IN THE HIGH COURT OF NEW ZEALAND WELLINGTON REGISTRY

I TE KŌTI MATUA O AOTEAROA TE WHANGANUI-A-TARA ROHE	
CIV-2023-485-378
[2024] NZHC 2722	

BETWEEN	LEBANESE SOCIETY OF AOTEAROA NEW ZEALAND INCORPORATED
First Appellant

CEDARS OF LEBANON INCORPORATED
Second Appellant	
AND	THE LEBANESE SOCIETY OF NEW ZEALAND
First Respondent

THE REGISTRAR OF INCORPORATED SOCIETIES
Second Respondent	

On the papers		
Counsel:	F E Geiringer for First and Second Appellants W Lim for First Respondent
S P Connolly and S M Perera for Second Respondent	
Judgment:	19 September 2024	

JUDGMENT OF CHURCHMAN J (COSTS)

[1]	On 25 July 2024 I issued a decision on proceedings bought by the appellants seeking a direction under s 27 of the Incorporated Societies Act 1908 (the Act). The direction related to a property (the Property) owned by an incorporated society, the Lebanese Society of New Zealand (Incorporated), which had been dissolved by the Registrar of Incorporated Societies (the Registrar) in 1978 as a result of its failure to provide financial accounts.

LEBANESE SOCIETY OF AOTEAROA NEW ZEALAND INCORPORATED v THE LEBANESE SOCIETY OF NEW ZEALAND [2024] NZHC 2722 [19 September 2024]

[2]	In a decision dated 9 June 2023, the Registrar made a direction pursuant to s 27 of the Act vesting the property of the Lebanese Society of New Zealand Inc, the first respondent.

[3]	The appellants objected to that decision and issued a statement of claim which sought the relief of the vesting of the property in the two appellants as tenants in common. The outcome of my decision was that the property was to be vested equally in the two appellants and the first respondent with the Registrar to be responsible for the conduct of the sale of the property and division of the proceeds.

[4]	I expressed a preliminary view that costs should lie where they fall but reserved the right for any party who wished to apply for costs to file a memorandum of no greater than three pages length within 20 days of the date of the decision.

Submissions

The appellants

[5]	The appellants, by memorandum dated 22 August 2024, have sought costs in the sum of $26,290. The applicants assert that they were the successful party. This submission is made on the basis that although the only relief sought in the statement of claim was the vesting of the property in the two appellants, in submissions to the Court, an outcome similar to the result arrived at by the Court was advanced as an alternative.

[6]	In a schedule attached to the written submissions in support of the costs claim the appellants set out a record of the attempts made to settle the issues that were central to the claim. In a second schedule the appellants set out the quantum of their claim for costs in the sum of $26,290. With the exception of costs for completion of the casebook, which was sought on a 2C basis, costs were sought on a 2B basis.

[7]	The appellants sought costs against both the first respondent and the Registrar, although the memorandum in support of the costs application did not explain which proportion of the $26,290 was sought against each party.

[8]	In support of the costs application against the Registrar, the appellants say that the appeal was bought on the basis of “procedural irregularity” by the Registrar. The irregularity was said to be the Registrar’s failure to refer to historical material relied on by the appellants. It was also noted that in the decision under challenge, the Registrar had made no reference to the second appellant and did not inform the second appellant of its decision.

[9]	The appellants had also referred to the fact that, although the Court had made a direction that if parties wish to rely on evidence other than what was before the Registrar, they needed to apply for leave to do that. No party had applied for such leave — the respondents had filed evidence. Because of the failure to comply with the direction I had declined to have regard to that evidence.

The respondents

[10]	Both respondents oppose the costs application.

[11]	The second respondent points to the fact that its involvement in the appeal was limited and, at the direction of the Court, submissions were only made on the proper interpretation and application of s 27. The Registrar submits that it otherwise remained neutral between the appellants and the first respondent.

[12]	The Registrar also relies on the fact that although the Court made a direction that differed from the Registrar’s direction, the Registrar could not be described as an unsuccessful party, given its limited participation in the proceedings and the fact that the first respondent was the “contradictor”. The Registrar also raised the public policy argument that, if a Registrar was exposed to an adverse costs award in these circumstances, this would be a disincentive to statutory decision makers participating in future appeals. Counsel also refers to the concession made by the Registrar that, with the benefit of hindsight, relevant material had not received the full consideration it should have.

[13]	Counsel for the Registrar also notes that a number of steps included in the appellants’ schedule of costs arose primarily because of the appellants’ non-compliance with timetable directions.

[14]	In his memorandum of 4 September 2024, counsel for the first respondent takes the point that the appellants’ application for costs did not comply with the filing times specified in my decision, having been filed eight days beyond the time specified. Counsel also notes that the memorandum (inclusive of schedules) was seven pages in length rather than the three pages specified.

[15]	The first respondent acknowledges that what was described as an “informal” offer by the appellants to settle for an outcome similar to that arrived at by the Court was made shortly before the hearing and was referred to in the submissions of the appellant at the hearing. However, it states the statement of claim seeking to vest the property solely in the appellants was never amended and the primary relief sought by the appellants remained the vesting of the property exclusively in the two of them.

[16]	The memorandum also submits that the appellants had twice failed to comply with timetable directions leading to the substantive hearing having to be rescheduled. Council states this had incurred additional and unnecessary costs.

Analysis

[17]	The general principles applicable to the awarding of costs are set out in 14.02 of the High Court Rules 2016 (HCR). The two most relevant principles are that:

the primary principle is that an unsuccessful party should pay costs; and

the rules aim to achieve predictability, consistency and expediency in the fixing and payment of costs.

[18]	Ultimately, the decision of whether to award costs and the quantum of any costs is a matter of discretion for the Court, having regard to all relevant matters.

Who was the successful party?

[19]	The appellants’ categorisation of the appellants having been the successful party significantly overstates the situation. The statement of claim seeking the vesting of the property solely in the appellants was never amended. The primary submission

of the appellants at the hearing remained that this was the relief sought. The three-way division was put forward only in the event that the primary relief sought was not granted by the Court. This is not a case of a clear and unequivocal settlement offer which was similar to, or better than the result ultimately achieved having been put by the appellants to the first respondent.

[20]	The appellants’ “alternative” proposal is not relevant to the appellants’ costs application against the second respondent. The offer was not directed to the second respondent and was not something capable of being accepted by the second respondent.

Late filing of memorandum

[21]	Of itself, the appellants’ failure to comply with the directions as to the time for filing of a costs application would not automatically disqualify the appellants from seeking costs. However, it is a matter to be weighed in the exercise of the Court’s discretion. It is one of a number of instances where the appellants have not complied with timetable directions.

[22]	There is also substance in the first respondent’s point that some of the costs claimed by the appellants would appear to have related to the consequences of the appellants’ own failure to comply with timetable orders. It would not be appropriate to award costs in respect of such matters.

Conclusion

[23]	Nothing in the submissions filed by the appellants in support of the costs application has convinced me to alter my preliminary view that this is an appropriate case for costs to lie where they fall. The appellants cannot claim to have been the successful party. With respect to the first respondent and, in relation to the second respondent, where a statutory officer has participated in an extent limited to making submissions on the interpretation of the statute to assist the Court and otherwise remained neutral between the protagonists an award of costs would not be appropriate.

[24]	Accordingly, the application for costs is dismissed and costs are to lie where they fall.

Churchman J

Solicitors:
Woodward Law, Lower Hutt for Appellants Oakley Moran, Wellington for First Respondent
Crown Law Office, Wellington for Second Respondent