St Liberty, LLC v The Ship "Persevere"

[2021] NZHC 2280

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

ADMIRALTY ACTION IN REMEMBER AND IN PERSONAM

I TE KŌTI MATUA O AOTEAROA TĀMAKI MAKAURAU ROHE

CIV-2021-404-302

[2021] NZHC 2280

BETWEEN

ST LIBERTY, LLC

Plaintiff

AND

THE SHIP “PERSEVERE”

First Defendant

VALHALLA, LLC
Second Defendant

COLIN D RATH

Third Defendant

Hearing:

On the papers

Counsel:

P Davies for the Plaintiff

C Hunter for the First Defendant Third Defendant on own behalf

Judgment:

1 September 2021

JUDGMENT OF GORDON J

[As to costs]

This judgment was delivered by me

On 1 September 2021 at 3 pm, pursuant to r 11.5 of the High Court Rules

Registrar/Deputy Registrar Date:

Solicitors:           Fee Langstone, Auckland

McElroys, Auckland

Copy to:            Third Defendant

ST LIBERTY, LLC v THE SHIP “PERSEVERE” [2021] NZHC 2280 [1 September 2021]

[1]        This is an application for costs by the plaintiff and the first defendant against the second and third defendants.

[2]        The proceeding concerns the vessel “Persevere” which is a 54ft pleasure boat with an approximate value of NZ$400,000. The plaintiff is a Florida financier. It asserts a security interest over the vessel which, in December 2018, was purchased by a New Zealander, Ms S Bosher.

[3]        The plaintiff applied for particular discovery from the second and third defendants. The application was scheduled for a hearing on 5 August 2021. However, as most of the issues between the parties had been resolved, counsel sought to vacate the fixture and  instead  Harland  J  convened  a  judicial  telephone  conference  on  3 August 2021 to make the necessary orders and to make further directions in order to progress the proceedings.

[4]        One of the directions made by Harland J in her minute of 5 August 2021 was that the plaintiff and first defendant were to file any application for costs in relation to the application for particular discovery by 5 pm on 6 August 2021 and a memorandum in response was to be filed and served by 5 pm on 13 August 2021.

[5]        At the time of the telephone conference on 3 August 2021 the second and third defendants were represented by counsel. However, the Judge’s minute of 5 August 2021 records that since the telephone conference counsel for the plaintiff and first defendant had filed a memorandum in which they advised that the solicitors for the second and third defendants had indicated they were no longer instructed. That possibility had apparently been signalled in the course of the judicial conference and the Judge’s minute makes it clear that even if there were a change of representation the obligation to comply with the timetable still applied to the second and third defendants.

[6]        Counsel for the plaintiff and counsel for the first defendant have each filed an application for costs in accordance with the Judge’s timetable order.

[7]        The third defendant has not complied but, acting for himself, filed a memorandum on 20 August 2021, seven days after any opposition was due to be filed and served, seeking an extension of time. The application for an extension is opposed by the plaintiff and first defendant.

[8]        The matter came before me in my capacity as Duty Judge on 30 August 2021. By that date Mr Rath had still not filed any opposition to the costs applications. He has had an unofficial extension of over two weeks. I issued a minute on 31 August 2021 recording that no further indulgence would be accorded to Mr Rath and that I would proceed to consider the application on the papers on the basis of the memoranda filed on behalf of the plaintiff and first defendant.

[9]        As to the second defendant, it was also represented by the same counsel previously representing Mr Rath. Beyond that it is not entirely clear as to the position regarding the second defendant. However, as the Court has received no separate communication on behalf of the second defendant, this judgment will apply to both the second defendant and Mr Rath.1

[10]      The plaintiff applies for costs in accordance with the scale and the 2B categorisation of the proceeding. Counsel for the plaintiff, Ms Davies, submits that the second and third defendants have caused additional costs to the plaintiff through the plaintiff having to apply for particular discovery, filing additional memoranda and then preparing submissions for a hearing that did not, in the end, proceed. She notes that the plaintiff was still required to file submissions even though there was a failure by the second and third defendants to file a notice of opposition as that did not remove the Court’s obligation to assess an application on its merits.

[11]      In this case, the second and third defendants ultimately conceded that the documents sought by the plaintiff should be discovered. I am satisfied that, applying the ordinary principle that the party who fails in a proceeding or interlocutory

1      Mr Rath has asserted in a memorandum that the second defendant is no longer registered under the laws of the state of Rhode Island.

application should pay costs to the party who succeeds, the second and third defendants should pay costs to the plaintiff.2

[12]      I am satisfied that the costs sought have been calculated correctly and that the sum of $9,104 is appropriately claimed.

[13]      Turning to the position of the first defendant, counsel, Mr Hunter notes that the first defendant has endeavoured not to incur extraneous costs regarding the application for particular discovery. As a consequence the first defendant’s costs were relatively modest and Mr Hunter applies for costs in relation to a single memorandum and a single subsequent case management conference. As most of this work was conducted by junior counsel, despite the categorisation of the proceedings as 2B, the first defendant responsibly submits that the order in relation to the first defendant should be on a 1B basis.

[14]I am satisfied that the amount of $1,113 is appropriately claimed.

[15]I make the following orders:

(a)I award costs in the sum of $9,104 in favour of the plaintiff against the second and third defendants; and

(b)I award costs in the sum of $1,113 in favour of the first defendant against the second and third defendants.

Gordon J

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