Shields v Hayward - [2017] NZHC 1216

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

CIV-2014-404-828 [2017] NZHC 1216

BETWEEN
RUVE ADELE SHIELDS

Plaintiff

AND

CARLA HAYWARD First Defendant

CORBAN REVELL Second Defendant

Hearing: On the papers

Appearances:

D A Wood for Plaintiff
First Defendant in person
M C Smith for Second Defendant

Judgment:

6 June 2017

JUDGMENT OF LANG J [on costs]

This judgment was delivered by me on 6 June 2017 at 3.30 pm, pursuant to Rule 11.5 of the High Court Rules.

Registrar/Deputy Registrar

Date……………

SHIELDS v HAYWARD [2017] NZHC 1216 [6 June 2017]

[1] On 24 February 2017 I issued a judgment in which I dismissed proceedings brought in the name of the plaintiff against the first and second defendants.1 I am now required to fix costs in relation to the proceeding.

Background

[2] The plaintiff sought an order setting aside the transfer of a property to a trust of which she and her daughter Carla, the first defendant, were beneficiaries. She claimed that she had entered into the transaction in circumstances where she had been subject to undue influence by Carla, and / or that Carla had been guilty of unconscionable conduct towards her. I dismissed both of these claims.

[3] I also dismissed claims against the law firm Corban Revell, who had acted for the plaintiff when she entered into the transactions. The plaintiff alleged that Corban Revell had breached a duty of care to exercise proper skill and competence to ensure that the plaintiff’s instructions were not given as a result of undue influence or unconscionable conduct by Carla. The plaintiff also failed in an alternative claim that Corban Revell had breached a duty to ensure she fully understood the nature and effect of the transaction at the time she undertook it.

The application by Carla for indemnity costs

[4] Carla was not represented by counsel at the trial. Instead she represented herself. She had earlier been represented both in this proceeding and in proceedings in the Family Court by the law firm Price Berridge. She seeks indemnity costs against the plaintiff in the sum of $23,236.69, being the fees charged by that firm between May 2004 and 14 February 2015. Carla attaches copies of invoices from Price Berridge in support of her application.

[5] There are several problems surrounding Carla’s application for indemnity costs. First, the invoices demonstrate that many of the attendances in respect of
which costs are sought relate to proceedings in the Family Court. Those attendances

1 Shields v Hayward [2017] NZHC 261.

fall outside the scope of the current proceeding. Costs incurred in respect of the

Family Court proceeding are not claimable in this proceeding.

[6] In addition, costs in this Court are governed by Part 14 of the High Court Rules 2016. Rule 14.6(4) sets out the circumstances in which the Court may order a party to pay indemnity costs. It relevantly provides as follows:

14.6 Increased costs and indemnity costs

(1) Despite rules 14.2 to 14.5, the court may make an…

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 Shields v Hayward

Details

AGLC: Shields v Hayward [2017] NZHC 1216
Case: [2017] NZHC 1216
Decision Date: 6 June 2017

CaseChat Overview and Summary

The High Court of New Zealand considered a case involving Ruve Adele Shields, who sought to set aside a property transfer to a trust where she and her daughter Carla, the first defendant, were beneficiaries. The plaintiff alleged undue influence and unconscionable conduct by Carla. The plaintiff also claimed that Corban Revell, the law firm that acted for her during the transaction, failed to exercise proper skill and competence and did not ensure she understood the transaction. The court dismissed all claims. The first defendant, Carla, sought indemnity costs from the plaintiff, claiming the fees charged by her former law firm, Price Berridge, which represented her in the case and other proceedings. The court found that many of the claimed costs related to Family Court proceedings and were not applicable to the current case. Additionally, none of the circumstances warranting an award of indemnity costs were present, so Carla was awarded costs on a Category 2B basis up to the point she dispensed with Price Berridge’s services. Corban Revell sought increased costs from the plaintiff, arguing that she pursued a claim without merit, failed to accept their legal arguments, and rejected settlement offers. The court found that the plaintiff should have acknowledged the weakness of her position against Corban Revell early on and should have considered their settlement offers more carefully. Therefore, the plaintiff was required to pay Category 2B costs increased by one-third from August 2014 onwards.

The court's reasoning involved evaluating the circumstances under which indemnity and increased costs could be awarded, according to the High Court Rules. Carla's claim for indemnity costs was denied because the costs related to proceedings outside the scope of the current case and no grounds for indemnity costs were met. Corban Revell's claim for increased costs was partially accepted. The court found that the plaintiff's claims against Corban Revell were meritless and that she should have accepted their legal arguments and settlement offers earlier. However, the court did not consider a 50% increase in costs appropriate, instead deciding on a one-third increase to reflect the factors discussed. The court emphasized that the plaintiff had been on notice of the potential for an increased costs application if she took the case to trial against Corban Revell.

Orders