IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

I TE KŌTI MATUA O AOTEAROA TĀMAKI MAKAURAU ROHE	
CIV-2018-404-001143
[2019] NZHC 1916	

UNDER	the Consumer Guarantees Act 1993, Fair Trading Act 1986 and High Court Rule 4.24	

BETWEEN	
DAVID ERIC PAINE and LYNDA CAROLINE BOWERS
First Plaintiffs

KEVIN BRYAN START and FLORENCE ELIZABETH START
Second Plaintiffs

.../Third and Fourth Plaintiffs cont over page	

AND	
CARTER HOLT HARVEY LIMITED
Defendant	

Hearing:	On the papers	
Judgment:	7 August 2019	

JUDGMENT OF DOWNS J
(Costs)

This judgment was delivered by me on Wednesday, 7 August 2019 at 4 pm pursuant to r 11.5 of the High Court Rules.

Registrar/Deputy Registrar

Solicitors/Counsel:
Adina Thorn Ltd, Auckland. LeeSalmonLong, Auckland. AS Ross QC, Auckland.
JG Miles QC, Auckland.

PAINE v CARTER HOLT HARVEY LTD [2019] NZHC 1916 [7 August 2019]

DONALD BRAMWELL JACKSON and HEATHER MAY PROCTOR JACKSON, and DONALD BRAMWELL JACKSON, HEATHER MAY PROCTOR JACKSON and HOLLAND BECKETT TRUSTEE
No.11 LIMITED as trustees of the Jackson Family Trust 2011
Third Plaintiffs

STEPHEN MATHEW DEVCICH, JESSIE DIANA DEVCICH and JOHNNY CHARLES AUGUST as
trustees of the Devcich Family Trust Fourth Plaintiffs

The issues

[1]	On 11 July this year, I dismissed applications by Carter Holt Harvey Ltd1 to stay or dismiss the plaintiffs’ claim,2 and for permission to appeal an earlier ruling of mine about particulars.3 Knowledge of these earlier decisions is assumed. Carter Holt acknowledges it is liable for costs. However, it and the plaintiffs disagree what these should be. The plaintiffs contend $72,328.98; Carter Holt says $34,428.27. The difference reflects disagreement over whether:

(a)	The application for permission to appeal should be classified 3B or 3C.

(b)	That application should attract increased costs.

(c)	The stay application should attract increased costs.

(d)	Disbursements in relation to two expert witnesses for the plaintiffs are recoverable.

Classification of the application for permission: 3B or 3C?

[2]	Carter Holt sought security for costs on a 3C basis. I granted the application— on the same basis. Carter Holt’s application for permission to appeal appended a six-page, draft notice of appeal. Fourteen separate grounds of appeal were pleaded. Carter Holt’s written submissions extended to 10 pages. The plaintiffs responded accordingly, all of which must have taken time. 3C classification is warranted.

Should the application for permission to appeal attract increased costs?

[3]	The plaintiffs say “yes” because I concluded much of Carter Holt’s earlier application for particulars lacked merit. So, that must be equally true for Carter Holt’s proposed appeal.

1	Carter Holt.
2	Paine v Carter Holt Harvey Ltd [2019] NZHC 1614.
3	Paine v Carter Holt Harvey Ltd [2019] NZHC 478.

[4]	This submission is accurate but incomplete. Reasonable minds can differ about particulars; what a plaintiff and defendant consider adequate not infrequently diverges. Provision of particulars was important to Carter Holt. Having lost, it was not unreasonable for the company to seek permission to appeal. Departures from scale costs are the exception, not the rule. These considerations tip the balance—just—in favour of scale (3C) costs.

Should the stay application attract increased costs?

[5]	Carter Holt says “no” because I found Ms Thorn misled potential claimants (albeit in the context of a single media interview); a stay application “was the proper avenue” to ventilate this issue and the plaintiffs’ funding arrangements; and elucidation of r 4.24(a) of the High Court Rules 2016 was required.

[6]	I disagree. The stay application was much too broad. It, essentially, put everything in issue. Elucidation of r 4.24 was unnecessary. As explained in my judgment, the rule means what it says. Funding arrangements are unremarkable. Nothing, objectively, suggested otherwise. The remedy sought by Carter Holt—a dismissal or stay of the plaintiffs’ claim—was “hopelessly disproportionate” to any wrong, even assuming the conduct complained of amounted to an abuse of process.4 There was no realistic prospect of either form of relief. For these reasons, the application bordered misadventure. Increased costs of 30 percent are warranted.

Are the disbursements in relation to the two experts recoverable?

[7]	Carter Holt argues “no” because I expressed doubt about the admissibility of the experts’ evidence. And, because I placed no reliance on their testimony. It submits the evidence was not reasonably necessary for the conduct of the plaintiffs’ case, particularly as both experts addressed funding arrangements in jurisdictions beyond New Zealand: England and Wales, and Hong Kong.

[8]	These arguments would have force if Carter Holt’s attack on funding arrangements had not been so broad. And, if Carter Holt had not adduced its own

4	See Paine v Carter Holt Harvey Ltd, above n 2, at [92].

expert evidence in support of its challenge.5 Rule 14.12(2) of the High Court Rules permits disbursements “reasonably necessary for the conduct of the proceeding”. The rule anticipates an objective, contextual analysis. The plaintiffs’ briefing of two experts was a reasonable response to Carter Holt’s attack on funding arrangements. The related evidence was not plainly inadmissible; our courts sometimes consider the common law of each jurisdiction. In any event, I reached no final view on admissibility. The total sought—approximately $15,290.00—is reasonable. I allow for both experts.

Result

[9]	I award costs in accordance with this judgment.

……………………………..
Downs J

5	Carter Holt abandoned reliance on its expert evidence after the hearing (by memorandum of counsel). However, by then, the plaintiffs had incurred the cost of briefing their experts.