Young v Ross

[2023] NZHC 747

IN THE HIGH COURT OF NEW ZEALAND NAPIER REGISTRY

I TE KŌTI MATUA O AOTEAROA AHURIRI ROHE

CIV-2022-441-059

[2023] NZHC 747

BETWEEN

PHILIP ROGER YOUNG

Appellant

AND

PHILIP NICHOLAS ROSS

Respondent

CIV-2022-441-060

BETWEEN

PROGRESSIVE ACCOUNTANTS LIMITED

Appellant

AND

PHILIP NICHOLAS ROSS

Respondent

On the papers:
Counsel:	P R Young in person
Judgment:	4 April 2023

JUDGMENT (NO. 3) OF CHURCHMAN J [COSTS]

Introduction

[1]    On 17 February 2023, I issued my substantive decision in these proceedings, dismissing the appellants’ appeals against two decisions of the District Court at Napier striking out the appellants’ respective claims.1 I considered all of the causes of action had no prospect of success and were properly struck out.2

1      Young v Ross [2023] NZHC 212.

2 At [72].

YOUNG v ROSS (NO. 3) (COSTS) [2023] NZHC 747 [4 April 2023]

[2]    I invited the parties to settle costs between themselves by agreement, failing which they were to file memoranda as to costs which I would then deal with on the papers. It appears agreement has not been reached.

[3]    The respondent, Mr Ross, has now  filed  a  memorandum  claiming costs. Mr Ross’ calculations are based on recovery on a 2B scale basis, with allowance for a second memorandum for the case management conference. He also seeks for the costs to be uplifted by 30 per cent on the basis the appellants’ arguments lacked merit and the appellants acted vexatiously and made scandalous allegations against the respondent, resulting in a final claim for the costs in the sum of $19,418.75.

[4]    This is opposed by Mr Young, on behalf of the appellants. He claims that awarding costs to Mr Ross here would undermine an agreement between them whereby each agreed to bear their own costs. He rejects both the calculation of costs on the amount of time said to have been spent in preparation for the hearing, as well as any uplift.

[5]    It is also relevant that Mr Young has made an application for leave to bring a second appeal against my decision to the Court of Appeal. He submits in his memorandum as to costs that any award of costs should be delayed until after the appeal is heard. However, I have dismissed that application for leave to bring a second appeal, and I consider it is appropriate at this time to address the application brought by Mr Ross for costs as the successful party in the proceedings before me.

Discussion

[6]    Costs are at the discretion of the Court.3 The overall objective is to achieve the outcome that best meets the interests of justice. The High Court Rules 2016 apply to the calculation of costs and set out the principles according to which the discretion must be exercised. Costs will typically be awarded to the successful party,4 which in this case was the respondent, Mr Ross.

3      High Court Rules 2016, r 14.1(1).

4      Rule 14.2(1)(a).

[7]    In considering any costs award, I first address a technical matter raised by  Mr Young, which is whether Mr Ross’ claim for costs is in breach of the parties’ agreement of 4 September 2000 in which the parties agree to bear their own costs. This argument is clearly misconceived. That agreement referred to the 1997 defamation proceedings brought by Mr Young against Mr Ross, which he ultimately discontinued. It is irrelevant to the ability of Mr Ross, who holds a practising certificate as a barrister and solicitor and is entitled to seek costs,5 to claim costs in these proceedings.

[8]    Turning to the costs themselves, this proceeding was categorised  as  Category 2B, which is the categorisation of a proceeding of average complexity requiring counsel of skill and experience considered average in the High Court, and allowing an amount of time normally considered reasonable for each step.6 This is the basis on which Mr Ross has made his calculations. I see no reason to depart from that classification, and no issue arises in respect of those calculations.

[9]    Mr Young challenges the amount of time Mr Ross has claimed for the preparation of written submissions, being three days. Mr Young submits in his memorandum that such an amount of time spent preparing for the hearing is “highly unlikely”. However, I consider such a period of time is reasonable. I note in particular that while the appeals traversed a number of similar factual information and legal issues, the matters involved different parties and, in some cases, different issues. They were also not consolidated. Mr Ross accepts that the case proceeded as though the two had been consolidated into one, but says there was additional work involved in relation to the second appeal. I accept this. There is nothing before me to suggest that the three days’ preparation time claimed is an inflated estimate of the amount of time spent in preparing the submissions for the hearing. I do not disturb the estimates of time spent in preparation as set out in Mr Ross’ memorandum.

[10]   Mr Ross also seeks an allowance for the preparation of a second memorandum in respect of the case management conference. Mr Ross has appropriately factored in an allowance for preparation towards that case management conference only once.

5      McGuire v Secretary for Justice [2018] NZSC 116 at [88].

6      High Court Rules, rr 14.3(1) and 14.5(2)(b).

However, although there was only one case management conference, Mr Ross rightly points out that he was required to prepare two memoranda for that conference, as the hearing proceeded in respect of two distinct appeals. Accordingly, I grant the allowance for a second memorandum.

[11]   I turn now to consider whether there should be an uplift applied to the costs as claimed. Under r 14.6 of the High Court Rules, the Court may order a party to pay increased costs if the party opposing costs has contributed unnecessarily to the time or expense of the proceeding or a step in it, including by taking or pursuing an unnecessary step or an argument that lacks merit,7 or there is some other reason which justifies the Court making an order for increased costs.8

[12]   In this case I have concluded that an uplift is appropriate. I now set out the reasons for that conclusion.

[13]   Many aspects of the case advanced by Mr Young, both on his own behalf, and then on behalf of his company once his own claim was struck out, were entirely without merit. Mr Young also persisted in advancing this unmeritorious case notwithstanding the fact he was alerted to this on multiple occasions by a number of decision-making bodies. Despite the decisions of the District Court striking out his claims, Mr Young essentially repeated the same arguments on appeal. Mr Young also advanced and then perpetuated claims against the respondent that were clearly contrived, including that the respondent acted in contempt of court.

[14]   I am satisfied that the pursuit of the claim here, which lacked merit, warrants increased costs.

[15]   Mr Ross seeks an uplift of 30 per cent for these matters. Instances where an uplift has been applied on 2B costs range between 25 and 50 per cent.9 In the

7      Rule 14.6(3)(b)(ii).

8      Rule 14.6(3)(d).

9      See for example Jarden v Lumley General Insurance (NZ) Ltd [2018] NZCA 6, in which the Court of Appeal upheld the High Court’s award of a 25 per cent uplift; and Baker v Waimakuku Whanau Trust Board Inc HC Napier CIV-2010-441-581, 13 October 2011, where the High Court provided a 50 per cent uplift on an unsuccessful joinder application.

circumstances, I consider a 30 per cent uplift is appropriate, and award that accordingly.

[16]   Where r 14.6(3)(b)(ii) applies, that is, where an argument lacked merit and was inherently unlikely to succeed, the increased costs apply to all steps.10 I consider this was the case here, and accordingly the uplift is to apply to all steps claimed.

Result and orders

[17]The result is that I accept the respondent’s claim for costs in its entirety.

[18]The appellants are to pay to the respondent costs of $19,418.75.

[19]   I note the sum of $2,230 has been lodged with the Court already as security for costs. I direct that this sum is to be paid to the respondent immediately in partial satisfaction of the costs order.

Churchman J

Solicitors:

Cathedral Lane Law, Napier for Respondent cc:           P R Young

10     NR v MR [2014] NZCA 623, (2014) 22 PRNZ 636; and Broadspectrum (New Zealand) Ltd v Nathan [2017] NZCA 434 at [57].