since judgment are far greater, and on their face seem difficult to justify fully notwithstanding that the defendant has not challenged them (I suspect that such a course may have been beyond him in terms of having the resources to do so and having awareness of what he needed to do – but that does not mean that the plaintiff does not have to show that the costs are reasonable).

[12]     I accept that the solicitors had to take a “hands on” approach given the impending settlement date, and that the evidence establishes that the property was in an appalling state and the removal process needed regular supervision.  However, the

amount of time expended appears to reflect an over-abundance of caution.   The schedule  of  attendances  shows  that  the  solicitor  primarily  handling  the  matter attended the property on about 13 occasions over a 14 working day period.  On two occasions she was accompanied by either a principal of the firm or another solicitor. There is no explanation as to the need for all of those attendances, particularly the amount of time spent (several hours on some visits), bearing in mind that these attendances were on top of the charges of the persons carrying out the work of removing the defendant’s property and rubbish.   I also note an apparent double recording of attendances on two of those occasions (9 and 13 June 2011).  Again, there  may  be  a  reason  for  the  various  attendances,  but  there  is  insufficient information before me to satisfy me that all of the time was necessary and reasonable in the circumstances,  given that the defendant  is required to meet the costs.   I consider that the time (and hence charge) for this work should be reduced.  As the description given for some of the blocks of time sought includes other aspects of work (that is, combined with time for the visits to 18 East Street) I fix the amount by reducing the total claim (for costs since judgment) by 20% (to $14,260), which by my assessment reduces the amount for supervision visits by approximately 40%.

Decision

[13]     I  determine  the  amount  of  the  solicitor/client  costs  in  respect  of  this proceeding reasonably payable by the defendant to be $21,390 in respect of the solicitors  having  the  conduct  of  the  litigation,  together  with  disbursements  of

$5,903.17, giving a total of $27,293.17 (figures inclusive of GST).  I also approve the associated costs of the estate’s solicitor in the amount of $4,312.50, and the investigator’s costs of $8,946.25 (again inclusive of GST).

[14]     The charges for rates and water are incidents of the defendant’s occupancy

rather than the litigation, and are chargeable on that basis.

Associate Judge Abbott