FARMLANDS CO-OPERATIVE SOCIETY LIMITED v SCOTT & SONS EARTHMOVING LIMITED[2022] NZHC 3048

FARMLANDS CO-OPERATIVE SOCIETY LIMITED v SCOTT & SONS EARTHMOVING LIMITED[2022] NZHC 3048 [22 November 2022]IN THE HIGH COURT OF NEW ZEALANDNELSON REGISTRYI TE KŌTI MATUA O AOTEAROAWHAKATŪ ROHECIV-2022-442-009[2022] NZHC 3048UNDER the Companies At 1993IN THE MATTER of an application for putting a company intoliquidationBETWEEN FARMLANDS CO-OPERATIVE SOCIETYLIMITEDPlaintiffAND SCOTT & SONS EARTHMOVINGLIMITEDDefendantHearing: On the papersAppearances: C Houghton for PlaintiffT Scott (Director) on his own behalf and given permission tomake submissions on behalf of the DefendantJudgment: 22 November 2022JUDGMENT OF ASSOCIATE JUDGE JOHNSTON[COSTS][1] This matter was called in the Associate Judge's list on 7 November 2022. Onthe application of the plaintiff an order was made winding up the defendant company.That order is to come into force at 4.00 pm on Tuesday 13 December 2022, unless, bythat time and date, the company has paid the outstanding debt together with any costsit is ordered to pay.[2] Regrettably, although the plaintiff sought indemnity costs on a contractualbasis, counsel was not in a position to inform the Court as to the quantum of these,and costs therefore had to be reserved.[3] The Court now has a memorandum from Ms Houghton on behalf of theplaintiff as to costs, to which Mr Scott has replied.[4] The plaintiff's claim is based on r 37(h)(iii) of the contract between the plaintiffand the defendant, which provides that if the plaintiff is obliged to commence recoveryproceedings it is entitled to recover its solicitor-and-client (indemnity) costs.[5] The plaintiff claims costs of $20,231.49 and disbursements of $1,244.75, atotal of $21,476.24.[6] In her submissions, Ms Houghton identifies the hourly rates charged by theplaintiff's solicitors and schedulises the firm's attendances going to make up the claim.In my assessment, the plaintiff's costs are within the range of reasonable costs for thework carried out.[7] Mr Scott's argument boils down to the proposition that it would beunreasonable for the plaintiff to recover the costs it is claiming.[8] He points out that the plaintiff's claim was the subject of a settlementagreement between the parties (he may have been a party to this in his personalcapacity). He says that, whilst not all payments called for under that agreement weremade on time, the company's payments are now up to date.[9] He says that the costs occurred after June 2022 are excessive and that the Courtshould not sanction such costs.[10] It is not difficult to see how Mr Scott has reached that view. After that time,there was limited communication between the parties. However, what he does notfactor in is that the plaintiff's solicitors and counsel have been required to prepare forand participate in two if not three hearings.[11] In the end, all the Court would be doing by awarding costs in the amount soughtby the plaintiff is enforcing the terms of the original contract between these twocommercial entities, into which they entered freely.[12] In my view, the appropriate course this case is to award the full amount of costssought by the plaintiff, which I have already concluded are reasonable.[13] The defendant will pay the plaintiff's total costs and disbursements in the sumof $21,476.24.Associate Judge JohnstonSolicitors:Anderson Lloyd, Christchurch for Plaintiff