Wills v Stewart
[2021] NZHC 3225
•29 November 2021
IN THE HIGH COURT OF NEW ZEALAND CHRISTCHURCH REGISTRY
I TE KŌTI MATUA O AOTEAROA ŌTAUTAHI ROHE
CIV-2021-409-000427
[2021] NZHC 3225
UNDER the Defamation Act 1992 IN THE MATTER
of defamation
BETWEEN
BLENDDYN FRANCIS WILLS
Plaintiff
AND
LISA DOMINIQUE STEWART
Defendant
Hearing: On the papers Counsel:
Plaintiff self-represented
T J Mackenzie for Defendant
Judgment:
29 November 2021
COSTS JUDGMENT OF ASSOCIATE JUDGE PAULSEN
This judgment was delivered by me on 29 November 2021 at 3.30 pm pursuant to Rule 11.5 of the High Court Rules
Registrar/Deputy Registrar Date:
WILLS v STEWART Costs [2021] NZHC 3225 [29 November 2021]
Background
[1] This judgment concerns an application by the defendant (Ms Stewart) for costs upon the discontinuance of this proceeding by the plaintiff (Mr Wills).
[2] On 6 September 2021, Mr Wills commenced this proceeding seeking, amongst other things, damages for defamation and injurious falsehood. On 28 October 2021, Mr Wills applied for summary judgment. That application was set down to be heard on 25 November 2021.
[3] On 17 November 2021, counsel instructed for Ms Stewart, Mr Mackenzie, sent an email to Mr Wills stating the case was unsuitable for summary judgment and advising that if the summary judgment application was not withdrawn costs would be sought upon its dismissal. Mr Wills was to advise his position by 12 pm on 18 November 2021 failing which the opposition to the summary judgment application would be filed.
[4] On 18 November 2021, Mr Wills’ wife responded stating unequivocally, “We will be proceeding. We can prove our case…” and, “Do not make further contact or respond unless it is in regard to settlement. As I will not respond.”
[5] At 12:04 pm on 18 November 2021, Mr Mackenzie again emailed Mr Wills to clarify that his correspondence was directed towards the withdrawal of the summary judgment application not the substantive proceeding and stating, “Mr Wills needs to be aware that the summary judgment will be dismissed and that costs will be sought against him and any costs order enforced against him.” There was a response to that email at 12:33 pm stating “I will seek advice on this”. The email also asserted that Mr Wills had authority that summary judgment was appropriate based on advice of “defamation experts” that had been consulted.
[6] Having received no advice the summary judgment application was to be withdrawn, Ms Stewart filed a statement of defence, notice of opposition to summary judgment application and affidavits on 19 November 2021.
[7] Later, on 19 November 2021, Mr Wills filed a notice of discontinuance following which Mr Mackenzie advised that Ms Stewart would be seeking costs of the proceeding.
[8] Submissions in relation to costs have been filed on behalf of Mr Wills and Ms Stewart and both have confirmed they are happy for me to deal with the matter on the papers without a hearing.
Relevant principles
[9] All issues of costs are in the Court’s discretion but the discretion must be exercised on a principled basis. Relevant in the present context is r 15.23 of the High Court Rules 2016 which provides:
Unless the defendant otherwise agrees or the court otherwise orders, a plaintiff who discontinues a proceeding against a defendant must pay costs to the defendant of and incidental to the proceeding up to and including the discontinuance.
[10] Rule 15.23 creates a presumption in favour of a defendant that a plaintiff who discontinues a proceeding will be liable for costs without the need for the defendant to establish the plaintiff acted unreasonably in commencing and then discontinuing the proceeding. The presumption is designed to give a certain and predictable outcome upon discontinuance but may be displaced if the Court finds there are circumstances which make it just and equitable that it should not apply.1
[11] In FM Custodians Ltd v Pati, Associate Judge Abbott stated the principles governing the exercise of the discretion under r 15.23 as follows:2
(a)As the general rule the Court will not consider the merits of the respective cases (unless they are so obvious that they should influence the costs issue).
(b)The Court will consider the reasonableness of the stance of both parties in the proceeding (whether it was reasonable for the plaintiff to bring and continue the proceeding, and for the defendant to oppose and continue to oppose it, up to the point of discontinuance).
1 Andrew Beck and others (eds) McGechan on Procedure (online ed, Thomson Reuters) at [HR15.23.01].
2 FM Custodians Ltd v Pati [2012] NZHC 1902 at [11] (footnotes omitted).
(c)Conduct prior to the commencement of the proceeding may be relevant (for example, if any conduct by a defendant has precipitated the litigation), as may be the reason for discontinuing (for example, where a change of circumstances has made the proceedings unnecessary).
[12] In Powell v Hally Labels Ltd the Court of Appeal recognised that as a matter of practice the Court does not lightly allow a plaintiff to displace the presumption that costs follow discontinuance.3 The presumption may be displaced “in a clear case” where the plaintiff may have achieved its ends by other means or otherwise discontinued for reasons not connected to the merits such as where a proceeding was reasonably brought but due to some intervening event or decision rendered redundant.4
Discussion
[13] The issue is whether Mr Wills has displaced the presumption that he should pay costs upon the discontinuance. He has filed comprehensive submissions opposing costs.
[14] A significant portion of Mr Wills’ submissions deals with his view of the merits of his claim. He argues that he has a legitimate and solid claim. However, as noted above, in the present context I will not consider the merits of the parties’ respective cases unless they are so obvious that they should influence the costs outcome.5 Here, the merits are not obvious. Ms Stewart denies the allegations Mr Wills makes against her and has filed affidavits supporting her defence. I am in no position to make any assessment of the merits.
[15] Mr Wills says he discontinued the claim believing, based on the email correspondence with Mr Mackenzie, that he would not be liable for costs as he was withdrawing the claim prior to the hearing. Related to this, he says he indicated to Mr Mackenzie he was taking advice and he did so in a timely manner. He also says that he did not receive Ms Stewart’s papers in defence of the claim until after the discontinuance was filed. I do not accept these submissions.
3 Powell v Hally Labels Ltd [2014] NZCA 572 at [20].
4 At [21] and [22].
5 Beck, above n 1, at [HR15.23.01].
[16] Ms Stewart’s position was communicated to Mr Wills very clearly. Unless Mr Wills confirmed he would withdraw the summary judgment application by 12 pm on 18 November 2021, Ms Stewart would seek costs against him. His response, communicated at 8.53am on 18 November 2021, was that he would be proceeding with his application. Although further email correspondence passed between Mr Wills and Mr Mackenzie there was nothing to suggest the summary judgment application (or the substantive proceeding) would be withdrawn and no extension of the deadline to do so was sought or offered. It was entirely reasonable for Ms Stewart to file her defence in those circumstances and also because that was what she was required to do under the High Court Rules.6 It is not accepted by Ms Stewart that Mr Wills did not receive her defence until after he had discontinued the claim but in any event that is irrelevant in the present context.
[17] This is not a case where Mr Wills discontinued his proceeding because his object was achieved by other means or because of an intervening event or change of circumstances the proceeding has become redundant. Mr Wills says the proceeding was withdrawn because he could not afford legal representation. He says Ms Stewart denied him the opportunity for employment and caused his lack of funds. It would be unfair, he says to impose a costs liability upon him in those circumstances. I do not accept these submissions.
[18] There is nothing unfair in awarding costs to Ms Stewart in the circumstance of this case. It appears from Mr Wills’ submissions there were several factors that influenced him to discontinue the proceeding. He commenced this proceeding with the benefit of legal advice and knowing his financial circumstances. A party who issues proceedings must expect to take them through to a conclusion or risk costs consequences. Having issued this proceeding Mr Wills cannot justify his decision to discontinue because Ms Stewart did not capitulate to his demands. There is no way that I can determine what (if any) effect Ms Stewart’s conduct has had on Mr Wills finances. What is clear is that Ms Stewart has been put to the considerable cost of defending the proceeding and she is the successful party and prima facie entitled to costs. It would be entirely unfair to deprive her of her entitlement on the basis that
6 High Court Rules, r 12.9.
Mr Wills does not have an ability to pay. Finally, it was within Mr Wills’ ability to avoid paying costs had he accepted Ms Stewart’s proposal but he did not do so.
[19] Mr Wills also asks I take into account there were several attempts to settle to avoid costs; the inference being Ms Stewart was unreasonable in not settling. A party is not obliged to settle a claim that she does not consider has any merit.
[20] There is a complaint by Mr Wills that the solicitor representing Ms Stewart has also represented him in the past and has a conflict of interest. There is no detail of the conflict nor any suggestion it has influenced the course of this proceeding. This is a matter between Mr Wills and the solicitor. It is not relevant to Ms Stewart’s entitlement to costs.
[21] Mr Wills has failed to displace the presumption in r 15.23 and Ms Stewart is entitled to her costs. She has claimed costs on a 2B basis with an uplift for costs of preparing her opposition to the summary judgment application. This is because of unsatisfactory aspects of the evidence and because there were two tranches of affidavits to respond to. In my view scale 2B costs are appropriate (without the uplift).
Result
[22]Ms Stewart is awarded costs of the proceedings on a 2B basis in the amount of
$6,214 plus disbursements of $220.
O G Paulsen Associate Judge
Solicitors:
Anderson Lloyd (Charlotte Houghton), Christchurch (Counsel: T Mackenzie, Barrister, Christchurch) B F Wills (Plaintiff), self-represented, Christchurch
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