WESTPAC NEW ZEALAND LTD (1763882) v ANDERSON [2021] NZHC 3074

WESTPAC NEW ZEALAND LTD (1763882) v ANDERSON [2021] NZHC 3074 [15 November 2021]IN THE HIGH COURT OF NEW ZEALANDCHRISTCHURCH REGISTRYI TE KŌTI MATUA O AOTEAROAŌTAUTAHI ROHECIV-2021-409-000347[2021] NZHC 3074BETWEEN WESTPAC NEW ZEALAND LIMITED(1763882)PlaintiffAND PATRICIA KARENIA ANDERSONDefendantHearing: 11 November 2021Appearances: R G Smedley for PlaintiffJudgment: 15 November 2021JUDGMENT OF ASSOCIATE JUDGE PAULSENThis judgment was delivered by me on 15 November 2021 at 3.00 pmpursuant to Rule 11.5 of the High Court RulesRegistrar/Deputy RegistrarDate:[1] On 24 June 2021, in related proceedings between these parties under CIV-2016-409-373, Associate Judge Lester made orders on an interlocutory application byWestpac New Zealand Ltd (Westpac). These included that the judgment debtor,Mrs Anderson, was to pay Westpac costs and disbursements in the sum of $3,607 (thecosts award).[2] Mrs Anderson did not pay the costs award.[3] On 5 August 2021, Westpac applied to this Court for the issue of a bankruptcynotice against Mrs Anderson in respect of the costs award. The bankruptcy notice wasissued on 10 August 2021.[4] Westpac says it served the bankruptcy notice on Mrs Anderson on 31 August2021 in accordance with directions made by Venning J on 9 June 2021 in the relatedproceeding.[5] On 15 October 2021, Mrs Anderson, who is self-represented, applied to setaside the bankruptcy notice. The application was set down to be heard in theInsolvency List on 11 November 2021.[6] On 10 November 2021, I issued a minute that I would deal with the applicationat the end of the Insolvency List on 11 November 2021. That minute was forwardedby email to the parties. In the case of Mrs Anderson, it was sent to an email addressprovided by her. Her application does not provide a physical address for service.[7] When the application was called on 11 November 2021, Mrs Anderson did notappear. I adjourned the application to be re-called later in the morning.[8] When the application was re-called Ms Anderson still did not appear.Mr Smedley sought an order dismissing the application and indemnity costs.[9] I was satisfied it was appropriate to make an order dismissing the applicationand did so. These are my reasons.[10] First, as the applicant it is incumbent upon Mrs Anderson to prosecute herapplication. Before re-calling the application, I made enquires of the Registry and wasadvised that Mrs Anderson had notice of the hearing date, was sent my minute of10 November 2021 and had not been in contact with the Registry to say she would notbe appearing in Court. In the absence of any communication from her, Westpac wasentitled to ask that the application be determined.[11] Second, I am satisfied the application should be dismissed on its merits.[12] Section 17 of the Insolvency Act 2006 relevantly provides:17 Failure to comply with bankruptcy notice(1) A debtor commits an act of bankruptcy if—(a) a creditor has obtained a final judgment or a final orderagainst the debtor for any amount; and(b) execution of the judgment or order has not been halted bya court; and(c) the debtor has been served with a bankruptcy notice; and(d) the debtor has not, within the time limit specified insubsection (4),—(i) complied with the requirements of the notice; or(ii) satisfied the Court that he or she has a cross claimagainst the creditor.(2) The form that the bankruptcy notice must take is set out in section29.(3) The debtor must have been served with the bankruptcy notice inNew Zealand, unless the Court gave permission for the serviceof the notice on the debtor outside New Zealand.(4) The time limit referred to in subsection (1)(d) is,—(a) if the debtor is served with the bankruptcy notice in NewZealand, 10 working days after service; or(b) if the debtor is served outside New Zealand, the timespecified in the order of the Court permitting serviceoutside New Zealand.(5) In this section, a creditor who has obtained a final judgment or afinal order includes a person who is for the time being entitled toenforce a final judgment or final order.(7) In subsection (1)(d)(ii), cross claim means a counterclaim, set-off, or cross demand that—(a) is equal to, or greater than, the judgment debt or theamount that the debtor has been ordered to pay; and(b) the debtor could not use as a defence in the action orproceedings in which the judgment or the order, as the casemay be, was obtained.[13] In her notice of application, Mrs Anderson advances the following grounds insupport of the application:(a) she is not insolvent;(b) there are monies owed to her by Westpac that exceed the amountclaimed by Westpac in the bankruptcy notice;(c) that Westpac did not make it clear to the Court when obtaining the costsaward that the "convention" or "course of dealings" in the relatedproceeding has been that costs should lie where they fall;(d) the orders sought by Westpac which led to the making of the costs orderwere unnecessary; and(e) that allocating costs "when incurred" prejudices justice in favour ofWestpac and prevents Mrs Anderson from being able to defend herself.[14] In respect to these matters:(a) Mrs Anderson's solvency is not presently in issue but, in any event,there is no evidence as to her solvency.(b) I do not accept that Mrs Anderson has a genuine and triable cross claimagainst Westpac. Mrs Anderson asserts that she is entitled to costs inthe related proceeding. However, she is self-represented and cannotclaim party-party costs. She has also claimed a filing fee and"Extension of Costs for Independent Report on Quantum" but there isinsufficient evidence to suggest that Westpac has or may have anyliability for these sums.(c) There has been no convention or course of dealings in the relatedproceeding that costs would lie where they fall. In addition to the awardmade by Associate Judge Lester, there have been two other occasionswhere the Court has awarded costs against Mrs Anderson in thatproceeding.1(d) Mrs Anderson says the orders made by Associate Judge Lester wereunnecessary and as a result of developments since, would not have beenmade. However, she filed no challenge to them, nor has she applied tovary the costs award.2(e) While Mrs Anderson says awarding costs "when incurred" prejudicesher, the presumption under the High Court Rules is that costs should befixed and paid when an application is determined.3 This reflects themerits of particular applications and fairness is maintained as the rulecan be departed from if special reasons exist.[15] In these circumstances, it is not necessary to deal with Westpac's argument thatMrs Anderson's application must be dismissed as being out of time.[16] As noted, Mr Smedley sought indemnity costs on the application, but Iindicated to him I would not award them. On what is before me I cannot be satisfiedMrs Anderson made the application frivolously, vexatiously, in bad faith or that she isotherwise sufficiently blameworthy to reach the high threshold justifying such anaward.[17] In the alternative, Mr Smedley sought increased costs. In my view there is agood basis to award increased costs under r 14.6(3)(b)(ii) and (d) of the High CourtRules. Mrs Anderson's application was unnecessary and lacked merit. In addition, itis unacceptable that she failed to appear at the hearing without explanation, putting1 Westpac New Zealand Ltd v Anderson [2018] NZHC 1814 at [40(d)] and Westpac New ZealandLtd v Anderson [2019] NZHC 979 at [70].2 High Court Rules 2016, r 14.8.3 Rule 14.8.Westpac's counsel needlessly to the time and effort of preparing in anticipation ofargument on the application. Her actions, of course, unnecessarily added to Westpac'scosts.Result[18] It follows and I have ordered:(a) Mrs Anderson's application to set aside Westpac's bankruptcy notice isdismissed.[19] Westpac is awarded costs on a 2B basis with a 20 per cent uplift and reasonabledisbursements (to be fixed by the Registrar)._______________________O G PaulsenAssociate JudgeSolicitors:Anthony Harper, Christchurch