Willis v Thompson
[2018] NZHC 261
•28 February 2018
IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY
I TE KŌTI MATUA O AOTEAROA TĀMAKI MAKAURAU ROHE
CIV-2015-404-002840 [2018] NZHC 261
BETWEEN LESLIE ARNOLD WILLIS
First Plaintiff
DONALD BRUCE THOMAS Second Plaintiff
AND
PAMELA JOYCE THOMPSON First Defendant
ANZ BANK (NEW ZEALAND) LIMITED Second Defendant
Hearing: (On the papers) Counsel:
Margaret Matthew for the Plaintiffs
Stephen Bryers for the First Defendant
Second Defendant abides the decision of the CourtJudgment:
28 February 2018
[COSTS] JUDGMENT OF MOORE J
This judgment was delivered by me on 28 February 2018 at 3:30 pm pursuant to Rule 11.5 of the High Court Rules.
Registrar/ Deputy Registrar
Date:
WILLIS & ANOR v THOMPSON & ANOR [2018] NZHC 261 [28 February 2018]
Introduction
[1] By decision dated 11 August 2017 I found it was unconscionable for the defendant to retain the benefit of Bonus Bonds worth $50,000 transferred to her by the elderly and dying Mr Willis. Alternatively, I found the defendant had procured the transfer of the bonds through the exercise of undue influence. I declared that the sole legal owners of the Bonus Bonds were the executors of the estate of Mr Willis.
[2] In my judgment I indicated a preliminary view that costs should lie where they fall but invited counsel to file submissions in the event of disagreement. Ms Matthew, for the plaintiffs, filed submissions, but after the issue of my judgment counsel for the defendant sought and obtained leave to cease acting. No memorandum has been filed by or on behalf of the defendant.
[3] In a Minute of 21 December 2017 I addressed Ms Matthew’s submissions, and recorded my revised view that the plaintiffs were entitled to costs on a 2B basis. I invited her to file a memorandum outlining claimable costs, which she has now done. This judgment sets out the reasons for, and quantifies, that award.
Submissions for the plaintiffs
[4] Ms Matthew submits costs and disbursements calculated on a 2B basis should be awarded in favour of the plaintiffs, stressing the Court should not lightly depart from the usual presumption that costs follow the event. While acknowledging the modesty of the sum in issue, Ms Matthew submits denying the plaintiffs costs in this case would create an unfortunate precedent to the effect that only large claims are deserving of costs awards.
[5] Ms Matthew annexes to her submission a copy of a letter dated 19 February
2016 she sent on behalf of the plaintiffs to counsel for the defendant. The letter reveals that the defendant had offered to pay a proportion of the Bonus Bond fund to Mr Willis’ grandchildren. In response, Ms Matthew offered to settle the case on the basis that the defendant would receive $20,000 out of the fund with the balance falling to Mr Willis’ estate. She submits that most of the costs associated with this proceeding would have been avoided had the defendant accepted the offer, which she describes as reasonable.
[6] Ms Matthew quantifies scale costs at $32,112, and disbursements at $3,557.
She provided the following breakdown of costs claimed:
Item
Description
Daily rate
No. of days
Total
1
Commencement of proceeding by plaintiff $2,230
3
$2,2301
22
Filing interlocutory application for directions as to service $2,230
0.6
$1,338
10
Preparation for first case management conference $2,230
0.4
$892
11
Filing memorandum for first case management conference $2,230
0.4
$892
13
Appearance at first case management conference $2,230
0.3
$669
21
Inspection of documents (informal discovery) $2,230
1.5
$3,345
30 Plaintiff’s preparation of affidavits $2,230 2.5 $5,575 31
Plaintiff’s preparation of list of issues, authorities and common bundle $2,230
2.5
$5,575
33 Preparation for hearing $2,230 3 $6,690 34 Appearance at hearing $2,230 2 $4,460 29 Sealing judgment $2,230 0.2 $446 Total Costs 16.4 $32,1122
Discussion
[7] As confirmed by the Supreme Court, in all general courts in New Zealand costs should follow the event.3 There is also a strong implication that a Court is to apply the detailed costs regime provided in the High Court Rules 2016 in the absence of
some reason to the contrary.4
1 This appears to be an arithmetical error on Ms Matthew’s part; the ordinary amount recoverable for this step is $6,690.
2 If three days are allocated for step 1, the total costs claimed on a 2B basis are $36,572.
3 Manukau Golf Club Inc v Shoye Venture Ltd [2012] NZSC 109, [2013] 1 NZLR 305 at [8].
4 Mansfield Drycleaners Ltd v Quinny’s Drycleaning (Dentice Drycleaning Upper Hutt) Ltd (2002)
16 PRNZ 662 (CA) at [27], cited with approval in Manukau Golf Club Inc v Shoye Venture Ltd, above n 3, at [7].
[8] My preliminary view that costs should lie where they fall reflected my view that the plaintiffs’ delay in bringing proceedings was lengthy and not explained entirely satisfactorily. It bears briefly recounting the relevant chronology.
[9] As observed, Mr Willis died on 8 September 2000. That same day, his son instructed his father’s solicitors to contact the ANZ Bank (“the Bank”) and advise it there could be a possible fraud involved in the transfer of the Bonus Bonds into the joint names of Mr Willis and the defendant. Shortly after, in 2001, the Bank placed a stop on the Bonus Bonds to prevent their redemption until the dispute was resolved.
[10] Apparently, in the months that followed Leslie Willis attempted to locate the defendant. But when those attempts failed he sat idle for almost fifteen years. As he explained, he did not start any proceedings because his marriage was failing and he did not regard the matter as one of high priority. It was not until 2015 that he began a further attempt to locate the defendant. He engaged a private investigator who, within a few days, found out where the defendant was living. The defendant’s unchallenged evidence was that she moved to Sandringham in 2000 and was living at that address when Mr Willis died. She moved to Avondale in 2003 and has lived there since.
[11] In the circumstances, the delay did not occasion any prejudice to the defendant which meant the equitable defence of laches failed. But, I consider the same factor is relevant to the determination of costs. The failure to take any substantial action against the defendant for close to 15 years supports the conclusion that costs should lie where they fall. That is particularly so, given it was the actions of Leslie Willis which resulted in the Bank placing a stop on the Bonus Bonds account.
[12] Thus, contrary to Ms Matthew’s submissions, the modesty of the sum at stake was not the primary factor influencing my view that costs should lie where they fall. The primary factor was a lengthy and unexplained delay in issuing proceedings.
[13] The question is whether the plaintiffs’ settlement offer affects the position. As I stated in my earlier Minute, I am satisfied it does. Given the Bonus Bonds were transferred for no consideration into a joint account shared by the defendant and
Mr Willis, the offer of $20,000, representing almost half of the value of the Bonus
Bonds, was entirely reasonable. Despite the offer, the defendant elected to take the matter to trial and lost. She must bear the consequences of that decision.
[14] In ordinary circumstances, the failure to accept what was a reasonable offer could justify an award of increased costs.5 But here, balanced against delay, I am satisfied that costs calculated against the defendant on a 2B basis are appropriate. I have inspected the schedule of costs claimed and am satisfied they are reasonable. I am also willing to adjust for the error in calculating costs associated with commencement. Finally, I am satisfied the disbursements claimed are reasonable.
Result
[15] For the foregoing reasons, I award costs in the sum of $36,572 to the plaintiffs, as well as disbursements of $3,557.
Moore J
Solicitors/Counsel:
Ms Matthew, Auckland
Mr Bryers, Auckland
5 High Court Rules, r 14.6(3)(b)(v). See, for example, Weaver v Auckland Council [2017] NZCA
330 at [35]-[36].
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