Young v Wadman - [2025] NZHC 1746

IN THE HIGH COURT OF NEW ZEALAND HAMILTON REGISTRY

I TE KŌTI MATUA O AOTEAROA KIRIKIRIROA ROHE

CIV-2021-419-000259

[2025] NZHC 1746

UNDER

AND
the Insolvency Act 2006

IN THE MATTER

of the bankruptcy of BRIAN DAVID WADMAN

BETWEEN

GRANT YOUNG

Judgment Creditor

AND

BRIAN DAVID WADMAN

Judgment Debtor

Hearing: On the papers

Appearances:

AM Swan for the Judgment Creditor TJP Bowler for the Judgment Debtor

Judgment:

1 July 2025

JUDGMENT OF ASSOCIATE JUDGE SUSSOCK

This judgment was delivered by me on 1 July 2025 at 11 am pursuant to r 11.5 of the High Court Rules

Registrar/Deputy Registrar

Solicitors:
Auckland Property Legal Service, Auckland Neilsons Lawyers, Auckland

YOUNG v WADMAN [2025] NZHC 1746 [1 July 2025]

Introduction

[1] In my 10 December 2024 judgment, I made a bankruptcy order in respect of the judgment debtor, Brian David Wadman, but directed that the order was to lie in Court until 18 December 2024, to allow Mr Wadman one final opportunity to pay. 1 Mr Wadman took up this opportunity and paid the debt. I therefore issued a further judgment on 20 December 2024, confirming that the bankruptcy order was not to take effect.2

[2] Counsel for the judgment creditor advised prior to the 20 December judgment that the parties had not agreed on costs and that it seemed likely that the debtor would avoid paying costs given the history of the matter. The judgment creditor therefore requested that the bankruptcy proceedings continue until costs had been determined and paid.

[3] The judgment creditor seeks costs on a 2B basis and disbursements, together amounting to $8,178.50. I recorded in the 20 December judgment that the costs claimed appeared appropriately sought but as the debt on which the bankruptcy proceedings were based had now been paid, there may no longer be a basis for the bankruptcy proceedings to continue. I encouraged the parties to try to reach agreement on costs to avoid further delay and expense and made directions that any costs memoranda were to address the question of whether it was appropriate for the bankruptcy proceedings to continue when only costs remain in issue (confirming that the bankruptcy proceedings were to continue in the meantime).

[4]No agreement was reached and further memoranda have been filed.

[5] In addition to submitting the bankruptcy proceedings should not continue, the judgment debtor submits no costs should be awarded as the judgment creditor has been paid.

1 Young v Wadman [2024] NZHC 3973.
2 Young v Wadman [2024] NZHC 3571.

[6]There are therefore two issues for determination:

(a)Can an order for costs be made where payment of the underlying debt has been accepted?

(b)Can bankruptcy proceedings continue when only costs are outstanding?

Can an order for costs be made where payment of the underlying debt has been accepted?

[7] Counsel for the judgment debtor, Mr Bowler, relies upon Re Peacock to support his submission that no costs should be awarded now that the judgment creditor has been paid.3 Counsel submits the decision in Re…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

Continue reading Young v Wadman

Details

AGLC: Young v Wadman [2025] NZHC 1746
Case: [2025] NZHC 1746
Decision Date: 1 July 2025

CaseChat Overview and Summary

In Young v Wadman, the judgment creditor sought to continue bankruptcy proceedings against the judgment debtor, Brian David Wadman, following payment of the underlying debt. The creditor sought to recover costs and disbursements totaling $8,178.50. The primary issues for determination were whether a costs order could be made following payment of the underlying debt and whether bankruptcy proceedings could continue when only costs remain outstanding. The court found that costs could indeed be awarded following payment of the underlying debt, rejecting the argument that the creditor must choose between accepting payment of the debt or pursuing costs. The court held that the creditor was entitled to pursue both, and the reasoning in Smith and Partners (a Firm) v Laurenson was followed. Regarding the continuation of bankruptcy proceedings, the court found that the provisions of the Insolvency Act and the required forms did not support a power to continue the proceedings when only costs remain outstanding, except for the costs of the bankruptcy notice. The court concluded that the bankruptcy proceedings should be discontinued as the underlying debt had been paid. However, the court ordered that costs be paid by the debtor to the creditor in the amount of $8,178.50.

The court ordered that the bankruptcy proceedings be discontinued and that costs in the amount of $8,178.50 be paid by the debtor to the creditor.

Orders