Walker v Gibbston Water Services Limited - [2014] NZHC 549

IN THE HIGH COURT OF NEW ZEALAND CHRISTCHURCH REGISTRY

CIV-2012-409-002834 [2014] NZHC 549

UNDER Section 284 of the Companies Act 1993

IN THE MATTER OF Gibbston Water Holdings Limited (in liquidation)

BETWEEN ROBERT BRUCE WALKER as liquidator of Gibbston Water Holdings Limited Applicant

ANDGIBBSTON WATER SERVICES LIMITED
First Respondent
CASTLEREAGH PROPERTIES LIMITED
Second Respondent
KRISTINA LOUISE BUXTON Third Respondent
CANTERBURY LEGAL SERVICES LIMITED
Fourth Respondent

Submissions received:

25 February 2014 and 12 March 2014

Counsel: K Sullivan for Applicant
J Moss for Respondents

Judgment: 24 March 2014

JUDGMENT OF ASSOCIATE JUDGE OSBORNE
as to costs

[1] This judgment is in relation to costs which were reserved on a substantive

WALKER v GIBBSTON WATER SERVICES LIMITED [2014] NZHC 549 [24 March 2014]

issue judgment on 7 November 2013.1

The substantive proceeding

[2] The applicant, Robert Walker, is liquidator of Gibbston Water Holdings Limited. By Originating Application he sought directions in relation to the liquidation. The respondents raised further issues by cross application.

[3] The parties recognised that there would be a convenience to dealing with some issues first as the outcome on those issues might have obviated the need for judgment on the remaining issues. A hearing proceeded in September 2013 on that basis. By my judgment of 7 November 2013 I made orders in favour of Mr Walker on the first issues dealt with. The proceeding in relation to the remaining directions was adjourned.

The costs issues

[4] Counsel agree that the appropriate categorisation of the proceeding under r 14.3(i) High Court Rules is Category 2. They agree that for the attendances to date the determination of reasonable time under r 14.5 is appropriately by reference to Band B. That is also my assessment.

[5] What the parties disagree on is:

(a) Should costs be awarded now to Mr Walker or should costs be fixed and be costs in the cause?

(b)What are the appropriate items to be included and to what extent should there be a full allowance for the items?

(c) Should the Court’s order as to costs be affected by a pending appeal in

relation to the 7 November 2013 judgment?

Should costs follow the event?

[6] Mr Sullivan for Mr Walker submits that costs should follow the event, with the result that the respondents be ordered to pay costs to Mr Walker. Mr Sullivan acknowledges that the originating application and cross-application seek orders which have yet to be heard and determined. He submits that an allowance of two days for the filing of the application and dealing with the cross-application is a modest allowance. He submits that all the other items he seeks relate to the matters determined in the 7 November 2013 judgment and should be included in an appropriate costs order.

[7] Mr Sullivan does not pursue at this point disbursements such as filing fees. Those can be dealt with at a later date when all substantive issues are resolved.

[8] Mr Moss for the respondents submits that the appropriate order is that the…

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.

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Details

Case: [2014] NZHC 549
Decision Date: 24 March 2014

CaseChat Overview and Summary

In Walker v Gibbston Water Services Limited, the court was tasked with determining the issue of costs in a liquidation proceeding involving Gibbston Water Holdings Limited. The liquidator, Robert Bruce Walker, sought directions in relation to the liquidation, while the respondents raised further issues by cross-application. The court had previously made orders in favour of Mr Walker on the first issues dealt with, but the proceeding in relation to the remaining directions was adjourned. The court now had to determine the appropriate costs to be awarded to Mr Walker.

The parties agreed that the proceeding fell under Category 2 of the High Court Rules and that the determination of reasonable time for the attendances to date was appropriately by reference to Band B. The disagreement between the parties was on whether costs should be awarded now to Mr Walker or should be fixed and be costs in the cause, what items should be included, and whether a pending appeal should affect the court's order as to costs.

Mr Sullivan, representing Mr Walker, argued that costs should follow the event, with the result that the respondents be ordered to pay costs to Mr Walker. He submitted that all the other items he sought related to the matters determined in the 7 November 2013 judgment and should be included in an appropriate costs order. On the other hand, Mr Moss, representing the respondents, submitted that the appropriate order was that the costs for the 16 September 2013 hearing and 7 November 2013 judgment be costs in the cause, as the primary principle under r 14.2(a) was that the party who fails with respect to a proceeding should pay costs to the party who succeeds.

The court found that Mr Walker had reasonably required direction from the court on a range of issues, and there was a degree of interrelationship between some of these issues but they all properly remained for determination. The court concluded that the just order was that Mr Walker have an appropriate award of costs now. The court also determined the appropriate items to be included and to what extent there should be a full allowance for the items. The court rejected the submission that there should be a stay of the costs order pending the outcome of the appeal.

In conclusion, the court ordered that the respondents are jointly and severally to pay to the applicant the sum of $9,641.00 on account of costs. The court also reserved issues of costs and disbursements in relation to such remaining items that had not been fully dealt with in the order.

Orders