M R MARSHALL V TAYLORS PROPERTIES LTD HC AK CIV 2008-404-003675

M R MARSHALL V TAYLORS PROPERTIES LTD HC AK CIV 2008-404-003675 31 October 2008IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY CIV 2008-404-003675BETWEEN MYRA ROSE MARSHALL Applicant AND TAYLORS PROPERTIES LIMITED Respondent Hearing: On the papers Counsel: D Law for the Applicant N Farrands for the Respondent Judgment: 31 October 2008 at 2.30pmCOSTS JUDGMENT OF WYLIE JThis judgment was delivered by Justice Wylie on 31 October 2008 at 2.30pm pursuant to r 540(4) of the High Court Rules Registrar/Deputy Registrar Date: Solicitors: Wood Ruck Manukau, P O Box 76 014, Manukau City Morrison Kent, P O Box 222, Auckland[1] In June 2008 the applicant filed a notice of application for leave to appeal out of time against a judgment given by Judge Singh on 15 June 2006 in the Manukau District Court (CIV 2006-092-000433). Although Judge Singh's decision is not on the Court file, as I understand it, judgment was given against the applicant on the basis that she had guaranteed a lease of premises to the Marangamai Maramatanga Trust. [2] By agreement between counsel for the parties, the schedule to the lease containing the guarantee was examined by the Police document examiner. The examiner expressed the view that the applicant's signature on the document was most likely to be authentic. While the view expressed did not purport to be a conclusive determination, the applicant accepted that it posed a serious impediment to her application for leave to appeal out of time. She accordingly withdrew the application. [3] The respondent now applies for a costs order. [4] The applicant was granted legal aid in relation to this matter by the Legal Services Agency on 14 August 2008. Although she was not legally aided at the time she lodged and then withdrew her application for leave to appeal out of time, a grant of aid has retrospective effect – Dowd v Gubay (1991) 6 PRNZ 154 at 155, and (1992) 6 PRNZ 158. Consequently the Court must approach the issue of costs having regard to ss 40 and 41 of the Legal Services Act 2000. [5] Section 40(2) provides as follows:No order for costs may be made against an aided person in a civil proceeding unless the court is satisfied that there are exceptional circumstances.[6] It is common ground that the applicant is an aided person and that there are no exceptional circumstances. [7] The respondent does not seek a costs order directly against the applicant. Rather it seeks an order from the Court confirming the costs that would have been paid but for the application of s 40(2) of the Act. It relies on s 40(5) which provides as follows:If, because of this section, no order for costs is made against the aided person, an order may be made specifying what order for costs would have been made against that person with respect to the proceedings if this section had not affected that person's liability.Such order is sought so that the respondent can apply to the agency and ask it to give consideration to payment of some or all its costs – s 41. [8] I accept that an order specifying the costs that would have been awarded against the applicant but for the operation of s 40(2) is appropriate. [9] The applicant's application was lodged on 20 June 2008. The respondent filed a notice of opposition and a reasonably lengthy and comprehensive supporting affidavit. The application was set down for a case management conference on 1 July 2008. The parties filed a joint memorandum on 27 June 2008, seeking orders by consent. Those orders were made by Lang J, and the matter was removed from the list. The application was set down for hearing on 3 September 2008, although that date was subsequently changed to accommodate counsel. On 25 July 2008, the Court was advised, by joint memorandum, that the applicant was withdrawing her application. The fixture was vacated by Harrison J on 13 August 2008, and the parties were asked to advise the Registry whether an application for costs would proceed. The matter came before me as Duty Judge on 2 October 2008 and I directed the filing of the requisite memoranda in relation to costs. [10] The respondent is entitled to costs, the application having been withdrawn. As far as I can ascertain from the file, the appropriate costs category for these proceedings has not previously been discussed or set. In my view costs in the proceedings should be calculated on a 2B basis. [11] The quantum should be calculated by reference to the Third Schedule to the High Court Rules as follows:4.13 Preparing and filing opposition to interlocutory application 0.6 days4.10 Filing memorandum for mentions hearing (dated 10 September 2008 0.4 days 4.17 Appearance at mentions hearing (2 October 2008) 0.2 daysTotal 1.2 daysAt $1,600 per day Costs = 1.2 days x $1,600 (category B daily recovery rate) $1,920[12] In addition, the respondent seeks disbursements as follows:Private investigator's costs (Paragon NZ Limited) $1,183.50 Costs for Police report regarding examination of deed of lease $ 720.00TOTAL $1,903.50[13] The respondent submits that these disbursements are appropriate, and can be properly claimed under r 48H(1)(a) of the High Court Rules. It advises that the private investigator's costs related to enquiries made to locate witnesses and other guarantors to the lease. The time that has passed since execution of the guarantees meant that enquiries by the respondent's solicitors were unsuccessful, and it was necessary to retain private investigators to trace potential witnesses. In regard to the Police report, it was necessary to try and ascertain whether or not the applicant's signature on the guarantee was authentic. The report did not support any suggestion of forgery, and as noted it prompted the applicant to withdraw her application. [14] Copies of invoices rendered by both the private investigators and the New Zealand Police have been made available to me. The respondent has confirmed that the invoices were paid by its solicitors as a disbursement, and that they were necessarily incurred so that the respondent could effectively oppose the applicant's application for leave. [15] Section 40(2) shields legally-aided persons from disbursements as well as costs: see Burmeister v O'Brien HC TAU CIV 2005-470-396 7 April 2008, Doogue AJ. I am satisfied that the disbursements can be properly claimed.[16] If not for the operation of s 40(2) of the High Court Rules, a costs order against the applicant in favour of the respondent would have been made in the sum of $3,823.50. I make an order accordingly. Wylie J