DELIU v THE NEW ZEALAND LAW SOCIETY [2013] NZHC 2500

DELIU v THE NEW ZEALAND LAW SOCIETY [2013] NZHC 2500 [25 September 2013]IN THE HIGH COURT OF NEW ZEALANDAUCKLAND REGISTRYCIV-2010-404-6182[2013] NZHC 2500BETWEEN FRANCISC CATALIN DELIUPlaintiffAND THE NEW ZEALAND LAW SOCIETYDefendantHearing: On the papersCounsel: Plaintiff in personPJ Morgan QC and TA Needham for DefendantJudgment: 25 September 2013JUDGMENT OF KATZ J(Costs)This judgment was delivered by me on 25 September 2013 at 10:00 amPursuant to Rule 11.5 High Court RulesRegistrar/Deputy RegistrarSolicitors: Glaister Ennor, AucklandCopy to: PJ Morgan QC, HamiltonFC Deliu, AucklandIntroduction[1] This decision relates to costs issues arising out of two judgments previously delivered in these proceedings, namely:(a) a judgment dated 27 June 2013 on various interlocutory issues("Interlocutory Judgment"); and(b) a judgment dated 26 July 2013 in respect of an application by Mr Deliu that I recuse myself from further involvement in theseproceedings ("Recusal Judgment").[2] The New Zealand Law Society ("Law Society") seeks costs in relation toboth those judgments.1 Mr Deliu seeks costs in relation to one application which was the subject of the Interlocutory Judgment and also opposes aspects of the LawSociety's costs claims in relation to both judgments.Costs in respect of the Interlocutory JudgmentThe Interlocutory Judgment[3] The Interlocutory Judgment relates to four interlocutory applications pursued by Mr Deliu relating to:(a) further and better discovery from the Law Society;(b) interrogatories;(c) a notice to the Law Society to admit facts, which Mr Deliu sought court orders in relation to; and(d) an application for further particulars of the statement of defence.1 The basic principle (as set out at r 14.8 of the High Court Rules) is that costs on an interlocutory application should be fixed when the application is determined, and become payable when they are fixed.[4] The Law Society successfully opposed the court orders sought by Mr Deliu in relation to the interlocutory matters referred to at (a) to (c) above. Mr Deliu was partially successful in his application for particulars ((d) above), albeit only to a fairly limited extent. His request for a more explicit pleading in respect of paragraphs 3, 10, 11, and 17 of the statement of defence was declined. The Law Society was, however, ordered to plead more fully to the allegations in paragraphs 6 and 18 of the statement of defence (which both related to the same issue).[5] It was not disputed that the Law Society is entitled to costs in respect of the three applications it successfully opposed, although there are a number of quantum issues to be resolved. The key "liability" issue is whether Mr Deliu is entitled tocosts in respect of the particulars application, in which he was partially successful.Should Mr Deliu be awarded costs in respect of the particulars application?[6] Mr Deliu submitted that he should be awarded costs in respect of his partially successful application for particulars. He submitted, in reliance on Shotter v Westpac Banking Corporation,2 that it is the overall result that matters and that "it is not uncommon for a party to succeed on one issue and to fail on several others and in theordinary course not to suffer in costs for that reason alone".3 Ultimately, Mr Deliu submitted, he had succeeded in respect of his particulars application. As the successful party he should be entitled to costs in respect of that application.[7] The Law Society submitted that an application for further particulars is not the same as a claim in which a plaintiff pleads various causes of action, all of which would result in the same outcome. In such cases a plaintiff only needs to succeed on any one cause of action in order to achieve the desired result. In this case, it was submitted, each request for particulars was discrete. Accordingly an "all or nothing"approach is not appropriate. The Law Society noted that in Shotter the Judge did infact take into account the limited nature of the plaintiff's victory in assessing costsand he considered that recognition should also be given to the defendant bank's success on several of the plaintiff's causes of action. The Law Society submitted that the Court is entitled to take an overall view, taking into account the Law2 Shotter v Westpac Banking Corporation HC Auckland A995/85, 5 June 1991.3 Ibid, at 4 - 5 as cited in Zhao v New Zealand Law Society[2012] NZHC 3112.Society's success on the majority of the issues raised by the plaintiff's particularsapplication. In those circumstances a fair result would be that costs lie where they fall.[8] Although the issue is finely balanced, after careful consideration I have concluded that Mr Deliu is entitled to a modest award of costs in respect of the particulars application. He succeeded in relation to one issue and accordingly an application in relation to that issue, at least, was justified. It cannot therefore be said that the particulars application as a whole was unnecessary. Mr Deliu has incurred costs in pursuing an application that was at least partially justified.[9] Any award of costs must also reflect, however, that the Law Society was put to expense in successfully opposing the majority of the particulars sought, many of which related to matters that were irrelevant or were not the proper subject of pleading. In my view it is appropriate to reduce the costs that would otherwise have been awarded to Mr Deliu by 50% to take account of this factor.Quantum issues[10] The four interlocutory applications were allocated a two day hearing. The key focus of the first day of hearing was, however, an issues conference under s 10 of the Judicature Amendment Act 1972. The interlocutory applications were heard on the second day of the hearing. I therefore accept the Law Society's submissionthat costs should be apportioned on the basis that each application took one quarter of a day.[11] Further, although the scale allows 1.5 days for preparing written submissions for each application, I note that the Law Society accepted that some of the issues overlapped and accordingly only claimed a total of 1.5 days preparation time for all three applications. In my view a time allocation of 0.5 days for the preparation of written submissions (by either party) for each interlocutory application is appropriate. It follows that the appropriate time allocation for Mr Deliu, in respect of the particulars application, is also 0.5 days.[12] Mr Deliu submitted that as the Law Society filed its submissions late (the day prior to the hearing) I should decline to allow a costs claim for their preparation. I do not accept that submission. Although late submissions are obviously not to be condoned, they were nevertheless of considerable assistance both during the hearing and in the preparation of the judgment. Both Mr Deliu and the Court had ample time to consider them prior to the hearing of the interlocutory applications, as the first day of the two day hearing was focussed on the s 10 conference. In addition the Law Society (despite being the respondent) provided the Court with a bundle of key documents for each interlocutory application, which was of considerable assistance.[13] In my view the various other time allocations allowed for under the High Court Rules for Category 2 proceedings are appropriate in the circumstances of this case and no further adjustments are required. On this basis, costs on a scale 2B basis would amount to $2,686.50 in respect of each interlocutory application.[14] The Law Society is accordingly entitled to costs of $8,059.50, whereas Mr Deliu is entitled to costs of $1,343.25 (50% of $2,686.50). The net result is that the Law Society is entitled to costs in respect of the Interlocutory Judgment in the sum of $6,716.25. The costs of the respective filing fees are to lie where they fall.Costs on recusal application[15] In my Recusal Judgment of 26 July 2013 I declined Mr Deliu's applicationthat I recuse myself from further involvement in these proceedings. That application was opposed by the Law Society.[16] At Mr Deliu's request a hearing was held in respect of the recusal application,rather than it being dealt with on the papers. The Law Society now seeks scale costs on a category 2B basis, comprising 0.6 days for filing a notice of opposition ($1,194) and 0.25 days for appearance at the hearing of the defended application ($497.50). Mr Deliu takes issue with the hearing time of 0.25 days and says that the hearing time took under 1 hour.[17] My recollection is that the hearing commenced at approximately 9.00 am and finished just before 10.00 am, as Mr Deliu was due to appear in another court room. Schedule 3 of the High Court Rules provides, however, that hearing time is to be measured in quarter days. The difference is not significant in this case, given that a full quarter day amounts to either 1.25 or 1.5 hours.[18] In my view category 2B costs are appropriate in respect of the recusal application and quantifying costs on that basis will not result in an excessive award of costs in favour of the Law Society.Result[19] The following costs are awarded in favour of the defendant:(a) $6,716.25 in respect of the judgment dated 27 June 2013; and(b) $1,691.50 in respect of the judgment dated 26 July 2013.____________________________Katz J