Townshend v Ranworth Farm Limited

[2021] NZHC 1375

IN THE HIGH COURT OF NEW ZEALAND HAMILTON REGISTRY

I TE KŌTI MATUA O AOTEAROA KIRIKIRIROA ROHE

CIV-2021-419-32

[2021] NZHC 1375

IN THE MATTER OF

an application for pre-trial discovery

BETWEEN

PAMELA DENISE TOWNSHEND

Intended Plaintiff

AND

ROSS EDWIN TOWNSHEND

First Intended Defendant

TOMPKINS WAKE TRUSTEES 2015 LIMITED, PAMELA DENISE TOWNSHEND and ROSS EDWIN
TOWNSHEND as trustees for R E & P D Townshend Foundation Trust
Second Intended Defendant

RANWORTH FARM LIMITED

Third Intended Defendant

On papers
Judgment:	10 June 2021

JUDGMENT OF TOOGOOD J

[Costs]

This judgment was delivered by me on 10 June 2021 at 4.00pm, pursuant to r 11.5 of the High Court Rules

Registrar/Deputy Registrar Date:

Solicitors:

Cooney Law, Cambridge for intended plaintiff

Tompkins Wake, Hamilton for first-named second intended defendant

TOWNSHEND v TOWNSHEND [2021] NZHC 1375 [10 June 2021]

Background

[1]    Pamela Denise Townshend (Mrs Townshend) is the intended plaintiff in this matter. Her former husband, Ross Edwin Townshend, is the first intended defendant and the sole listed director of the third intended defendant. Mrs Townshend has engaged a forensic accountant, Mr Dennis Parsons, to undertake an analysis and investigation into the sum paid to her by Mr Townshend pursuant to a relationship property agreement. Pre-trial discovery of documentation was sought in order for  Mr Parsons to undertake an audit of costs and expenses incurred in a property subdivision in relation to which Mrs Townshend claims she has not been paid the full amount she is due.

[2]    On 24 March 2021, I made consent orders on the application for pre-trial discovery, but the parties are unable to agree about costs.

Approach

[3]    Matters relating to costs are at the discretion of the Court,1 which must be exercised on a principled basis.2 The determination of costs, so far as possible, should be both predictable and expeditious.3

[4]    Rule 14.2(1)(a) provides that, “the party who fails … should pay costs to the party who succeeds”. The other relevant principles set out in r 14.2(1) are that:

(a)an award of costs should reflect the complexity and significance of the proceeding; and

(b)costs should be assessed by applying the appropriate daily recovery rate to the time considered reasonable for each step reasonably required in relation to the proceeding or interlocutory application.

1      High Court Rules 2016, r 14.1(1).

2      Huakiwi Copenhagen Lot 4 Orchard Ltd v Te Moana [2019] NZHC 1582 at [13]; Bi v Westcoast Mining Ltd [2020] NZHC 2940 at [14].

3      High Court Rules 2016, r 14.2(1)(g).

[5]    The successful party is entitled to recover the actual disbursements incurred that were reasonable in amount, reasonably necessary for the conduct of the proceeding, and were specific to the conduct of the proceeding.4

Discussion

[6]    Mrs Townshend applies for costs, calculated on a category 2B basis. She also claims filing and service fees of $900.20. On her behalf, Mr O’Neill submits that the application for discovery was necessary because the intended defendants refused to discover the documents sought by Mrs Townshend unless she agreed to conditions about confidentiality. He submits that the application should not have been necessary and that the first and third intended defendants ought to have agreed to the requests for the documentation without conditions. An award of costs should follow.

[7]    The first and third intended defendants oppose the making of any costs order in favour of Mrs Townshend. Mr Morgan QC submits that costs “can be considered if any proceeding is issued”, but that submission overlooks the possibility that a proceeding may not follow. Mr Morgan argues that presently there has been no inquiry into the merits of an intended claim, but that is not relevant to the merits of the application itself. He says the reason for the delay in providing the documentation was that the intended defendants sought an agreement as to confidentiality from     Mr Parsons if they were to provide the documents. Mr Morgan referred me to a redacted letter dated 10 December 2020, addressed to counsel for Mrs Townshend, offering to provide the requested documentation, subject to Mr Parsons signing a confidentiality agreement.5 Mrs Townshend did not consent to Mr Parsons signing such an agreement, and the documentation was not provided. She was not obliged to agree to conditional disclosure and no such conditions were sought when the application was before the Court.

4      High Court Rules 2016, r 14.12. See further A C Beck and others McGechan on Procedure (loose- leaf ed, Thomson Reuters) at [HR14.12].

5      The confidentiality agreement prevented the disclosure of confidential information received to third parties, except for disclosure to Mrs Townshend’s legal adviser and for Mr Parsons to discuss the confidential information with Mrs Townshend.

[8]    Mr Morgan submits that the only appropriate  course  of  action  was  for  Mrs Townshend to make her application and, when it was granted by consent, receive the benefit of r 8.30(4):

A party who obtains a document by way of inspection or who makes a copy of a document under this rule-

(a)may use that document or copy only for the purposes of the proceeding; and

(b)except for the purposes of the proceeding, must not make it available to any other person (unless it has been read out in open court).

[9]    Mr O’Neill submits in reply that the request for the confidentiality agreement was  unwarranted.  Counsel  submits   that   the   information   was   available   to Mrs Townshend as a matter of right, the request for confidentiality did not need to be signed and the protection referred to by the intended defendants was unnecessary.

Decision

[10]   Mrs Townshend was entitled to discovery without the imposition of conditions which Mr Townshend sought to impose. Although the orders sought were made by consent, Mr Townshend’s initial opposition made it necessary for the application to be made. It succeeded. The application was “of a straightforward nature able to be conducted by counsel considered junior in the High Court”.6 Costs should be calculated on a category 1B basis.

Result

[11]I award costs on a 1B basis, together with disbursements of $900.20.

Toogood J

6      High Court Rules 2016, r 14.3(1).