HI-TEC PROPERTY DEVELOPMENTS LIMITED v PHI CONSTRUCTION LIMITED [2020] NZHC 2719

HI-TEC PROPERTY DEVELOPMENTS LIMITED v PHI CONSTRUCTION LIMITED [2020] NZHC 2719

The threshold for security was met; security ordered reflecting usual practice (two-thirds approach adjusted) and reduced to account for the portion of estimated costs attributable to the counterclaim (one-third deduction from the defendants' adjusted $60,000), resulting in $40,000 security ordered against the plaintiff and $25,000 ordered by consent against the defendants; both matters stayed until security is paid.

Citation
[2020] NZHC 2719
Parties
Plaintiff: Hi-Tec Property Developments Limited; First Defendant/first Counterclaim Plaintiff: PHI Construction Limited; Second Defendant/second Counterclaim Plaintiff: ICLP Limited; Counterclaim Defendant: Steven John Palmer
Court
High Court
Jurisdiction
New Zealand
Judgment Date
15 October 2020
Procedural Posture
Civil Contract / Construction Debt / Interlocutory Security for Costs
Outcome
Security for costs ordered: defendants to pay $25,000 into court (by consent) as security for plaintiff's costs in defending the counterclaim; plaintiff to pay $40,000 into court as security for defendants' costs in defending the plaintiff's claim; both respective proceedings stayed until security furnished.
Legal Topics
Security for Costs, Counterclaim, Stay of Proceedings, Costs Estimation
Civil Procedure Contract Construction Law Security for Costs Counterclaim Stay of Proceedings Costs Estimation

Case Brief

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Parties

Hi-Tec Property Developments Limited

Plaintiff

PHI Construction Limited

First Defendant/first Counterclaim Plaintiff

ICLP Limited

Second Defendant/second Counterclaim Plaintiff

Steven John Palmer

Counterclaim Defendant

Procedural Posture

Civil Contract / Construction Debt / Interlocutory Security for Costs

Legal Issues

  1. 1 Whether security for costs should be ordered against the plaintiff
  2. 2 Appropriate quantum of security for costs
  3. 3 Whether and to what extent security for costs may include costs attributable to a counterclaim

Ratio Decidendi

The threshold for security was met; security ordered reflecting usual practice (two-thirds approach adjusted) and reduced to account for the portion of estimated costs attributable to the counterclaim (one-third deduction from the defendants' adjusted $60,000), resulting in $40,000 security ordered against the plaintiff and $25,000 ordered by consent against the defendants; both matters stayed until security is paid.

Court Disposition

Security for costs ordered: defendants to pay $25,000 into court (by consent) as security for plaintiff's costs in defending the counterclaim; plaintiff to pay $40,000 into court as security for defendants' costs in defending the plaintiff's claim; both respective proceedings stayed until security furnished.

Orders

  • First and second defendants jointly and/or severally to pay into court security for the plaintiff's costs in defending the counterclaim in the sum of $25,000
  • The counterclaim is stayed until such security has been given