NEW HEALTH NEW ZEALAND INC v WELLINGTON WATER LTD [2022] NZHC 2783

NEW HEALTH NEW ZEALAND INC v WELLINGTON WATER LTD [2022] NZHC 2783 [27 October 2022]IN THE HIGH COURT OF NEW ZEALANDWELLINGTON REGISTRYI TE KŌTI MATUA O AOTEAROATE WHANGANUI-A-TARA ROHECIV-2022-485-556[2022] NZHC 2783UNDER the Judicial Review Procedure Act 2016IN THE MATTER of an application for judicial review and anapplication for a declarationBETWEEN NEW HEALTH NEW ZEALAND INCApplicantAND WELLINGTON WATER LTDFirst RespondentWELLINGTON CITY COUNCILSecond RespondentHUTT CITY COUNCILThird RespondentHearing: On the papersAppearances: T Mijatov and J S Trevella for the ApplicantA S Butler for the RespondentsJudgment: 27 October 2022JUDGMENT (NO 2) OF COOKE J(Costs)[1] By judgment dated 16 September 2022 I declined an application for interimorders.1 I indicated that the respondents would be entitled to costs, and if not agreedthis could be addressed by memoranda. Memoranda have now been filed. Therespondents seek costs on a 3B basis with certain uplifts, and the applicant submits1 New Health New Zealand Inc v Wellington Water Ltd [2022] NZHC 2389.that the respondents should only be entitled to a nominal award of costs. So the partiesare a considerable distance apart.[2] I address the differences between the parties arising from their memoranda.Public interest[3] The applicant argues that the interim relief application was brought in thepublic interest justifying no more than a nominal costs award.[4] Rule 14.7(e) of the High Court Rules 2016 contemplates that costs can berefused or reduced when the proceeding concerned a matter of public interest and theparty acted reasonably in the conduct of the proceedings. The applicant argues thatthe fluoridation of water supplies involves a limitation of the right to refuse to undergomedical treatment under the New Zealand Bill of Rights Act 1990, and that theinternational materials indicate that there are genuine issues about the benefits anddetriments of the fluoridation of drinking water supplies. It emphasises that it hasnothing personally to gain by the proceedings. It also refers to previous decisionswhich have recognised the importance of public interest litigation, including whenparties act as effective watchdogs of the public interest, including when fundamentalrights have been limited.2[5] I do not accept, however, that such principles mean that costs should not beawarded here. As I indicated in the judgment, the applicant has already challenged thefluoridation of drinking water supplies all the way through to the Supreme Court inthe earlier proceeding. I am told that in this first challenge costs were awarded againstthe applicant in the High Court, Court of Appeal and Supreme Court. In any event,the applicant must have appreciated that its chances of success second time aroundwere slim, particularly given the enactment of the Health (Fluoridation of DrinkingWater) Amendment Act 2021 which amounted to a legislative response to the issuesraised by it in the first challenge. I held the application for interim relief was " at2 Environmental Defence Society Inc v The New Zealand King Salmon Company Ltd [2014] NZSC167, (2014) 25 PRNZ 637; New Zealand Animal Law Association v Attorney-General [2022]NZHC 2192 at [21]; Te Whare O Te Kaitiaka Ngahere Inc Society v West Coast Regional Council[2015] NZCA 356 at [27]; Yardley v Minister of Workplace Relatons and Safety [2022] NZHC 975at [8].best opportunistic, and also somewhat artificial ".3 The applicant cannot avoid thenormal cost consequences of litigation it has initiated in those circumstances.Categorisation[6] The respondents say that this proceeding should be categorised as category 3,but the applicant says it should be categorised as category 2.[7] Under r 14.3 of the High Court Rules 2016 category 2 proceedings are:Proceedings of average complexity requiring counsel of skill and experienceconsidered average in the High Court.[8] Category 3 proceedings are:Proceedings that because of their complexity or significance require counselto have special skill and experience in the High Court.[9] It is important to note that the categorisation does not flow from counselactually instructed. Rather it is an assessment by the Court of the character of theproceedings themselves. The applicant argues that whilst the proceeding raised issuesof administrative law it did not meet the required standard of "specialist" expertise,referring to a number of recent judicial review proceedings where costs were awardedon a category 2 basis.4[10] The fact that this is a judicial review proceeding does not of itself mean that itmoves into category 3, although judicial review does in itself involve a degree ofspecialisation. Each case will depend on its characteristics. This particular challenge,and the interim relief application, was one of some complexity. There had alreadybeen an extensive challenge that had been argued in the High Court, Court of Appeal,and Supreme Court. The new challenge was based on issues concerning the healthbenefits (or otherwise) of fluoridation and reasonably extensive scientific evidencewas filed in support of the application. There was new legislation now regulating thefield, and the applicant was seeking interim relief pending the hearing of its new3 New Health New Zealand Inc v Wellington Water Ltd, above n 1, at [28].4 Wellington International Airport Ltd v Waka Kotahi New Zealand Transport Agency [2022] NZHC954 at [235]; Moveme Health Ltd v New Zealand Artificial Limb Service [2022] NZHC 1629;New Zealand Animal Law Association v Attorney-General, above n 2; Yardley v Minister forWorkplace Relations and Safety, above n 2 (noting, however the Court's reservation in paragraph[11]).challenge. These factors seem to me to demonstrate that these were proceedings thatbecause of their complexity and special significance required counsel of special skilland experience, rather counsel of skill and experience considered average in the HighCourt. I agree that the proceedings are to be categorised as category 3.Uplifts[11] The respondents seek an uplift of the costs award for two reasons:(a) that each of the respondents was required to respond to the interim reliefapplication, and incurred its own costs in delivering material, affidavits,and providing instructions; and(b) the respondents offered the applicant an opportunity to withdraw theapplication for interim relief with costs to lie where they fall which wasdeclined.[12] The respondents seek an uplift of either 50 to 100 per cent in relation to thesteps of taking instructions and filing papers in opposition. The uplift is not soughtfor the costs incurred for the hearing itself. The respondents note that they appearedby a single counsel and seeks an award of costs on that basis. It is also relevant thatwhen the application was first fielded by me as Duty Judge I indicated at the telephoneconference that there may be costs consequences if the application was pursued andwas unsuccessful.[13] The applicant says that these claims are extraordinary, and that even a 50 percent uplift would amount to more than the notional two third award that the scheduleis directed to. It also argues that the ground for an uplift under r 14.6 has not been setout, that the costs incurred by the respondents were not unusual with the coordinationdemonstrated by them instructing single counsel. It also says that the "walk away"offer is not a good reason to uplift costs.[14] I accept the applicant's submission that there is no basis to increase costsbecause of the respondents' settlement offer. Rule 14.6(3)(b)(v) includes a failure toaccept a settlement offer as a reason to increase costs. But the respondents incurredno additional legal expenditure because the applicant declined this offer, and the lackof merit in the application does not of itself meet the level warranting an increase.[15] I also accept the applicant's point that the respondents have not articulated abasis for an uplift under r 14.6. But it seems to me that the respondents are making aslightly different point which is properly addressed in another way. This was an urgentapplication for interim relief brought against three separate entities that needed torespond to it. They would each have incurred legal expenditure to organise thatresponse, yet they jointly seek a single costs award. The appropriate way for the costsregime to respond to the additional legal expenditure arising from those circumstancesis in the time allocations. In particular under r 14.5(2) this is not a situation where "anormal amount of time is considered reasonable" for the initial response, but ratherwhere "a comparatively large amount of time for the particular step is consideredreasonable". So rather than awarding the respondents a percentage uplift I direct thatsteps 23 and 24 (filing opposition to the interlocutory application, and preparingwritten submissions) should be awarded on a time band C basis rather than a time bandB basis. In particular I accept that there would have been more work required by thethree bodies to consider the papers, assess the position, instruct single counsel, providematerial to counsel and to review the argument advanced in response than would havebeen the case if there was a single respondent. That approach also takes into accountthat higher legal costs are likely to be involved to respond to an application broughton an urgent basis. So a higher time allowance is reasonable in the circumstances.Conclusion[16] For the above reasons I conclude that public interest factors do not mean thatcosts should not be awarded to the respondents, that the proceedings are appropriatelycategorised as category 3 because of their particular complexity, and that some of thesteps should be assessed under time band C rather than B as the three respondents hadto coordinate a single response to an application brought on a urgent basis.[17] Costs are to be calculated on the above basis.Cooke J