Water Guard NZ Limited v Midgen Enterprises Limited

[2016] NZHC 2347

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

CIV-2014-404-000445 [2016] NZHC 2347

BETWEEN

WATER GUARD NZ LIMITED

Plaintiff

AND

MIDGEN ENTERPRISES LIMITED First Defendant

DAVID JAMES MIDGEN Second Defendant

Hearing:	5 July 2016
Appearances:	M J Fisher and H L Hui for Plaintiff D W Grove for First and Second Defendants
Judgment:	4 October 2016

JUDGMENT OF ASHER J

This judgment was delivered by me on Tuesday, 4 October 2016 at 3 pm pursuant to r 11.5 of the High Court Rules.

Registrar/Deputy Registrar

Solicitors/Counsel:

Castle/Brown Solicitors, Auckland.

M J Fisher, Auckland. Dawsons, Auckland.

D W Grove, Auckland.

WATER GUARD NZ LTD v MIDGEN ENTERPRISES LTD [2016] NZHC 2347 [4 October 2016]

Introduction

[1]      On 8 July 2016 I issued a costs decision in this matter.  I stated:1

[34]      In accordance with my finding that the defendants are in general terms entitled to costs against the plaintiff, I grant the defendants their full disbursements, including for their experts.  This includes the disbursements for Mr Stephen Hogg.  I did not particularly rely on his evidence, but it was nevertheless competently presented, and relevant and reasonably necessary to the proceeding.2

[2]      In his submission of 4 July 2016 seeking costs for the defendants, Mr Grove, set out at paragraph 31 the total costs incurred by the defendants, which included a heading at (c) “Expert instructed”.   Two invoices from an expert, Stephen Hogg, were attached.

[3]      Following delivery of the costs judgment on 8 July 2016 Mr Grove filed a memorandum.   He sought a further award of costs, in relation to an expert’s disbursement.  He explained that subsequent to the delivery of my costs judgment on

8 July 2016 he had received an invoice for $15,150.00 from another expert called by the first defendant, Mr Adaway.  He was an expert witness called by the defendant and gave evidence in relation to the electrical ballasts.  I understand Mr Grove to ask for a further award of costs which covers this invoice.

[4]      Mr  Fisher  for  the  plaintiff  opposes.    He  raises  the  question  of  whether Mr Adaway was engaged on a contingency basis, and if so whether he could have been truly regarded as independent.   He seeks a ruling that the invoice is not a disbursement that is payable.

My decision

[5]      I refer in my costs judgment to my overall perception of success in the hearing,3 and my overall assessment of costs.4

1      Water Guard NZ Ltd v Midgen Enterprises Ltd [2016] NZHC 1546.

2      High Court Rules, r 14.12(2).

3      Water Guard NZ Ltd v Midgen Enterprises Ltd, above n 1, at [10].

4 At [28].

[6]      When I granted the defendants their full disbursements, including for experts, I was referring only to the disbursements that were before me.  Indeed I specifically referred to Mr Hogg.  I was not in that paragraph leaving it open for costs to increase for any further invoices that might be received.

[7]      In my costs decision I made some allowance for the costs of the party who in my overall assessment did not succeed, because of partial success on some aspects of the case.5   A precisely formulaic approach was impossible.  In that costs decision I allowed the defendants their full disbursements which included Mr Hogg’s disbursement,  even  though  I  did  not  rely  on  his  evidence.    My  allowance  of Mr Hogg’s disbursement did not turn on the strength of his evidence, but my overall perception of what was a fair costs result.

[8]      The award of the disbursement for Mr Hogg was generous to the defendants. In contrast to Mr Hogg, I did in fact rely on Mr Adaway’s evidence.6   Nevertheless, my overall perception of fairness is that given the degree of success that I have recognised the plaintiff enjoyed in relation to the defects in the units, it would be unfairly generous to add Mr Adaway’s costs to the disbursements.   If I awarded Mr Adaway’s fees, the expert’s fees would at that point almost double.  That seems to me to be too much of a reward for the defendants, who were in part unsuccessful in this aspect of the case.   Needless to say the plaintiffs already have to meet the

costs of its’ own experts.   To order it to pay more would be unjust in the circumstances.

[9]      Therefore I am not prepared to increase the order for costs that I have already made.  I decline Mr Grove’s request to increase the costs judgment or clarify it in the way he seeks.

[10]     I record that I do not accept the submission Mr Fisher made that there should be no payment of Mr Adaway’s fee because he had been instructed on a contingency basis.  It was not established that he was instructed on a contingency basis.  Even if

he was, I would need further argument before I refused payment on that ground.  It is

5 At [29].

6      Water Guard NZ Ltd v Midgen Enterprises Ltd [2015] NZHC 2227 at [124].

not necessary that I take this matter further, as I have refused to increase the award of costs in any event.

……………………………..

Asher J