ISLAND GRACE (FIJI) LTD (IN REC AND IN LIQ) v SATORI HOLDINGS LTD (IN INTERIM LIQ) [2023] NZHC 997

ISLAND GRACE (FIJI) LTD (IN REC AND IN LIQ) v SATORI HOLDINGS LTD (IN INTERIM LIQ) [2023]NZHC 997 [1 May 2023]IN THE HIGH COURT OF NEW ZEALANDHAMILTON REGISTRYI TE KŌTI MATUA O AOTEAROAKIRIKIRIROA ROHECIV-2022-419-000145[2023] NZHC 997BETWEEN ISLAND GRACE (FIJI) LIMITED (INRECEIVERSHIP AND IN LIQUIDATION)PlaintiffAND SATORI HOLDINGS LIMITED (ININTERIM LIQUIDATIONDefendantHearing: On the papersCounsel: A S Olney and B E Marriner for PlaintiffL A O'Gorman KC for DefendantJudgment: 1 May 2023JUDGMENT OF ANDREW J[Costs]This judgment was delivered by Justice Andrewon 1 May 2023 at 3.00 pmpursuant to r 11.5 of the High Court Rules 2016Registrar / Deputy RegistrarDate ..Introduction[1] On 17 February 2023, I granted the plaintiff's application and placed thedefendant company into liquidation pursuant to s 241 of the Companies Act 1993.1[2] This judgment contains my decision on costs.Discussion[3] The general approach is, of course, that costs should follow the event.2 Rule14.1 of the High Court Rules 2016 confers a wide discretion generally on the Court inrelation to costs.[4] I find that the contributory, Mr Griffiths, should pay costs to the plaintiff andon a 2B basis plus disbursements. Although formally a non-party, he effectively actedas a party and had, in my view, made himself liable to costs. He opposed, in substance,the liquidation application.3[5] As to the calculation of the 2B costs, they are awarded on the basis of thecalculations set out in the plaintiff's memorandum dated 3 March 2023, though withsome adjustments as follows.[6] Firstly, I do not accept that costs should be awarded against Mr Griffiths forsteps taken relating to the appointment of interim liquidators. In particular, noallowance will be made for items 22, 24 and 29, either because they precededMr Griffiths taking active steps in the proceeding or, in the case of the sealing of theorder appointing interim liquidators to the company (item 29), would have beenrequired in any event. These costs are to be ordered against the defendant company,Satori Holdings Limited.[7] However, I accept that costs should be awarded against Mr Griffiths in relationto item 49 (filing of the statement of claim and other documents relating to the1 Island Grace (Fiji) Ltd (in rec and in liq) v Satori Holdings Ltd (in interim liq) [2023] NZHC 219.2 High Court Rules 2016, r 14.2(1)(a).3 Concrete Structures (NZ) Ltd v Smith [2019] NZHC 2572 at [13]–[19], citing Reserve Bank ofNew Zealand v CBL Insurance Ltd [2019] NZHC 737.liquidation) given that Mr Griffiths actively opposed the substantive liquidationproceedings.[8] Furthermore, I accept that costs are appropriately awarded with respect toappearances at the case management conferences. The fundamental principle is thatcosts ought to follow the event and there is no basis for departing from this given thatthe case management conferences were necessitated by the applications and othersteps taken in the proceeding by Mr Griffith as contributory. This includes steps takenin preparation for the first case management conference (item 10).[9] I also accept that the hearing was of sufficient complexity to warrant a costsaward for second counsel. I agree with [10] of the plaintiff's memorandum dated17 March 2023 on this point.[10] The combined effect of these findings is to order costs against Mr Griffiths ona reduced basis of $33,092.50. The balance of the costs sought, $5,497, relating toitems 22, 24 and 29, are ordered against the defendant company.[11] As to the disbursements, I accept that allowance should be made for processserver fees. The fees claimed are supported by invoices, and I accept the quantumsought appropriately reflects the complexity of the service required. However, I agreewith the submission of counsel for Mr Griffiths that this disbursement is properly thatof the defendant company and not Mr Griffiths personally. The documents wereserved on the defendant company, rather than Mr Griffiths, with the three instances ofservice comprising of a notice of demand against the defendant company, a statutorydemand for unpaid capital calls and the proceedings for the liquidation of thedefendant company and appointment of interim liquidators.[12] Disbursements associated with costs relating to the appointment of interimliquidators, outlined at [6] above, are also to be ordered against the defendant companyrather than Mr Griffiths. The filing fees for the interlocutory application and for thesealed order for interim liquidation, totalling $217.39, are therefore ordered againstSatori Holdings Limited.[13] However, I find that it is appropriate for disbursements to be awarded againstMr Griffiths in respect of the accommodation and meals of counsel. Again, invoicesrelating to these disbursements have been disclosed and I accept that the instruction ofout of town counsel was appropriate in the circumstances.Result[14] I order that Mr Griffiths is to pay costs of $33,092.50 to the plaintiff, alongwith disbursements of $4,037.72.[15] The defendant company, Satori Holdings Ltd, is to pay the remaining costssought of $5,497 and disbursements of $1,749.29.__________________________Andrew J