ECKHOFF v ORBELL [2021] NZHC 1118

ECKHOFF v ORBELL [2021] NZHC 1118 [19 May 2021]IN THE HIGH COURT OF NEW ZEALANDCHRISTCHURCH REGISTRYI TE KŌTI MATUA O AOTEAROAŌTAUTAHI ROHECIV-2019-409-000133[2021] NZHC 1118BETWEEN PHILIPPA JANE ECKHOFFPlaintiffAND RUTH ALICE ORBELLFirst DefendantAND NICOLA ALICE HYSLOPSecond DefendantAND WILLIAM HAMISH ORBELLThird DefendantAND RUTH ALICE ORBELL and WILLIAMHAMISH ORBELL as trustees of theHamish Orbell Family TrustFourth DefendantsAND NICOLA ALICE HYSLOP, JONATHANANGUS HYSLOP and QA TRUSTEES2012 LIMITED as trustees of the HyslopFamily TrustFifth DefendantsAND JOHN DUNCAN MCFARLANESixth DefendantAND JONATHAN ANGUS HYSLOPSeventh DefendantHearing: On the papersCounsel: D R Tobin for PlaintiffM K Prendergast for First DefendantM J Wallace for Second, Fifth and Seventh DefendantsS J Jamieson and J A Higby for Third and Fourth DefendantsJudgment: 19 May 2021JUDGMENT OF ASSOCIATE JUDGE PAULSEN ON COSTSThis judgment was delivered by me on 19 May 2021 at 11.30 ampursuant to Rule 11.5 of the High Court RulesRegistrar/Deputy RegistrarDate:[1] In a judgment of 13 April 2021 I determined applications:1(a) by the second, fifth and seventh defendants for further particulars of thestatement of claim; and(b) by the plaintiff for particular discovery from the first and seconddefendants.[2] I directed counsel to confer on costs and reserved leave to file memoranda oncosts if necessary.[3] Memoranda have now been filed for the plaintiff, the first defendant andsecond, fifth and seventh defendants.[4] Although Ms Jamieson and Mr Higby appeared at the hearing for the third andfourth defendants no memorandum has been filed on their behalf and it is to be inferredthey do not seek costs.The application for further particulars of statement of claim[5] The second, fifth and seventh defendants were successful on their applicationfor further particulars of the statement of claim. They are entitled to an award of scale2B costs and disbursements amounting to $6,314.The application by the plaintiff for particular discoveryThe parties' positions[6] Both the first and second defendants claim success on this application and seekcosts. The plaintiff also claims some success on the application but in recognition thather success was limited she argues costs should lie where they fall.1 Eckhoff v Orbell [2021] NZHC 757.Relevant principles[7] All matters of costs are discretionary. The discretion must be exercised on aprincipled basis. The determination of costs, so far as possible, should be bothpredictable and expeditious.2[8] The party who has lost should pay the costs of the party that has won.3 Theloser pays costs unless there are exceptional reasons to the contrary.4 It is not unusualfor a party bringing an application or proceeding to achieve only partial success. Ithas been held that the starting point in such cases is that success on more limited termsis still success.5[9] In Emmons Developments New Zealand Ltd v Mitsui Sumitomo Insurance CoLtd, Dunningham J observed it is not always easy to determine which party wonoverall and what is required is a realistic appraisal of the end result.6 There, thisappraisal involved consideration of which party won in circumstances where theparties had put five discrete issues before the Court for determination and each hadhad mixed success. Dunningham J had regard to several other factors in determiningthe question of which party won overall including the terms of a partial settlementagreement resolving issues which would otherwise have been determined in theproceeding and the downstream financial implications of the findings on the fiveissues determined in the proceeding. Ultimately she decided that balancing all mattersneither party had won nor lost and costs were to lie where they fell.7[10] Costs on an opposed interlocutory application should, unless there are specialreasons to the contrary, be fixed when the application is determined.82 Rule r 14.2(1)(g).3 Rule 14.2(1)(a).4 Rule 14.2(1)(a); Shirley v Wairarapa District Health Board [2006] NZSC 63, [2006] 3 NZLR 523at [19].5 Weaver v Auckland Council [2017] NZCA 330, (2017) 24 PRNZ 379 at [26].6 Emmons Developments New Zealand Ltd v Mitsui Sumitomo Insurance Co Ltd [2020] NZHC 932at [28].7 At [41].8 High Court Rules 2016, r 14.8(1)(a).[11] In the present context some reference is necessary to r 14.7 of the High CourtRules which relevantly provides:14.7 Refusal of, or reduction in, costsDespite rules 14.2 to 14.5, the court may refuse to make an order forcosts or may reduce the costs otherwise payable under those rules if—(d) although the party claiming costs has succeeded overall, thatparty has failed in relation to a cause of action or issue whichsignificantly increased the costs of the party opposing costs; or(f) the party claiming costs has contributed unnecessarily to thetime or expense of the proceeding or step in it by—(ii) taking or pursuing an unnecessary step or an argumentthat lacks merit; or(g) some other reason exists which justifies the court refusing costsor reducing costs despite the principle that the determination ofcosts should be predictable and expeditious.The circumstances of this case[12] Here, by her application, the plaintiff sought particular discovery of fivecategories of documents. This is how the plaintiff's application fared:(a) In respect of one category (category (b)), the first and seconddefendants did not oppose the order sought by the plaintiff. Thedocuments were to be supplied by consent, although the plaintiffcomplains this has still not occurred.(b) In respect of another category (category (e)), the second defendant wasrequired to give further discovery to the plaintiff, albeit on a morelimited basis than had been sought.(c) In respect of the remaining three categories of documents (categories(a), (c) and (d)), the application was dismissed.[13] The first defendant submits the plaintiff's application failed as no order wasmade against her to provide additional discovery of documents to the plaintiff and theapplication was unnecessary in any event as discovery issues could have been resolvedbetween counsel. While acknowledging she had, after the application was made, fileda second affidavit of documents, the first defendant submits that affidavit did notdisclose additional material documents relevant to the dispute.[14] Alternatively, the first defendant argues, costs should be awarded in her favourbecause given her additional disclosure the plaintiff gained nothing by pursuing theapplication to a hearing.[15] Furthermore, the first defendant contends that in several respects the mannerin which the plaintiff's application was presented led to the first and second defendantsincurring unnecessary and avoidable costs.[16] The second defendant adopts the submissions made on behalf of the firstdefendant. Although the plaintiff had success in respect to disclosure from the seconddefendant of one category of document, namely annual financial accounts of LevelsEstate Company Ltd, the second defendant says the plaintiff has now agreed thatdisclosure of the company's annual accounts for the years ending 30 June 2005 to30 June 2007 satisfies the requirement for disclosure, whereas the plaintiff hadpreviously sought annual accounts for a further 13 years. On this basis, the seconddefendant claims success and seeks an award of 2B costs but accepts a deduction of,say, 20 per cent as appropriate.[17] I do not accept the first or second defendant's analysis because it isundoubtedly the case that the plaintiff achieved success on her application in at leastthree respects.[18] First, the first and second defendants acknowledged the plaintiff's entitlementto further disclosure in respect of the category (b) documents. I made no order fordisclosure only because counsel acknowledged the documents would be provided ona consensual basis.[19] Second, the plaintiff achieved success in that I accepted her entitlement todisclosure from the second defendant of at least some annual financial accounts ofLevels Estate Company Ltd. While it is true that the disclosure sought went beyondwhat was required upon the plaintiff's pleadings and she has now accepted disclosureon a more limited basis, partial success is still success.[20] Third, and perhaps most significantly, it was only as a result of the making ofthe application that the first defendant sought and made disclosure of files held byRSM Law and also then filed her second affidavit of documents. This was primarilythe reason the plaintiff's application in respect of categories (a), (c) and (d) documentswas dismissed.[21] I do not accept Mr Prendergast's submission the first defendant's furtheraffidavit did not disclose any additional "material documents". The importance of,say, documents on the RSM Law files is a matter that will only become clear at trialbut it appears to me that the additional disclosure was of obvious relevance.[22] I also do not accept the application was unnecessary. As I said in the judgment,I regard steps taken by Mr Prendergast on the first defendants behalf in response to theplaintiff's discovery requests to have been constructive.9 However, ultimately it wasthe making of the application that was the impetus for the first defendant providingfurther disclosure and it was only after the issue of the Court's judgment that thesecond defendant agreed to disclose any of the annual financial accounts of LevelsEstate Company Ltd.[23] Mr Prendergast is also critical of the plaintiff's decision to pursue theapplication even after the first defendant filed her second affidavit of documents andof the manner in which the application was argued. In this latter respect he relies onmatters in my judgment and there is no need to repeat them. There is some force inhis arguments. But it is also the case that the first defendant's second affidavit ofdocuments was filed well after the plaintiff's application and at a relatively late stagewithin two weeks of the hearing. It is also the case that it cannot be said the plaintiffachieved nothing from proceeding with her application to hearing.9 At [44].[24] The plaintiff achieved partial success on her application and prima facie couldadvance an argument she is entitled to costs. However, due to the factors identifiedby Mr Prendergast in his submissions there is a strong case she would be refused costsunder r 14.7(d) and (f) High Court Rules. I do not need to consider that possibilityfurther as the plaintiff has not sought costs. In the result costs will lie where they fallwhich, in my view, is an equitable outcome.Result[25] In relation to the second, fifth and seventh defendants' application forparticulars of the statement of claim, they are awarded 2B scale costs anddisbursements amounting to $6,314.[26] In relation to the plaintiff's application against the first and second defendantfor particular discovery, costs shall lie where they fall._______________________O G PaulsenAssociate JudgeSolicitors:Wilkinson Rodgers Lawyers, DunedinSimpson Grierson, ChristchurchGresson Dorman & Co, Timaru