Wenzhou Hongliang Trading Co Limited v MSUT Trustee Limited

[2020] NZHC 2322

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

I TE KŌTI MATUA O AOTEAROA TĀMAKI MAKAURAU ROHE

CIV-2020-404-000453

[2020] NZHC 2322

UNDER

the Property Law Act 2007

IN THE MATTER

of an application for an order under s 348 for orders setting aside certain dispositions of property

BETWEEN

WENZHOU HONGLIANG TRADING CO LIMITED

Plaintiff

AND

MSUT TRUSTEE LIMITED

First Defendant

AND

MSM HOLDINGS NZ LIMITED

Second Defendant

Hearing:	(On the papers)
Counsel:	Howard Thompson for the Plaintiff Peter Twist for the Defendants
Judgment:	7 September 2020

[COSTS] JUDGMENT OF MOORE J

This judgment was delivered by me on 7 September 2020 at 4:30 pm pursuant to Rule 11.5 of the High Court Rules.

Registrar/ Deputy Registrar Date:

WENZHOU HONGLIANG TRADING CO LIMITED v MSUT TRUSTEE LIMITED & ANOR [2020] NZHC

2322 [7 September 2020]

Introduction

[1]                  Wenzhou Hongliang Trading Co Limited (“Wenzhou”) is the beneficiary of a freezing order made by Duffy J on 19 March 2020 against the first defendant, MSUT Trustee Limited (“MSUT”) and the second defendant, MSM Holdings NZ Limited (“MSM”).

[2]                  On 13 May 2020 Lang J granted MSM’s application to vary the freezing order, to enable the settlement of a residential section with immediate effect.

[3]                  On 29 May 2020, I dealt with Wenzhou’s request for further information in relation to assets covered by the freezing order.1 I concluded that only one of the categories of material sought, consisting of documents submitted to funders or prospective funders, should be provided to Wenzhou by MSM.

[4]                  This judgment determines the question of costs for the proceedings held on 13 May 2020 and 29 May 2020.

Submissions

MSM

[5]MSM seeks:

(a)costs of $3,346 for the application to vary the freezing order;

(b)costs of $4,182.50 for the request for information proceeding;

(c)costs of $1,434 for costs of this costs’ application; and

(d)disbursement to be fixed by the Registrar.

1      Wenzhou Hongliang Trading Co Limited v MSUT Trustee Limited & Anor [2020] NZHC 1492.

[6]                  MSM states it was compelled to seek the order to save the sale of the section. It places the blame for this urgency with Wenzhou.

[7]                  MSM also notes that before the request for information hearing, it had already agreed to provide Wenzhou with the category of information which I subsequently ordered to be provided. On that basis, MSM argues that Wenzhou was wholly unsuccessful in the request for information proceeding.

Wenzhou

[8]                  Wenzhou submits that no basis has been made out for an order for costs and that costs should lie where they fall.

[9]                  It is submitted that the question for the variation hearing was moot by the time Lang J dealt with the application. MSM did not disclose to Wenzhou that Lot 3 was subject to sale until 24 April 2020, the date it was to settle. MSM filed its variation application on 11 May 2020. Wenzhou states that it was only provided with a valuation of Lot 3 at that point. On learning the purchase price was consistent with the valuation, the plaintiff informed the Registrar-General of Lands that it did not object to the transfer of the property to the purchasers.

[10]              As to the request for information application, Wenzhou submits that it was taking a responsible approach and should not be penalised in costs. If MSM had disclosed the existence of the sale and purchase agreement over Lot 3 at the outset and had promptly provided information about the identity of the purchasers, the application would probably not have been necessary.

Analysis

[11]Ultimately, costs are at the discretion of the Court.2

2      High Court Rules 2016, r 14.2.

Costs for the freezing order variation

[12]              Under r 14.8 of the High Court Rules 2016, costs on an opposed interlocutory application, unless there are special reasons to the contrary, must be fixed in accordance with these rules when the application is determined. This rule recognises that the costs of an interlocutory application are best fixed contemporaneously by the Judge or Associate Judge who decides it.3

[13]              In their application to vary the freezing order, dated 11 May 2020, the applicant did seek an order for costs. However, Lang J’s Minute granting the order makes no reference to the question of costs. By the time the application was heard, Wenzhou had no opposition to the section being sold. As it submits, the matter was moot. The order was made on 13 May 2020. MSM applied to me for costs on both matters on 14 July 2020. On the basis of the general costs principle that the determination of costs should be predictable and expeditious,4 I will not grant costs in relation to the freezing order variation.

Ancillary order eliciting information

[14]              I agree that MSM was essentially successful on this application. They did not oppose the order that was made and opposed the unsuccessful aspects of Wenzhou’s request for information.

[15]Accordingly, I will grant costs for this matter.

Costs on the costs application

[16]              Lastly, the Court is traditionally reluctant to award costs on costs applications.5 No submission was made as to why this costs application was special. I will not make such an order here.

3      AC Beck and others McGechan on Procedure (online looseleaf ed, Thomson Reuters) at [HR14.8.04].

4      High Court Rules 2016, r 14.2.

5      Jeffreys v Morgenstern [2013] NZHC 1361.

Orders

[17]              Wenzhou are to pay MSM costs of $4,182.50, as well as disbursements to be set by the Registrar.

Moore J

Solicitors:

McMahon Butterworth Thompson, Auckland Mr Twist, Auckland