Sinclair v Rural Builders Limited

[2020] NZHC 2856

IN THE HIGH COURT OF NEW ZEALAND PALMERSTON NORTH REGISTRY

I TE KŌTI MATUA O AOTEAROA TE PAPAIOEA ROHE

CIV-2020-454-13

[2020] NZHC 2856

BETWEEN

JEREMY RALEIGH SINCLAIR

Applicant

AND

RURAL BUILDERS LIMITED

Respondent

Counsel:	D Sheppard for applicant A Swan for respondent
Judgment:	30 October 2020

COSTS JUDGMENT OF ASSOCIATE JUDGE JOHNSTON

[On the papers]

[1]                  In my judgment of 29 July 2020 I dismissed Mr Sinclair’s application for an order setting aside a bankruptcy notice served by Rural Builders. I reserved costs, indicating that my preliminary view was that Rural Builders was entitled to its costs on a 2B basis together with such disbursements as may be allowed by the Registrar, but expressing the expectation that counsel will be able to finalise these. Disappointingly, that has not happened.

[2]                  On behalf of Rural Builders Mr Swan seeks costs. Mr Sheppard for Mr Sinclair opposes a costs order at this stage on two interrelated bases:

(a)As at the date of Mr Sheppard’s memorandum, Rural Builders had not commenced a proceeding for an order adjudicating Mr Sinclair bankrupt on the basis of his failure to comply with the bankruptcy notice. Mr Sheppard’s first submission is that if it elects not to do so then that would have the same effect as if Mr Sinclair had been

SINCLAIR v RURAL BUILDERS LIMITED [2020] NZHC 2856 [30 October 2020]

successful in his application. This, Mr Sheppard suggests, is a basis for declining costs. I reject that submission. There might be any number of reasons behind a decision by Rural Builders not to commence proceedings. In any event, the point does not arise. Rural Builders has now commenced proceedings.

(b)Second, Mr Sheppard submits that even if Rural Builders were to commence proceedings, the likely outcome is that it will not succeed in securing an order bankrupting Mr Sinclair while Mr Sinclair is pursuing a significantly larger claim against the company arising out of the same events. The contention in that this too is a reason for refusing a costs order. I reject this submission. Rule 14.8 of the High Court Rules provides that the Court is to deal with costs in interlocutory proceedings at the time unless there are exceptional circumstances. I can see no reason for declining to deal with costs in respect of this application on the basis of a speculative assessment of what the outcome may be when Rural Builder’s proceeding is dealt with.

[3]                  The respondent having been successful in defending Mr Sinclair’s interlocutory application, it is entitled to its costs. It will have these on a 2B basis, together with such disbursements as may be fixed by the Registrar.

Associate Judge Johnston

Solicitors:

Fitzherbert Rowe, Palmerston North for applicant Auckland Property Legal Service, Auckland for respondent