| IN THE COURT OF APPEAL OF NEW ZEALAND |
| CA288/2014 [2015] NZCA 200 |
| BETWEEN | WAIMAKARIRI DISTRICT COUNCIL |
| AND | KEITH FRASER GAULD |
| Hearing: | 30 April 2015 |
Court: | Harrison, Keane and Wylie JJ |
Counsel: | F P Divich and A C Harpur for Appellant |
Judgment: | 26 May 2015 at 3 pm |
JUDGMENT OF THE COURT
AThe appeal is dismissed.
BThe appellant must pay the respondent indemnity costs calculated on a reasonable solicitor and client basis together with usual disbursements.
____________________________________________________________________
REASONS OF THE COURT
(Given by Harrison J)
Introduction
Following a trial in the High Court at Christchurch, Whata J entered judgment for Keith Gauld against Waimakariri District Council (WDC) for damages of $6,913.39.[1] The Judge found that WDC had negligently failed to issue a statutory rectification notice for Mr Gauld’s house. But he reduced its liability by 25 per cent to allow for contributory negligence.
[1]Gauld v Waimakariri District Council [2013] NZHC 1923, [2013] NZAR 1320.
In the normal course costs follow the event. When giving judgment on liability Whata J provisionally observed that Mr Gauld should be entitled to costs on a 2B basis less 25 per cent.[2] Given the modesty of the damages award, it might have been expected that the parties would accept Whata J’s provisional view or agree on costs. However, WDC sought a costs award against Mr Gauld on the ground that he acted unreasonably in rejecting its offer made on 26 March 2013, two weeks before the trial started, to settle his claim for $50,000. WDC sought costs from that date of $18,275.22. Mr Gauld maintained his claim for costs.
[2]At [102].
Whata J found for Mr Gauld and entered judgment in his favour for costs of $31,288 plus disbursements.[3] WDC now appeals against the costs judgment but not the liability judgment.
High Court
Whata J identified the key issue as being whether WDC’s settlement offer of $50,000 had the effect of either disentitling Mr Gauld to costs either in full or in part or entitling WDC to its costs from the date of the offer.[4]
[4]At [3].
WDC’s offer was made in terms of r 14.10 of the High Court Rules. Costs were thus governed by r 14.11 which materially provides:
14.11 Effect on costs
(1)The effect (if any) that the making of an offer under rule 14.10 has on the question of costs is at the discretion of the court.
…
(3) Party A is entitled to costs on the steps taken in the proceeding after the offer is made, if party A—
(a) offers a sum of money to party B that exceeds the amount of a judgment obtained by party B against party A; or
(b) makes an offer that would have been more beneficial to party B than the judgment obtained by party B against party A.
(4) The offer may be taken into account, if party A makes an offer that—
(a)…
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- Case
- [2015] NZCA 200
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