ROY WILLIAM BASSETT-BURR v QUENTIN STOBART HAINES [2023] NZCA 380
The Court held the statutory demands were not an abuse of process in light of subsequent findings that the debt was properly assigned and that the appellant did not commit relevant impropriety nor act solely in his own interests; therefore there was no sufficient basis to impose non-party costs or an uplift on the...
Source-derived case information.
- Citation
- [2023] NZCA 380
- Parties
- Appellant: Roy William Bassett-Burr; First Respondent: Quentin Stobart Haines; Second Respondent: BPE Trustees (No 1) Limited; Third Respondent: Quentin Haines Properties Limited
- Court
- Court of Appeal
- Jurisdiction
- New Zealand
- Judgment Date
- 21 August 2023
- Procedural Posture
- Civil Appeal (companies/costs) / Decision of the Court of Appeal
- Outcome
- Appeal allowed in part; order that appellant pay non-party costs set aside; High Court directed to revisit costs; Court of Appeal awarded costs to appellant for this appeal
- Legal Topics
- Statutory Demand (s289 Companies Act 1993), Setting Aside Statutory Demand (s290), Non Party Costs, Costs Uplift for Abuse/misuse of Process, Director/trustee Duties, Limited Liability and Piercing Corporate Veil
Source-derived case record
Summary, issues, holding and outcome
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Parties
Roy William Bassett-Burr
Appellant
Quentin Stobart Haines
First Respondent
BPE Trustees (No 1) Limited
Second Respondent
Quentin Haines Properties Limited
Third Respondent
Procedural Posture
Civil Appeal (companies/costs) / Decision of the Court of Appeal
Legal Issues
- 1 Whether non-party costs could properly be imposed on a director/trustee who signed statutory demands
- 2 Whether the statutory demands amounted to an abuse of process warranting uplifted non-party costs
- 3 Whether there was sufficient causal nexus and impropriety to treat the director as the real party in interest
Ratio Decidendi
The Court held the statutory demands were not an abuse of process in light of subsequent findings that the debt was properly assigned and that the appellant did not commit relevant impropriety nor act solely in his own interests; therefore there was no sufficient basis to impose non-party costs or an uplift on the appellant, and the High Court order requiring him to pay those costs was set aside with directions that the High Court revisit costs in light of this judgment; the Court ordered the respondents to pay the appellant costs of this appeal on a standard band A basis.
Court Disposition
Appeal allowed in part; order that appellant pay non-party costs set aside; High Court directed to revisit costs; Court of Appeal awarded costs to appellant for this appeal
Orders
- The appeal is allowed and the order for costs made in [2022] NZHC 2966 is set aside.
- The High Court must revisit, in light of this judgment, the costs award made in [2022] NZHC 3402.
Full Case Text
Judgment text and source record
1 paragraphs
ROY WILLIAM BASSETT-BURR v QUENTIN STOBART HAINES [2023] NZCA 380 [21 August 2023]IN THE COURT OF APPEAL OF NEW ZEALANDI TE KŌTI PĪRA O AOTEAROACA60/2023[2023] NZCA 380BETWEEN ROY WILLIAM BASSETT-BURRAppellantAND QUENTIN STOBART HAINESFirst RespondentAND BPE TRUSTEES (No 1) LIMITEDSecond RespondentAND QUENTIN HAINES PROPERTIESLIMITEDThird RespondentHearing: 24 July 2023Court: Miller, Moore and Palmer JJCounsel: DGO Livingston for AppellantJ D Dallas for First RespondentD K Evans and L C McIvor for Second and Third RespondentsJudgment: 21 August 2023 at 3.00 pmJUDGMENT OF THE COURTA The appeal is allowed. The order for costs made in [2022] NZHC 2966 is setaside.B The High Court must revisit, in light of this judgment, the costs award madein [2022] NZHC 3402.C The three respondents must pay the appellant one set of costs for a standardappeal on a band A basis, with disbursements as fixed by the Registrar.____________________________________________________________________REASONS OF THE COURT(Given by Miller J)[1] This is an appeal from a High Court decision awarding costs against theappellant as a non-party to a proceeding in which statutory demands issued under s 289of the Companies Act 1993 were set aside.1Background[2] The statutory demands were served on 20 May 2019.2 They were issued bythe trustees of the Link No 1 Trust. One of the trustees was Harry Memelink, whosefamily trust it was. The other was Lynx Trustees Ltd, a company owned and directedby the appellant, Roy Bassett-Burr. He signed all the demands, and immediately afterservice he emailed a number of parties, including the debtors.[3] The debtors named in the statutory demands were Quentin Haines, formerlyMr Memelink's solicitor but no longer practising,3 the QSH family trust, and thesecond and third respondents, both of which are companies associated with Mr Haines.The sums claimed in the demands were sums payable under loan obligations assumedby the Haines interests to financiers which had assigned their interests to theLink No 1 Trust. The loans were secured by a mortgage over a lifestyle property atManakau, Levin. It appears that Mr Memelink and the Link No 1 Trust had guaranteedthe loans and took the assignment after Mr Haines defaulted.[4] A statutory demand under s 289 of the Companies Act may only be issuedagainst a company in respect of a debt that is due. It requires the company to paywithin 15 working days,4 failing which the company is presumed unable to pay itsdebts and may be wound up.5 Under s 290 the High Court may set aside a statutory1 Haines v Memelink [2022] NZHC 2966 [Judgment under appeal]; and Haines v Memelink[2019] NZHC 2169 [Statutory demands decision].2 Statutory demands decision, above n 1, at [3].3 Mr Haines has deposed that he surrendered his practising certificate on 23 August 2018, forunrelated reasons.4 Companies Act 1993, s 289(2)(d).5 Sections 241(4)(a) and 287(a).demand if satisfied that there is a substantial dispute as to whether the debt is owingor due, or the company appears to have a set-off or cross-claim against the creditor.6[5] The demands appeared on their face to have been prepared by a solicitor whoacted for the Memelink interests, but in fact the solicitor had not been involved in theirpreparation.7 It appears that Mr Memelink and Mr Bassett-Burr intended to brief thesolicitor on the latter's return from leave.[6] On 24 May 2019 Mr Haines demanded by email to Mr Bassett-Burr that thedemands be withdrawn by 27 May. He warned that the entities served intended tomove to set the demands aside and would seek an uplift on costs for abuse of thestatutory demand process. Mr Bassett-Burr asked what was wrong with the demands.Mr Haines responded (we now know, incorrectly) that the assignment of the mortgagewas not done correctly and a discharge of mortgage had occurred. Mr Bassett-Burrreplied on 27 May that he would take legal advice urgently but could not hold thelawyer to a deadline. He asked that Mr Haines defer action until the lawyer hadresponded.[7] On 31 May the three respondents to this appeal applied to set the statutorydemands aside on a number of grounds: relevantly, Mr Haines and the QSH familytrust were not companies, the debts were disputed, and the assignments were unlawfulor had the effect of discharging the mortgages. Mr Haines swore an affidavit deposingto cross-claims which included a very large sum of more than $1 million for legal feesincurred while he had been acting for Mr Memelink. He maintained that as he had notheard further from Mr Bassett-Burr he had been forced to file the application.[8] Mr Memelink advised Mr Haines by email of 17 June that the demands werewithdrawn. He reserved the right to produce the email and seek costs, shouldMr Haines move to set the demands aside. The email was copied to Mr Bassett-Burr.[9] Mr Haines offered on 18 June to withdraw his application if costs of $5,000were paid by 20 June. There was no response. On 21 June he confirmed that he would6 Section 290(4)(a)–(b).7 Statutory demands decision, above n 1, at [5].seek costs with an uplift. On 23 June Mr Memelink replied, copied to Mr Bassett-Burr,stating that the demands had never been properly served and no action had been takenon them. It had not been necessary for Mr Haines to incur costs. He rehearsed anumber of complaints against Mr Haines and warned that he would seek costs shouldMr Haines persist. He made similar allegations in another email on 24 June.[10] Mr Haines evidently refused to deal with Mr Memelink. Instead of respondingto Mr Memelink's emails, he forwarded the email of 24 June to Mr Bassett-Burr on25 June. He told Mr Bassett-Burr that the application was to be called in theHigh Court on 1 July.[11] Mr Memelink emailed Mr Haines on 25 June demanding that the applicationbe withdrawn because, among other reasons, the demands had not been servedproperly and had been withdrawn. He advised that costs would be sought if Mr Hainespersisted.[12] Mr Dallas appeared for the applicants on 1 July to advise the Court that thenotices had been withdrawn and to seek costs with an uplift of 50 per cent. He advisedCull J that the applicants also sought costs against Mr Bassett-Burr personally on theground that he had taken an active part in causing wasted costs for the applicants bypursuing meritless and disputed demands. Mr Memelink appeared and advised Cull Jthat the application was opposed.8 She directed that a notice of opposition be filed.9[13] The application was set down for 30 August 2019. On August 28 Mr Smith,counsel for the Memelink interests, sought an adjournment on grounds of hisunavailability that day and Mr Memelink's need for legal advice. The adjournmentapplication was declined the next day.10 That evening, Mr Memelink sought to filedocuments in apparent opposition. It appears his stance was that the demands hadnever been served and there had been no loss to anyone.8 Haines v Memelink HC Wellington CIV-2019-485-315, 2 July 2019 (Minute of Cull J) at [2].9 At [4].10 Haines v Memelink HC Wellington CIV-2019-485-315, 29 August 2019 (Minute of Churchman J)at [21].[14] The 30 August hearing was held before Churchman J. No documents had beenfiled in opposition, with the Judge declining to admit the documents filed byMr Memelink the evening prior. Mr Memelink appeared. He confirmed that theapplication was not opposed but sought to draw the Judge's attention to complaintsagainst Mr Haines relating, among other things, to the latter's claim for fees.The Judge declined to hear from him on these matters. Mr Dallas argued that the casewas a textbook example of a meritless demand which warranted uplifted costs andcosts against Mr Bassett-Burr, who was said to have "a direct financial interest in theoutcome of this litigation" and to be using Lynx Trustees "as a ruse to avoid personalliability".[15] It was common ground before us that that Mr Bassett-Burr had no involvementin the proceeding after 25 June. (In fact, it appears from the record before us that hewas copied into emails between Mr Memelink and their solicitor about the request toadjourn and emails between Mr Memelink and the Registrar of the High Court aboutthe fixture, but Mr Dallas did not seek to make anything of this.)[16] Churchman J set the demands aside, noting that the first two had not beenissued against a company as required by s 289 of the Companies Act and that thepurported debts on which they all were based were clearly disputed.11 The Judge alsorejected as untenable Mr Memelink's claim that the application had never beenopposed.12 He awarded costs against Mr Bassett-Burr personally, finding that he hadimproperly issued the demands and had failed to respond to the invitation towithdraw.13 He noted that Mr Bassett-Burr is the brother-in-law of Mr Memelink andfound that the two had acted in concert in a vendetta against Mr Haines.14[17] The award of costs was set aside on appeal on procedural grounds,this Court finding that there had been no formal application for non-party costs andMr Bassett-Burr had not been put on notice.15 An application was then made for costs11 Statutory demands decision, above n 1, at [6]–[7] and [33].12 At [27]–[33].13 At [47]–[48], citing ETB Realty Ltd v Eastlight Asset Trading No 3 Ltd [2016] NZHC 609.14 At [49].15 Bassett-Burr v BPE Trustees (No 1) Ltd [2020] NZCA 457, (2020) 25 PRNZ 509 at [14] and [21].Leave to appeal this Court's decision to the Supreme Court was declined: BPE Trustees (No 1)Ltd v Bassett-Burr [2021] NZSC 14 at [14].against Lynx Trustees and Mr Memelink. On 13 May 2021 Churchman J fixed thecosts at $21,689.25 and disbursements at $1,230.16[18] The costs have not been paid. Mr Memelink was bankrupted on28 August 2018 and Lynx Trustees was placed in liquidation on 10 September 2019.The Link No 1 Trust went into receivership on 31 May 2022. We were told that itsreceivers are seeking to recover the debt which Mr Haines was found liable to paythe Trust.[19] On 3 August 2021 Grice J delivered a judgment on an application for summaryjudgment between Mr Memelink as trustee of the Link No 1 Trust, and the Hainesinterests.17 The Judge found Mr Haines liable on the assigned debts, rejecting asuntenable his claims that the debts had not been assigned but rather had beendischarged.18 It was not in dispute that the loans to the finance companies were indefault. There is a cross-claim which could not be struck out on summary judgmentand needs to be repleaded.19 The exact amount owing to the Memelink interests isuncertain. Quantum is to be decided after a hearing in 2025.[20] On 24 August 2022 the Haines interests moved for an order thatMr Bassett-Burr pay non-party costs, following the successful appeal of the originalnon-party costs award.20 A hearing was held before Churchman J on10 November 2022.21 Mr Bassett-Burr was represented by Mr Livingston. In thejudgment under appeal, which was delivered on 11 November 2022, the Judge orderedthat Mr Bassett-Burr pay the costs that had been fixed on 13 May 2021.22[21] The Judge directed that the parties seek agreement on costs of the costshearing.23 If they could not agree memoranda were to be filed and he would make adecision on the papers. Memoranda were duly filed. On 14 December 2022 the Judgeordered that Mr Bassett-Burr pay a further $18,075 with disbursements of $890 for the16 Haines v Memelink [2021] NZHC 1063 [Costs decision of May 2021] at [31].17 Memelink v Haines [2021] NZHC 1992 [Judgment of Grice J].18 At [112], [119] and [185].19 At [171]–[172].20 Bassett-Burr v BPE Trustees (No 1) Ltd, above n 15.21 Judgment under appeal, above n 1.22 At [30] and [32]; and Costs decision of May 2021, above n 16, at [31].23 Judgment under appeal, above n 1, at [34].non-party costs hearing.24 That sum included an uplift of 25 per cent on scale costs.25The Judge accepted Mr Dallas's argument that Mr Livingston had made meritlessarguments and put incorrect information before the Court.26 The meritless argumentsappear to have related to the parties' indebtedness to one another, which the Judgefound irrelevant, and the incorrect information appears to have concernedLynx Trustees' insolvency.[22] There was some confusion surrounding whether leave was required to bringthe judgment under appeal to this Court. The December 2022 decision dealt with anapplication by Mr Bassett-Burr for leave to appeal the November 2022 non-party costsaward, with the parties believing at the time that the decision was interlocutory andthus leave was required under s 56(3) of the Senior Courts Act 2016.27 We note thatthis Court has stated that where costs are sought from a non-party, this is in substancea separate claim brought against the non-party, and is therefore an originatingapplication even if made in the form of an interlocutory application in the substantiveproceedings.28 Leave of the High Court is therefore not required to appeal tothis Court and this appeal was brought as of right.29The judgment under appeal[23] Churchman J recounted the background,30 noting that the application fornon-party costs had followed the Supreme Court's indication that such an applicationoffered Mr Haines an alternative avenue of redress.31 He rejected as untenable thearguments that Mr Bassett-Burr had no substantive involvement in the issue of thedemands and found that the costs could have been avoided had Mr Bassett-Burr actedresponsibly.32 The Judge emphasised that as a trustee and a director of Lynx Trustees,Mr Bassett-Burr had obligations to act prudently and in accordance with the law, and24 Haines v Memelink [2022] NZHC 3402 [Costs decision of December 2022] at [44].25 At [42].26 At [41].27 At [16].28 Rerekura v Prison Director, Auckland South Corrections Facility (SERCO) [2022] NZCA 232 at[18]–[19].29 At [20].30 Judgment under appeal, above n 1, at [2]–[11].31 At [10]–[11].32 At [16] and [21].could not hide behind Mr Memelink.33 He declined to entertain a set-off againstMr Haines's alleged liabilities in other proceedings.34 He found that neither LynxTrustees nor the Trust had any prospect of meeting an award of costs.35 A 50 per centuplift was justified and Mr Bassett-Burr had been notice from the outset that it wouldbe sought.36The appeal[24] The question is whether it was right to order Mr Bassett-Burr, as a non-party,to pay costs. He contends that:(a) he was not the real party, standing to benefit from the proceeding;(b) there was no sufficient causal link between him and the proceeding;(c) the circumstances did not warrant looking behind the limited liabilityof Lynx Trustees; and(d) this is not one of those exceptional cases in which non-party costs arejustified.[25] Mr Haines contends that the issues are:(a) whether there is a sufficient nexus between Mr Bassett-Burr's actionsand the costs incurred;(b) whether his actions were those of a prudent director or trustee;(c) whether Lynx Trustees and the Link No 1 Trust are insolvent; and(d) whether Mr Bassett-Burr believed he could benefit financially from theissue of the statutory demands.33 At [29].34 At [24]–[26].35 At [28].36 At [30]–[31].Non-party costs[26] The principles are relevantly settled. Costs are discretionary but must be fixedon a principled and reasonable basis.37 The jurisdiction extends to costs against anon-party.38 Such awards are exceptional, but that means only that they requiresomething outside the ordinary run of cases.39 The ultimate question is whether it isjust to order that the non-party pay them, and because a number of considerations maybe in play the court's enquiry is to some extent fact-specific.40 It is not sufficient thatthe non-party, Mr Bassett-Burr, shared responsibility for the inept litigation strategythat the trustees of the Link No 1 Trust pursued. It is necessary, in the circumstancesof this case, to consider whether he committed any relevant impropriety or wasrelevantly acting not in the interests of the Trust but in his own interest, such that hewas the real party.41No relevant impropriety[27] The costs award against Lynx Trustees and Mr Memelink is not under appeal.It cannot be doubted that the High Court might properly award costs in circumstanceswhere no notice of opposition was filed and the Court was faced with an unchallengedclaim that the debt was disputed. It is unsurprising that the Court treated the demandsas an abuse of process. Lynx Trustees and Mr Memelink did not comply withdirections to file papers in opposition. They did not offer any coherent explanationwhich might excuse them from liability for costs.[28] However, we must be prepared to consider the substantive merits whenassessing Mr Bassett-Burr's costs liability, and in particular his liability for an uplifton costs. Mr Livingston argued that Mr Memelink's email of 17 June 2019 was aneffective withdrawal, contending that it is arguable whether there were grounds to set37 Shirley v Wairarapa District Health Board [2006] NZSC 63, [2006] 3 NZLR 523 at [16], citingSharp v Wakefield [1891] AC 173 (HL) at 179 per Lord Halsbury LC.38 Concrete Structures (NZ) Ltd v Smith [2019] NZHC 2572, (2019) 25 PRNZ 74 at [14].39 At [15], citing Dymocks Franchise Systems (NSW) Pty Ltd v Todd (No 2) [2004] UKPC 39, [2005]1 NZLR 145 at [25] and [29].40 Dymocks Franchise Systems (NSW) Pty Ltd, above n 39, at [25].41 Kidd v Equity Realty (1995) Ltd [2010] NZCA 452 at [16], citing Goodwood Recoveries Ltd vBreen [2005] EWCA Civ 414, [2006] 1 WLR 2723, Metalloy Supplies Ltd v MA (UK) Ltd[1997] 1 WLR 1613 (CA) at 1620 per Millett LJ and Secretary of State for Trade and Industry vBackhouse [2001] EWCA Civ 67.the demands aside and claiming that it is obvious that the quantum of the loans owedby Mr Haines far exceeds any cross-claim.[29] We are persuaded that this is not a case in which the issue of the demands canbe regarded as an abuse of the statutory demand process. It was never appropriate toissue demands against debtors which are not companies, but for those debtors thedemands were ineffective; there was never any question of a statutory presumption ofinability to pay debts and a resulting winding-up order.42 It is because a demand placesa debtor company in an invidious position that there is ample High Court precedentfor an uplift on scale costs.43 Nor were the demands inaccurate; the Haines interestswere and are indebted to the Link No 1 Trust under the assigned loan documents.Mr Haines's claim that the loans had never been assigned has been rejected.44[30] Mr Haines has advanced a cross-claim, including a claim for costs said to bepayable to him as the former solicitor for the Memelink interests, which could not beresolved on summary judgment.45 Churchman J pointed to the judgment of Grice J asevidence that the amount payable is presently unliquidated.46 But it does not followthat it was an abuse of the statutory demand process to claim amounts due in debt inMay 2019. Rather, the demands were prima facie justified, though susceptible to beingset aside if the Haines interests could persuade the Court that there was a counterclaim,set-off or cross-demand that ought to be brought into account. The costs thatMr Haines claims from Mr Memelink appear to comprise a substantial part of thecross-claim. We observe that in related disciplinary proceedings the Law PractitionersDisciplinary Tribunal found on 8 April 2022 that Mr Haines had overchargedMr Memelink and was guilty of disgraceful and dishonourable conduct.4742 Summer Construction Ltd v Bakker HC Wellington CIV-2006-485-1499, 10 November 2006 at[31].43 At [31] and [38]; ETB Realty Ltd, above n 13, at [17]–[18]; and Four Avenues Property Group Ltdv Higgs Construction Ltd [2016] NZHC 1202 at [13].44 Judgment of Grice J, above n 17, at [112].45 At [187].46 Judgment under appeal, above n 1, at [22], citing Judgment of Grice J, above n 17, at [161].47 National Standards Committee (No 1) v Haines [2022] NZLCDT 10 at [82]–[90] and [102]–[104].The Tribunal did not attempt to quantify the overcharging but found that the amount claimed wasfar more than could be considered fair and reasonable.[31] This is not a case in which it can yet be said that the Memelink interests shouldhave known there was a genuine cross-claim. Grice J found that, as pleaded, two ofthe three causes of action in the cross-claim could not succeed and the allegations (ofan alleged agreement or fiduciary relationship) were imprecise.48 In the meantime, itis at least premature to describe the statutory demands as an abuse on the ground thatthe sum payable was unliquidated. The outcome may yet be that any set-off orcross-claim advanced by the Haines interests fails or is not sufficiently connected tothe debt to establish a legal or equitable set-off.[32] For these reasons, we think there was a basis for the statutory demands to beissued. It cannot be said, in light of Grice J's judgment, that an application to set thedemands aside must succeed; it would depend on the Haines interests persuadingthe Court that there is a cross-claim which ought to be taken into account. That issuewas never decided because the Memelink interests withdrew the demands. It isbecause no opposition was filed that the application to set the demands aside wasgranted.49[33] Churchman J accepted that it was necessary to move to set the notices asidebecause nothing further was heard from Mr Bassett-Burr after he had told Mr Haineson 27 May 2019 that he would take legal advice urgently and requested that Mr Haineshold off in the meantime.50[34] We are not persuaded that it was necessary to move as abruptly asMr Haines did. There was no reason to doubt Mr Bassett-Burr's assurance that hewould get legal advice urgently. Advice was taken. The Memelink interests appear tohave been advised that the demands were bad because they could not be issued againstMr Haines and the Trust, and the demands were abandoned by email of 17 June. It isdifficult to escape the inference that thereafter it was all about costs, which the Hainesinterests pursued very aggressively.48 Judgment of Grice J, above n 17, at [184], [165] and [169].49 Statutory demands decision, above n 1, at [31]–[32].50 At [13]; and Judgment under appeal, above n 1, at [5].[35] For these reasons we do not accept Mr Bassett-Burr was guilty of anyimpropriety in issuing the demands or in failing to move more quickly to have themwithdrawn.Mr Bassett-Burr's control of and interest in the litigation[36] As Churchman J found, Mr Bassett-Burr signed all the notices and took anactive part in the dealings with Mr Haines over them.51 Mr Memelink has claimedthat he was the decisionmaker, that Mr Bassett-Burr acquiesced on the ground thatMr Haines owed the Link No 1 Trust money, and that the "technical errors" wereMr Memelink's responsibility. Mr Bassett-Burr's affidavit is to the same effect.We are not persuaded that Churchman J was wrong to reject Mr Bassett-Burr'sevidence that he was merely a reader-writer for Mr Memelink (who suffers fromdyslexia and poor eyesight).52 We also agree with the Judge that Mr Bassett-Burrcould not defer to Mr Memelink but was obliged to exercise his own judgement as adirector/trustee.53 We accept that he shares responsibility for the issue of the statutorydemands.54[37] However, Mr Bassett-Burr did respond to Mr Haines's claim that the demandsshould not have been issued, and they were withdrawn after legal advice was taken.Further, we have noted that Mr Dallas accepted before us that Mr Bassett-Burr had noinvolvement after 25 June. So far as he was concerned, the only matter remaining wasthe Haines claim for costs.[38] It appears Mr Bassett-Burr has an interest in the litigation between the Hainesand Memelink interests. He is a substantial lender to the Trust via what he describesas his company, and so is his late mother's estate. Churchman J did not appear toattach significance to this. Nor do we. It is not possible on the material before us toknow just how direct is Mr Bassett-Burr's interest. He claims that the family lendingto the Trust is secured against Trust properties and serviced by rental income. It cannotbe said, on the information before us, that he was acting in his own interest and not51 Judgment under appeal, above n 1, at [3]–[5].52 At [17].53 At [16].54 Dymocks Franchise Systems (NSW) Pty Ltd, above n 39, at [25].that of the Trust. We record that before us Mr Dallas withdrew a claim thatMr Bassett-Burr's wife and child are also beneficiaries of the Trust.Was the order just?[39] This is the ultimate issue. We agree with Churchman J that it appears a widervendetta is being pursued,55 but we do not know the rights and wrongs of it. No doubtthat will become apparent when the High Court quantifies the liability ofthe Haines interests. In the meantime we cannot blame the Memelink interests alonefor the waste of court time and parties' money that this litigation represents. We mustfocus on the statutory demands and the application to set them aside.[40] We have accepted that the High Court was entitled to award costs as againstLynx Trustees and Mr Memelink, but the decision was justified for what are essentiallyprocess reasons; they did not take steps in opposition and in the absence of anycoherent explanation the High Court cannot be faulted for finding the demands to bea misuse of the statutory process.[41] We have also accepted that the merits are relevant to non-party liabilityfor costs. By the time the non-party costs application was heard the judgment ofGrice J and the decision of the Disciplinary Tribunal had been delivered. It is nowclear that the Haines interests are indeed liable on the assigned debts, and there is aquestion mark, at least, over the alleged cross-claim. Differing from Churchman J, weare not persuaded that the demands were in fact an abuse of process. Nor are wepersuaded that it was necessary to move so quickly to set the demands aside.Mr Bassett-Burr committed no impropriety, nor was he acting in his own interestsrather than those of the Link No 1 Trust.Disposition[42] We do not agree that this is a case in which Mr Bassett-Burr should have beenheld liable to pay costs as a non-party, still less an uplift on costs.55 Statutory demands decision, above n 1, at [49].[43] The appeal is allowed. We set aside the order that Mr Bassett-Burr pay thecosts which were fixed in the judgment of 11 November 2022.[44] No appeal was filed against the judgment of 14 December 2022, but thesubstantive basis for the High Court decision has been overturned and costs in theHigh Court should be considered afresh.56 The appropriate course is to direct that theHigh Court revisit costs, fixing them on the basis that the application for non-partycosts has failed. We make a direction accordingly. No purpose would be served byrequiring the appellant to move for a recall or seek leave to bring an appeal out of time.[45] We turn to costs in this Court. Mr Dallas sought to begin the hearing by layingthe groundwork for increased costs here. We observe that costs were also sought byMs Evans, appearing for the second and third respondents. Her argument was moremeasured than that of Mr Dallas but it added nothing of substance. When we askedwhy it was necessary for the Haines parties to be separately represented we were toldthat it was in case there might be a conflict of interest. None is apparent, so far as thislitigation is concerned.[46] We accept Mr Dallas's complaints about the case on appeal to some extent; itwas badly put together and badly indexed, making it very difficult to use. But there isno reason why that should much affect costs incurred by the Haines interests. We seeno reason to depart from the usual practice in this Court: costs follow the result.The three respondents are jointly liable to pay the appellant one set of costs for astandard appeal on a band A basis, with disbursements as fixed by the Registrar.Solicitors:Livingston & Livingston, Wellington for Appellantjd Dallas, Wellington for First RespondentAspire Legal, Wellington for Second and Third Respondents56 Jurisdiction to make such an order is found in r 48 of the Court of Appeal (Civil) Rules 2005.