NEW HEALTH NEW ZEALAND INC v MINISTER FOR COVID-19 RESPONSE [2023] NZHC 3132 [7 November 2023]

NEW HEALTH NEW ZEALAND INC v MINISTER FOR COVID-19 RESPONSE [2023] NZHC 3132[7 November 2023]IN THE HIGH COURT OF NEW ZEALANDWELLINGTON REGISTRYI TE KŌTI MATUA O AOTEAROATE WHANGANUI-A-TARA ROHECIV-2022-485-379[2023] NZHC 3132UNDER the Judicial Review Procedure Act 2016AND Part 30 of the High Court RulesIN THE MATTER of COVID-19 Public Health Response(Protection Framework) Order 2021 andCOVID-19 Public Health Response (Masks)Order 2022BETWEEN NEW HEALTH NEW ZEALANDINCORPORATEDApplicantAND MINISTER FOR COVID-19 RESPONSEFirst RespondentATTORNEY-GENERALSecond RespondentHearing: On the papersAppearances: L M Hansen and C F J Reid for the ApplicantK B Bell and E J Cameron for the RespondentsJudgment: 7 November 2023JUDGMENT (NO 2) OF COOKE J(Costs)[1] By judgment dated 21 September I dismissed the applicant's judicial reviewchallenge, providing a preliminary view that costs should be awarded to therespondents on a 2B basis but allowing memoranda to be filed.1 A memorandum ofcounsel for the respondents dated 12 October, and from counsel for the applicant dated1 New Health New Zealand Ltd v Minister for COVID-19 Response [2023] NZHC 2647 at [107].27 October have now been received and referred to me. Three main issues are raisedin relation to the costs award:(a) The applicant says that no costs should be awarded, or they ought to bereduced, as the proceedings were advanced in the public interest.(b) The respondent seeks a 50 per cent uplift for two of the steps given themanner in which the litigation was conducted.(c) The applicant challenges the level of the disbursements that have beenclaimed by the respondents in relation to expert evidence.Public interest[2] Under r 14.7(e) there can be a refusal or reduction in costs if the proceedingconcerned a matter of public interest and the party opposing costs acted reasonably inthe conduct of the proceedings.2 The applicant says that this principle should applyhere, and refers to other unsuccessful Covid-19 challenges where the Court hasindicated that this principle was applicable.3[3] In advancing this submission the applicant first contends that the Court erredin finding that there was not a significant transgression of rights or mistake of factinvolved in the challenged decisions. The applicant says that it is appealing the wholedecision to the Court of Appeal. These arguments are not relevant to the costs award.Costs are awarded on the basis of the judgment as it stands, and the respondents areentitled to have costs assessed on that basis.[4] The applicant next argues that there was significant public interest in ensuringthat coercive public measures such as mask mandates are underpinned by the highestquality scientific evidence. It points out that the Court concluded there weredifferences of view on the effectiveness of face coverings, and it repeats its arguments2 See Environmental Defence Society Inc v New Zealand King Salmon Co Ltd [2014] NZSC 167,(2014) 25 PRNZ 637.3 Four Aviation Security Service Employees v Minister of COVID-19 Response [2021] NZHC 3012,[2022] 2 NZLR 26 at [145]; Four Midwives v Minister of COVID-19 Response [2021] NZHC3420.about the adverse effects of face coverings. It does not accept the respondents'criticisms that the case was not conducted reasonably and says that when proceedingsare brought solely in the public interest costs should not be awarded against theapplicant as this may discourage litigants from bringing claims concerningfundamental rights. Reference is made to Radich J's recent observation that doing socan result in a weakening of the protections of the New Zealand Bill of Rights Act1990.4[5] When judicial review proceedings involve challenges to significant measuresthat affect a section of the wider public I agree that considerations of this kind can berelevant to the costs awards. That has been recognised with other challenges toCOVID-19 measures. But as I said in the judgment I do not consider this proceedingto be of the same kind, and I concluded that the challenge was not well founded.5 Inparticular:(a) Unlike the unsuccessful COVID-19 challenges where the Court hasindicated that costs might not be awarded, or might be reduced, theapplicant's fundamental rights were not affected. Neither was evidencefiled from anyone adversely affected by the mask mandaterequirements. So any reduction in costs would need to be based on awider public interest being advanced by the challenge.(b) By the time of the hearing the mask mandate in effect only related tomedical facilities, and by the time of judgment it had been entirelyremoved. The proceedings cannot be categorised as a challenge to arestrictive measure that affected a category of the public in a significantway in those circumstances. I also note that the applicant sought toadjourn the hearing of the challenge as the trial approached, whichfurther illustrates that the challenge was not directed to matters of4 Greenhorn v The Speaker of the House of Representatives [2023] NZHC 2865 at [61]–[63]referring to Attorney-General v Udompun [2005] 3 NZLR 204 (CA) at [185]–[187].5 New Health New Zealand Ltd v Minister for COVID-19 Response, above n 1, at [105]–[106].significant restriction, but rather to issues that the applicant wished tolitigate as a matter of principle.6(c) The challenged measures were not held to restrict rights under theNew Zealand Bill of Rights Act with the exception of freedom ofexpression, and then only in a limited way. In substance the challengeinvolved the applicant's criticisms of the view that had been formed bythe Ministers and those advising them on the efficacy andappropriateness of a measure taken to respond to the pandemic. Theapplicant is entitled to bring such a challenge to the Court, but it willonly be relieved of the normal cost consequences when the challengefails if a significant public interest can be shown to have been advanced.I held in the judgment that no such public interest was involved, andremain of that view notwithstanding the applicant's reiteration of itspoints in its costs submissions.(d) I consider there is substance to the respondents' criticism of the natureof the challenge. A challenge based on a difference of expert opinionwas artificially characterised as engaging the mistake of fact ground ofjudicial review. The artificiality of that characterisation was illustratedby the fact that the applicant did not refer to any authority for theproposition that such a difference of opinion could found such a judicialreview challenge. Neither was there consistency in the oralsubmissions of counsel for the applicant where the essential nature ofthe applicant's challenge changed on this point depending on whichcounsel was addressing the Court.7(e) Extensive expert opinion was relied on in support of the argumentsraising a broad range of technical issues, although the evidence of oneof the experts was disallowed as inadmissible. The challenge can fairlybe characterised as a comprehensive attack on the merits of the6 New Health New Zealand Ltd v Minister for COVID-19 Response HC Wellington CIV-2022-485-379, 26 May 2023.7 New Health New Zealand Ltd v Minister for COVID-19 Response, above n 1, at [59]–[63].decisions on a wide range of issues. It was not a judicial reviewchallenge to the legality of the decisions clearly based on establishedgrounds of judicial review.[6] For these reasons I see no basis upon which to disallow or reduce the normalaward of costs under r 14.7(e) or otherwise.Uplift[7] The respondents seek an uplift for steps 30 (preparing affidavits, list of issuesor authorities; and agreeing common bundle) and 32 (preparing for hearing) underr 14.6. On a band B basis three days are allowed for each step. The respondents seeka 50 per cent uplift for each step under r 14.6(3)(b)(i). The applicant resists this claimand says that it did not make unnecessary arguments, or pursue arguments withoutmerit.[8] Claims for uplifts are usually directed to a percentage uplift of the entire costsaward, although applying it to only some steps is an available approach.8 I see somemerit in a more refined approach where a percentage increase is allowed only forparticular steps rather than the whole award. Having said that it is important that costsassessments be relatively simple and predictable.[9] I see force in the respondents' submission that the applicant's arguments hadlittle merit, and ultimately involved an invitation to the Court to address the substanceof the decisions made by the Ministers rather than focusing on the legality of thedecisions on established grounds of judicial review. But I do not consider it isnecessary to reach a conclusion on the respondents' application to increase costs onthis basis. The conventional approach to assessing costs involves determining theappropriate time band assessment prior to deciding whether an uplift should beallowed.9 Time band C is contemplated when "a comparatively large amount of timefor the particular step is considered reasonable" under r 14.5(2)(c). Step 30 covers thepreparation of evidence and other associated steps for an affidavit hearing. Band C8 Holdfast NZ Ltd v Selleys Pty Ltd (2005) 17 PRNZ 897 (CA) at [46]–[48].9 At [44].involves four days for the first day of hearing, and then two days per day for the secondto fifth days of the hearing. It seems to me that this is the appropriate allowance here— the expert evidence relied upon by the applicant involved a need to preparesubstantial evidence in response from the respondent, including instructing experts togive expert evidence on the large number of issues raised in addition to the evidencefrom the two Ministers, the two Director-Generals of Health and other deponents.When evidence from a new expert (Dr Jefferson) was filed in reply it was necessaryfor the respondents to obtain further expert evidence responding to it. I consider thata comparatively large amount of time was accordingly reasonably required for thisstep. That assessment arises irrespective of any arguments concerning the merit of theapplicant's challenge.[10] This involves six days for step 30 as well as the three days for step 32,involving a total of nine days. This results in an award of $21,510 which is the sameas the amount of the respondents claim on the 50 per cent uplift basis.[11] For these reasons I allow the days claimed for these steps, but for differentreasons.Expert costs[12] Finally the applicant disputes some of the disbursements claimed by therespondents, in particular a claim for the fees of the experts instructed to give evidencein this proceeding. These were fees rendered by the University of Otago for the workof Professor Baker and Associate Professor Kvalsvig involving the total amount of$74,750.[13] The applicant argues that the expertise of these experts was inferior to theexpertise of those relied upon by the applicant, that Professors Baker and Kvalsvighave been "dedicated advocates of face coverings since June 2020", and that it wassurprising that they needed to undertake the analysis described in their evidencebecause their analysis was the sort of assessment that the Crown ought to haveobtained in any event. The applicant refers to a statement from the Chief Justice tothe profession on 12 September 2022 indicating that independent advice was beingrelied upon by her at that time. The applicant also points out that the invoices wererendered to the Department of Prime Minister and Cabinet showing an existingrelationship for the provision of such services.[14] Disbursements are allowable under r 14.12 in relation to expenses incurred forthe purposes of the proceeding. This includes expert fees under r 14.12(2) if they arereasonable in amount. The applicant says that its own expenses for its expert evidencewere $36,318, less than half the fees charged by the respondents' experts.[15] The Court has previously disallowed expert fees that are very large,particularly for very expensive overseas experts.10 But this will not occur unless thefees are disproportionate, or otherwise unreasonable.11 That cannot be said here. I donot accept the proposition that the respondents' experts had inferior expertise. Indeedthe evidence of the person who appears to have charged the most for giving expertevidence for the applicant was found to be inadmissible as he was not qualified to giveexpert evidence.12 The proposition that Professors Baker and Kvalsvig have beendedicated advocates of face coverings is also not well-founded given that, as I notedin the judgment, Professor Baker had changed his mind about the efficacy of facemasks during the period of the pandemic.13 So I see no basis to disallow the costs ofthe respondents' experts based on the applicants criticism of them.[16] I also see no substance to the applicant's complaint that this expert evidenceshould already have been available to the Crown at some earlier point. Whether expertadvice had been provided by these experts previously is irrelevant. Expert evidenceneeds to be directed to the issues before the Court. Here the expert evidence obtainedand filed by the respondents was specifically directed to the issues that had been raisedby the applicant's expert evidence. The applicant's case involved a very wide-rangingchallenge to the merits of face mask mandates. A large number of issues were raised,some of a highly technical nature. The respondents cannot be criticised for instructingindependent experts to address the matters raised by the applicant's expert evidence inthose circumstances. Indeed it is difficult to see how they could be expected to dootherwise. It would be quite unfair for a claimant to advance a case based on expert10 Houghton v Saunders [2021] NZHC 3590 at [65]–[68].11 Cridge v Studcorp [2022] NZHC 2024 at [146]–[150].12 New Health New Zealand Ltd v Minister for COVID-19 Response, above n 1, at [7]–[10].13 At [43].evidence, and then contend that it is unreasonable for the respondent to instruct itsown expert evidence to address those matters.[17] For these reasons I allow the disbursements as claimed.Conclusion[18] Costs are accordingly awarded to the respondents as claimed for the reasonsset out above.Cooke JSolicitors:G L Reeves, Wellington for the ApplicantCrown Law, Wellington for the Respondents