Weatherhead v O'Sullivan HC Auckland CIV 2009-406-1

[2010] NZHC 1249

IN THE HIGH COURT OF NEW ZEALAND BLENHEIM REGISTRY

CIV 2009-406-1

BETWEEN  VICTOR WEATHERHEAD AND ELIZABETH WEATHERHEAD Plaintiffs

ANDPAUL WALTER O'SULLIVAN AND AMY RUTH O'SULLIVAN

First Defendants

ANDWINSTON JAMES IRVINE AND MORGAN MARGERY IRVINE Second Defendants

Hearing:         On Papers

Counsel:         Q A M Davies for Plaintiffs

P McRae for First Defendants
G W Allan for Second Defendants

Judgment:      21 July 2010

JUDGMENT OF RONALD YOUNG J (Costs)

[1]      Part way through the course of the trial in this case the plaintiffs elected to abandon  the  proceedings.    I  therefore  struck  out  the  plaintiffs’  claim.    Both defendants now seek costs, both either indemnity or increased costs.  The plaintiffs are now represented by different counsel from trial counsel.

[2]      The plaintiff sought access to a water supply for his property.  The causes of action  were  proprietary  estoppel  and  trespass  to  goods.    It  became  abundantly evident during the first day of the trial that the plaintiffs claim could not possibly succeed.  I note that newly instructed counsel for the plaintiffs accepts that the case

was “indeed hopeless”.

VICTOR WEATHERHEAD AND ELIZABETH WEATHERHEAD V PAUL WALTER O'SULLIVAN AND AMY RUTH O'SULLIVAN AND ANOR HC BLE CIV 2009-406-1  21 July 2010

[3]      In the circumstances this is clearly a case for an award of costs beyond scale. It should have been obvious to the plaintiffs that these proceedings could never give them access to the water source they desired.   Secondly, a proper analysis of the facts and law would have revealed that a claim based on proprietary estoppel could not possibly succeed.  In part the cornerstone of the plaintiffs claim was an allegation the first defendants had given reassurances about water supply prior to the plaintiffs’ purchase of the land.  At evidence at trial this claim was effectively abandoned.

[4]      It was also clear that the plaintiffs had alternative and less expensive water sources than the one these proceedings relate to.

[5]      Essentially increased costs can be awarded where there is a failure to act reasonably by the party against whom the award is proposed to be made and indemnity costs were a party has behaved very badly or very unreasonably.

[6]      It is difficult to know precisely here how it came to be that the plaintiffs pursued this litigation.  Mrs Weatherhead, one of the plaintiffs, has filed an affidavit with respect to costs advising that she had not understood the inadequacies in their case before trial and certainly would not have pursued the matter in the High Court had they understood how poor their case was.

[7]      I agree that this is a strong case for the exercise of the discretion in favour of additional costs for both defendants.  The plaintiffs case was always doomed given there was never sufficient evidence to establish their claim.   The defendants had pointed out to the plaintiffs the inadequacies  of their claim prior to  trial.   The plaintiffs did not correct the impression, until trial, that they had received some form of assurance about the water supply by the first defendants prior to purchase.  It was only at trial the plaintiffs accepted that this assertion was wrong.

[8]      I have no doubt in the circumstances, therefore, that each of defendants are entitled to an increase of 50% on the 2B costs.  As to the appropriate 2B costs I agree with plaintiffs’ counsel that no allowance should be in the 2B costs made for the settlement conference and attendance at that conference.  As to preparation for the case, the case proceeded only for one and a half of the anticipated three days.   It

would, however, be quite unfair to the defendants to allow them only preparation for a one and a half day trial when the trial was due to take and would have taken the three days estimated.   In those circumstances they should have the full six day preparation given this preparation would in fact have been required.

[9]      The appropriate costs therefore on a 2B scale prior to any uplift for the first defendant is the sum of $21,780.  As to the second defendants the appropriate sum would be $20,160.  As to the first defendant I order a 50% uplift on the 2B costs of

$21,780 being a further $10,890.  Total costs therefore of $32,670.  As to the second defendants  they  accept  that  their  total  costs  inclusive  of  disbursements  were

$26,198.40.   In the circumstances they should have these full costs.   They would constitute only a modest uplift from the 2B costs.

[10]     Summary:

a)        the first defendants will have costs against the plaintiffs for $32,670 plus disbursements as approved;

b)        the  second  defendants  will  have  costs  against  the  plaintiffs  of

$26,198.40 including disbursements.

Solicitors:

Ronald Young J

Q A M Davies, Gascoigne Wicks, PO Box 2, Blenheim, email: [email protected]

P McRae, C & F Legal Limited, PO Box 1049, Nelson, email: [email protected]
G W Allan, Pitt & Moore, PO Box 42, Nelson, email: graham[email protected]