NEW ZEALAND BLOODSTOCK FINANCE & LEASING LTD v JONES [2022] NZHC 1477

NEW ZEALAND BLOODSTOCK FINANCE & LEASING LTD v JONES [2022] NZHC 1477 [23 June 2022]IN THE HIGH COURT OF NEW ZEALANDAUCKLAND REGISTRYI TE KŌTI MATUA O AOTEAROATĀMAKI MAKAURAU ROHECIV-2019-404-1822CIV-2020-404-1357[2022] NZHC 1477BETWEEN NEW ZEALAND BLOODSTOCKFINANCE & LEASING LIMITEDPlaintiffAND GREGORY JOHN JONESDefendantHearing: On the papersCounsel: F A King and A Osama for the plaintiffG J Jones in personDate of judgment: 23 June 2022JUDGMENT OF JAGOSE J[Quantification of solicitor-client costs]This judgment was delivered by me on 23 June 2022 at 10.00am.Pursuant to Rule 11.5 of the High Court Rules.Registrar/Deputy RegistrarSolicitors/Party:McKenna King, HamiltonG J Jones, Auckland[1] By judgment of 28 May 2021,1 Harland J set aside the Registrar's sealing ofmy 5 June 2020 judgment in favour of the plaintiff ("NZ Bloodstock").2 (I also haddismissed Mr Jones' applications for leave to appeal and stay my original judgment,with scale costs payable by Mr Jones.3)[2] Undetermined is the sum of solicitor-client costs on which my originaljudgment in part gave NZ Bloodstock summary judgment against Mr Jones.My 10 August 2021 minute had directed Mr Jones file and serve any and all responsehe had to the balance of NZ Bloodstock's 1 July 2020 memorandum quantifying itsclaim for solicitor-client costs, the timetable for which response was suspended by myand Harland J's 20 August 2021 joint minute while Her Honour determinedNZ Bloodstock's application for recall of her judgment.4 Mr Jones filed his responseon 6 April 2022. The file remained with the Judge for her determination ofinterlocutory costs,5 concluding 6 May 2022, and now is returned to me.[3] NZ Bloodstock seeks I quantify the sum of my original judgment'ssolicitor-client costs at $108,021.95 (including GST) plus interest at 10 per cent perannum. Mr Jones responds I am to recuse myself from any litigation in which he isinvolved, on grounds of my alleged "judicial misfeasance and lack of good faith" indelivering my judgments, and otherwise I am without jurisdiction to re-enter myoriginal determination. He adds I gave NZ Bloodstock summary judgment in terms ofits contractual claim, and it cannot now pursue "Judicature [Act]" interest in thealternative or seek to adduce further evidence to quantify those contractualsolicitor-client costs.1 Jones v New Zealand Bloodstock Finance & Leasing Ltd [2021] NZHC 1228.2 New Zealand Bloodstock Finance & Leasing Ltd v Jones [2020] NZHC 1233.3 New Zealand Bloodstock Finance & Leasing Ltd v Jones [2020] NZHC 1633 and New ZealandBloodstock Finance & Leasing Ltd v Jones [2020] NZHC 1962.4 New Zealand Bloodstock Finance & Leasing Ltd v Jones [2022] NZHC 231.5 New Zealand Bloodstock Finance & Leasing Ltd v Jones [2022] NZHC 948.[4] I previously refused to recuse myself on grounds of my original judgment'scontended error.6 Nothing in Mr Jones' renewed claim — which adds, with referencealso to other adverse judgments from this Court:7[M]embers of the judiciary are plainly acting in concert against me to bothprevent criticism of fellow members of the judiciary and to inflict damage tomy reputation both personally and in terms of the legal profession.— justifies me revisiting that decision. I will not recuse myself.[5] My original judgment gave summary judgment against Mr Jones onNZ Bloodstock's contractual claim.8 That claim expressly included "[t]he plaintiff'ssolicitor-client costs". Such arose by reason of "the advances contract's and lease'sindemnities".9 But that is not to render Mr Jones' liability for such costs exclusivelycontractual.[6] Instead, "[a]ll matters [relating to costs] are at the discretion of the court",10usually for determination in accordance with general principle.11 "Despite" that lattergenerality, the court may make an order "the costs payable are the actual costs,disbursements, and witness expenses reasonably incurred by a party (indemnitycosts)".12 Relevantly here, the power to make such order includes when "the partyclaiming costs is entitled to indemnity costs under a contract or deed".13 In thosecontractual circumstances, if the actual costs, disbursements and expenses are"reasonably incurred" does not engage the court's usual discretion on costs.14 Rather,there is to be an objective assessment — from the perspective of "the contractualprotection the indemnity was intended to provide" — of the contractual indemnity's6 New Zealand Bloodstock Finance & Leasing Ltd v Jones [2020] NZHC 1633 at [5].7 New Zealand Bloodstock Finance & Leasing Ltd v Jones [2021] NZHC 3220; New ZealandBloodstock Finance & Leasing Ltd v Jones [2021] NZHC 3371; and Jones v Stace HammondLawyers [2022] NZHC 47.8 New Zealand Bloodstock Finance & Leasing Ltd v Jones [2020] NZHC 1233 at [42].9 New Zealand Bloodstock Finance & Leasing Ltd v Jones [2020] NZHC 1633 at [26]; and NewZealand Bloodstock Finance & Leasing Ltd v Jones [2020] NZHC 1962 at [3] (and see also [5]–[6]).10 High Court Rules 2016, r 14.1(1).11 Rule 14.212 Rule 14.6(1)(b) (original emphasis).13 Rule 14.6(4)(e).14 Black v ASB Bank Ltd [2012] NZCA 384 at [78].scope, and the reasonableness of the work and charges in that context.15 I am nottherefore without jurisdiction.[7] The advances contract's and lease's indemnities are in uncompromising terms,respectively:All costs and charges and expenses incurred by the Creditor arising fromdefault in payment of any monies owing pursuant to this Agreement or thebreach of any covenant on the part of the Borrower or the Guarantor will bepaid by the Borrower and will from the date on which such costs charges andexpenses are incurred be deemed to be part of this Facility and shall bearpenalty interest computed by applying the penalty interest rate to the amountof costs charges and expenses outstanding daily from the date of payment bythe Creditor until the date of payment by the Borrower.andShould any such event of default occur or be committed at any time, then theLessor may, at its option [o]btain judgment against the Lessee and enforcesuch judgment against the lessee and/or Guarantor/s for the monies owinghereunder or of any deficiency in such monies including but not limited torecovering from the Lessee any shortfall from the proceeds of the sale of theCollateral, damages, interest and costs on a solicitor to client basis whichthe Lessor may suffer by reason of the Lessee's breach or default and anyaction by the Lessor hereunder in consequence thereof and the Lessee herebyagrees to indemnify and keep indemnified the Lessor against all such damagescosts and liabilities as aforesaid[.] The Lessee will in addition to paying [its] own costs in relation to his leasepay the Lessor's reasonable costs of this Lease and without limiting thegenerality of the foregoing shall include the cost of credit checks, ofinvestigations in relation to the Animal, of the costs [of] preparing andexecuting this Lease, and of complying with the registration and formalitiesrelating thereto, of variation or waiver or change demand, of consents andrequests in relation hereto, and of protecting its security interest herein.[8] My original judgment specified the qualifying defaults.16 In my anticipated"robust [judgement]" now,17 NZ Bloodstock's claimed solicitor-client costsreasonably fall within the scope of those indemnities, particularly as "arising fromdefault", 'suffering' solicitor and client costs and "protecting [the plaintiff's] securityinterest". They are supported by appropriately particularised client invoices as well as15 At [80], citing ANZ Banking Group (NZ) Ltd v Gibson [1986] 1 NZLR 556 (CA) and Beecher vMills [1993] MCLR 19 (CA).16 New Zealand Bloodstock Finance & Leasing Ltd v Jones [2020] NZHC 1233 at [24]–[27].17 Black v ASB Bank Ltd, above n 14, at [81], citing Frater Williams & Co Ltd v Australian GuaranteeCorp (NZ) Ltd (1994) 2 NZ ConvC 191,873 (CA) at 191,887.detailed solicitors' time records calculated at what appear to be market rates. I havenothing to impugn their incurrence as beyond the indemnities' scope or themunreasonably incurred within it. (The exception is a half-day hearing fee of $1600,which appears claimed twice, first on its own account and then as charged toNZ Bloodstock on 30 April 2020. Excluding it reduces NZ Bloodstock's claim to$106,421.95.) In any event, it was for Mr Jones to do so,18 and he has not. The 10 percent interest rate sought is less than the 16 per cent penalty interest rate specified inthe advances contract. I cannot identify anything of work exclusively under the leaseif not there incurring the same default interest charge.[9] Last, as I previously held,19 assuming NZ Bloodstock to be GST-registered,GST is not recoverable in costs. I am not able to calculate the net figure from theinformation before me, as the invoices include travel disbursements withoutidentifying if they include or exclude GST.[10] I therefore quantify the sum of solicitor-client costs payable by Mr Jones undermy original judgment at $106,421.95 (less GST, if NZ Bloodstock is GST-registered)plus interest at 10 per cent per annum and direct the Registrar to seal the judgmentaccordingly.—Jagose J18 At [81].19 New Zealand Bloodstock Finance & Leasing Ltd v Jones [2020] NZHC 1962 at [9], citing NewZealand Venue and Event Management Ltd v Worldwide NZ LLC [2016] NZCA 282, (2016) 27NZTC 22-058 at [17].