TPD 2018 LTD v GODFREY AND COMPANY LTD [2021] NZHC 431

TPD 2018 LTD v GODFREY AND COMPANY LTD [2021] NZHC 431 [9 March 2021]IN THE HIGH COURT OF NEW ZEALANDAUCKLAND REGISTRYI TE KŌTI MATUA O AOTEAROATĀMAKI MAKAURAU ROHECIV-2019-404-93[2021] NZHC 431BETWEEN TPD 2018 LIMITEDPlaintiffAND GODFREY AND COMPANY LIMITEDDefendantAND CNZ (AUCKLAND) LIMITED (INLIQUIDATION)First Third PartyHearing: 2, 3, 4, 5, 6, 9 and 10 November 2020Appearances: S O McAnally and N W Coyle for the Plaintiff and First ThirdPartyR J Hollyman QC and T E Bielby for the DefendantJudgment: 9 March 2021JUDGMENT OF GAULT JThis judgment was delivered by me on 9 March 2021 at 3:00 pmpursuant to r 11.5 of the High Court Rules 2016.Registrar/Deputy RegistrarSolicitors:Mr S McAnally, Keegan Alexander, AucklandMr K Stolberger and Mr T Bielby, Lowndes Jordan, Auckland[1] The plaintiff (TPD) claims as assignee of the claim of Thomas Pasley andAssociates Ltd (TPA) against the defendant (Godfreys) following a joint operation inanticipation of a full merger that ultimately did not proceed and had to be unwound.[2] TPD claims the joint operation was a joint venture and Godfreys was obligedto account to TPA for revenue received on behalf of the joint venture as a fiduciary orby way of breach of contract. TPD claims it is entitled to a final accounting.[3] Godfreys says in its defence that the joint operation was a partnership and that,applying equitable principles where details were not agreed, Godfreys overpaid TPA.In a third party claim, Godfreys seeks recovery of the overpayment from CNZ(Auckland) Ltd (in liquidation) (CNZ), TPA's successor following a subsequentamalgamation. Godfreys' defence also disputes the assignment to TPD on the basisthat TPA's rights had been carved out of the merger with CNZ and the assignment wasof a bare cause of action, which is void. In addition, Godfreys pleaded breaches offiduciary duty by TPA and a limitation defence (but these were not pursued at trial).[4] The trial began with TPD claiming that Godfreys owed $1,320,139 andGodfreys claiming that it was owed $1,453,394 (that is, a difference between theparties of $2,773,533). There were numerous issues. However, the accounting expertscontinued to confer and narrow the differences during the trial, and filed further jointstatements. As a result, the remaining issues reduced considerably and the quantumdifference reduced to $1,243,264 with TPD claiming Godfreys owes $817,286 andGodfreys claiming it is owed $425,978.Factual background[5] TPA and Godfreys were each established firms carrying on the business ofinsurance loss adjusting. Leading up to the events in issue, the two directors andshareholders of TPA were Mr Pasley and Mr Ziegler. TPA was based in Auckland.The major shareholders of Godfreys were Mr Godfrey and Mr Moonlight. Godfreyshad three other shareholders, including Mr Buckley who was not an insurance lossadjuster. Godfreys had several offices around New Zealand.[6] Sometime prior to 4 September 2010, Godfreys approached TPA about apossible merger. The idea was not progressed immediately. Following the first majorCanterbury earthquake on 4 September 2010, the increase in workload and otherbusiness imperatives led to further discussions. Financial information was exchanged,and a meeting was held on 18 November 2010. The parties informally agreed toprogress towards a merger by 1 April 2011 and started co-operating in the interim.[7] The catastrophic earthquake of 22 February 2011 led TPA and Godfreys tomeet that night and agree that joint operations as TPA-Godfreys (TPAG) shouldcommence immediately. They announced an operational merger the next day.[8] There was no formal written agreement recording the terms of the jointoperation but it is common ground that TPA and Godfreys also agreed:(a) Invoicing would be done using Godfreys' existing infrastructure;Godfreys would receive payments and account to TPA for its share ofnet proceeds of the joint operation.1 Revenue and costs of theirrespective existing businesses were to remain the benefit/obligation ofeach.(b) TPAG would use Godfreys' premises in Christchurch and,progressively, TPA's premises in Auckland.(c) Each party would reimburse the other for the increased costs incurredby each giving effect to the combined operation.2(d) Mr Godfrey would be the managing director of TPAG and Mr Pasleywould be the professional practice leader.[9] Although the parties' proportionate shares in the net proceeds had beendiscussed and modelled prior to 22 February 2011, this was not agreed until later.On 10/11 June 2011 the parties met and agreed that the net proceeds derived from the1 Except that TPA would bill QBE and those receipts would be treated as a credit.2 A dispute as to exactly how increased costs over each party's pre-22 February 2011 costs wouldbe determined was not pursued.TPAG operation would be shared in proportions of 62.5 per cent to Godfreys and37.5 per cent to TPA, with the same proportions used to determine each party's shareof the other's increased costs.[10] Similarly, allocation of staff between the existing businesses and TPAG wasnot finalised on 22 February 2011. This was addressed in the monthly reconciliationsthat Mr Godfrey began to provide in the following months.[11] In April 2012 Mr Godfrey suffered a heart attack and was off work for someweeks before returning, initially for three days per week. In August 2012 a new chiefoperations officer was engaged.[12] Formal merger was not progressed due, it seems, to the post-earthquakeworkload. Mr Pasley urged the resumption of discussions in early 2013. The partiesmet in March 2013 and discussions continued, evidently with different expectations,until Mr Pasley advised Mr Godfrey on 14 May 2013 that TPA no longer wished toproceed with the merger. The parties exchanged documents relating to the unwindlater in May 2013, but there was no new agreement relevant to the remaining issuesaffecting the parties' respective shares of the net proceeds derived from the TPAGoperation.[13] Relations deteriorated somewhat thereafter, culminating with news that TPAwould become part of CNZ, followed by Mr Godfrey's email on 23 October 2013stating that the joint venture should be concluded on 31 October 2013. Despiteallegations both ways in relation to the reasons for the breakdown, it was ultimatelycommon ground that the reasons are not material and the joint operation terminatedwith effect from 31 October 2013.[14] Although there were subsequent attempts, the parties never reached agreementon the reconciliation of their respective shares of the net proceeds.[15] On 30 November 2013 TPA amalgamated with CNZ.[16] On 31 March 2018 CNZ, in anticipation of its liquidation as part of a grouprestructure, assigned its rights against Godfreys to TPD.Issues[17] The remaining issues to be determined are:(a) the nature of the joint operation;(b) allocation of staff;(c) allowance for Mr Godfrey as managing director;(d) Godfreys' "run off" costs;(e) whether TPD had inherited TPA's rights by assignment and, if not,whether that matters.Nature of the joint operation[18] The parties ultimately agreed that nothing turned on whether the joint operationwas characterised as a joint venture or a partnership. I consider that is correct giventhat what the parties agreed at the time is important whether the joint operation ischaracterised as a partnership or a joint venture giving rise to fiduciary obligations,3and given the confined issues remaining in dispute. Nevertheless, the characterisationwas addressed in submissions and I therefore address it (relatively briefly).Submissions[19] Mr McAnally, for TPD/CNZ, submitted that the following circumstances,cumulatively, point away from the existence of a partnership:(a) This was not a case where an established partnership restructured andadopted another guise such as an incorporated company (as in3 Partnership Law Act 2019, s 35; and Paper Reclaim Ltd v Aotearoa International Ltd[2007] NZSC 26, [2007] 3 NZLR 169 at [31].Amaltal Corporation Ltd v Maruha Corporation).4 Rather therelationship in issue might fairly be categorised as something of a"waiting room". The general notion of the partnership as an availablebusiness structure would suggest a partnership should not be thought ofas something that happens by accident while waiting to implement theintended end structure.(b) The parties did not, jointly or in common, own any assets.(c) The parties did not jointly contract. For example, employees wereengaged by one or the other of the two companies and contractors inthe "shared pool" were contracted by Godfreys.(d) The parties took none of the steps that would be usually expected, suchas formalising some sort of partnership agreement, opening sharedbank accounts or registering and reporting as a partnership for matterssuch as payment of GST.(e) The parties retained separate business interests in the sense of theresources they entered the relationship with, it being agreed thatpending "formal merger", the "shared pool" of contract resource andthe associated uplift of the cost to service it was to be shared.[20] Mr McAnally accepted that a partnership is defined as "the relationship thatexists between persons carrying on a business in common with a view to profit",5 butsubmitted that is analogous with the essence of a joint venture that has been describedas an arrangement or understanding between two or more parties to work togethertowards achieving a common objective.6 He submitted that here terms were looselyagreed on or about 22 February 2011 but were the subject of ongoing development, aswas progress, or lack thereof, towards a formal amalgamation of the two companies.In many respects it was not until at least June 2011 that important matters of principlewere resolved (such as the division of net proceeds) and, given the ever present eye to4 Amaltal Corporation Ltd v Maruha Corporation [2007] NZSC 40, [2007] 3 NZLR 192.5 Partnership Law Act 2019, s 8.6 Chirnside v Fay [2006] NZSC 68, [2007] 1 NZLR 433 at [91].the future amalgamation, it cannot be said the relationship ever matured to the pointthat the parties intended to assume the formalities of partnership (such as joint liabilityfor debts or obligations incurred by the other party,7 joint and several liability for theacts of TPAG no matter who executed them,8 or responsibility for the admissions orrepresentations of the other).9[21] Mr Hollyman QC, for Godfreys, submitted that where the parties'arrangements provide for profit sharing, that will be prima facie evidence that apartnership exists. He referred to s 5(c) of the Partnership Act 1908 which providesthat the receipt by a person of a share of the profits of the business is prima facieevidence that he or she is a partner in the business (now s 14(1) of the Partnership LawAct 2019 which provides that if a person receives a share of the profits of the businessit is presumed, in the absence of evidence to the contrary, that the person is a partnerin the business), and Clark v Libra Developments Ltd.10[22] Mr Hollyman submitted that exactly describes the TPAG relationship.He submitted it is common ground that the parties agreed to carry on a loss adjustingbusiness together, whereby profits and expenses would be shared in accordance withits terms, pending formal merger. He submitted that is supported by the evidence, andin particular Mr Pasley's description of profit sharing, as the most important featureof the parties' agreement. He submitted that partnership is also wholly consistent withthe parties' intention to merge, and to do so in short order. Although that did not provepossible, the parties pursued that option in good faith and with full engagement, untilthey gave up in May 2013. He submitted that the fact that the parties acted with aview to formal merger tips the relationship into one of partnership.Discussion[23] There is no real dispute as to the Court's approach to determining whether theparties had entered into a partnership. That approach has been confirmed since thehearing by the Court of Appeal in Zheng v Deng.11 In that case, the parties carried out7 Partnership Law Act 2019, s 22.8 Section 25.9 Section 29.10 Clark v Libra Developments Ltd [2007] 2 NZLR 709 (CA) at [155]-[157].11 Zheng v Deng [2020] NZCA 614.a number of property development and construction projects through variouscompanies before agreeing to separate their affairs. A central issue was whether therewas an overarching partnership. Despite the absence of the familiar language andtrappings of partnership, and the existence of the corporate vehicles through which theprojects were carried out, the Court of Appeal concluded there was an overarchingbusiness carried on by the two parties in common with a view to profits; that is, apartnership. The Court stated:The test for a partnership[90] It was common ground before us that the question whether the partieshad entered into a partnership was a mixed question of fact and law. Thestarting point is s 4 of the Partnership Act, which provides:4 Definition of partnership(1) Partnership is the relation which subsists between personscarrying on a business in common with a view to profit.(2) But the relation between members of any company orassociation registered as a company under the Companies Act1993 is not a partnership within the meaning of this Act.[91] Some factors that may be relevant to determining whether or not apartnership exists are set out in s 5:5 Rules for determining existence of partnershipIn determining whether a partnership does or does not exist regardshall be had to the following rules:(a) joint tenancy, tenancy in common, joint property, or partownership does not itself create a partnership as to anythingso held or owned, whether the tenants or owners do or do notshare any profits made by the use thereof:(b) the sharing of gross returns does not of itself create apartnership, whether the persons sharing such returns have orhave not a joint or common right or interest in any propertyfrom which or from the use of which the returns are derived:(c) the receipt by a person of a share of the profits of a businessis prima facie evidence that he or she is a partner in thebusiness, but the receipt of such a share or of a paymentcontingent on or varying with the profits of a business doesnot of itself make him or her a partner in the business; and, inparticular,—(i) the receipt by a person of a debt or other liquidatedamount, by instalments or otherwise, out of theaccruing profits of a business does not of itself makehim or her a partner in the business or liable as such:(ii) a contract for the remuneration of a servant or agentof a person engaged in a business by a share of theprofits of the business does not of itself make theservant or agent a partner in the business or liable assuch:(iii) a person being the widow, widower, surviving civilunion partner, surviving de facto partner, or child of adeceased partner, and receiving by way of annuity aportion of the profits made in the business in whichthe deceased person was a partner, is not by reasononly of such receipt a partner in the business or liableas such:(iv) the advance of money by way of loan to a personengaged or about to engage in any business on acontract with that person that the lender shall receivea rate of interest varying with the profits, or shallreceive a share of the profits arising from carrying onthe business, does not of itself make the lender apartner with the person or persons carrying on thebusiness, or liable as such: provided that the contractis in writing, and signed by or on behalf of all theparties thereto:(v) a person receiving by way of annuity or otherwise aportion of the profits of a business in consideration ofthe sale by him or her of the goodwill of the businessis not, by reason only of such receipt, a partner in thebusiness or liable as such.[92] There is limited assistance to be had from the authorities, because theanalysis is inevitably highly fact-specific. The warning given by Cooper J inAldridge v Paterson more than 100 years ago remains apposite:12Very little assistance can be obtained from the numerous casesreported in which the question of partnership or no partnership hasbeen decided. In all such cases the particular facts — what were ineffect the respective contracts — were intimately connected with thequestions of law.[93] As this Court said more recently, the question "is a legal question tobe determined by the Court on the basis of what the parties said and did".13[94] It is important to bear in mind the infinite variation in partnershipstructures and avoid the assumption that a partnership must have certaincharacteristics or incidents other than those actually required by s 4(1) of the12 Aldridge v Paterson (1914) 33 NZLR 997 (SC) at 1006.13 Clark v Libra Developments Ltd [2007] 2 NZLR 709 (CA) at [51].Partnership Act. As the learned authors of Lindley & Banks on Partnershipsay:14There is a danger that what are, in truth, normal incidents orcharacteristics of partnership are wrongly perceived as pre-requisitesto the existence of that relationship, thus distorting the application of[the United Kingdom equivalent of s 4(1) of the Partnership Act].[24] Mr Hollyman referred to the Partnership Act 1908 whereas Mr McAnallyreferred to the Partnership Law Act 2019 on the basis that it is now in force and appliesto every partnership regardless of when it was formed.15 Which Act applies makes nodifference in this case. For present purposes, Part 2 of the Partnership Law Act 2019is similar in effect to the 1908 Act referred to in Zheng v Deng.[25] Here, against the background of informal merger discussions, TPA andGodfreys agreed on the same day as the 22 February 2011 earthquake that jointoperations should commence immediately. They announced an operational mergerthe next day. It was agreed that the joint operation applied to new business – not theparties' respective existing businesses. At that stage, the parties also agreed themethod of invoicing, use of premises, and the leadership roles of Mr Godfrey andMr Pasley. However, the proportionate shares in the net proceeds and the relatedcalculation of the other's increased costs were not agreed at that time.[26] In the circumstances, I do not consider that the agreement between the partieson 22 February 2011 gave rise to a partnership. The profit share was yet to be agreed.The terms of the joint operation relating to the profit share and allocation of staff wereprogressively agreed over the following months. On 10/11 June 2011 the partiesagreed their respective profit shares in the joint operation, but I do not consider thatconverted the joint operation into a partnership.[27] I accept, however, that the parties clearly agreed to engage in a joint operationfrom 22 February 2011 and I consider the arrangement was such as to give rise tofiduciary obligations of loyalty in respect of the joint operation or joint venture, albeitthat no issue of breach of fiduciary duty arises – the relevance of fiduciary obligations14 Roderick l'Anson Banks Lindley & Banks on Partnership (20th ed, Sweet & Maxwell, London,2017) at [2-15].15 Partnership Law Act 2019, s 6 and sch 1, cl 1.here being that equity may fill a gap in the parties' agreement. In that respect, thiscase is different from Li v 110 Formosa (NZ) Ltd, where the parties' joint venture wasdetailed in their cooperation agreement.16[28] Following termination of the joint venture, the party holding more than itsshare of the net proceeds of the joint venture had an obligation – in contract or equity– to account to the other for the other's share. It is common ground that the Court istaking a final account and will make an order for payment.[29] I now turn to consider the claimed adjustments to the revenue and costreconciliation.Allocation of staff[30] This issue requiring determination is whether (as Godfreys claim) the financialtreatment of the revenue of six staff who were allocated to TPA should be reallocatedto "Shared": Ms Bennett, Ms Paki, Mr Webb, Mr Kearvell, Mr Lawless and Ms Pratt.The parties are agreed as to the quantum of each of the claimed adjustments to theprofit share.[31] Mr McAnally submitted that throughout the joint venture staff revenue wasallocated in accordance with the joint venture terms and, more importantly, with thefull agreement of Godfreys – and Godfreys, ultimately, controlled the monthlyreconciliations and the calculation of revenue within them.[32] Mr Hollyman submitted that the parties agreed an overarching principle inrelation to the treatment of new staff members who joined TPAG after 22 February2011, expressed in Mr Godfrey's evidence as agreement that each would claim as itsown only its permanent employees at that date and that all other personnel, whethercontractors or new employees, would be for the benefit of the merger, and thus sharedon the agreed ratio.16 Li v 110 Formosa (NZ) Ltd [2020] NZCA 492 at [100]-[106].[33] Mr Pasley accepted this "as a principle", although correspondence at the timeindicates he did not make a distinction between existing permanent employees andcontractors.[34] Mr Ziegler, who was more involved in the reconciliation involving staffallocation at the time, accepted Mr Godfrey's proposition.[35] I doubt there was such an explicit agreement on or shortly after 22 February2011, as Mr Godfrey claimed. His relevant evidence was as follows:Because Godfreys would be introducing both the bulk of the professionalwork from which revenue would be derived and the bulk of the contractpersonnel to undertake the work, it was agreed either at the 22 February 2011meeting or shortly thereafter that the merger would require a joint benefit ofthe large volume of work and resources or Godfreys would benefit much morethan its share in the 62.5%/37.5% principle established for the proposedcompany. The parties therefore agreed that each would claim as its own onlyits permanent employees at that date and that all other personnel, whethercontractors or new employees would be for the benefit of the merger, and thusshared on the agreed ratio.[36] As indicated, it is common ground that the 62.5/37.5 per centage ratio was notagreed until June 2011. Therefore, I consider it more likely that any early discussionabout staff allocation was less explicit than suggested, or in principle. In any event,the principle is the appropriate starting point, but subject to subsequent agreement inrelation to specific personnel. It is clear from the correspondence that changes weremade over time, after Mr Godfrey's initial iteration of the inter-company analysis inApril 2011.Ms Bennett[37] Ms Bennett is Mr Pasley's partner (common-law wife). It is common groundthat she was not a permanent employee of TPA as at 22 February 2011. Mr Godfreysaid that she was only a contractor to TPA prior to the second earthquake and thusshould have been a shared employee. Mr Pasley accepted that "in principle" sheshould have been characterised as a shared staff member. But Mr Godfrey allocatedher to TPA for reconciliation purposes. The question is whether he agreed to do so(perhaps knowing she was Mr Pasley's partner) or made an error believing she was apermanent employee of TPA as at 22 February 2011 (which was not corrected by TPA).I consider it more likely that he agreed to do so than that he was effectively misledinto thinking she was a permanent employee and would not have agreed if told shewas a contractor. I do not consider an adjustment is required.Ms Paki[38] It is common ground that Ms Paki was an employee of TPA on 22 February2011. She had been with TPA since 2002. However, she subsequently resigned as anemployee and became a contractor. As Mr Hollyman submitted, she did so becauseshe wanted to contract back to TPAG on a non-exclusive basis. Godfreys claim shewas wrongly categorised as a TPA employee. On the other hand, Mr McAnallysubmitted that Ms Paki continued to perform the same functions, and that applyingMr Godfrey's own principle a change after 22 February 2011 requires no adjustment.[39] Applying the agreed principle according to its terms, I consider that Ms Pakiwas an employee at 22 February 2011 and not "other personnel". I do not considerthe principle required that a person who changed status after 22 February 2011 wasthen treated as a separate person, let alone that the person's earlier status also changed.[40] In any event, Mr Godfrey was aware of Ms Paki's change of status andnevertheless agreed to allocate her to TPA. I do not consider it likely that he did so bymistake. Ms Paki's reference to contracting back to "TPAG" is not significant. TPAGwas not a legal entity and I do not infer from that reference that she specifically wantedto contract to the merged business. She did not do so. Even if Mr Godfrey did not seethat reference, I do not consider his allocation was a mistake requiring adjustment.Mr Webb[41] Similarly, Mr Webb was a long-term employee of TPA on 22 February 2011.He subsequently resigned as an employee and returned as a contractor to run off hisexisting files. Mr Hollyman submitted that given his return as a contractor, Mr Webbshould have been treated as a shared employee; that his allocation was also a mistake.[42] As indicated, I do not consider the principle required that a person whochanged status after 22 February 2011 was then treated as a separate person, let alonethat their earlier status changed as well. In any event, Mr Godfrey agreed to theallocation and I do not see this as a mistake requiring adjustment.Mr Kearvell[43] It is common ground that Mr Kearvell was a contractor rather than a permanentemployee as at 22 February 2011. While I doubt the distinction is determinative giventhe nature of the agreed principle, Mr McAnally acknowledged that Mr Kearvell'sallocation is de minimis and warrants no further consideration. In the absence ofspecific agreement, I accept that Mr Kearvell should be treated as Shared.Mr Lawless[44] Mr Lawless joined as a contractor in March 2011. He was initially treated asShared but later changed by Mr Godfrey to TPA. Mr McAnally acknowledged that,but for the change, Mr Lawless would properly be treated as Shared, but submitted thechange was agreed. Mr Hollyman submitted the agreed change was for a temporaryperiod of two to three months only, after which Mr Lawless would be returned toShared. On this basis, some apportionment would be required.[45] The change followed discussion between Mr Godfrey and Mr Ziegler on oraround 11 June 2011. Neither witness's evidence-in-chief referred specifically to thatdiscussion and there was no suggestion in Mr Godfrey's evidence-in-chief that eitherhe or Mr Ziegler had said the change was for a temporary period only (nor was thatput to Mr Ziegler).[46] The issue is whether that was implicit. Mr Ziegler was asked in cross-examination whether he said to Mr Godfrey that it would only be a month or two untilthe merger, and he could not recall. However, Mr Godfrey, in cross-examination whileexplaining the context of the correspondence dealing with the change, said: what I said to Mr Ziegler, who had pressed for Mr Lawless to become aTPA or T class adjuster more than once was that we were about to merge atthat stage still contemplated to happen at 30 September for a 1 October jointventure company and that in response to his request for Mr Lawless to be aTPA employee that for that period it was fine. That was the dialogue we hadat the meeting[47] I accept that at the time of the conversation in June 2011, Mr Godfrey andMr Ziegler anticipated that the merger would occur, and the next possible date was30 September 2011, whether or not it was contemplated at that time that it wouldhappen at 30 September 2011. Later in his evidence, Mr Godfrey acknowledged that,as at 22 June 2011, merger on 30 September 2011 was not realistic.[48] Overall, I consider it unlikely Mr Godfrey said, or the parties agreed, that thechange to Mr Lawless's status was for that period only or otherwise implied it wastemporary if the merger did not occur at 30 September 2011. The references in thecontemporaneous documents to changing Mr Lawless from Shared to TPA do notsuggest it was temporary. Rather, I consider it more likely that Mr Godfrey simplyaccepted the change proposed by Mr Ziegler because Mr Godfrey considered themerger would occur soon and the change would not make any material difference.That did not make the change temporary or conditional. Rather, it was up toMr Godfrey to revisit the matter if he wished to do so once it became evident that themerger would not occur as soon as anticipated. He apparently did not do so. Evenaccepting the agreed change turned out to be in effect for longer than Mr Godfreyanticipated, I do not consider there is a gap that equity should fill. That would bere-writing the agreed change. No adjustment is required.Ms Pratt[49] Ms Pratt started with TPA in August 2011. The starting point therefore is thatshe should have been Shared, having not been with TPA as at 22 February 2011.Mr McAnally submitted, however, that her employment was in prospect prior to22 February 2011 and that Godfreys personnel were fully involved in her recruitmentand Mr Godfrey agreed to allocate her to TPA. Mr Godfrey said that he just "wasn'tover it adequately". Mr Hollyman submitted this was a mistake that should becorrected.[50] I do not consider the preliminary discussions with Ms Pratt prior to22 February 2011 are significant but I accept that Godfreys personnel on the TPAGexecutive were actively involved in confirming her engagement around June 2011.As Mr Hollyman acknowledged, Mr Godfrey was responsible for the allocation andthere is no compelling evidence of mistake at the time of the initial allocation norduring the subsequent reconciliations. But neither does the evidence sufficientlyindicate an agreement to allocate Ms Pratt to TPA (as an offset for Ms Page orotherwise). Given the starting principle, I therefore consider Ms Pratt's status shouldbe adjusted to Shared.Allowance for Mr Godfrey as managing director[51] Godfreys seeks an adjustment of $111,215 to reflect Mr Godfrey's work asmanaging director of the joint operation for which he/Godfreys was not separatelyremunerated.17 It is common ground that Mr Godfrey was designated the managingdirector of the joint operation and was intended to be the managing director of the newentity should the merger complete. It is also common ground that he expendedsignificant time on administrative matters and had lower billable hours than othersenior members of staff.[52] Mr Godfrey said he was only prepared to take on the role without remunerationon the basis there would be a merger. Mr Hollyman acknowledged there was noexpress agreement for payment of a salary but submitted there was an inferredagreement to pay him if there was no merger or that equity must fill the gap.[53] The adjustment sought between the parties should not be conflated withMr Godfrey's personal remuneration. In any event, the evidence does not indicatethere was any agreement with TPA, inferred or otherwise, that there would be anadjustment reflecting Mr Godfrey's work as managing director if there was no merger.Mr Godfrey did not suggest that was discussed or agreed, and the early modelling ofremuneration in a proposed merged entity does not assist.[54] In the absence of such an agreed adjustment and given the agreed approach torevenue and cost apportionment, Godfreys had no entitlement to payment forMr Godfrey's work such as would justify a deduction when settling the profit obtainedby the joint venture.18 There is no gap for equity to fill. Equity will not intervene to17 The claimed adjustment is for the period from 22 February 2011 to late April 2012 (the date ofMr Godfrey's heart attack).18 As in Chirnside v Fay [2006] NZSC 68, [2007] 1 NZLR 433 at [37].revisit the agreed apportionment. As Mr McAnally submitted, an obligation to actequitably towards one another upon dissolution of a joint venture does not give rise tosuch an equitable claim. Any claim to payment for services rendered by an agent arosewhen those services were supplied. In the absence of an agreement, the only claimwould be an unpleaded quantum meruit claim, which would be statute barred. Heresuch a claim would be inconsistent with the agreed revenue and cost apportionment,which was not subject to adjustment if the merger did not occur. In that context, thecases where a fiduciary is given an allowance for effort and skill despite a breach donot assist.19Godfreys' "run off" costs[55] Godfreys seeks contribution for certain TPAG "run off" costs:(a) $23,763 for direct cost recoveries for contractors from 1 November2013;(b) $46,639 for administrative staff from 1 November 2013 to 31 March2014;(c) $60,451 for rent in Featherston Street from 1 November 2013 toSeptember 2019; and(d) $16,782 for loss on disposal of its Featherston Street premises inSeptember 2019.[56] Mr McAnally submitted that these claimed costs cannot be shown to be jointventure expenses, are inconsistent with the joint venture agreement and are bereft ofan evidential basis.Contractor costs[57] Mr McAnally accepted as a general proposition that TPA would have beenrequired to meet its share of any expenses arising from the joint venture after19 Crampton-Smith v Crampton-Smith [2011] NZCA 308, [2012] 1 NZLR 5 at [65]-[69].31 October 2013, notwithstanding termination on that date. However, he sought todistinguish between expenses incurred after that date that are due to ongoing jointventure work and those claimed because there was a joint venture up to 31 October2013. He submitted that the costs were not pleaded and there was no evidence otherthan Mr Godfrey's statement in his supplementary evidence in chief that: contractors could choose who they worked for after 31 October and theyeither left or did so, but Godfreys carried on paying costs for those contractorsthat were working for one or other of the companies that were not necessarilyGodfreys' benefit [sic] and that amount relates to those costs. They would'veincluded accommodation largely in Christchurch and per diems which all ofthe contractors were paid.[58] It is common ground that the joint venture files were allocated as of 31 October2013 either to Godfreys or TPA based on the lead loss adjuster and each entity finishedthe work and billed them separately. What is unclear is the extent to which thecontractors paid thereafter were working for TPA. However, I accept Mr Godfrey'sevidence provides an evidential basis for this modest adjustment.Administrative staff[59] Mr Godfrey accepted that the claim in respect of administrative staff was notdue to the staff having attended to joint venture work between 1 November 2013 and31 March 2014 but on the basis that Godfreys had taken on more administrative staffduring the course of the joint venture than might otherwise have been the case andsome were made redundant about a year later. It appears 31 March 2014 was simplya cut-off date applied by Godfreys.[60] I accept that Godfreys had likely taken on more administrative staff during thecourse of the joint venture than might otherwise have been the case, but I do notconsider that provides a basis for the claimed adjustment for administrative staff costsafter 31 October 2013. As Mr McAnally submitted, there was no evidence of theextent of the surplus in staff over Godfreys' subsequent separate requirements, or thatstaff were not gainfully employed given that Mr Godfrey said several of those stafflasted for more than a year after that. Godfreys knew from 14 May 2013 that TPA nolonger wished to proceed with the merger and the parties exchanged documentsrelating to the unwind later in May 2013.Rent in Featherston Street[61] Godfreys claims an adjustment for rental of its Featherston Street premisesfrom November 2013 to September 2019 when the lease expired. Godfreys acceptsthat at some point it was able to swap premises with another tenant and sublet part ofthose premises. It seeks an adjustment for 37.5 per cent of its losses.[62] The context is that before the joint venture Godfreys had premises in LowerHutt. The lease of those premises was due to expire in July 2013. There were issueswith those premises that led to consideration of early termination in 2012, during thejoint venture, and it was decided that Godfreys would move back into the central cityto be nearer clients. The TPAG executive were consulted but Mr McAnally submittedthat the decision was ultimately for Godfreys alone. Even though Godfreys were toenter the lease, I accept that it was entered during the joint venture with the greaterneeds of the joint operation in mind. On that basis, I accept that equity may treat it asa joint venture expense in the absence of agreement.[63] However, the parties had agreed the approach to sharing costs; that is, eachparty would reimburse the other for the increased costs incurred by each giving effectto the combined operation. On that basis, the Featherston Street costs should bebenchmarked against the existing Lower Hutt costs before even considering a run-offadjustment. The claimed adjustment was not calculated on that basis. Further, if itwere a joint venture expense, for a run-off adjustment Godfreys would need to showwhat its rental would otherwise have been post termination (taking reasonable steps tomitigate its loss). A spreadsheet provided by Ms Beckett, an expert engaged byGodfreys, referred to a benchmark of the rent paid when Godfreys swapped to smallerpremises, but there was no evidence as to when that occurred or substantiating that thedifference reflected the surplus joint venture expense.[64] In the absence of sufficient evidence as to the increased costs and surplus jointventure expense, I do not consider the claimed adjustment is warranted.Featherston Street disposal[65] Godfreys seeks an adjustment for a loss on disposal of its Featherston Streetpremises in September 2019. This was described by Ms Beckett as the unexpired bookvalue of leasehold improvements at the end of the tenancy. Her spreadsheet refers toblinds, Spaceworks fitout, two F&P dishdrawers and alarm and security.[66] As Mr McAnally submitted, there was no evidence to establish that those assetswere joint venture expenses, as opposed to part of the premises Godfreys required forits own business. No adjustment is warranted.Assignment[67] From TPD's perspective, this was a preliminary issue in the sense that theassignment founds its right of action. It is not relevant to Godfreys' third party claimagainst CNZ. Godfreys initially disputed the assignment to TPD on the basis thatTPA's rights had been carved out of the merger with CNZ. It also submitted theassignment to TPD was of a bare cause of action and therefore void. Ultimately, therewas a degree of common ground that the assignment issue was something of atechnicality that could be overcome by amendment to the pleadings if necessary.[68] Dealing first with Godfreys' carve out submission, clause 7.8 of the mergeragreement dated 27 November 2013 provided:20TPA has advised that there is currently a dispute between TPA and Godfreyand Company Limited ("Godfrey") in relation to the settlement between theparties of arrangements relating to the termination of the joint venturearrangements between them (the "Godfreys Dispute"), which may result in areceipt or payment by TPA or the Amalgamated Company, depending on whenthe Godfreys Dispute is resolved.The Godfreys Dispute (each a "Dispute")shall be treated as being excluded from the Amalgamation and for the accountof the TPA Shareholders as follows:(b) If the relevant Dispute is resolved after the Amalgamation and anyagreed settlement amount is to be paid by the relevant party to thedispute after the Amalgamation, then:20 The gaps appear to be redactions in the Court copy.(i) if resolved in TPA's favour, any settlement amount receivedby the Amalgamated Company shall be for the sole benefit ofthe TPA Shareholders and the parties shall determine anappropriate mechanism to achieve that objective subject toand in accordance with clause 7.B(c)(iv); and(ii) if resolved in Godfreys' favour or favour (as the casemay be), any settlement amount to be paid by theAmalgamated Company shall be paid by the AmalgamatedCompany by the due date for payment, provided that:(1) the full cost to the Amalgamated Company of suchpayment is ultimately borne by the TPA Shareholders(and not by any CNZ Auckland Shareholder);(2) subject to sub-clause (3) below and unless all CNZAuckland Shareholders agree in writing, theAmalgamated Company's cash reserves are promptlyrestored to the pre-payment level by the TPAShareholders;(3) the parties shall, subject to and in accordance withclause 7.8(c)(iv), determine an appropriatemechanism to achieve the requirements set out in thisclause 7.B(b)(ii); and(4) the TPA Shareholders hold each of the CNZ AucklandShareholders harmless in respect of any suchpayment.(c) In either case:(i) each of the TPA Shareholders warrant to each of the CNZAuckland Shareholders that the joint venture arrangementbetween TPA and Godfreys ("TPA/Godfreys JV") has beenterminated and that except for the Godfreys' Dispute there areno other outstanding, threatened, or pending proceedings,claims or actions either between TPA and Godfreys arising outof the TPA/Godfreys JV (including its termination) orbetween TPA and any other person arising out of any servicesprovided by TPA while the TPA/Godfreys JV was in place;(iii) the TPA Shareholders hereby indemnify the AmalgamatedCompany and the CNZ Auckland Shareholders for all costs,losses, expenses (including legal costs on a solicitor/clientbasis), liabilities and obligations incurred or suffered by theAmalgamated Company or by any one or more of the CNZAuckland Shareholders arising out of or in connection with,whether directly or indirectly, each of the Godfreys Disputeand Dispute; and(iv) the parties shall, acting reasonably, determine an appropriatemechanism to be used to give effect to the intention of theparties as set out in clauses 7.8(a) and 7.8(b) having regard tothe Amalgamated Company's solvency requirements, taxefficiency considerations of the relevant Shareholders and theAmalgamated Company, and any other relevant factors.[69] I consider TPA's rights against Godfreys were not assigned or otherwiseexcluded by the merger agreement and therefore became CNZ's rights as a result ofthe amalgamation. That is the effect of amalgamation of two companies.21Notwithstanding the words "shall be treated as being excluded from theAmalgamation", read as a whole I do not consider the effect of the merger agreementwas to carve out TPA's rights against Godfreys. In closing, Mr Hollyman accepted theclaim was not excluded. In context, the merger agreement provided that, as betweenthe shareholders who were parties to the agreement, any settlement amount receivedby CNZ would be for the benefit of the named TPA shareholders and likewise anysettlement amount paid by CNZ would be borne by the named TPA shareholders. Theagreement was not purporting to assign TPA's rights (or obligations – which cannot beassigned) to the shareholders. If it were an assignment of TPA's rights to theshareholders, the technical issue could be dealt with by amendment to join the TPAshareholders as plaintiffs with no prejudice to Godfreys.[70] In relation to the subsequent assignment to TPD, Mr Hollyman submitted theassignment was of a bare cause of action and offends against the rules againstchamperty and maintenance. Mr Hollyman acknowledged the exception to the ruleswhere the assignee can establish a genuine commercial interest in the assignment,22but submitted this does not apply. He submitted that TPD does not have a genuinecommercial interest in the assignment. It did not even exist at the time of thepartnership/joint venture. He submitted the laws of separate corporate personalityprevent it from simply assuming the interest of its shareholders. He submitted thereis no genuine commercial interest merely because the shareholders of TPD are the21 Companies Act 1993, s 225.22 It is common ground that the other exception, that of assignment of a property right or interestwhere the cause of action is ancillary to that right or interest, does not apply in this case. SeeTrendtex Trading Corporation v Credit Suisse [1982] AC 679 (HL) at 703F-G; and First CityCorporation Ltd v Downsview Nominees Ltd [1989] 3 NZLR 710 (HC) at 755.same persons who were shareholders of TPA, relying on Wayby Investments Ltd vKrukziener.23[71] The relevant legal principle is not in dispute. As Fogarty J said inBody Corporate 160361 (Fleetwood Apartments) v BC 2004 Ltd and BC 2009 Ltd:24The leading case on whether assignments are void by reason of maintenanceand champerty is Trendtex Trading Corporation v Credit Suisse.25This decision is regarded as the leading case in the United Kingdom, inNew Zealand and in Australia. It is common ground that the Trendtex decisionsets the current standard for judging maintenance and champerty byexamining whether the assignee had "a genuine commercial interest in takingthe assignment and in enforcing it for his own benefit".26[72] Fogarty J also noted that, as is the method of common law, the Commonwealthcourts' understanding of "the standard of genuine commercial interest" is being testedon a case by case basis.27 It is the application of this standard or principle that is inissue here.[73] In Trendtex, the House of Lords upheld an assignment of Trendtex's rights toits banker, Credit Suisse, but not a further assignment from Credit Suisse to anunknown third party who had no genuine commercial interest in the claim in returnfor a division of the spoils.28[74] Fleetwood Apartments involved an assignment by apartment owners toAuckland Council in the context of leaky building litigation by the apartment ownersagainst the Council and other defendants. The apartment owners assigned their causeof action to the Council as part of a settlement. Mr Hollyman acknowledged that thefacts of Fleetwood Apartments are not materially similar to this proceeding, but hesubmitted the statements of principle are relevant here. Fogarty J held the assignmentwas void. It undermined the law of maintenance and champerty and the purpose ofthe Law Reform Act 1936 of achieving just and equal contributions between23 Wayby Investments Ltd v Krukziener (2003) 16 PRNZ 907 (HC).24 Body Corporate 160361 (Fleetwood Apartments) v BC 2004 Ltd and BC 2009 Ltd [2014] NZHC1514, [2014] 3 NZLR 758 at [26] (emphasis in original); see also Waterhouse v ContractorsBonding Ltd [2013] NZSC 89, [2014] 1 NZLR 91 at [57].25 Trendtex Trading Corporation v Credit Suisse [1982] AC 679 (HL).26 At 703.27 Fleetwood Apartments at [33].28 Trendtex at 694 and 703-704.tortfeasors. Avoiding that statutory process was a significant feature in the case.Fogarty J concluded:29There is a general common law hostility to enable causes of actions to be atradable commodity. There is a longstanding reluctance of common lawjudges to allow assignment of claims, particularly tort claims. This isparticularly so when the damage is to individuals. Part of these claims includedamage to individuals, stress etc, for which there is a claim totallingapproximately $20,000 per head, or nearly half a million.The goal of the assignment on the part of the Council is to reduce the amountthat it would otherwise have to pay after a combination of a trial leading to ajudgment and then a second hearing leading to apportionment of the judgmentsum under the Law Reform Act 1936. For otherwise the assignment would nothave been entered into.[75] In those circumstances, Fogarty J was concerned that the assignment meddledin the statutory apportionment of contribution.30 Fogarty J did not share theconfidence in a just and equitable final outcome of Heath J in Auckland City Council(As Assignee) v Auckland City Council,31 which concerned a similar settlement andfollowed the English Court of Appeal decision of Brownton Ltd v Edward MooreInbucon Ltd.32[76] Separately, Fogarty J referred to a number of Australian cases,33 and thedesirability of alignment of New Zealand and Australian common law.34 On the basisof the Australian cases, Fogarty J concluded that a prior "pre-existing" commercialinterest in the matters that give rise to the cause of action is, at the very least, apowerful consideration in support of the assignment being legitimate and not contraryto public policy.35 The Council did not meet that criterion.29 Body Corporate 160361 (Fleetwood Apartments) v BC 2004 Ltd and BC 2009 Ltd [2014] NZHC1514, [2014] 3 NZLR 758 at [115]-[116].30 At [117]-[119].31 Auckland City Council (As Assignee) v Auckland City Council [2008] 1 NZLR 838 (HC).32 Brownton Ltd v Edward Moore Inbucon Ltd [1985] 3 All ER 499 (CA).33 National Mutual Property Services (Australia) Pty Ltd v Citibank Savings Ltd (1995) 132 ALR514 (FCA); Monk v ANZ Banking Group Ltd (1994) 34 NSWLR 148 (SC); Deloitte ToucheTohmatsu v JP Morgan Portfolio Services Ltd [2007] FCAFC 52, (2007) 158 FCR 417; Dover vLewkovitz [2013] NSWCA 452; and EWC Payments Pty Ltd v Commonwealth Bank of Australia[2014] VSC 4.34 Fleetwood Apartments at [141].35 Fleetwood Apartments at [142]. Fogarty J had noted at [131]-[132] that the Australian case ofWorkCover Queensland v Amaca Pty Ltd [2012] QCA 240, [2013] Qd R 276 at [66] appeared toundercut a submission that the pre-existing commercial interest must be prior in time to thelitigation which is being assigned.[77] Fogarty J's overall conclusion included the following:[143] The common law has long been hostile to assignments of causes ofaction. It has identified the tort of maintenance and its most pernicious form,champerty, as wrongs contrary to public policy, by reason of being a trade incauses of action. Judges have an instinctive hostility to surrogates bringingclaims, taking advantage of the misfortune of others.[144] The torts of maintenance and champerty have not been abolished.Rather, funding arrangements which are fair are tolerated, consistent withfacilitating access to justice. Secondly, when property is sold and causes ofactions run with the property, the common law courts, which have alwaysfacilitated a free market in property, tolerate assignments of causes of action,including those in tort.[145] Neither of these two qualifications, however, reflects any lessening ofthe basic common law hostility to there being trade in causes of action. Causesof action, unless there are special reasons, should always be brought by thepersons in respect of whom the law provides rights and damages or otherrelief. Assignments have to be justified.[146] The judgment that I essentially am faced with is that I cannot be surethat a trial judge during a trial and when fixing contribution after judgment,would not be distracted, deflected, or even frustrated by considerations as tothe role of the assignee and the weight to be attached to the assignment. Thetrial judge would know, at all times, that the plaintiffs claims are being pursuedin the interests of the tortfeasor, not in fact in the interests of the originalplaintiffs, unless the judgment reaches up and beyond $1.7m.[147] Ms Thodey agreed in the course of argument that if this assignmentstands, there is nothing to stop any defendant, in any proceedings, enteringinto a bargain to purchase the plaintiff's causes of action as part of a settlementin order to sue the other defendants. There will then be a market for theplaintiffs' causes of action when there is more than one defendant. Such a stateof affairs does not happen anywhere else in the common law world. The caseof Brownton stands on its own. The Australian jurisprudence does not allowit. Lindgren J's judgment in Citibank has been cited many times by otherAustralian judges, without criticism.[148] The torts of maintenance and champerty are still law. The law toleratessome relief against their strictures when there are good reasons in the publicinterest to do so. The reduction of those reasons to the principle of pre-existingcommercial considerations existing prior to the litigation itself is the standardfollowed in Australia, ultimately applying the standard in Trendtex. Browntonshould be confined to its facts. In that case the UK equivalent to s 17 of theLaw Reform Act was not available to adjust contribution between thedefendants.[149] I do not think there is sufficient merit in this stratagem of the AucklandCouncil to warrant extending the toleration of such assignments. It is meddlingwith the common law of torts, and the purpose of the Law Reform Act 1936.It will encourage traffic in assignments of actions and will make a trial judge'sduty to do justice between the parties even more difficult, and potentiallyprevent the judge from applying both the common law and the statute.[78] This case is materially different from Fleetwood Apartments. It does notinvolve a settlement of litigation whereby one defendant is assigned the plaintiff'srights against other defendants who are the settling defendant's joint tortfeasors, givingrise to the Law Reform Act contribution issue. Indeed, this case does not involveassignment of a tort claim at all but rather the contractual or equitable right to anaccount. Nor does this case involve litigation funding. As Fogarty J acknowledged inthe passage quoted, funding arrangements which are fair are tolerated, consistent withfacilitating access to justice.36 At least in that context, a pre-existing right is notrequired.[79] Mr McAnally submitted that the interests of a company are ultimately those ofits shareholders as a whole, referring to the recent Supreme Court decision inMadsen-Ries v Cooper in the context of the duty of directors to act in the best interestsof the company (the shareholder primacy model).37 He submitted it is artificial, in thiscontext, to suggest there is any divergence in interests in the claim between TPD andthe TPA shareholders that have incorporated it for the purposes of prosecuting theclaim. Even so, I accept Mr Hollyman's submission that the laws of separatepersonality prevent TPD from simply assuming the interest of its shareholders.[80] Mr Hollyman relied, as indicated, on Wayby Investments Ltd v Krukziener,which involved an application to substitute a newly incorporated special purposecompany as sole plaintiff following the issue of proceedings.38 The shareholders ofthe new entity included the original plaintiffs. Master Faire declined the applicationon the basis that the arrangement provided for the funding of the proceeding and asharing of the proceeds, and did not fit within any of the recognised exceptions to therules against maintenance and champerty. Master Faire noted the plaintiff hadacknowledged that the shareholding of the new entity may change as investors enteredby way of acquisition of shares and no doubt the provision of funds by way ofadvances.39 Given that, he was not asked to base his ruling on there being no passingof control of the proceedings by virtue of the assignment.36 Litigation funding can also occur without an assignment.37 Madsen-Ries v Cooper [2020] NZSC 100 at [28].38 Wayby Investments Ltd v Krukziener (2003) 16 PRNZ 907 (HC).39 At [8].[81] The Court's approach to litigation funding has developed considerably sinceWayby.40 While abuse of process is a ground (but not the only ground) for challenginglitigation funding arrangements,41 in the context of this case the test remains whetherthe assignee has a genuine commercial interest. This case differs from Wayby in thesense that there is no litigation funding element to the assignment and any passing ofcontrol is somewhat technical since there is no suggestion that the shareholders of TPAand TPD differ.[82] In this materially different case, involving neither litigation funding nor jointtortfeasor settlement, I do not favour an overly hostile approach to ascertainingwhether the assignee has a genuine commercial interest. I consider the effect of the2013 merger agreement was that the TPA shareholders had a genuine commercialinterest in the claim against Godfreys even though it was not assigned to them by TPAbefore the CNZ amalgamation. In the particular circumstances of this case, I alsoconsider that TPD had a genuine commercial interest in the subsequent assignment,just as its shareholders would have had if the assignment had been to them personally,given the terms of the merger agreement and the fact that the assignment occurred inthe context of a restructure of the network of companies including CNZ whichanticipated CNZ's liquidation. There was no suggestion of ringfencing by the TPAshareholders and Mr McAnally advised that security for costs had been provided. Iconsider the assignment was valid.[83] In any event, since TPA's claim was not excluded from the amalgamation bythe merger agreement, even if the assignment were void, I consider this issue could bedealt with by amendment to joint CNZ (in liquidation) as plaintiff with no prejudiceto Godfreys, given it is accepted there is an indemnity from the TPA shareholders.Quantum[84] Following the further work of the experts in narrowing the differences duringthe trial, counsel helpfully provided an Excel spreadsheet with which to calculate the40 Saunders v Houghton [2009] NZCA 610, [2010] 3 NZLR 331 at [21]; and Waterhouse vContractors Bonding Ltd [2013] NZSC 89, [2014] 1 NZLR 91 at [56].41 Waterhouse at [56].result based on my determination of the remaining issues. I am grateful to counsel fortheir assistance in focusing and confining the issues.[85] Inputting into the spreadsheet the adjustments I have allowed for staff(Mr Kearvell and Ms Pratt) and run-off costs (direct contractor cost recoveries),the total payable by Godfreys is $589,844 (as set out in the attached version of thespreadsheet).Result[86] I make an order that Godfreys pay TPD the sum of $589,844.Interest and costs[87] The parties agreed that the calculation of interest should be deferred and, ifnecessary, dealt with at the same time as costs. If interest and costs cannot be agreed,TPD is to file and serve a brief memorandum within 20 working days, and Godfreysis to file and serve a brief memorandum in response within a further 10 working days.I will determine interest and costs on the papers unless I need further assistance fromcounsel.________________________________Gault JSCHEDULE 1