Singh v Buttar - [2023] NZHC 1401

IN THE HIGH COURT OF NEW ZEALAND TAURANGA REGISTRY

I TE KŌTI MATUA O AOTEAROA TAURANGA MOANA ROHE

CIV 2021-470-26

[2023] NZHC 1401

UNDER section 165 of the Companies Act 1993

BETWEEN

JASWINDER SINGH

Applicant

AND

DALJEET SINGH BUTTAR

First Respondent

KIWI JOINT LIMITED

Second Respondent

Hearing: On the papers

Judgment:

7 June 2023

COSTS JUDGMENT OF DUFFY J

This judgment was delivered by me on 7 June 2023 at 11 am pursuant to Rule 11.5 of the High Court Rules.

Registrar/ Deputy Registrar

Solicitors:
Holland Beckett, Tauranga
Vallant Hooker & Partners, Tauranga

SINGH v BUTTAR [2023] NZHC 1401 [7 June 2023]

[1] On 21 February 2023 I delivered judgment granting Mr Singh’s application to take a derivative action in the name of Kiwi Joint Ltd (Kiwi Joint) pursuant to s 165 of the Companies Act 1993.1 Mr Singh now seeks costs on a 2B basis uplifted by 50 per cent plus disbursements. Mr Buttar opposes an uplift and challenges certain items claimed by Mr Singh.

Scale costs

[2] The parties are agreed that as regards scale costs 2B costs are appropriate. However, certain items are contested by Mr Buttar.

[3] First, Mr Buttar submits that there was only one case management conference relevant to the substantive proceeding on 20 September 2021. He says that a telephone conference on 4 May 2021 related to charging and freezing order applications (the interim relief applications) which were ultimately withdrawn. Mr Singh argues the 4 May 2021 case management conference does in fact relate to the derivative action proceeding as evidenced by van Bohemen J’s minute of 5 May 2021.

[4] Mr Singh has included an allowance for second counsel. Mr Buttar submits that costs for second counsel are not justified. He contends the matter was not complex. Further, second counsel did not take an active part in the hearing.

[5] Mr Singh disagrees, stating that whilst the hearing was short there was extensive documentation. He maintains that second counsel was active during the hearing, providing assistance to senior counsel and making oral submissions in reply, similar to Beverley v Drylandcarbon GP One Ltd.2

Finding

[6] The timeline of the interim relief applications is recorded in the judgment I delivered on the s 165 application.3 The timeline shows they were set down for hearing on 22 June 2021. On 18 June 2021 Mr Buttar agreed not to dispose of the assets

1      Singh v Buttar [2023] NZHC 243.
2      Beverley v Drylandcarbon GP One Ltd [2023] NZHC 586 at [21]–[23].
3      Singh v Buttar, above n 1, at [5].

involved in those applications and to provide requested information to Mr Singh. Accordingly, any questions regarding costs relating to the interim relief applications should have been addressed as part of the agreement the parties made to dispose of those applications.

[7] I have read Van Bohemen J’s minute of 5 May 2021. It covers the s 165 application and the interim relief applications. The latter applications were dependent on the s…

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 Singh v Buttar

Details

AGLC: Singh v Buttar [2023] NZHC 1401
Case: [2023] NZHC 1401
Decision Date: 7 June 2023

CaseChat Overview and Summary

In the High Court of New Zealand, Singh v Buttar [2023] NZHC 1401, Jaswinder Singh sought costs for a successful application under section 165 of the Companies Act 1993, which allowed him to bring a derivative action on behalf of Kiwi Joint Ltd. Daljeet Singh Buttar opposed the costs application, challenging certain items and arguing against an uplift in costs. The court was required to decide whether the costs claimed by Mr Singh were justified, including whether certain steps taken by Mr Buttar lacked merit, and whether the settlement offers made by Mr Singh were reasonably refused by Mr Buttar.

The court found that certain costs claimed by Mr Singh were justified, including the cost of a second counsel and the fees of an expert forensic accountant. However, the court reduced the cost of a case management conference because it related to both the derivative action and interim relief applications. The court also found that Mr Buttar's opposition to the derivative action lacked merit, as he did not dispute many of the transactions in question or his involvement in them. Additionally, the court found that Mr Buttar unreasonably refused settlement offers, but did not rule on this issue as it was prematurely raised. The court awarded a 30% uplift in costs for Mr Buttar's lack of merit in opposing the derivative action, but not for the refusal to accept settlement offers, reserving leave for Mr Singh to bring this application at the conclusion of any proceedings Kiwi Joint brings against Mr Buttar.

The final orders of the court were that Mr Buttar was to pay Mr Singh $19,574.10 in costs and $6,173.75 in disbursements. Mr Singh was also entitled to claim scale costs and any disbursement cost for sealing the costs order.

Orders