Sparks v St Heliers Capital Limited

[2020] NZHC 1343

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

I TE KŌTI MATUA O AOTEAROA TĀMAKI MAKAURAU ROHE

CIV-2019-404-002232

[2020] NZHC 1343

UNDER

the Property (Relationships) Act 1976 and the Land Transfer Act 2017

BETWEEN

SARAH PATRICIA SPARKS

Plaintiff

AND

ST HELIERS CAPITAL LIMITED

Defendant

Hearing:	Determined on the papers
Counsel:	S Sparks, Plaintiff in person P J K Spring for Defendant
Judgment:	16 June 2020

COSTS JUDGMENT OF ASSOCIATE JUDGE PAULSEN

This judgment was delivered by me on 16 June 2020 at 11.00 am pursuant to Rule 11.5 of the High Court Rules

Registrar/Deputy Registrar Date:

SPARKS v ST HELIERS CAPITAL LTD (Costs) [2020] NZHC 1343 [16 June 2020]

[1]    In a judgment of 10 February 2020, I dismissed Ms Sparks’ applications for leave to lodge a second notice of claim against a property at 109 Kapiti Road, Paraparaumu and that her notice of claim lodged against a contiguous property at   77 Kapiti Road not lapse.1

[2]    I made a timetable for the filing of memoranda in relation to costs which was not complied with due to the COVID-19 pandemic restrictions. Neither party seeks to make any issue of that. St Heliers Capital Ltd (St Heliers) applies for costs which is opposed by Ms Sparks.

Submissions

[3]    St Heliers says it was wholly successful on both grounds it had put forward in opposition to Ms Sparks’ application and there is no reason to depart from the general principle that costs follow the event.2

[4]    I was referred to McElroy v Auckland International Airport Ltd,3 where Keane J noted:

The paramount principle is that costs lie within the discretion of the Court. The usual principle is, however, that ‘the party who fails with respect to a proceeding … should pay costs to the party who succeeds’. That principle will apply unless ‘although the party claiming costs has succeeded overall, that party has failed in relation to a cause of action or issue which significantly increased the costs of the party opposing costs’. Whether that is so is to be assessed in broad terms.

[5]St Heliers has submitted a schedule of costs calculated on a 2B basis totalling

$12,179.50 (with disbursements). This includes an allowance for second counsel said to be reasonable due to the complexity of the matter.

[6]    Ms Sparks submits that the purpose of her applications was to preserve her interest in properties pending the hearing of her long-running matrimonial dispute with her former husband (Mr Olliver). She argues that costs should not be determined only by reference to the result of this proceeding, but that consideration should also be given

1      Sparks v Olliver Trustee Company Ltd (in liq) [2020] NZHC 486.

2      High Court Rules 2016, r 14.2(1)(a).

3      McElroy v Auckland International Airport Ltd HC Auckland CIV-2006-404-5980, 4 May 2011 at [7].

to other numerous proceedings between her and Mr Olliver (or entities with which he is associated). She notes that here she was self-represented and subject to abuse from Mr Olliver which she found incomprehensible, terribly distracting and brutal. It will not serve her whānau, including the children of Mr Olliver, if she is bankrupted over costs. She is hopeful there can be a humane, dignified and principled determination of the matter.

Analysis

[7]    The court has an overriding discretion in relation to costs but the discretion must be exercised in a principled manner and consistently with the costs regime in the High Court Rules 2016.

[8]    In Taylor v Roper4 Edwards J noted the following principles. The primary purpose of a costs award is to compensate a successful party for the costs they have expended in having their legal rights recognised and enforced by the court. Costs are not awarded as a punishment against the losing party, nor as a reward for the winner. The principle that costs should be paid by the unsuccessful party, is fundamental to the High Court Rules costs regime and will apply unless there are exceptional circumstances.5 An award of costs is generally linked to the conduct of the proceeding and its result but is not usually concerned with what happened before the proceeding. The High Court Rules set out a method of calculating costs by taking a prescribed time allocation for steps taken in a proceeding and multiplying those time allocations by a prescribed daily rate. The allocations and the daily rates are aimed at delivering a successful party two-thirds of the costs deemed to be reasonable in the litigation.

[9]The relevant principles in this case are r 14.2(1)(a) and (g). They provide:

14.2 Principles applying to determination of costs

(1)     The following general principles apply to the determination of costs:

(a)the party who fails with respect to a proceeding or an interlocutory application should pay costs to the party who succeeds:

…

4      Taylor v Roper [2019] NZHC 16, (2019) 24 PRNZ 373 at [6] – [8].

5      Manakau Golf Club Inc v Shoye Venture Ltd [2012] NZSC 109, [2013] 1 NZLR 305 at [7].

(g)so far as possible the determination of costs should be predictable and expeditious.

[10]   The High Court Rules also govern the circumstances in which costs may be either increased or reduced in scale. The court may refuse to make an order for costs or reduce costs otherwise payable in circumstances set out in r 14.7. One such circumstance, and the only one even arguably applicable in this case, is r 14.7(g). It provides:

(g) some other reason exists which justifies  the  court  refusing  costs despite the principle that the determination of costs should be predictable and expeditious.

Analysis

[11]   St Heliers was the successful party. It is therefore entitled to an award of costs unless Ms Sparks can show there are circumstances justifying the court to depart from the usual rule.

[12]   Ms Sparks asks that consideration be given to the history of litigation between her and Mr Olliver. I do not agree. The conduct of the parties in prior proceedings and the costs implications flowing from that can only be determined in those proceedings.

[13]   I accept Ms Sparks brought her proceedings in good faith. However, her belief that she had an interest in the properties was incorrect and in bringing her proceeding she put St Heliers to considerable expense. Her obligation to pay costs is not affected because she was self-represented.

[14]   Ms Sparks raises Mr. Olliver’s conduct during the hearing. While Ms Sparks was presenting submissions, she was interrupted by Mr Olliver. He shouted at her across the court and argued with his lawyer. He then left the court. Mr Olliver’s behavior was inappropriate, undignified and upsetting to Ms Sparks but it did not have any effect on the costs of the proceeding. While the court may reduce an award of costs it must be cautious about a broad interpretation of the exception in r 14.7(g) lest

the exception swallows the rule.6 A party’s discourteous behavior at the hearing that ultimately has no bearing on the costs of the proceeding to either party should not be a basis to reduce costs under r 14.7(g).

[15]   I am satisfied St Heliers is entitled to costs. It has sought costs on a 2B basis, which is appropriate. Its calculation of the costs sought appears to be correct except, I do not allow for second counsel. I do not consider this matter was complex justifying second counsel.

Result

[16]   St Heliers is awarded costs and  disbursements  of the  proceeding against  Ms Sparks in the amount of $11,582.00.

O G Paulsen Associate Judge

Solicitors:

Keegan Alexander, Auckland

S Sparks, (Plaintiff – in person)

cc: F B Barton, Anderson Lloyd, Dunedin (for Bank of New Zealand)

6      Taylor v Roper. Above n 4, at [21] citing Roberts v A Professional Conduct Committee of the Nursing Council of New Zealand [2014] NZCA 141, (2014) 21 PRNZ 753 at [24] – [25].