COMMISSIONER OF INLAND REVENUE v LIVINGSPACE PROPERTIES LIMITED (in liquidation and receivership) [2019] NZHC 3332

COMMISSIONER OF INLAND REVENUE v LIVINGSPACE PROPERTIES LIMITED (in liquidation andreceivership) [2019] NZHC 3332 [17 December 2019]IN THE HIGH COURT OF NEW ZEALANDCHRISTCHURCH REGISTRYI TE KŌTI MATUA O AOTEAROAŌTAUTAHI ROHECIV-2010-409-2323[2019] NZHC 3332BETWEEN COMMISSIONER OF INLANDREVENUEPlaintiffAND LIVINGSPACE PROPERTIES LIMITED(in liquidation and receivership)DefendantAppearances: A Ho for the liquidator of Livingspace Properties LtdJ Moss and H Weston for Kristina BuxtonJudgment: 17 December 2019COSTS JUDGMENT OF ASSOCIATE JUDGE JOHNSTON[On the papers][1] At the conclusion of my judgment in this matter dated 6 September 2019 Ireserved costs and invited counsel to resolve these.1 Regrettably, counsel have notbeen able to do so.[2] My judgment dealt with four interlocutory matters:(a) Ms Buxton's application for an order joining five additionaldefendants;(b) Ms Buxton's application for a stay of the liquidator's application for anorder for further and better discovery pending resolution of herapplication for the removal of the liquidator;1 Commissioner of Inland Revenue v Livingspace Properties Ltd (in liq and in rec) [2019]NZHC 2213.(c) FTG Securities' application for leave to apply for an order unders 284(1) of the Companies Act 1993; and(d) The question of whether the Court has inherent jurisdiction to grantleave to a party to apply for an order removing a liquidator even if thatperson does not fall within the categories of persons referred to ins 284(1) of the Companies Act.[3] For Ms Buxton, Mr Moss submits that she was successful on the first, secondand fourth of those matters and unsuccessful on the third. He proposes that the Courtaward Ms Buxton costs on a 2B basis but discounted so as to reflect the fact that theliquidator was successful on one matter.[4] Mr Ho on the other hand submits that Ms Buxton was not successful on any ofthe four applications. He says that the liquidator's position prevailed on the first andthird while the second and fourth resulted in neutral outcomes.[5] Costs in a case such as this should be viewed from a broad perspective and notsubjected to minute analysis of comparative wins and losses on aspects of issues.[6] As to the first matter, whilst it is true that I declined to make a formal orderjoining the proposed additional defendants, I directed that they be entitled to a right ofaudience in relation to the liquidator's application for further discovery, which was thepurpose for the application. As to the second, I would have made the order for a stayhad the liquidator not agreed to refrain from pursuing his application pending theresolution of Ms Buxton's application for an order removing him. As to the fourth,the position advanced on Ms Buxton's behalf certainly prevailed. It is true that I didnot make an order granting leave to make applications under the inherent jurisdiction.But that was because that was not the issue before the Court.[7] As I see it, Ms Buxton was substantially successful on three of the four issuesbefore the Court, as Mr Moss submits.[8] In my view, in such circumstances, Ms Buxton ought to be entitled to adiscounted award of costs on a 2B basis.[9] Having said that, I accept Mr Ho's submission that Ms Buxton ought not to beallowed costs for two counsel as the case did not merit that. After all it was apreliminary interlocutory argument of only modest complexity.[10] I take Mr Moss' schedule of costs as my starting point but this appears to meto contain some arithmetical errors. My own arithmetic indicates that if items 10, 11,13, 25 and 26 are taken at the 25 per cent discounted rate, items 22 and 24 are takenat the full rate but reduced by the amount of the costs allowed to reflect the liquidator'ssuccess on the third application, and item 27 (second counsel) is deducted, the coststo which Ms Buxton is entitled total $15,136.13. I award Ms Buxton costs of thatamount, plus disbursements of $2,374.31 (which figure is also discounted by 25per cent).Associate Judge JohnstonSolicitors:Canterbury Legal, Christchurch for the applicantsNorling Law, Auckland for the liquidator of Livingspace Properties Ltd