LEVIN & ANOR V LAWRENCE & ANOR HC AK CIV 2012-404-956

LEVIN & ANOR V LAWRENCE & ANOR HC AK CIV 2012-404-956 [28 August 2012]IN THE HIGH COURT OF NEW ZEALANDAUCKLAND REGISTRYCIV 2012-404-956[2012] NZHC 2166UNDER the Companies Act 1993IN THE MATTER OF the liquidation of Waterman BuildingSupplies Limited (in liquidation)BETWEEN HENRY DAVID LEVIN AND VIVIENJUDITH MADSEN-RIES ASLIQUIDATORS OF PERSONAL HOMESLIMITEDApplicantsAND STEPHEN MARK LAWRENCE ANDANTHONY JOHN MCCULLAGH ASLIQUIDATORS OF WATERMANBUILDING SUPPLIES LIMITEDRespondentsHearing: 18 June 2012Counsel: N Malarao and J Blythe for applicantsD Hughes and P Gautam for respondentsK Fulton for Fletcher Distribution LimitedJudgment: 28 August 2012COSTS JUDGMENT OF TOOGOOD JThis judgment was delivered by me on 28 August 2012 at 2:15 pmPursuant to Rule 11.5 High Court RulesRegistrar/Deputy RegistrarSolicitors: N Malarao, Meredith Connell, Auckland: nick.malarao@meredithconnell.co.nzDM Hughes/P Gautam, Kensington Swan, Auckland:damiel.hughes@kensingtonswan.com; tista.gautam@kensingtonswan.comC L Waugh, Craig Griffin & Lord, Auckland:Copy: K Fulton, Auckland: kerry.fulton@xtra.co.nz[1] The applicants are the liquidators of Personal Homes Limited, a company which was a creditor of Waterman Building Supplies Limited, of whom the respondents are the liquidators.[2] In a judgment dated 25 June 2012, I dismissed the application for orders that Waterman not be removed from the Companies Register and directing the liquidators to permit inspection of the accounts and records of the liquidation and the accounts and records of Waterman under s 256(1)(a)(ii) of the Companies Act 1993.[3] Waterman was the company vehicle for a joint venture between Waterman Enterprises Limited, Trade Mart Limited and Fletcher Distribution Limited (FDL) for the operation of a PlaceMakers franchise. In the originating application, the applicants sought a direction that the application be served on the liquidators and FDL as a party affected by the application.[4] FDL was not formally joined as a party but it filed a notice of opposition to the application. FDL issued a notice that it wished to cross-examine one of the applicants, but subsequently abandoned that intention. FDL did not file any evidence in relation to the matter but was represented by counsel at the hearing and Mr Fulton appeared to advance oral argument in support of written submissions which he had filed. The submissions were helpful.[5] The respondent liquidators seek costs of $8,955 calculated in accordance with the schedules to the High Court Rules on a category 2B basis. That application is not opposed by the applicants.[6] FDL also seeks costs, claiming $5,970 on a 2B basis.[7] It is not disputed that the Court has jurisdiction to award costs to FDL as an intervener.1 Mr Fulton first points to service of the proceeding on FDL as a party affected by the application, being the other primary creditor of the company in liquidation. He also indicates that FDL or, at least, the joint venture company, was the ultimate target of the applicants in applying for permission to review the1 Judicature Act 1908, s 99A; High Court Rules, r 14.1; Diagnostic Medlab v Auckland District Health Board HC Auckland CIV 2006-404-4724, 13 June 2007.accounts of the liquidation and the company in liquidation. I accept that it was clearthat the applicants' purpose in seeking access to the accounts and records was to determine whether there was evidence to suggest that FDL or the joint venture company had received preferential treatment in the course of the liquidation, or whether the liquidators had elected without good cause not to pursue the possibility of a claim against either of those companies.[8] Mr Fulton also points to aspects of the argument which he presented on behalf of FDL to which reference was made in the course of my judgment. Further,he submits that FDL's involvement did not unduly prolong the hearing. Finally, hepointed to an invitation in an email to the plaintiffs' solicitors some weeks before the hearing inviting the applicants to "gracefully withdraw the application."[9] While Mr Fulton's arguments are well founded, I am not persuaded that a separate award of costs should be made in favour of FDL. FDL's interests and those of the liquidators were similar or overlapping. To the extent that submissions were presented on behalf of FDL which did more than merely repeat arguments advanced on behalf of the respondent liquidators, co-operation between counsel could have seen those additional arguments incorporated into the respondents' submissions. Although r 14.15 did not apply, in that FDL was not a respondent, I consider the policy underpinning that rule to have analogous application here. The respondent liquidators and FDL had common or overlapping interests in the outcome of the proceeding. The combined submissions of counsel for the respondents and FDL were directed to the principal argument which was focused on statutory interpretation and the application of the statutory regime.[10] FDL's application for costs is refused. Without opposition, I direct the applicants to pay a contribution of $8,995 to the costs of the respondent liquidators............................................ Toogood J