THE COMMISSIONER OF INLAND REVENUE v THE POP-UP GLOBE FOUNDATION LIMITED [2021] NZHC 718

THE COMMISSIONER OF INLAND REVENUE v THE POP-UP GLOBE FOUNDATION LIMITED [2021]NZHC 718 [31 March 2021]IN THE HIGH COURT OF NEW ZEALANDAUCKLAND REGISTRYI TE KŌTI MATUA O AOTEAROATĀMAKI MAKAURAU ROHECIV-2021-404-91[2021] NZHC 718BETWEEN THE COMMISSIONER OF INLANDREVENUEPlaintiffAND THE POP-UP GLOBE FOUNDATIONLIMITEDDefendantHearing: On the papersAppearances: C Van Der Merwe for the CommissionerJ Marcetic for the shareholder, The Pop-Up Globe InternationalLimitedJudgment: 31 March 2021COSTS JUDGMENT OF ASSOCIATE JUDGE R M BELLThis judgment was delivered by me on 31 March 2021 at 4:30pmpursuant to Rule 11.5 of the High Court Rules.Registrar/Deputy RegistrarSolicitors:Inland Revenue (Cloete van der Merwe/Paul Sparrow), Auckland, for the PlaintiffChapman Tripp (Janko Marcetic/Michael D Arthur), Auckland, for the DefendantCopy for:Gareth Hoole and Clive Bish (liquidators), Ecovis KGA[1] On 12 March 2021, I dismissed the Commissioner's application to put the Pop-Up Globe Foundation Ltd into liquidation, because the company had already been putinto liquidation by a valid shareholder resolution on 3 March 2021.1 That resolutionwas within time under s 241AA(2)(a) of the Companies Act 1993. I awarded costs tothe Commissioner as sought, because notwithstanding the dismissal of the proceedingthe Commissioner had been vindicated in seeking liquidation. Spurred by theCommissioner's application, the shareholder recognised that the company'sinsolvency required liquidation.[2] The hearing on 12 March 2021 concerned the Commissioner's argument thatthe shareholder's resolution was ineffective under s 241AA. The Commissionercontended unsuccessfully that her consent was also required to the appointment of theliquidators. The shareholder, The Pop-Up Globe International Ltd, presentedopposing argument. The hearing was brief.[3] The Pop-Up Globe International Ltd now seeks costs against theCommissioner.[4] Once the Commissioner rejected the validity of the shareholder's resolution of3 March 2021, there was a live issue which required the court's decision. On thatissue, The Pop-Up Globe International Ltd succeeded. The normal rule that costsfollow the event applies.2 The Pop-Up Globe International Ltd should accordinglyhave costs for the steps it took to have the resolution of 3 March 2021 upheld.[5] Under category 2 it seeks costs of $3,824.00, claiming one day for filing astatement of defence, 0.4 of a day for the appearance at the hearing, and 0.2 for filinga memorandum as to costs.[6] It seeks one day for the statement of defence and affidavit by analogy withstep 38 of Schedule 3 of the High Court Rules 2016 – filing a notice of opposition andsupporting affidavits in response to an originating application. In response, the1 Commissioner of Inland Revenue v The Pop-Up Globe Foundation Ltd [2021] NZHC 515.2 High Court Rules 2016, r 14.2(1)(a).Commissioner says that the appropriate analogy is with step 23 - notice of oppositionto an interlocutory application.[7] I am with the Commissioner that the appropriate analogy is with Step 23. Theshareholder's steps were equivalent to those taken in opposition to an interlocutoryapplication, rather than an originating application. The matter required a decision ona single point. The Commissioner proposes 0.3 of a day under Band A, but 0.6 of aday under Band B is more appropriate as the time required to prepare and file theopposition documents.[8] The Commissioner proposes 0.2 of a day for the appearance, whereas theshareholder proposes 0.4 of a day. I take it that the time claimed for the appearancealso includes some preparation time. 0.4 of a day is appropriate. This is not a casewhere costs should be awarded for preparing the costs application.[9] Accordingly, the Commissioner is to pay The Pop-Up Globe International Ltdcosts under category 2 for one day, $2,390.00, plus the filing fee for the statement ofdefence, $93.50..Associate Judge R M Bell