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Sullivan v Wellsford Properties Ltd

Sullivan v Wellsford Properties Ltd

Case [2018] NZHC 129 14 February 2018

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IN THE HIGH COURT OF NEW ZEALAND WHANGAREI REGISTRY

I TE KŌTI MATUA O AOTEAROA WHANGANUI ROHE

CIV-2016-488-35

[2018] NZHC 129

BETWEEN
PETER ANTHONY SULLIVAN

First Plaintiff

PORT ALBERT INVESTMENTS LIMITED
Second Plaintiff

AND

WELLSFORD PROPERTIES LIMITED

First Defendant

GARRY EDWARD HANNAM
Second Defendant

SUMPTER BAUGHEN CHARTERED ACCOUNTANTS LIMITED (DISCONTINUED)

Third Defendant

Hearing: On the papers

Counsel:

P J Dale and A J Steel for the Plaintiffs J Golightly for the Defendants

Judgment:

14 February 2018

JUDGMENT OF GORDON J

[As to costs]

This judgment was delivered by me
on 14 February 2018 at 10 am, pursuant to r 11.5 of the High Court Rules

Registrar/Deputy Registrar Date:

Solicitors: Stafford Klaassen, Auckland
Marsden Woods Inskip & Smith, Whangarei

Counsel: P J Dale, Auckland

SULLIVAN v WELLSFORD PROPERTIES LTD [2018] NZHC 129 [14 February 2018]

Introduction

[1] In my reserved judgment dated 8 December 2017,1 I determined that the plaintiffs failed entirely in their claims against the first and second defendants2 which arose out of a purchase by the second plaintiff of a multi-tenanted commercial property from the first defendant.

[2]I indicated in the judgment that:

[225] My present view is that the defendants as the successful parties are entitled to costs and that costs should be on a category 2B basis. However, a final determination of costs is reserved in the event the parties are not able to agree …

[3]The parties were not able to agree and separate memoranda have been filed.

Respective positions

Defendants’ position

[4]The defendants submit that:

(a)Category 2 applies.

(b)Band C should apply to step 30 (defendants’ preparation of briefs) and step 33 (preparation for hearing).

(c)Otherwise band B should apply, including to a Request to Plaintiffs for Further and Better Particulars dated 15 March 2017 (1 day) and Answer to Plaintiffs’ Request for Further Particulars dated 28 March 2017 (1 day), under step 36 by analogy with steps 16 and 18.3

(d)Second counsel should be certified.

1      Sullivan v Wellsford Properties Ltd [2017] NZHC 3047.
2      I will use the term ‘the defendants’ to refer to the first and second defendants. As is apparent from the entituling, the plaintiffs’ claim against the third defendant was discontinued (following settlement).
3      See Weaver v HML Nominees Ltd [2016] NZHC 473 at [51].

(e)An uplift from scale of 50 per cent is appropriate on the basis of a Calderbank offer made to the plaintiffs on 16 December 2016.

[5] A total sum of $145,877.55 is sought, being costs of $117,298 and disbursements of $28,579.55 as set out in the defendants’ schedule of costs annexed as Annexure A to this judgment.

Plaintiffs’ position

[6] The plaintiffs are largely in agreement in relation to the steps on which costs should be allowed to the defendants. However, the plaintiffs oppose the following:

(a)The time allocations claimed for items 10, 11 and 32, submitting that there are errors in the claims.

(b)Band C time allocations for step 30 (defendants’ preparation of briefs) and step 33 (preparation for hearing). It is…

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 Sullivan v Wellsford Properties Ltd

Details

AGLC: Sullivan v Wellsford Properties Ltd [2018] NZHC 129
Case: [2018] NZHC 129
Decision Date: 14 February 2018

CaseChat Overview and Summary

In the case of Sullivan v Wellsford Properties Ltd, the High Court of New Zealand was tasked with determining the costs and disbursements of a proceeding initiated by the plaintiffs, Peter Anthony Sullivan and Port Albert Investments Limited, against the defendants, Wellsford Properties Limited and Garry Edward Hannam. The dispute arose from a transaction involving the purchase of a multi-tenanted commercial property. The plaintiffs' claims against the defendants were dismissed, and the matter proceeded to a determination of costs.

The central legal issues involved the categorisation and banding of the costs, the appropriateness of certification for the defendants' second counsel, the allowance for increased costs due to a Calderbank offer, and the assessment of expert witness expenses and disbursements. The court had to determine whether the defendants' claims for costs were reasonable and justified based on the nature and complexity of the proceeding.

The court concluded that the proceeding should be categorised as a category 2 matter and that band B was appropriate for all steps, except for a specific analogy to step 16 in Schedule 3 for a request for further particulars. The court rejected the defendants' claim for certification of second counsel, finding that the proceeding did not warrant such an expense. The court also declined to award increased costs based on a Calderbank offer, holding that the offer was not reasonable and did not provide an incentive to settle. Regarding disbursements, the court reduced the claim for expert witness expenses by 20% and made a corresponding adjustment to the filing fees to account for the GST component.

The court ultimately awarded the plaintiffs costs of $64,893 and disbursements of $23,104.77, totalling $87,997.97. This decision was made in light of the specific facts and circumstances of the case, the submissions made by both parties, and the relevant legal principles governing costs in High Court proceedings.

Orders