DAVIS v WHITE Costs Judgment [2017] NZHC 500

DAVIS v WHITE Costs Judgment [2017] NZHC 500

Applicants acted unreasonably by pursuing an untenable position (relying on a draft deed and arguing the Freemasons were entitled to the whole fund) contrary to earlier advice that respondent was entitled to the assets; indemnity costs were not awarded because applicants relied on counsel's opinion, but an increased award was warranted; the court therefore awarded a 50% uplift on 2B costs ($34,119 plus $1,928.72 disbursements) in favour of the respondent and ordered the applicants personally to pay 50% of their own legal fees and barred them from recourse to trust funds to satisfy the awarded costs.

Citation
[2017] NZHC 500
Parties
Applicant / Trustee of the Rex White Family Trust: Alexander James Davis; Applicant / Trustee of the Rex White Family Trust: Bruce Cyril McNiece; Respondent / Beneficiary: Minnie Beatrice White
Court
High Court
Jurisdiction
New Zealand
Judgment Date
17 March 2017
Procedural Posture
Trusts Declaration and Directions; Costs / Costs Judgment (on the Papers)
Outcome
Respondent awarded increased costs; applicants ordered personally liable for part of their own fees and barred from using trust funds to meet respondents' costs
Legal Topics
Certainty of Trust, Trustees' Duties, Increased Costs, Indemnity Costs, Personal Liability for Costs, Disgorgement
Trusts Civil Procedure Costs Certainty of Trust Trustees' Duties Increased Costs Indemnity Costs Personal Liability for Costs +1 more

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Parties

Alexander James Davis

Applicant / Trustee of the Rex White Family Trust

Bruce Cyril McNiece

Applicant / Trustee of the Rex White Family Trust

Minnie Beatrice White

Respondent / Beneficiary

Procedural Posture

Trusts Declaration and Directions; Costs / Costs Judgment (on the Papers)

Legal Issues

  1. 1 Whether increased or indemnity costs should be awarded for unreasonable conduct
  2. 2 Whether applicants acted unreasonably in pursuing an untenable position based on a draft deed and seeking to pay trust funds to Freemasons
  3. 3 Whether applicants should be personally liable for costs and barred from recourse to trust funds

Ratio Decidendi

Applicants acted unreasonably by pursuing an untenable position (relying on a draft deed and arguing the Freemasons were entitled to the whole fund) contrary to earlier advice that respondent was entitled to the assets; indemnity costs were not awarded because applicants relied on counsel's opinion, but an increased award was warranted; the court therefore awarded a 50% uplift on 2B costs ($34,119 plus $1,928.72 disbursements) in favour of the respondent and ordered the applicants personally to pay 50% of their own legal fees and barred them from recourse to trust funds to satisfy the awarded costs.

Court Disposition

Respondent awarded increased costs; applicants ordered personally liable for part of their own fees and barred from using trust funds to meet respondents' costs

Orders

  • Applicants to pay respondent increased scale 2B costs totaling NZD 34,119 plus disbursements NZD 1,928.72
  • Applicants ordered to personally meet 50 percent of their own legal costs (including counsel's fees) incurred in commencing and conducting this proceeding