Vector Limited v Utilities Disputes Commissioner, Utilities Disputes Limited
[2019] NZHC 862
•17 April 2019
IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY
I TE KŌTI MATUA O AOTEAROA TĀMAKI MAKAURAU ROHE
CIV-2017-404-605 [2019] NZHC 862
BETWEEN VECTOR LIMITED
Applicant
ANDUTILITIES DISPUTES COMMISSIONER, UTILITIES DISPUTES LIMITED
First Respondent
AMERICOLD NZ LIMITED
Second RespondentPROGRESSIVE ENTERPRISES LIMITED
Third RespondentWENDCO (NZ) LIMITED
Fourth Respondent
Hearing: On the papers
Appearances: J A Farmer QC, B H Dickey and M P Hardy for Applicant A R Galbraith QC, JWH Little for First Respondent
K Anderson and K E Morrison for Second Respondent J A MacGillivray for Third Respondent
S D Munro and A L Davidson for Fourth Respondent
Judgment: 17 April 2019
JUDGMENT OF COURTNEY J
This judgment was delivered by Justice Courtney on 17 April 2019. At 12 pm.
Pursuant to Rule 11.5 of the High Court Rules.
Registrar/Deputy Registrar Date:…………………………
VECTOR LIMITED v UTILITIES DISPUTES COMMISSIONER [2019] NZHC 862 [17 April 2019]
Introduction
[1] Vector Ltd brought successful judicial review proceedings in relation to decisions made by the Utilities Disputes Commissioner holding Vector liable to compensate claimants affected by a significant power outage.1 I held that the Commissioner had made errors of law.2 I quashed her decisions awarding compensation to the second to fourth respondents, Americold NZ Ltd (Americold), Progressive Enterprises Ltd (Progressive) and Wendco (NZ) Ltd (Wendco) and remitted the matter for reconsideration of the respondents’ complaints.3
[2] Vector seeks costs against the Commissioner and Progressive. The Commissioner took active steps at the outset of the proceeding but subsequently indicated her intention to abide the decision of the Court. Progressive also took steps initially but, at an earlier stage than the Commissioner, indicated its intention to abide the decision of the Court. Vector does not seek costs against Wendco, which, from the outset, indicated that it would abide the decision of the court. Nor does it seek costs against Americold, the only respondent that actively defended the proceeding, because it agreed with Americold that costs would lie where they fell.
[3] Vector also seeks to have costs against the Commissioner and Progressive apportioned, rather than fixed on the usual joint and several basis.4 The proposed apportionment is:
(a)The Commissioner 30 per cent
(b)Americold (notionally) 50 per cent
(c)Progressive 20 per cent
(d)Wendco 0 per cent
1 The Energy Complaints Scheme is a dispute resolution scheme established pursuant to the Electricity Industry Act 2010 to resolve claims against members of the Scheme below a level of
$50,000.
2 Vector Ltd v Utilities Disputes Commissioner [2018] NZHC 3096.
3 At [168].
4 High Court Rules 2016, r 14.14.
Relevant principles
[4] Costs are at the discretion of the court but are invariably determined in accordance with the principles set out at r 14.2 of the High Court Rules 2016. Relevantly, these include that the successful party should be awarded costs and that costs should reflect the complexity and significance of the proceeding, be assessed by applying the appropriate daily rate to the time considered reasonable for each step reasonably required and, as far as possible, be predictable and expeditious.
[5] This proceeding was categorised at an early stage as Category 3 in recognition of its complexity and significance.5 There is no doubt that this is the appropriate categorisation. The costs are sought on the basis of bands B and C which I also consider to be appropriate.6 Vector also seeks that second counsel be allowed for the purposes of costs, which I consider is appropriate.
[6] As noted, costs are generally awarded on a joint and several basis.7 But there are cases in which that approach is not appropriate. In particular, where a defendant abides the decision of the court the cost to the plaintiff can be expected to be less and that can reasonably be expected to be reflected in the costs award.8 However, the fact that a party abides the decision of the court will not necessarily relieve it of exposure to costs; a defendant who abides does not reduce the level of cost to a plaintiff to the same extent as a defendant who admits that claim.
[7] Where there is more than one defendant the court may also consider it appropriate to allocate costs at a variable level between defendants.
Costs against the Commissioner
[8] Before I can consider Vector’s proposed apportionment the question arises whether costs ought to be awarded at all against the Commissioner. Vector argues that the proceedings were necessitated by fundamental and serious legal errors made by
5 Rule 14.3.
6 Rule 14.5(2).
7 Rule 14.14.
8 Hong v Deliu [2016] NZCA 75, [2016] NZAR 667 at [23]–[25]; Kawarau Jet Services Holdings Ltd v Queenstown Lakes District Council HC Invercargill CIV-2008-425-518, 19 May 2009 at [18]–[21]; and Sutton v Canterbury Regional Council [2015] NZHC 1000 at [24]–[26].
the Commissioner, particularly her decision to proceed on a basis that a novel duty of care by Vector to end-users existed. It relies, by analogy, on cases involving local authorities whose decision-making errors led to them being required to contribute to costs in judicial review proceedings challenging the decisions.9
[9] In Sutton v Canterbury Regional Council (a successful judicial review of the Council’s processing of a resource consent) Gendall J held that costs ought to be awarded against the Council.10 He relied on French J’s comment in Kawarau Jet Services Holdings Ltd v Queenstown Lakes District Council that:11
…where the Council made a very fundamental and serious error which necessitated the issuing of proceedings, I consider the council should make a contribution.
[10] In both Sutton and Kawarau Jet Services Holdings Ltd the level of the contribution was 20 per cent.
[11] The Commissioner opposes costs being awarded against her on the ground that her function and role should be viewed as similar to that of a court or arbitral tribunal. She sought to distinguish the line of cases relied on by Vector and, instead, relied on the principle that those with quasi-judicial decision-making roles ought to be exempt from costs if they abide the Court’s decision.12 The Commissioner relied on the decision in Coroner’s Court v Newton, where the Court of Appeal said:13
[44] In this subject area it is important to keep first principle squarely in mind. Costs will only be awarded (even in judicial review proceedings) against judicial officers such as Justices or coroners in the rarest of circumstances when such a judicial officer has done something which calls for strong disapproval. It is certainly not the practice to grant costs against Justices or a coroner merely because that person has made a mistake in law. It must be shown that the judicial officer concerned has acted perversely, oppressively or in bad faith.
9 Sutton v Canterbury Regional Council, above n 8; and Kawarau Jet Services Holdings Ltd v Queenstown Lakes District Council, above n 8.
10 At [27].
11 At [24]; citing Kawarau Jet Services Holdings Ltd v Queenstown Lakes District Council, above n 8, at [18].
12 Graham Taylor Judicial Review: A New Zealand Perspective (4th ed, LexisNexis, Wellington, 2018) at 296.
13 Coroner’s Court v Newton [2006] NZAR 312 (CA).
[12] I accept that the Commissioner is to be viewed as having a quasi-judicial function. In one sense that is not immediately obvious; the role of the Commissioner is created by the deed that established the complaints resolution scheme.14 The Commissioner is appointed by the board that operates the scheme and the Commissioner’s principal role is to consider complaints and facilitate their resolution.15 However, the Commissioner also has the power to make binding decisions which are enforceable in the District Court.16 And although she is not required to apply the law, she must take account of it. In my view the Commissioner exercises a similar power to a Disputes Tribunal Referee.17 Of course, the Disputes Tribunal is a division of the District Court but in substance there is considerable similarity.
[13] There are at least two cases in which costs against the Disputes Tribunal have been considered. In Brown v Christchurch Disputes Tribunal costs were awarded against the Disputes Tribunal on the basis that costs had largely arisen as a result of the Tribunal’s refusal to grant rehearings.18 However, the basis on which those costs were granted was not considered and it is difficult to identify any principle from the decision. In Southern Cross Building Society v Disputes Tribunal at Alexandra Rodney Hansen J declined to award costs.19 Although there was no specific consideration of the principles on which that decision should be made, it is evident that the Judge treated the Disputes Tribunal as a quasi-judicial body that should have costs awarded against it only in exceptional circumstances. The reasons given for refusing costs included that the Tribunal had acted in good faith, reflecting the criteria discussed in Coroner’s Court v Newton.20
[14] I therefore proceed on the basis that costs may only be awarded against the Commissioner in accordance with those principles. In my view the circumstances
14 The Electricity and Gas Complaints Commissioner Scheme (1 October 2014), Part A and E.26.
15 Clause B.1.
16 Clause F.8; and Electricity Industry Act, s 97.
17 Disputes Tribunal Act 1988, s 18(6).
18 Brown v Christchurch Disputes Tribunal [2000] 14 PRNZ 554 (HC) at [18].
19 Southern Cross Building Society v Disputes Tribunal at Alexandra (Costs) [2003] 16 PRNZ 1042 (HC) at [15].
20 At [13]–[15]; referring to Coroner’s Court v Newton, above n 13.
of the case do not warrant costs being awarded. There was no bad faith. The errors did not reflect any conduct that could be described as perverse.
[15] My decision to refuse costs against the Commissioner means that the question of apportionment does not arise. For completeness, however, I briefly indicate my views on this aspect. This issue turned mainly on the extent of involvement of the various parties. Initially the Commissioner advised that she intended to seek directions from the Court that she be entitled to participate fully in the proceeding, including by way of pleadings and submissions but would not take steps until she had obtained such directions. Vector indicated that if the Commissioner were to file a statement of defence (so that Vector could understand the Commissioner’s position), no issue would be taken on costs by doing so. The Commissioner filed a statement of defence together with a memorandum of counsel indicating her intention to seek directions from the Court as to her proper role. Vector filed a very brief statement in reply to the Commissioner’s statement of defence and also addressed the issue of the Commissioner’s participation in memoranda filed for case management conferences. However, by the second case management conference on 24 August 2017 counsel for the Commissioner had advised that the Commissioner intended to abide the Court’s decision. She took no steps from that point and, although represented at the hearing, did not take an active role.
[16] It is evident that the actual costs to Vector as a result of the steps taken by the Commissioner during the early stages of the proceeding were minimal. Most of the time and expense involved in the proceeding from Vector’s perspective occurred subsequent to the Commissioner’s indication that she would abide the decision of the Court. As discussed, abiding rather than admitting a claim may still result in a costs award, albeit reduced. But I accept that admitting the claim was not an appropriate course for the Commissioner. Had she been exposed to costs I would nevertheless have concluded that no order should be made because of the position she took.
Costs against Progressive
[17] The basis of Vector’s application for costs against Progressive is that Progressive took steps in the proceedings from May 2017 to August 2017 and then, in October 2017, advised that it would be abiding the decision of the Court.
[18] Progressive’s decision to abide did not relieve Vector of the cost of advancing the case. It is therefore appropriate that it contributes to the overall costs and I accept the suggested apportionment of 20 per cent as appropriate, subject to the issues noted below.
[19] Vector claims that as a result of its change in position the Court required Vector to file a further memorandum in relation to the appointment of amicus curiae and seeks costs for that (item 11). Progressive says that it ought not be required to meet the whole of that item because that would have been required, even if it had indicated from the outset that it intended to abide that decision of the Court. I do not accept that. The appointment of amicus was required to address an issue that related to Progressive alone. The fact that amicus successfully resisted that ground of review does not alter the position; Progressive could have avoided costs by admitting the claim or it could have defended the proceeding and thereby secured an entitlement to costs on that aspect. But by abiding, it forced Vector to deal with the issue at trial and the Court to appoint amicus to provide a contradictor.
[20] Progressive also resists item 16 which is claimed as being a notice to answer interrogatories that was no more than an informal request for further particulars, to which Progressive responded. I accept Progressive’s position on this issue.
Result
[21]The application for costs against the Commissioner is dismissed.
[22] Costs are awarded against Progressive to the extent of 20 per cent of scale costs and disbursements together with the total amount for item 11 but excluding item 16.
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