Stuart Allan Investments Ltd v Tasman District Council HC Nelson CIV 2008-442-275

[2010] NZHC 1691

IN THE HIGH COURT OF NEW ZEALAND NELSON REGISTRY

CIV-2008-442-275

UNDER  the matter of the Judicature Amendment

Act 1972

IN THE MATTER OF     Decisions under the Resource Management

Act 1991

BETWEEN  STUART ALLAN INVESTMENTS LTD Plaintiff

ANDTASMAN DISTRICT COUNCIL First Defendant

ANDJULIAN BEDE RICHARDS LOUGHNAN AND LATIMER TRUSTEES (2006) LTD Second Defendants

ANDTIMOTHY JAMES DOUGLAS- CLIFFORD

Third Defendant

Hearing:         16 July 2009

Appearances: N Burley for Plaintiff

J C Ironside for First Defendant
M M Bell for Second and Third Defendants

Judgment:      3 August 2010

JUDGMENT OF JOSEPH WILLIAMS J (ON COSTS)

In accordance with r 11.5, I direct the Registrar to endorse this judgment with the delivery time of 2.00pm on the 3 August 2010.

Solicitors:
Hunter Ralfe, Solicitors, PO Box 49, Nelson
Fletcher Vautier Moore Lawyers, PO Box 3029, Richmond 7050

Corcoran French Lawyers, PO Box 13-001, Armagh

STUART ALLAN INVESTMENTS LTD V TASMAN DISTRICT COUNCIL AND ORS HC NEL CIV-2008-

442-275  3 August 2010

[1]      In a judgment dated 11 March 2010, the plaintiff was partly successful in challenging decisions made by the first defendant.   Costs were reserved, but the parties have been unable to reach agreement.

[2]      The plaintiff seeks costs from the first, second and third defendants based on the 2B scale, except in relation to certain steps where 2C costs are sought.

[3]      The first, second and third defendants accept in principle that they are liable to the plaintiff for costs, and accept that the 2B scale is appropriate.  The defendants are not arguing apportionment or contribution between them.

[4]      The essential disagreement between the parties is as to the application of the scale to particular steps in the proceedings, and to the level of discount for the unsuccessful cause of action.

Schedule 3 items

[5]      I set out below the costs sought and awarded by reference to the allocations in Schedule 3.

Item 1:  Commencement of proceeding	The parties agree that 3 days is appropriate.	3 days
Item 4.7:  Inspection of documents	The plaintiff seeks 1.5 days to reflect informal discovery and inspection of consent files, however I accept the defendants’ argument that no list of documents was produced, pre-proceeding inspection is in this case adequately covered by Item 1 and the matter discovered informally was unnecessary.	0 days
Item 4.10:  Memoranda for Case Management Conferences (CMCs)	The plaintiff seeks 1.6 days (4 x 0.4) however I accept the defendants’ argument that two of the conferences arose out of the plaintiff seeking an indulgence.	0.8 days

Item 4.11:  Appearances at CMCs	The plaintiff seeks 1.2 days (4 x 0.3) on the basis that appearance by telephone is still an appearance, however I accept the defendants’ argument that the teleconferences were very brief as matters were dealt with by agreed memoranda.	0 days
Item 7.1:  Plaintiff’s preparation of affidavits	The plaintiff seeks 5 days (the Band C allocation), however I accept the defendants’ argument that 2.5 days (the Band B allocation) is reasonable for this step, and that the plaintiff’s evidence was unnecessarily wide in scope.	2.5 days
Item 7.2:  Plaintiff’s preparation of lists of issues and authorities, common bundle etc	The plaintiff seeks 2.5 days however I accept the defendants’ argument that 1 day is reasonable for this purpose.	1 day
Item 8:  Preparation for hearing	The plaintiff seeks 3 days (Band C allocation) however I accept the defendants’ argument that 2 days (Band B) is reasonable for this step, for the same reason as regarding Item 7.1.	2 days
Item 9:  Appearance at hearing	The parties agree on 1 day.	1 day
Item 13:  Preparation for CMCs	The plaintiff seeks 0.8 days (4 x 0.2) however I accept the defendants’ argument that 0 days is appropriate as the only preparation required was the preparation of memoranda.	0 days
Sub total	$16,480.00 (10.3 days)
Item 3.6:  Amended pleading	The defendants seek a deduction of 0.6 days at 2B plus the $90 filing fee from the schedule costs to reflect the costs of pleading in response to the plaintiff’s amended statement of claim.  I accept that the statement of claim was amended in a number of distinct respects and required full pleading in response. 0.6 days ($960.00) plus $90.00 per both sets of defendants	- 2,100.00
Total	$14,380.00

[6]      There are two other matters on which the parties disagree: first, the amount of any deduction that should be applied to reflect the plaintiff’s failure on the discharge permit issue; and second, the amounts recoverable for expert witness costs and other disbursements.

Deduction for discharge permit issue

[7]      The defendants seek a 33.33% deduction on the schedule – and applicable expert witness – costs to reflect the plaintiff’s failed cause of action relating to the discharge permit.

[8]      The plaintiffs deny that failed cause of action significantly increased the defendants’ costs (per r 14.7(d)) or contribute unnecessarily to the time or expense of the proceeding (per r 14.7(f)(ii)).  In the alternative, the plaintiff appears to suggest a deduction in the vicinity 12.5%.

[9]      At [32] of my judgment I made it clear that the argument about notification of the discharge consent was unmeritorious.   Accordingly, I am satisfied that a deduction is necessary, and that 20% is appropriate.

Expert witness costs

(i)       Quickfall Associates

[10]     In relation to the costs of Quickfall Associates, the plaintiff seeks $4,850.02 in costs, representing the actual costs of $5,542.88 minus 12.5% for time spent on discharge matters.

[11]     The defendants seek to exclude GST from that figure, and to apply further reductions to reflect discharge matters and the defendants’ costs in replying to those discharge matters, or to start from a two-thirds recoverability starting point.

[13]     Expert evidence is a disbursement for the purposes of r 14.12.   That rule provides that:

...

(2)A disbursement must, if claimed and verified, be included in the costs awarded for a proceeding to the extent that it is—

(a)      of a class that is either—

(i)approved  by  the  court  for  the  purposes  of  the proceeding; or

(ii)      specified in paragraph (b) of subclause (1); and

(b)      specific to the conduct of the proceeding; and

(c)      reasonably necessary for the conduct of the proceeding; and

(d)      reasonable in amount.

(3)Despite subclause (2), a disbursement may be disallowed or reduced if it is disproportionate in the circumstances of the proceeding.  …

[14]     The Court of Appeal in Air New Zealand Limited v Commerce Commission, concluded, in relation to the preceding r 48H, that:[1]

[1] [2007] NZCA 27 at [47] - [48].

We have no doubt that, since the enactment of r 48H, the winning party is generally entitled to recover the actual expenses of its expert witnesses, provided they satisfy the criteria in r 48H(2).  ...

To our minds, r 48H is clear.  There is no reference in it to the losing parties being required to make only a contribution, whether two-thirds or otherwise. All disbursements are treated the same under r 48H, and full recovery is in theory possible.    The protection against unreasonable claims for disbursements is set out in subcl (2).  But provided those criteria are met, the winning party is prima facie entitled to recover the actual expenses.

[15]     Rule 14.12 is not materially different from r 48H.

[16]     There is no argument from the defendants that the criteria in r 14.12 are not met, except to the extent that deduction is required to reflect the discharge issue.

[17]     I concluded above that a general deduction of 20% on Schedule 3 costs is appropriate to reflect the plaintiff’s unsuccessful discharge permit cause of action.  I am satisfied that a 20% deduction is also appropriate here, on the basis that the Quickfall evidence is reflective of the plaintiff’s case as a whole.

[18]     In relation to GST, I proceed on the basis that GST is payable as there is no evidence to support a submission that it should be excluded on the basis that the plaintiff is GST registered and in a position to receive credits.

[19]     Accordingly, $4,434.30 is awarded.

(ii)      Duke & Cooke

[20]     The plaintiff seeks $3,431.25 for expert evidence on valuation issues.

[21]     I accept the defendants’ argument that valuation evidence was not reasonably necessary for the conduct of the proceedings, under r 14.12(2)(c), and do not award any amount for this item.

(iii)     Planscapes

[22]     The plaintiff seeks $622.13 for this expert cost.  The defendants also contest whether GST is payable and the two-thirds recoverability point.

[23]     Having previously accepted that GST is payable and that the starting point is full-recoverability, the full amount is awarded.  There is no deduction required for the discharge issue.

[24]     Accordingly, I award a total of $5,056.43 for expert witness costs.

Disbursements

[25]     The parties agree that the following costs are payable:

Filing and hearing fees  1,400.00
Service fees  190.80
Search fees  40.00

Tolls  92.51

$1,723.31

[26]     The parties dispute the amount payable for photocopying, based on their dispute about the appropriate deduction for discharge issues.  Accordingly, I deduct

20% from the $1,664.30 claimed by the plaintiff, based on my reasoning above, and award $1,331.44.

[27]     The total award for disbursements is therefore $3,054.75.

Summary

[28]     In summary, I award costs to the plaintiff as follows:

Schedule 3 costs	16,480.00
Less costs on amended pleading	2,100.00
Less 20% for discharge issue	3,086.00
$11,294.00
Plus relevant expert witness costs	5,056.43
Plus relevant disbursements	3,054.75
Total	$19,405.18

Joseph Williams J