Senior Trust Capital Limited v Holmes - [2023] NZHC 2356

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

I TE KŌTI MATUA O AOTEAROA TĀMAKI MAKAURAU ROHE

CIV-2023-404-952

[2023] NZHC 2356

BETWEEN
SENIOR TRUST CAPITAL LIMITED

Plaintiff

AND

CHRISTOPHER ALAN HOLMES

First Defendant

ANTHONY CHARLES RUSSELL HANNON

Second Defendant

Hearing: (On the papers)

Appearances:

M D Pascariu for Defendants M J Tingey for Plaintiff

Judgment:

18 December 2023

JUDGMENT OF ASSOCIATE JUDGE LESTER

(costs)

This judgment was delivered by me on 18 December 2023 at 2:30 pm pursuant to Rule 11.5 of the High Court Rules

Registrar/Deputy Registrar
………………………

SENIOR TRUST CAPITAL LIMITED v HOLMES [2023] NZHC 2356 [18 December 2023]

[1] On 24 November 2023, Mr Tingey, counsel for Senior Trust Capital Limited (Senior Trust) filed a memorandum seeking the fixing of costs on an indemnity basis.

[2] Indemnity costs were awarded in my judgment of 3 November 2023,1 pursuant to cl 15.1 of the term loan agreement between Senior Trust and Roys’ Bay Estate Limited (in liquidation) and the defendants as guarantors.

[3] Given Mr Tingey properly advised the Court that the quantum of indemnity costs was disputed, I set a timetable for counsel for Messrs Holmes and Hannon to file a response.

[4] Mr Pascariu, is now instructed for Messrs Holmes and Hannon. Mr Pascariu, in a memorandum dated 7 December 2023, raised three specific concerns, or at least queries, in relation to the breakdown of costs claimed by Senior Trust and a general issue in respect of the detail of material filed in support of quantum.

[5]Mr Tingey has filed a reply.

Costs claimed in respect of separate proceedings

[6] Mr Pascariu has, with reference to the time records produced by Senior Trust, identified claims for time that may have related to a separate proceeding being CIV-2023-404-1144. Some $11,940.00 has been identified. Most of the amount in issue relates to the preparation of an affidavit for a Mr Bedemski filed in the separate proceeding. An affidavit from Mr Bedemski was not filed in this proceeding but one was prepared.

[7] Mr Tingey’s memorandum explains that while an affidavit of Mr Bedemski was prepared for this proceeding, ultimately he declined to swear it. Mr Tingey advises a significant amount of work was put into preparing the affidavit, but as I have said, the deponent declined to swear it. I agree with Mr Tingey’s comment that the Court was advised of that during the hearing. Mr Tingey quantifies the amount of time

1 Senior Trust Capital Ltd v Hannon [2023] NZHC 3108.

that can be attributed to the preparation of that affidavit in this proceeding as being
$8,625.00.

[8] The fact that Mr Bedemski’s affidavit was not sworn and so could not ultimately be used in this proceeding does not render the time incurred in preparing that affidavit unrecoverable. Seeking an affidavit from Mr Bedemski was reasonable given the matters raised by Messrs Holmes and Hannon in relation to the mortgagee sale process undertaken by Senior Trust and the involvement of Mr Bedemski’s companies.

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: [2023] NZHC 2356
Decision Date: 18 December 2023

CaseChat Overview and Summary

The case of Senior Trust Capital Limited v Holmes involves a legal dispute where Senior Trust Capital Limited, a plaintiff, is seeking to recover indemnity costs from the defendants, Christopher Alan Holmes and Anthony Charles Russell Hannon. The matter was heard in the High Court of New Zealand, Auckland Registry. The primary focus of the court's attention was on the indemnity costs claimed by Senior Trust, which were awarded in an earlier judgment on 3 November 2023. The defendants, represented by counsel Mr Pascariu, have raised several concerns regarding the quantum and breakdown of the costs claimed.

The legal issues before the court primarily revolved around the reasonableness of the indemnity costs claimed by Senior Trust. Specifically, the court had to address the defendants' concerns regarding the inclusion of costs from a separate proceeding, the claim for GST, and the potential overlap with costs already included in the judgment sum. The court also needed to consider the adequacy of the material provided in support of the indemnity costs claim. The defendants argued that the costs claimed were not fully substantiated, particularly in relation to an affidavit prepared for another proceeding that was not ultimately sworn.

In its judgment, the court found that the costs claimed by Senior Trust were reasonable and appropriate, despite the defendants' objections. The court ruled that the time spent preparing an affidavit for a separate proceeding was justified given the context of the case. The court also accepted that the claim for GST was appropriately made, even though Senior Trust could not recover it due to its status as an investment fund. Regarding the potential overlap with costs included in the judgment sum, the court noted that if there was any duplication, it was minor and did not warrant a significant adjustment. Ultimately, the court determined that the material provided was sufficient to substantiate the indemnity costs claim, and it awarded a total of $112,763.13 in costs, plus disbursements of $3,449.76, without any order as to the costs of fixing the costs.

Orders