GRANT AND ORS v GOLDENCOURT INVESTMENTS LIMITED [2014] NZHC 2109

GRANT AND ORS v GOLDENCOURT INVESTMENTS LIMITED [2014] NZHC 2109

Indemnity costs were refused because the plaintiffs' conduct did not meet the high threshold of flagrant or exceptionally bad behaviour; however, the plaintiffs conceded the set aside application on the eve of hearing and the circumstances (including personal undertakings by liquidators and inability to secure costs) justified an award of scale costs of $13,134 and disbursements of $3,260 to LY, to be paid by the second plaintiff and the liquidators personally (subject to any company indemnity).

Citation
[2014] NZHC 2109
Parties
First Plaintiff Liquidator of Hunter Gills Road Limited (in Liquidation): Damien Mitchell Grant; First Plaintiff Liquidator of Hunter Gills Road Limited (in Liquidation): John Michael Gilbert; Second Plaintiff: Gills Road Village Limited; First Defendant: Goldencourt Investments Limited; Second Defendant: LY Investment (No 1) Limited as trustee of the LY Investment (No 1) Trust; Third Defendant: Marmande Property Investment Limited; Fourth Defendant: 125 Gills Limited; Fifth Defendant: 125 Gills Road Limited Partnership
Court
High Court
Jurisdiction
New Zealand
Judgment Date
3 September 2014
Procedural Posture
Civil Freezing Order and Related Claims Under Property Law Act and Partnership Disputes / Application to Set Aside Freezing Order Determined on the Papers With Costs Decision
Outcome
Indemnity costs denied; scale costs and disbursements awarded to second defendant (LY); costs payable by second plaintiff and liquidators personally subject to any company indemnity.
Legal Topics
Freezing Order, Set Aside Application, Indemnity Costs, Liquidator Personal Liability, Mortgagee Sale, Property Law Act Ss 176 and 185, Undertaking as to Damages
Property Law Company Law Injunctions and Freezing Orders Costs Law Partnership Law Freezing Order Set Aside Application Indemnity Costs +4 more

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Parties

Damien Mitchell Grant

First Plaintiff Liquidator of Hunter Gills Road Limited (in Liquidation)

John Michael Gilbert

First Plaintiff Liquidator of Hunter Gills Road Limited (in Liquidation)

Gills Road Village Limited

Second Plaintiff

Goldencourt Investments Limited

First Defendant

LY Investment (No 1) Limited as trustee of the LY Investment (No 1) Trust

Second Defendant

Marmande Property Investment Limited

Third Defendant

125 Gills Limited

Fourth Defendant

125 Gills Road Limited Partnership

Fifth Defendant

Procedural Posture

Civil Freezing Order and Related Claims Under Property Law Act and Partnership Disputes / Application to Set Aside Freezing Order Determined on the Papers With Costs Decision

Legal Issues

  1. 1 Whether indemnity costs under r 14.6(4)(a) should be awarded to the second defendant (LY) against the plaintiffs
  2. 2 Whether plaintiffs acted improperly, unnecessarily or in flagrant misconduct justifying indemnity costs
  3. 3 Whether scale costs and disbursements are appropriate

Ratio Decidendi

Indemnity costs were refused because the plaintiffs' conduct did not meet the high threshold of flagrant or exceptionally bad behaviour; however, the plaintiffs conceded the set aside application on the eve of hearing and the circumstances (including personal undertakings by liquidators and inability to secure costs) justified an award of scale costs of $13,134 and disbursements of $3,260 to LY, to be paid by the second plaintiff and the liquidators personally (subject to any company indemnity).

Court Disposition

Indemnity costs denied; scale costs and disbursements awarded to second defendant (LY); costs payable by second plaintiff and liquidators personally subject to any company indemnity.

Orders

  • LY Investment (No 1) Limited is awarded costs on a scale basis in the sum of NZD 13,134 payable by Gills Road Village Limited (second plaintiff) and by the liquidators Damien Mitchell Grant and John Michael Gilbert personally
  • LY Investment (No 1) Limited is awarded disbursements in the sum of NZD 3,260 payable by Gills Road Village Limited (second plaintiff) and by the liquidators Damien Mitchell Grant and John Michael Gilbert personally