PHILLIP ARTHUR VERRY v JULIA ANNE JOPP & ORS [2003] NZCA 74 (7 April 2003)

IN THE COURT OF APPEAL OF NEW ZEALAND

CA91/02

BETWEEN

PHILLIP ARTHUR VERRY

Appellant

AND

JULIA ANNE JOPP

First Respondent

AND

JULIA ANNE JOPP, JOHN MATTHEW SCURR AND MARTIN MONROE PATERSON

Second Respondents

Hearing:

19-20 February 2003

Coram:

Glazebrook J

Hammond J

Gendall J

Appearances:

Appellant in person

N A Till for Respondents

Judgment:

7 April 2003

JUDGMENT OF THE COURT DELIVERED BY GLAZEBROOK J

Introduction

[1]	Mr Verry is a chartered accountant by profession.Until 1986 he was a partner in one of the major accounting firms.He retired from the firm to concentrate on company directorships and major projects, particularly in the wool industry.
[2]	Mr Scurr and Mr Paterson (the Trustees) are the trustees of the estate of Mrs Julia (Julie) Jopp’s husband, Robert.Robert’s family had owned and farmed a high country sheep station known as Moutere in Central Otago since 1891.The family also owned other farming properties, mostly purchased by Robert’s father, Andrew.Andrew died in 1989 and a dispute arose between Robert and his mother, Florence, and brother, Tony, over the disposition of the family properties.The properties were held by family companies with some two thirds of the shares in those companies being held by the Moutere Mortgage Settlement Trust (the MMS Trust).
[3]	It is common ground that Robert and Julie, in late 1995, engaged Mr Verry to advise them in relation to this dispute.Robert was at that time very ill with a brain tumour.He died in early 1996 but the dispute continued.The matter was finally settled in December 1998 after court proceedings brought by Mrs Julie Jopp and the Trustees had been unsuccessful.The settlement involved Tony purchasing the shareholding and MMS Trust interests held by Mrs Jopp and the Trustees, with the shares in the family companies being valued on a notional liquidation basis.It also gave Mrs Jopp the option to purchase up to one half of a flock of stud merino sheep.
[4]	Mr Verry provided his professional services to Mrs Jopp and the Trustees up to August 1997 when the unsuccessful court action was heard.At issue between the parties are the terms of payment for these services.It is not in dispute that the parties had agreed on a fee of $80 per hour for Mr Verry’s services, to be billed and paid on a regular basis as the matter progressed.It is also agreed that Mr Verry was to be paid a further $170 an hour if certain conditions were met.The dispute is over what those conditions were.On Mr Verry’s interpretation the conditions were met.In addition, he contended that Mrs Jopp and the Trustees are estopped from asserting that the conditionswere not met at least from the beginning of 1997 when there was an exchange of correspondence and discussions in relation to the trigger.Mrs Jopp and the Trustees take a different view of the trigger for the further payment and say that it was not met.They also say that Mr Verry’s charges were excessive in any event and that there is no estoppel.
[5]	The proceedings were heard in the High Court before Heron J in July 2001.In a judgment of 16 October 2001 he found that the conditions for the further hourly payment were not met and that no estoppel arose.He further held that excessive time was taken and that Mr Verry’s bill should be discounted by approximately 25%. Mr Verry appeals against that decision.
[6]	There are thus three questions for this appeal:
(a)	Was Heron J in error when he held that the conditions for payment of the further $170 an hour were not met?
(b)	Was the judge in error when he held that there was no actionable estoppel?
(c)	Was he in error when he discounted Mr Verry’s fee?
[7]	Before turning to those issues we set out in more detail the course of the dispute between Robert and his brother and mother up to the time Mr Verry became involved professionally.We then turn to an examination of the events leading to Mr Verry’s engagement and finally to an examination of subsequent events both in relation to the dispute with Tony and Florence and in relation to the question of Mr Verry’s fees.

Course of the dispute between Robert and his brother and mother

[8]	As indicated above, the Jopp properties were held by family companies with the majority of shares (66.6%) in those companies being held by the MMS Trust.In October 1979 Andrew had purported to exercise a power of appointment in relation to the MMS Trust, providing for a discretionary payment of income to Florence but for the capital to vest in Robert’s children as to a half share and Tony’s children as to the other half.Shortly afterwards the articles of the companies were changed so that he was Governing Director of the family companies.When he died in 1989 Andrew’s will provided that Florence take over that position.Florence also owned some 16.7% of the shares in the family companies in her own right and, at the relevant time, her current will provided for these shares to go to Tony on her death along with the governing directorship of the companies.In addition, Andrew in his will left the 16.7% of the shares he still owned in the family companies to Tony’s sons on their turning 25 (with Tony to take the shares if they died before that age) rather than to Robert and his daughters.(Robert and Julie’s son was born after Andrew’s death.)
[9]	Robert was very disappointed with this state of affairs.He had returned to work on Moutere Station in 1973 after completing a commerce degree and his understanding was that he would have Moutere when his father died.After some attempt at negotiation with his mother and Tony, Family Protection Act proceedings were issued.There had been consideration given to issuing Testamentary Promises Act proceedings as well but that did not eventuate.The Family Protection Act proceedings were settled with the shares that had been left to Tony’s sons being transferred to Robert and Tony equally.This left Robert and Tony with shareholding in the family companies of some 8.4% each.
[10]	Negotiations continued between Robert and his mother and brother.It is unnecessary to set out the course of these negotiations in detail but there had been a proposal in 1994 (before Robert’s illness) to divide Moutere between the brothers and negotiations on that proposal appear to have reached a relatively advanced stage.We now describe the situation in 1995 just before Mr Verry’s professional involvement began.
[11]	In early 1995 Robert and Julie’s then solicitor, Mr Woodward, came to the view that the power of appointment in relation to the MMS Trust had been invalidly exercised.An opinion was sought from Mr Austin Forbes QC, who confirmed that view by letter dated 30 May 1995.This meant that both Robert’s and Tony’s shareholding was effectively raised to some 41% through them now being the sole capital beneficiaries of the MMS Trust.
[12]	Some discussion between the parties ensued and on 1 September 1995 Mr Woodward wrote to the solicitors acting for Tony and Florence, Cook Allan Gibson.He first set out the view that the power of appointment in favour of Robert and Tony’s children was invalidly exercised and the reasons for that view.He also indicated that Mr Austin Forbes had provided an opinion supporting that position.He then referred to Robert’s illness and the fact that Florence and Tony were refusing to meet with Robert’s attorneys, Mr John Scurr and Mr Martin Paterson.He pointed out that Robert’s inability to make arrangements for his family’s security and independence was causing continuing additional distress to Robert.He asked the firm if they were able to act for Tony and Florence so that the problems could be resolved without further stress.
[13]	He then indicated that the matters to be resolved were set out in an attached “statement of intent” signed by Robert.He said that, in addition, provision for the educational expenses of Robert and Julie’s children would need to be made if the MMS Trust were wound up.He also pointed out that Tony had made representations for a division of Moutere in November 1994 and that this contentious matter should be resolved. It is worth setting out the attached statement of intent in full:

I, Robert Bell Jopp, wish to resign from my position as director from all Jopp family companies and trusts in favour of my wife Julie Jopp, in order that she may represent my families [sic] interests.

I would like Julie to remain living in our present family home for as long as she may wish and at no cost to her.Her salary is to be paid on an automatic payment basis, equivalent to my present income and to be reviewed annually.Julie is to be provided with a car and to have the running expenses paid for.

I wish an equal division of the families company assets on the basis that Tony and his family have Kiatoa Station, Mt Difficulty Station and the part of Moutere Station from the ‘dry line’ south.It is my express wish that my family have the part of Moutere Station from the ‘dry line’ north including the Moutere Merino stud.I appoint my trustees Julie Jopp, Martin Paterson and John Scurr to negotiate this on my behalf as well as any other matters arising from this division including a division of the Moutere Mortgage Trust.

If in the future my family should no longer wish to retain their share of Moutere Station, I would like it to be offered first to Tony’s family.

This statement is made in the hope that my family take account of my wishes and is made knowing that my life expectancy is short.

These are my sincere wishes.

[14]	A reply to the Woodward letter was sent by Cook Allan Gibson on 2 October 1995.It began by stating that the firm’s preliminary view was that the power of appointment had been invalidly exercised but asked to see Mr Forbes’ opinion before it advised the trustees of the MMS Trust on what action they should take.The letter did acknowledge that, if the power of appointment was invalidly exercised, then “obviously Robert has an asset of very substantial value.”
[15]	It went on, however, to refuse all of the requests made in the Woodward letter and the Statement of Intent.In particular it stated that both Tony and Florence were both of the view that Moutere should not be subdivided and that Florence had always been unhappy with any proposal to split the property.It did, however, suggest that income from the MMS Trust and dividends from the farming companies could be used to provide future income for Robert’s family and that there could be some small capital distribution from the MMS Trust.
[16]	Mr Woodward gave evidence that his advice to Robert and Julie Jopp at the time had been to consider action under the Companies Act with an aim of dividing the shares of the company between the two competing interests.He instructed Mr Forbes to advise on this matter.Mr Forbes provided his opinion on 1 February 1996, although Mr Woodward said in cross-examination that he had met with Mr Forbes some time in the previous year and received his preliminary advice which did not differ in any major respect from the opinion subsequently received.It is uncertain if this meeting had occurred at the time of Mr Verry’s engagement.
[17]	Mr Forbes’ opinion, as set out in the conclusion to his letter, was that a court would probably order relief to the extent of requiring Robert’s shares to be purchased by the other shareholders at valuation but that relief in the form of partition and the mutual transfer of shares was less certain.He had said earlier in the letter that a valuation based on the capitalisation of maintainable earnings was likely to be preferred, as against the capitalisation of dividend yield or a valuation based on the notional liquidation of the company.He did say, however, that the fact that a minority shareholder was being forced out could justify something more than a pro rata value being paid for the shares.
[18]	Julie and Robert also consulted Mr Laing, a registered valuer and chartered accountant, on this topic.Mr Laing was at the relevant time a partner in the firm of Ernst & Young, Dunedin.He had been instructed to provide indicative values for the various Jopp properties in October 1994.This was in connection with the earlier proposal referred to above to split Moutere (although Tony apparently by 1995 maintained that the valuations were done with a view to a sale of the properties).Mr Laing had completed the valuation in 1994 but heard nothing more until September 1995 (he says 1996 in his brief but it is clear from the documents attached to his brief that he means 1995) when he was asked to provide Julie Jopp with a copy of the pricing options.He did so and then on 27 October 1995 (again he says 1996 in his brief but the notes of the meeting attached to his brief give the date as 1995) he met with Robert and Julie and the Trustees.
[19]	Mr Laing’s evidence is that they consulted him as to the means that could be employed to “get round the Trust and company structures to enable Robert to break away and end up with Moutere Station and stud.That was their purpose in consulting me.”He says that he advised them that nothing was impossible but that it was probably going to be very difficult to retain Moutere unless there was agreement by Tony to that end.He did identify three mechanisms by which Moutere could be transferred to Robert, all three involving Robert receiving Moutere in return for his shareholding in the various companies.He advised, according to his notes, that the shares in the companies would be valued on a notional liquidation basis, which would reflect the current market value of the properties.He said in evidence that he suggested legal advice be obtained on the various options and that he left the question open as to whether a court could order the partitioning of assets between shareholders or whether Robert as a 42% shareholder could call a meeting and require the company to wind up and distribute assets amongst the shareholders.
[20]	He also said that he may well have mentioned the possibility that cash could be extracted but he was sure that the concept was rejected by Robert and Julie and he did not consider it important enough to include in his notes.In cross-examination at trial Mr Laing rejected the proposition that he had told Robert and Julie at their meeting that their only option was to be paid out for the shares.

Events leading to Mr Verry’s engagement

[21]

Mr Verry’s evidence was that in 1989 he had advised Robert on an informal and pro bono basis in relation to the dispute.He had suggested a thorough legal review be undertaken and that Testamentary Promises Act, Family Protection and constructive trust claims be considered if negotiations foundered.Mr Verry did not begin his formal professional involvement until 1995, however.We split our discussion as to his engagement into the documentary evidence and the oral evidence.

Documentary evidence

[22]	Mrs Julie Jopp wrote to Mr Verry on 2 October 1995 asking for his opinion on the dispute.She said that Robert “was brought up to believe by action and by word of his parents that he and his family would one day own and manage Moutere Station” and that it was always understood that Tony would have a property or properties equal to Moutere.She said that in May of last year Robert had signed papers in relation to the Family Protection Act settlement and that it had also been agreed about then between Robert and Tony that there would be a division in the company assets with Tony to have Kiatoa and Mt Difficulty Stations, Robert to have the merino stud and Moutere to be divided between them at a line yet to be agreed.She referred in this regard to the Statement of Intent signed by Robert and enclosed a copy.
[23]	She indicated that valuations had been prepared for the properties and the stud (and enclosed these) but that Tony now was insisting that the valuations were done for an agreed eventual sale of the properties.She said that the Trustees had been trying to meet with Florence and Tony for some time to continue negotiations and that their lack of progress had been referred to in Mr Woodward’s letter to Cook Allan Gibson.She annexed a copy of that letter and said that they were still waiting for a reply despite two reminder phone calls.(The reply had in fact been sent on 2 October 1995).
[24]	She went on to tell Mr Verry that Mr Woodward had found “an anomally (sic) in the trust which now gives Robert and Tony a 41% shareholding in all the companies”.She then outlined difficulties with the staff on Moutere since Robert’s illness and concerns about Tony using a Moutere chequebook without consultation with Robert. She said that Florence and Tony were refusing to discuss security for her and the children if anything should happen to Robert and reported that Florence had said to a few people that Moutere was not Robert’s but was Tony’s and hers.Both she and Robert felt that they had had enough of the situation and that they wanted to concentrate on Robert’s getting well (and Robert had been advised that he must settle the dispute before he could attempt to get well).She finished as follows:

If we do not get the response we want from John Woodward’s latest letter to Cook Allan Gibson (this letter including Robert’s Statement of Intent), then we are considering forcing a sale of all the families (sic) company assets.John Woodward considers we have a good case to take this to the High Court.I am hoping this may make Tony and Florence reconsider their options.

[25]

Mr Verry replied by letter of 9 October 1995.He said that he had received the papers and made a preliminary review of them.He referred to the need to resolve the situation with minimum further delay to give family relationships some prospect of healing.He then said that at this stage “Robert’s recovery prospects must be a paramount consideration – together with future financial security for your family.”

[26]

He referred to the fact that the passage of time could be weakening their negotiating/legal position but that “the present circumstances, with a well-prepared concerted approach, could actually be conducive to the precipitation of an acceptable negotiated outcome”.He referred to negotiating points that had as yet not been introduced or fully asserted and expressed a wish to talk to Mr Woodward about these options.He suggested there would be advantage in assessing the relative financial accretion to the family’s assets contributed by Robert’s commitment and expertise with the merino industry as compared to Tony’s contribution.He suggested that his role should be to represent them in negotiations “with a brief to seek a negotiated outcome, on a basis which is fair and equitable to all concerned, including Tony & Florence”.He then went on as follows:

The aim for the negotiations which I envisage, once commenced, should be to have them conducted and completed over a quite short period of time.I imagine that would be your preference, in any case.It would appear that the extended passage of time over which this matter has been discussed has been to your detriment.We should ensure that does not continue.

Hitherto, I have been happy to provide advice to Robert on an informal basis. However, given the extent of professional commitment which would be entailed, and the circumstances, it would be appropriate to proceed, henceforth, on the usual professional hourly basis.Obviously, I would endeavour to minimise costs, where practicable, where this did not prejudice the ultimate objectives.I imagine this is as you would prefer, too.

[27]	In early November Mr Verry was asked to meet with Robert, Julie and the Trustees.The critical meeting took place at Moutere on 11 November 1995.Mr Verry says that he took rough handwritten notes at the meeting and then produced a file note of the discussions on the plane going home.He has produced this file note.It is common ground that this note was not distributed to the other attendees who gave evidence that they did not see Mr Verry taking notes during the meeting.Whether Mr Verry actually took notes at the meeting or not, the file note appears to us to be the nearest to a contemporary record of the meeting that is available, although clearly it will have recorded the meeting from Mr Verry’s perspective only.
[28]	The file note records the attendees at the meeting as being Robert and Julie Topp, the Trustees and himself.It then has a heading “Position”.It appears from the file note that a relatively wide-ranging discussion took place as to the situation existing at the time, including discussion as to Tony’s refusal to negotiate, his taking over the management of the family companies, the lack of security for Robert’s family, the tension between Tony and Julie and Robert’s state of health.Of particular note are two bullet points in this section, one saying “minority shareholdings – value?” and the other recording a comment “grab what you can and get out”.
[29]	The next heading in the file note is “Agreed Approach”.It is worth setting out this section in full:
•	Recognise two bases:
-	employment under-remunerated RV
-	oppressed minorities
•	try for Moutere=R’s [Robert’s] promise by Andrew (J [Julie] – anything R [Robert] wants T [Tony] will want or will deny to R) – considerations:
-	R’s health
-	Management
-	Memories bad for J
-	Andrew buried on Moutere (wanted mountain site) T[Tony] & F[Florence] will resist
•	Must escape minority position (worthless)
•	F/back:split by shareholding, if necessary to get independence
•	Research position for negotiation – prior
•	R [Robert] performances versus T’s [Tony]
•	Urgency/health/affidavit urgent

J [Julie] & MP [Martin Paterson] believe F [Florence] & T [Tony] will not got to Court – will negotiate.Family name and privacy.F eccentric 3-4 months.Otherwise Court.We need to be flexible.J to search records for evidence.

[30]	The file note finishes with a heading “Arranged”.It begins by stating that PAV (Mr Verry) is to coordinate strategy and lead negotiations.It then goes on as follows:
•	Prepare ground first, to strengthen position
•	Rem:$250/hour + GST + disb
•	Payment:Monthly $80/hour + GST + disb

Balance $170/hour when funds available from positive outcome, ie=better than minority S/H position under T & F’s control (to enable release of cash).

•	All to provide their full support – teamwork
•	All avenues to be pursued – need to escape/independence = commitment
•	PAV to prepare discuss and agree initial strategy – first priority.
•	PAV to work with JW [John Woodward] – through WT [Woodward Toomey].
•	Break silence to trawl for support – social pressure – evidence
•	Any 1 contacted to inform other 2
•	Urgency to be stressed to JW.

[31]	After the meeting Julie wrote a letter dated 15 November 1995 to Mr Verry “to confirm our conversation on Saturday regarding your representation, fees and proposal.”She stated:

It is my understanding that you are willing to represent Robert and myself in taking action against Tony and Florence Jopp and Moutere Station Limited (the Company).The action you propose is to develop an appropriate case to be heard by the Employment Tribunal regarding Robert’s past and current status as an employee of the Company, his remuneration level with respect to promises made (which appear to now be abandoned), and the effect that these stresses have clearly had on his health.

You have quoted a cost of $80 per hour for any work you undertake on our behalf which leads to a positive outcome.Following that, your fees will be set at a level of a round $250 per hour during which time you will be actively pursuing our case where positive results can be clearly demonstrated.Your expectation was that this matter could be resolved within the next few months (2?) with your involvement commencing immediately.

I understand that you intend to pursue the following course of action;

(i)	prepare a case for the Employment Tribunal,
(ii)	use it as a threat to pursue further negotiation,
(iii)	lodge the application should negotiations break down,
(iv)	pursue the Employment Tribunal case to fruition,
(v)	propose High Court action as a backstop if this action is unsuccessful.
[32]	She went on to say that she would endeavour to provide the information requested by Mr Verry as soon as possible and thanked him for visiting to discuss the proposal.She said that she felt “hopeful of a positive outcome with your skills now working with us”.She enclosed an authority to act signed by both her and Robert which had been drafted by Mr Verry.This was in the following terms:

TO WHOM IT MAY CONCERN

This letter serves to appoint, in his professional capacity, PHILLIP ARTHUR VERRY to represent us in negotiations for a family settlement, on a fair and equitable basis, in matters arising consequent to the provisions in the Will of the late Andrew James Jopp and related matters.

Where Mr Verry requires information or records which, in his reasonable opinion, may be necessary for his assignment please accept this letter as authority to provide such information to him, in the same manner as if his request had been made by us, or either one of us.

We request you to extend your cooperation in meeting such requests.

[33]	We note that, although the Trustees had been present at the 11 November meeting, their agreement to Mr Verry’s engagement was not necessary as, at the time of the meeting, Robert was still capable of looking after his own affairs, even though he had major difficulties in speaking.
[34]	Mr Verry replied by letter of 22 November 1995.He began by saying that he enclosed a memorandum setting out the strategy for the handling of matters and a request for further information.He then went on:

I have now received your letter to me dated 15 November 1995.Basically, the understanding is correct.Of the rate of $250/hour, $80/hour will be billed and will be payable as we go, to cover basic costs.The remainder ($170/hour) shall be deferred until such time as a positive outcome is achieved, which is better than the minority shareholder position which was in prospect.This balance will be billed and will be payable at that time.

In the event that an improved position is not achieved the rate shall be only $80/hour – the balance shall not be billed.

Disbursements (travel, tolls, typing etc) will be billed as we go.

[35]

He stated that the aim was to prepare a report that provided a basis for two legal claims – “a claim under breach of employment contract, seeking specific performance and general damages” and “a claim for a shareholder settlement on the grounds of prejudicial conduct by the majority shareholders against yourselves as minorities.”It stated that the report was to be directed at providing a basis for a negotiated settlement and failing that as support for court action.

Oral evidence

Mr Verry’s evidence

[36]

We begin with Mr Verry’s evidence.His evidence was that at the meeting on 11 November 1995 it was agreed that, such was the breakdown in the Jopp family relationships, the family assets should be divided to enable each brother to control their own respective destinies (para 15).He says that his role was to lead the negotiations in this regard and the rate for his remuneration was agreed at $250 an hour plus GST and disbursements.He says that he agreed to defer payment of $170 an hour in recognition of Robert and Julie’s cashflow difficulties:

... until such time as resolution of the case placed the defendants in possession of funds or control of assets, when the balance of the account would then be payable immediately.Only in the event that, having exhausted all available possible remedies, the defendants did not gain control of assets (i.e. remaining locked in as minority shareholders) would the deferred fees not be payable, as the means to do so would not exist.This facility was offered to the defendants only because of their funding difficulties and in recognition they had and would have no other access to assets or funding except from the division (para 15.4).

[37]	Later he said:

As a means to assist the defendants, I proposed a rate of $250/hour for my services, with $80/hour paid monthly and the balance $170/hour paid when they gained division.Disbursements, such as travelling typing and GST, would also be paid monthly.The fees were linked to the division only because this was the only source of funds the defendants would have to pay me and I did not want to expose John Scurr and Martin Paterson to liability to me.I emphasised to them that, as I was accepting financial exposure, there had to be a commitment to see the action through to the end.

There was discussion on the various permutations of settlement:buy-out of one party by the other; transfers/exchange of shares; inter-generational rights for Tony’s sons to purchase Moutere, if Robert junior was not interested in farming; sub-division; sale of the properties; etc.Because the precise form of possible settlement, if one was attainable, could not be anticipated, the deferred fees were linked to escape from the invidious minority shareholding position, by any means.Thus, for example, a small increase in a minority shareholding – one possible order by a Court – would be of little, if any, practical value.A positive outcome was to escape the minority shareholding position that was then in prospect, and which had been for over six years of fruitless attempts to escape it (paras 77 and 78).

[38]	After the fee arrangement had been discussed Mr Verry said that he suggested that he take a walk in the garden while they considered the proposed engagement terms and that, after some 20-30 minutes, Mr Scurr came out and indicated that the terms were accepted (para 85).
[39]	In cross-examination Mr Verry agreed that the term “positive outcome” was used but said that it was expressly defined at that meeting.He rejected the suggestion that positive outcome was defined as control of Moutere but said that the term as agreed meant “when the clients had the ability to pay by means of getting an outcome to put them in that position, by control of assets or control of cash” (Notes of Evidence, p13).He said that the exact outcome could not be anticipated but that the sole consideration motivating the deferral of the $170 an hour was that of cashflow.
[40]	In his view he was nevertheless taking a risk that Robert and Julie would remain locked in as minority shareholders and in that circumstance (and that circumstance alone) the extra $170 would not be payable.He was concerned that there was a possibility of Robert being locked in as a minority shareholder, as that had happened in another case (the Draper case) he had been involved in.He had raised the Draper case with Robert, Julie and the Trustees in the first part of the meeting (Notes of Evidence, p56) and that is what is referred to in his file note where he recorded “must escape minority position (worthless)” (Notes of Evidence, p58).The next line in his file note was “F/back:split by shareholding, if necessary to get independence.”Mr Verry explained that this meant “that the fall back position is to get out of the minority shareholding circumstance, split the assets”.He said that one aim of the strategy agreed was to try and provoke prejudicial conduct so that there were grounds for such a split (Notes of Evidence, p59).
[41]	He also said that, while the upper perimeter for negotiations was to obtain Moutere, there was a recognition that there would have to be negotiation downwards from there.The lower perimeter was for Julie and Robert not to spend the rest of their lives working for Tony and as minority shareholders.He did say, however, that the aim of the Employment Contract and Companies Act claims was to better the Jopps’ position.He said that:

the two bases of claim which I identified and discussed with Mr Woodward offered the opportunity of doing better than a minority shareholding outcome.I was concerned a min shareholding outcome under the Co’s Act might not be based on a valuation of assets.That it may be based upon for example future maintainable profits in which case for a farming co that would produce a low value (Notes of Evidence, p 10).

[42]	Later he explained his aim in the dual approach he was advocating in a bit more detail.He said:

There were two primary bases to the approach I was advocating.One was prejudice (sic) minority the other employment contract.Examining the EC angle I had in mind there were two elements, one that Robert had done the job asked and so he should be paid what he was promised, I guess in that context one could say that there was a king hit approach.The second leg to that was to put a quantum value on his sacrificed wealth and it was really that part I was thinking where we might end up and if we could tie that settlement in with a prejudice minority settlement we could leverage in negotiating to claim the Moutere assets (Notes of evidence pp57-58).

[43]	He admitted that he had formed the view that Robert and Julie had a prospect of obtaining Moutere based upon the information he had been given.He said:

If they provided Robert with a very substantial sum of money in the order of $3.5M and if what the defendants were saying to me that Tony and Florence will not go to court, that Tony had been prepared that year earlier, to sell Moutere and the stud had been promised as Robert, bringing those cirs together they would have a good prospect of getting Moutere (Notes of Evidence, p18).

Mrs Julie Jopp’s evidence

[44]	In Mrs Jopp’s brief of evidence at para 26(v) she said of the fee arrangement:

By the time fees were discussed, we had make it plain to Phil Verry that we had very limited income resources from which to pay fees.It was his suggestion to charge $80 per hour and for the balance of his normal commercial rate to be dependent upon a positive outcome being achieved.He did not say what he meant by a positive outcome, but the only outcome which had been discussed and agreed to be pursued up to that point was the ownership and control of Moutere.There had not been any discussion about aiming for payment of the value of Robert’s shares.To the contrary, the idea of payment for shares had been discussed as having been specifically rejected by us.

[45]	She said at para 26(viii) that Mr Verry had referred to a lack of worth in their shares by virtue of being minority shareholders but that was not of particular concern because their objective which he said they could achieve was the retention of the ownership and control of Moutere and they had been advised by Mr Woodward that they could extract the value of the shares if this is what they wanted.
[46]	She said that they were pleased because Mr Verry said that he would be able to prepare a case that would draw Florence and Tony into a negotiated outcome rather than a legal outcome (as Robert did not wish to go to court).Mr Verry had quoted some examples of positive negotiated outcomes that he had been involved in in the past.At first she said that the Draper case was mentioned in this context but later said that she did not remember it being mentioned (Notes of Evidence, p96).
[47]	In cross-examination Mrs Jopp insisted that they had been given advice that they had rights under the Companies Act to obtain cash but that is not what they wanted (Notes of Evidence, p77).She said that they had had that advice from Mr Woodward and Mr Laing.She was taken through the caveats on that advice and agreed that there were caveats – that Mr Woodward had said that there was no certain result and that Mr Laing had said that a number of issues had to be referred to legal advisors.In answer to the proposition then put that there was no certainty as to what might be achieved in this respect she said:

I guess there is no certainty in anything but we had several opinions from professionals to say we had a chance.We didn’t want to look into it we were not interested ...[in] the sale of the assets (Notes of Evidence, p79).

[48]	Earlier she had said “I guess going to court is no certain result anyway” (Notes of Evidence, p78).From the tenor of these answers it is clear that, while she recognised the possibility of failing in a Companies Act action, she had discounted that possibility and considered that a Companies Act action would have resulted in cash if that was what they had wanted.
[49]	She agreed that a Companies Act claim may have been discussed during the meeting but she remembered the Employment Contracts claim being the main focus (Notes of Evidence, p82).She reiterated that the reason for employing Mr Verry was his advice that obtaining Moutere was a possibility.She said:

But we employed Phil [Verry], I have to make this clear, to gain Moutere.We had had other legal professionals telling us there was a way out through the Companies Act and when Phil came to us and said there was a way to gain Moutere he was like my knight in shining armour, he was the only person said yes there was a possible way of getting Moutere (Notes of Evidence, p84).

[50]

Her evidence was that Mr Verry was very positive at the meeting.She and Robert had been prepared to settle for Moutere north of the dry line and the stud but Mr Verry talked them into going for the whole of Moutere as that is what his father had promised Robert.This was what was discussed at the meeting.There had been no specific definition of the term “positive outcome” but there did not need to be given the tenor of the discussion.She agreed that a lot of other matters were discussed at the meeting but said that a lot of those matters were background (Notes of Evidence, p87).

[51]

Mrs Jopp was asked about the letter she had written to Mr Verry after the November meeting and why she had not referred to the objective of gaining Moutere.She said:

I don’t know why because I suppose we all knew that is what we were after including Phil [Verry].There was absolutely no talk of any nature of selling up and taking assets.It was all the talk of negotiating for Moutere.That was the only thing.That was the positive outcome.And those words ‘positive outcome’ were the words Phil used in the meeting (Notes of Evidence, p88).

[52]	She explained that, at the time she wrote the letter, she thought that Mr Verry would be working for them in a negotiating role.If that failed he would help them through the Employment Tribunal but, after that, if there was to be High Court action they would need to employ another professional, as Mr Verry was not a barrister.She explained that she thought that, if he had failed to achieve Moutere after the negotiation and any Tribunal hearing, then he would only get $80 an hour for his work (Notes of Evidence, p89).She also said that the Trustees had not been consulted before the letter was written (Notes of Evidence, p90).
[53]	Mrs Jopp was also asked about Mr Verry’s letter to her of 22 November.She agreed that Robert’s health and the future financial security of his family were mentioned as paramount considerations and that there was no mention in that letter of an aim being to retain Moutere.She said, however, that the initial conversation on the telephone was their great desire to gain Moutere so she assumed that the whole letter is applicable to that (Notes of Evidence, p74).She also said that Robert needed to gain Moutere to recover.When it was put to her that everyone knew Robert was not going to recover she said that it was to ease Robert’s mind while he was sick.He had to know that his family could have continued on at Moutere (Notes of Evidence, p75).
[54]	She said that she did not reply to the letter or contact Mr Verry to say that he had expressed the situation inaccurately because she thought it was not inaccurate and that, in talking about a positive outcome, he was referring to the gaining of Moutere.This was because they had talked about Moutere at the November meeting as the positive outcome (Notes of Evidence, p89 and p90).When asked why she ignored the words “better than the minority shareholding position which was in prospect” she said “well he couldn’t increase my shareholding unless he negotiated, I guess that would be another positive outcome” (Notes of Evidence, p89).

Mr Martin Paterson’s Evidence

[55]	Mr Paterson in his brief of evidence said that it was difficult to recall exactly what was said at the meeting of 11 November 1995 but that he was certain about the general terms of the understanding reached.He said it was as follows:

i) Phil Verry persuaded us to pursue the whole of Moutere not just the half which had been pursued previously by the trustees as per CAG’s [Cook Allan Gibson] letter of 24 November 1994 and Robert’s ‘Letter of Intent’.Phil Verry’s role was to negotiate for Robert and Julie the ownership and control of Moutere Station and the Merino Stud.The decision was based on the promise, as related by Andrew Jopp to Murray Ashton.

ii)	Phil Verry was to prepare an Affidavit for Robert Jopp and the Jopp Family Report which was to be completed over the following few months to put Julie in a position of strength for negotiations which Phil Verry was to be involved in and which he was to lead.
iii)	The emphasis was on negotiation.I do not remember litigation being discussed in any significant way as the expectation was that a negotiated outcome could be achieved.
iv)	I do recall that we agreed to pay Phil Verry at the rate of $80 per hour and that commercial rates would be charged if there was a successful outcome which was discussed to be the retention of Moutere and the stud.There was no discussion of successful outcome being the extraction of cash nor of the balance of Phil Verry’s fee being payable if cash was extracted.The arrangement was clear to me:if he succeeded in obtaining Moutere and the stud for us he would get a commercial rate;if not he would get $80/hour.This created a huge incentive for him to get what we wanted.
v)	The actual commercial rate whether of $250/hr or otherwise was never discussed with me at that meeting.
vi)	I had no part in the correspondence which took place between Julie Jopp and Phil Verry subsequent to the 11 November meeting.
vii)	The letter from Cook Allan Gibson dated 2 October 1995 was unanswered at the time of the meeting because it offered a cash pay out.This was not the outcome which we wished to achieve i.e. Moutere and the Stud.The words ‘grab what you can and get out’ are Phil Verry’s words not contained in any written legal advice.Indeed action taken under the Companies Act in regard to minority shareholding was a possible course of action.At the time it was thought negotiations should continue but from a position of strength, hence Robert’s Affidavit and the Jopp Family Report to put us in a position of strength to continue those negotiations.
viii)	It was on the basis of continuing negotiation from a position of strength that Phil Verry’s professional services were required especially to make the Jopp Family Report which required much financial research and analysis.A successful outcome at this stage was never considered to be cash as claimed by Phil Verry. (para 34)
[56]	In cross-examination Mr Paterson said that it was his understanding from advice received from Mr Woodward, Mr Laing and Mr Forbes that the only option was to be paid for the shares unless Tony agreed to hand over control of Moutere.Mr Verry’s role was to negotiate control.He agreed that the term positive outcome was not defined at the meeting but they were at the meeting to discuss getting Moutere for Robert and Julie (Notes of Evidence, pp115-6).
[57]	He agreed that one of the approaches advocated by Mr Verry at the meeting was an approach designed to provide evidence that could be used to show that Robert was an oppressed minority in the company.He said that the term “locked in” was used but he considered that the part the Draper case played in the discussions had been overstated and that many family companies pay out or divide up property in negotiation (Notes of Evidence, p123).He did, however, agree that Mr Woodward’s advice had been that any split under the Companies Act was not certain to be achieved (Notes of Evidence, p113 and p124).

Evidence of Mr John Matthew Scurr

[58]	Mr Scurr in his brief of evidence said that at the 11 November meeting Mr Verry outlined what he could do for Robert and his family.He said that Mr Verry proposed:

that he should represent Robert and Julie by preparing a report regarding Robert’s contribution by comparison to the level of remuneration which he had received fleshing out the promise made to him by Andrew that Moutere would be left to him.The report was to be with the view to negotiating with Tony and Florence to reach an accommodation by which Robert and his family retained possession and control of Moutere Station and Moutere Stud.We were going for the Doctor(para 12).

[59]

His evidence was that Mr Verry said that he would prepare a case relating to the breach of Robert’s employment contract and use this as a lever in the negotiation.Court action would only be pursued if negotiation was unsuccessful and only if the employment contract case failed would High Court proceedings be instituted.Mr Scurr said that he asked Mr Verry to leave the room while they discussed whether they wished to engage him.When he had been asked about the basis of charging Mr Verry had said that he would charge at the rate of $80 per hour plus a normal commercial rate in the event of a successful outcome.Mr Scurr said:

None of us actually discussed what a successful outcome, in this context, meant but the whole basis of our discussion was that the objective was to obtain for Robert and his family possession and control of Moutere Station and Moutere Stud (para 15).

[60]	Mr Scurr said that the term successful outcome was not specifically discussed because it was in all their minds.He agreed that Mr Verry’s motivation in suggesting the split fee arrangement was in consideration of Julie and Robert’s cashflow position but said that it was also an incentive for him to perform (Notes of Evidence, p129).
[61]	Mr Scurr said that there was no thought whatsoever of seeking a realization of shares by obtaining a cash payout.Mr Woodward had previously advised that this could be obtained but this was not what Robert wanted.Mr Scurr’s evidence was that, from the time of the opinions as to the invalidity of the Deed of Appointment in relation to the MMS Trust, they had all viewed the minority shareholding as having significant value (para 23).He agrees that they did say to Mr Verry something along the lines that they had been advised to “grab what you can and get out.”However, that was in the context of Mr Woodward advising that they could extract the value of the shares and that he could not see a simple pathway for Robert to gain control of Moutere (para 24).Mr Scurr did not agree, however, that the outcome finally achieved at the end of 1998 was undoubtedly an outcome better than the “grab what you can and get out” scenario Mr Woodward had painted at some point in 1995.His view was that what was finally achieved was the same outcome as would have been achieved in 1995 (Notes of Evidence, p126).
[62]	Mr Scurr agreed in cross-examination that they had received advice from Mr Woodward that the outcome of any action under the Companies Act was uncertain.He also accepted that Mr Verry would have passed on his view as to the difficulties with the Companies Act cause of action at the 11 November meeting (Notes of Evidence p125 and p129).

Dispute with Tony and Florence, subsequent events

[63]	The first task that Mr Verry undertook after the 11 November meeting was to draft a reply to the 2 October letter from Cook Alan Gibson.This was sent by Mr Woodward on 17 November 1995.It enclosed a copy of the opinion from Mr Forbes regarding the purported exercise of the power of appointment, referred to the Statement of Intent and noted that the future income security of Robert’s family was of paramount importance.It asked that Florence and Tony set out their intentions as to the provision of adequate and reasonable capital and income to Robert’s family.A further letter was sent on 27 November.
[64]	On 11 December 1995 a reply was received from Cook Allan Gibson.Mr Verry accepted in cross-examination that it appeared from that letter that Tony and Florence had accepted that Robert had an interest worth some $2.5M in the family companies and that they were offering to sell assets to pay out Robert and to give his family financial security.Mr Woodward’s view was that reason the buy out proposal was made was rather the fact that one of those letters had enclosed the Forbes opinion, which Cook Allan Gibson had asked for in their letter of 2 October 1995 (para 9).Mr Verry disagreed with that proposition in cross-examination.His view is that the letter was in response to the letters he had drafted.
[65]	Mr Verry did agree, however, that he had discussed the offer with Robert and Julie and that he did not argue against refusal.He said “what I put to them was that this was the first leg of the double, that is how I saw it.We had a two pronged attack, that was now secured, the next step was to examine the grounds for the employment contract gain” (Notes of Evidence, p19).He agreed that Robert and Julie’s actions in rejecting the offer were consistent with the position taken at the 11 November meeting but “not in the sense that it was a final rejection”.He said that he considered the offer to buy out Robert and Julie’s shareholding meant that he was entitled to another $170 an hour but said that he did not discuss this with Robert and Julie because they were employing the second part of the strategy.
[66]	The offer of negotiation was not rejected outright, although the Jopps had decided to reject it.A holding letter was drafted by Mr Verry and sent by Mr Woodward to Cook Allan Gibson.This letter of 21 December 1995 dealt first with the unresolved issues of management. It then noted the continued concern for the future security for Robert’s family and stated that in the letter of 11 December:“there is no particular comfort in the matter set out.”The letter continued that it was necessary to resolve comprehensively all outstanding issues and advised that Mr Verry had been engaged to review matters and make recommendations which could lead to a full and comprehensive settlement between the parties.
[67]	Mr Verry’s next step was to prepare a report for use in negotiations.This was duly completed in early 1996.The report recommended that all of the shares in Moutere Station Ltd be transferred to Robert to fulfil the terms of his employment contract and that the shares in Kiatoa Station Ltd and Mt Difficulty Station Ltd be transferred to Tony.It then recommended that those companies repay the advances made by Moutere Station Ltd of some $1.6M plus interest and that Tony also reimburse Robert for half of the costs of maintenance for Florence but recommended that future provision be made for a house for Florence and income of $15,000 per year.It also recommended that Florence and Tony pay damages of not less than $500,000, being general damages arising from injury to/loss of health, happiness, family relationships and future earning capabilities, due to their failure to fulfil their obligations as employer, as directors, and as family members.
[68]	He went on to recommend that copies of the report be furnished to Florence and Tony and a meeting arranged with a view to reaching a negotiated settlement but, in the event negotiations were unsuccessful by April, action should be instigated in the High Court.Mr Verry also included in his report an affidavit by Robert (which had been drafted by Mr Verry) setting out the background to his involvement with Moutere Station and his claim that the Moutere Station property and business was to be his upon his father’s death.
[69]	It appears that little progress was made with negotiations and in May 1996 Mr Fogarty QC was instructed (to replace Mr Forbes).Mr Verry says that it was on Mr Fogarty’s advice that a legal claim was filed which made an explicit claim for Moutere rather than the employment contract approach advocated by Mr Verry.(Notes of Evidence, p57).Mr Verry said, however, that he had suggested a constructive trust approach in 1989 but had not revived that suggestion in 1995 because he assumed that it had been looked at and discarded by the lawyers (Notes of Evidence, p58).Mr Verry was very involved in the preparation for the court hearing.He took responsibility for briefing many of the witnesses and overseeing the litigation.His involvement ended at the hearing in August 1997.
[70]	In a judgment dated 21 October 1997 John Hansen J found against the Trustees and Mrs Julie Jopp.As indicated above the matter was finally settled in December 1998. In Mr Scurr’s opinion the negotiated settlement involving a sale of assets to pay out the shareholding had always been available (para 33).Mr Paterson also said in evidence (at para 50) that he believed that the cash payout finally achieved would have been available throughout the litigation if that had been what they wanted.He noted that the proposed settlement conference before Master Venning did not proceed as the Trustees were not prepared to drop Moutere from the table.

Subsequent events in relation to Mr Verry’s fees

[71]

Mr Verry sent regular accounts for the $80 an hour figure setting out a description of the services rendered.The fee arrangement was not discussed again between the parties until January 1997.Mr Verry’s evidence is that Mrs Julie Jopp indicated to him that the deferred fees would only be paid if they succeeded in getting a better outcome than a division of assets based upon shareholding percentages.She referred to the Cook Allan Gibson letter which suggested a buy out of the shareholding and wrongly said that this was sent in August 1995 as against the actual 11 December date of that letter (para 105).Mrs Jopp admitted that she had said that the offer to buy out Robert’s share was received in August 1995 but that was a simple mistake and when Mr Verry produced the December letter she acknowledged that.(Notes of Evidence, pp 98-99)

[72]

Mr Verry says that he reiterated the agreed position to Mrs Jopp who, he says, acknowledged that this was the position and passed the matter off as a misunderstanding.He also wrote to Mrs Julie Jopp on 4 February 1997 to reiterate the position and to offer to reduce his role if she wished him to do so.After discussing a report he had prepared on the issue of deferred earnings and the billing for the last month Mr Verry turned to the issue of the basis of his engagement.The letter went on to say that:

the basis for remuneration was confirmed in the 22 November 1995 letter at $250 /hour, plus GST. However, this was subject to deferral of individual billings beyond $80/hour until, in effect, a cash-producing, or asset controlling, outcome is reached “which is better than the minority shareholder position which was in prospect. (emphasis added).

[73]	Mr Verry says that he put the case to one side while he awaited Mrs Jopp’s response and that she called him on 8 February 1997 to ask him to continue acting for her and the Trustees.He said that he agreed to continue only after Mrs Jopp had confirmed that she understood the terms of engagement as reiterated to her.
[74]	Mrs Jopp agreed in cross-examination that she was left in no doubt from Mr Verry’s letter to her of 4 February 1997 that the arrangement, as Mr Verry understood it at that time, was that the outcome would be positive if a cash producing or assets controlling outcome was reached.She said that she did not contact him after receiving that letter to say that she wanted to review his role or to say that he had inaccurately stated what the arrangement was.She denied telephoning Mr Verry in response to the letter.
[75]	When confronted with her telephone account she admitted that she may have telephoned Mr Verry on 8 February but she did not remember doing so and in any event she would not have talked about remuneration over the telephone (Notes of Evidence, p92).She denied that Mr Verry had brought the matter up either (Notes of Evidence, p103).She says that she referred the letter to a lawyer in Dunedin, Mr Mirkin, as they were heading to court and she was not good at talking remuneration.Later she admitted that it may have been a later letter she referred to Mr Mirkin.
[76]	Mr Verry says that he assumed Mrs Jopp’s confirmation of the terms of engagement was “taken with the full knowledge of the other defendants [the Trustees] and that she was copying them with all correspondence, as had been the agreed procedure”.Mr Scurr’s evidence is that he was not aware that Mrs Jopp had made a telephone call if indeed she did (para 27).Mr Paterson says that he received a copy of Mr Verry’s letter to Mrs Jopp dated 4 February 1997 and that he was aware that Mrs Jopp had referred the letter to Mr Mirkin and Mr Fogarty and that he understood the decision reached was that Mr Fogarty “would rein in Phil Verry, but that the difference between Julie and Phil as to the basis of the engagement would be deferred until after the outcome of the case for resolution” (para 46).Mr Paterson said that Mr Verry would have received the full fee if control of Moutere had been achieved as a result of the court proceedings.(Notes of Evidence, p123)Mrs Jopp said the same thing (Notes of Evidence, p97).
[77]	Mr Verry said that in late May 1997 he was handed a letter dated 23 April 1997 from a Dunedin solicitor, Mr Geoff Mirkin.The letter said that Mrs Jopp would look at the result achieved in the case and, at that stage, enter into further discussion in relation to a premium. Mr Verry said that he saw this letter as yet another attempt unilaterally and retroactively to alter the terms of engagement. Mr Verry’s evidence was that he considered that this was out of character with what the other trustees were saying to him (although he was not explicit as to why) and therefore concluded that Mrs Jopp was not informing her fellow trustees of these actions (and he noted that the agreement had been that whichever of the Trustees he contacted they would copy his correspondence to the others).Mr Verry thus replied to Mr Mirkin on 5 June 1997 and copied the letter to Mr Scurr (para 117).
[78]	Mr Verry said that Mr Scurr telephoned him to confirm the terms of his engagement. (para 117).Mr Scurr’s evidence on the other hand was that he had not telephoned Mr Verry to discuss fees but the matter had arisen in the course of a call about another matter.He says that he said it was something that needed to be sorted out but that he did not confirm his view of the arrangement as Mr Verry claims (para 28).Further correspondence followed but it is not necessary to set this out in detail.
[79]	We note that Mr Verry’s accounts were paid in full up to March 1997 and part payment was made in respect of the period from April through to August 1997. We also note that, when asked why she did not question the accounts that had been sent to her over the time Mr Verry was acting for her, Mrs Jopp said:

I was completely in his hands as to what jobs needed to be done and how long they took to be done, that was up until the time that Mr Fogarty started to work for us.I relied on Mr Verry to spend no longer than was necessary on the jobs and do the jobs that he considered to be absolutely necessary in order to obtain Moutere.He was the professional and he was the one giving advice he was the one calling the shots.He was the expert. (Notes of Evidence, p100)

Was the condition for the further hourly payment met?

Mr Verry’s Submissions

[80]	Mr Verry submits that his professional engagement started from his letter of 9 October 1995 where he stated that his normal hourly rate would apply.The details of the engagement were worked out at the November meeting.He submits that the only contingency in the further hourly payment was the ability to pay.The further hourly rate was contingent on the agreed strategy yielding cash to enable payment.He submits that it was not possible to anticipate the form any settlement would take and thus the arrangement had to be left loose.He points in support of this proposition to the fact that there was no reference in the letters sent after the 11 November meeting to the effect that he would only get paid the extra $170 per hour if the Jopps succeeded in receiving Moutere.He submits that the respondents are confusing their ultimate objective with the trigger for the further payment.
[81]	He submits that the evidence of the respondents at trial that the positive outcome was the gaining of Moutere is not reconcilable with the contemporary documentation, including Mr Verry’s file note of the meeting, or with commonsense. An interpretation that accords with business commonsense should be preferred. Mr Verry submits that it is not credible that his full hourly rate (which was merely a normal hourly rate for someone of his seniority) would be dependent on a contingency that required the achievement of Moutere.
[82]	Negotiations to attain the stud and a part of Moutere had been underway since 1989 and the Jopps had failed to achieve a result.At the time Mr Verry was engaged Robert was locked in as a minority shareholder.While a Companies Act action was possible, it was not certain of succeeding.Robert could remain locked in and, even if a buy out was ordered, the valuation was likely to be on the basis of future maintainable profits, which would have yielded a result quite different from the notional liquidation basis eventually settled on.Looked at objectively therefore the respondents were better off after the 1998 settlement than they were at the time of the November 1995 meeting.Mr Verry submits that his full fee should therefore be paid.

Submissions for Mrs Jopp and the Trustees

[83]	Mr Till submits, on behalf of the respondents, that the fee arrangement entered into was a true contingency fee arrangement, with the extra payment contingent on a positive outcome being achieved.The strategy put forward by Mr Verry related to attaining control of Moutere.That was the objective and the trigger for the payment of the contingency fee (although he accepts in this regard that something less than ownership of the whole of Moutere and the stud may have sufficed).
[84]	He suggested that the background to the dispute can be used both to set the factual matrix and also to determine questions of credibility.Adopting the second approach it is appropriate to examine the status quo at the time of Mr Verry’s involvement.Mr Till pointed in this regard to the evidence of Mr Paterson and Mr Scurr who he submits can be seen as witnesses without a personal financial stake in the outcome.Their view was that extraction of value was possible but not wished for.What was wanted was control of Moutere and Mr Verry was the only advisor at the time who suggested that that objective was achievable.
[85]	Mr Till also suggests that subsequent events can also be used to test witness credibility even if on conventional principles they cannot be used to ascertain the terms of the contract.Subsequent events in his submission show clearly what the objective was.Here he points to the refusal of the buy out offer of December 1995, the proposals in Mr Verry’s January report and the subsequent proceedings.He also rejects the suggestion that the interpretation of the trigger he contends for does not accord with the contemporary documentation, including Mr Verry’s file note (although that is not accepted by the respondents as a contemporary record).
[86]	In answer to the question of why Mr Verry would undertake the assignment for merely $80 an hour Mr Till submits that Mr Verry was short of work.Mr Verry takes strong exception to this as he says that he never actively sought the Jopp assignment but, having undertaken it, he was prevented from taking other assignments because of the time and effort the case took.We comment at this point that there does appear to us to be some justification for Mr Verry’s comment that the demands of the Jopp case could well have inhibited the proper performance of other work.

What was the trigger for payment of the further hourly rate?

[87]	The question that must be decided is whether, as Mr Verry contends, the payment of the deferred $170 per hour was triggered when any position other than a locked in minority shareholding position was achieved, or whether it was, as Mrs Jopp and the Trustees maintain, triggered only if they gained control of Moutere.
[88]	We comment at this point that conventionally an objective approach is taken to the interpretation of contracts.It is not what each party separately subjectively hoped or thought was agreed.The question is what they actually did agree and this entails an examination of the words of the contract.While the words of the contract are the starting point, however, the law recognises that the words do not exist in a vacuum and that they must be interpreted in context.There is some controversy as to what material can be relied upon in order to set this context (for example whether prior negotiations or subsequent conduct can be examined) but we do not need to enter into that debate for this case.
[89]	We deal first with the 11 November meeting and Mr Verry’s submission that he agreed to defer the billing of $170 of his hourly fee for cashflow reasons and that the deferral was to last until funds were released.We do not accept this submission.Even though the Jopps’ cashflow position motivated the offer of the split fee Mr Verry accepts that the term “positive outcome” was used.It is clear that the arrangement was that any funds to pay the deferred fee would come from that positive outcome (see Mr Verry’s file note set out in para [30] above).In our view, if what was intended had merely been a deferral until the Jopps’ cashflow position improved, then this should have been stated explicitly.
[90]	We now consider what interpretation should be placed on the term “positive outcome”.Applying the ordinary meaning of the term it is difficult to understand a positive outcome as meaning “anything better than the absolutely worst possible scenario” as contended for by Mr Verry – i.e. anything better than Robert remaining as a locked in minority shareholder, and even including as a positive outcome any pay out of the minority shareholding on whatever basis (more likely in Mr Verry’s view to be at a valuation based on the capitalisation of maintainable earnings than one based on a notional liquidation).Furthermore, we note that being left as a locked-in minority shareholder was a worst case scenario that no one but Mr Verry appeared to consider a real possibility.
[91]	We consider that the term “positive outcome” denotes an outcome that is desired and that it therefore must be assessed in the context of the agreed strategy from the 11 November meeting.The term assumes the success of that strategy.As can be seen from the discussion of the evidence above Mr Verry’s strategy was to attain Moutere by putting the Jopps in a strong position to negotiate.There was a two-fold approach suggested – the Employment Contracts Act approach and the Companies Act approach – see file note referred to at para [29] and Mr Verry’s evidence set out in paras [42] and [43] of this judgment.The king hit approach under the Employment Contracts Act was to claim “specific performance” of the employment contract, Robert having allegedly been promised Moutere for his work on Moutere.Alternatively cash would be generated from the deferred wages claim as well as from the oppressed minority claim under the Companies Act which would be used as a negotiation tool against Florence and Tony in order to achieve control of Moutere.Either way the aim of the strategy and the purpose of Mr Verry’s engagement was to gain control of Moutere and therefore the positive outcome envisaged must relate to that control.
[92]	We also note that the discussion at the November meeting was against the background of Mrs Jopp’s letter to Mr Verry of 2 October 1995.That letter clearly set out, both in the text and the attached Statement of Intent, that the aim was to achieve at least part of Moutere.Mrs Jopp did mention at the end of the 2 October letter that they were considering forcing a sale of all the company assets but she clearly had little enthusiasm for that option (and we also note Mr Paterson’s evidence (para 25) that forcing a sale was with a view to giving Robert a chance of purchasing Moutere at auction).
[93]	Mr Verry’s next submission was that the term “positive outcome” must be interpreted with a degree of flexibility as the exact outcome could not be predicted.We agree that there may be some flexibility in the term as discussed below.However, the submission in this context was made rather to support the contention that the term “positive outcome” meant anything better than the worst case scenario of being locked in as a minority shareholder.If that had been what was intended there would have been no need to predict the range of positive outcomes.The arrangement could have been defined by reference to that worst case scenario – i.e. defined as requiring the payment of the full fee if any outcome apart from a locked in minority shareholder position was achieved.
[94]	We now move to deal with Mr Verry’s submission that the interpretation contended for by Mrs Jopp and the Trustees defies business commonsense.His submission is that he would not have staked his fee (which after all, he says, was merely his normal hourly rate) on achieving the “king hit” of Moutere when negotiations had been going on for so long without success.
[95]	The first point in relation to this submission is that it is clear from the evidence of both parties that Mr Verry believed control of Moutere to be achievable and had faith in his ability to negotiate successfully in this regard.It is also clear that Mr Verry considered that the Jopps had let the negotiations drag on too long and that, if they had promptly followed his advice in 1989, they would have been in a better position.We note too that there had been a major change in Robert’s bargaining position with the discovery that the purported exercise of the power of appointment was invalid.In the letter of 2 October 1995 from Cook Allan Gibson it was acknowledged that, if the power of appointment was invalidly exercised, Robert had “an asset of very substantial value”.
[96]	In addition, it is not the “king hit” approach of transfer of Moutere itself that would have been deemed success.The aim was control of Moutere which does not necessarily connote total ownership.It is unnecessary to decide the question of whether what is described by Mr Verry in his file note as the fall back position (i.e. the split of assets by shareholding) would have constituted a positive outcome.It is, on the ordinary meaning of the term, difficult to denote the achievement of a fall back option as success and therefore as a positive outcome.On the other hand we consider that any split which gave the Jopps control of the stud and the part of Moutere most suitable for that stud is likely to have been considered a positive outcome given that this was the limit of what was sought by Robert in his Statement of Intent attached to Mrs Jopp’s letter to Mr Verry of 2 October 1995.
[97]	Finally we note that Mr Verry was retired at the time of taking on the assignment and thus presumably had limited overheads.He was not in a firm and he said himself that he would have been unable to offer the deferred payment if he had still been a partner (Brief of Evidence, para 83).It is not necessarily unreasonable to suggest that Mr Verry may have been in a position to offer a lower charge out rate with the full charge out rate being contingent on success.Mr Irvine’s evidence was that there is generally a significant difference in charge out rates between a partner in a firm and a person on their own (Notes of Evidence, p112).We therefore reject Mr Verry’s submission that it is unreasonable in this context to interpret the term “positive outcome” in the manner we have.
[98]	Mr Verry now says that the fact that he considered the gaining of control of Moutere to be possible was as a result of misrepresentations by Mrs Jopp and the Trustees.This was not covered in the pleadings, was not part of the case before the High Court and can therefore form no part of this appeal.We doubt in any event that any of the matters Mr Verry referred to were misrepresentations or that, if they were, there would have been any remedy for Mr Verry.
[99]	Up to this point we have concentrated on the 11 November meeting.We consider it possible, however, that the parties were at cross purposes at that meeting and that there was in fact no agreement as to fees reached.Our concerns stem from the terms of Mrs Jopp’s letter of 15 November 1995.Mrs Jopp correctly outlined the two-fold strategy that had been agreed with the employment contract case backed up by High Court action.She, however, appears to have thought that the $250 an hour fee would begin after an initial positive outcome – see para [31] above.This is not the arrangement as documented in the file note and as it appears to have been understood by the other participants in the meeting.
[100]	Mr Verry had similar concerns on receiving Mrs Jopp’s letter.He replied to her on 22 November 1995.In that letter he upheld her understanding of the agreement apart from the question of the fee arrangement – see the extract set out at para [34] above.Mr Verry made it clear that the $170 an hour would be deferred “until such time as a positive outcome is achieved, which is better than the minority shareholder position which was in prospect”.He then said that in the event that an “improved position” is not achieved the $170 would not be billed.Mrs Jopp did not reply to this letter and must be taken to have agreed to those terms.She says that she did not reply because she considered it correctly set out the arrangement – see para [54] above.
[101]	If the parties had been at cross purposes after the meeting of 11 November (and we consider they may have been) then the agreement as to fees stemmed from Mr Verry’s 22 November letter.In that letter the term “positive outcome” was again used.The discussion set out above as to the ordinary meaning of that term is therefore still relevant and the term still has to be seen against the context of the result the agreed strategy was to achieve.
[102]	Mr Verry in his 22 November letter confirmed that Mrs Jopp’s understanding of the arrangement was basically correct (presumably apart from her understanding of the fees).Mr Verry is a professional and therefore we assume used to drafting with precision.We would have thought too that Mr Verry would have been especially careful to ensure there was no further misunderstanding as Mrs Jopp’s letter of 15 November must have raised real doubts as to her perception of the fee arrangement, particularly in light of the fact that Mrs Jopp had at first naively thought that Mr Verry would provide his services pro bono (Brief of Evidence, para 22).
[103]	Mr Verry points to the qualification of the term “positive outcome” used in the letter – i.e. that it had to be “better than the minority shareholder position which was in prospect” (and he also points back to similar words in his file note of the 11 November meeting).We note first that neither in the file note nor in the 22 November letter is the phrase “locked in minority shareholder position” used. The term used is “minority shareholder position”.Secondly, if the intention had been merely that the achievement of any position that was better than a minority shareholder position sufficed, then there was no need to refer to a positive outcome at all. We must assume that those words have some meaning.We consider that they refer back to the success of an agreed strategy.Finally in ordinary parlance a position that is better than a minority shareholder position is likely to be seen as involving anincrease in shareholding and perhaps even to a majority position.Conceivably in a different context it could denote payment out in cash for shareholding but the words must take their meaning from the context and the context was that the Jopps did not want a cash payout.The aim of the agreed strategy was control of Moutere.
[104]	There was also no mention in Mr Verry’s letter of a cash extraction aim.That could easily have been added (as indeed it was in Mr Verry’s subsequent letter of 4 February 1997 referred to at para [72] above).Mr Verry’s evidence was that there were many possibilities discussed at the meeting of 11 November and that the form of settlement could not be anticipated.In such circumstances we consider that it was incumbent on him to set out clearly the outcomes which were to be deemed “positive”, especially as he contends that all outcomes but one were so.Mr Verry has criticised Mrs Jopp for not setting out in her letter of 15 November that the positive outcome she sought was control of Moutere.We consider that in fact she did so – she set out the agreed strategy of the employment contract argument and the back up High Court action.Mr Verry’s own evidence is that the aim of the dual strategy was to achieve leverage with the aim of attaining Moutere, either directly or through the receipt of money.
[105]	We also note that Mr Verry, in his 22 November letter, said that the rate was to remain at $80 an hour “[i]n the event that an improved position is not achieved”. An improved position can only be seen as an improvement over the status quo and therefore necessitates an understanding of what the status quo was.It appears to us that the Jopps, the Trustees and their advisors thought that a payout for Robert’s shareholding was available.Mr Forbes view, for example, was that the Jopps would probably succeed in obtaining relief to the extent of requiring Robert’s shares to be purchased at valuation, although the valuation he considered most likely was on the basis of the capitalisation of maintainable earnings.Mr Laing differed as to the basis of valuation and considered that it would be done on a notional liquidation basis (as was eventually settled upon).In the event an offer to buy out was received in December.The status quo, both in perception and actuality, was therefore that cash for shares appears to have been available at the time Mr Verry was engaged. An improved position must therefore mean something other than being paid out for the shares at any price as Mr Verry contends.We consider also that, read in the context of the agreed strategy and the letter as a whole, an improved position does not extend to payment for the shares even at full valuation (for the reasons already articulated above).
[106]	If the agreement as to fees was reached on the basis of Mr Verry’s letter of 22 November and not at the 11 November meeting, therefore, our view as to the trigger for payment of the deferred hourly rate would not change.
[107]	We have referred above to the fact that courts have been reluctant to have regard to subsequent conduct as an aid to ascertaining the meaning of contractual terms.There is some sign that this rule may possibly be rethought – see e.g. Attorney-General and NZ Rail Corporation v Dreux Holdings Ltd (1996) TCLR 617.Mr Till suggested that subsequent conduct could in any event be used to assess credibility.We do not need to enter this debate either but we record that we are in agreement with Heron J when he pointed to the subsequent conduct of the parties (and in particular the conduct of Mr Verry after the receipt of the 11 December 1995 letter from Cook Allan Gibson) as being inconsistent with the interpretation Mr Verry places on the fee arrangement.
[108]	Finally we note that, in our view, the fee arrangement remained the same throughout the assignment.There may have been a conceptual difference in Mr Verry’s role after the failure of negotiations in early 1996 but this was not reflected in a change either in his instructions as to his role or in the fee arrangement.
[109]	In summary we are satisfied that the trigger for the payment of the further fee was the attainment of a positive outcome.In the circumstance the proper interpretation of the term “positive outcome” was control of Moutere.The evidence justified the finding that a positive outcome was not achieved.Consequently Heron J was correct to hold that the extra hourly payment of $170 an hour could not be recovered by Mr Verry.

Estoppel

Submissions of the parties

[110]

Mr Verry submits that, following the conversations concerning his fees in early 1997, Mrs Jopp and the Trustees were estopped from denying the terms of the engagement as understood by Mr Verry.They knew that Mr Verry was providing his services on the basis he had explained in the letter of 4 February 1997 to Mrs Jopp.Mrs Jopp’s alleged acknowledgement that this was the position and her request for Mr Very to continue acting for her and the Trustees amounted to a representation that they accepted that the terms of the agreement were as Mr Verry understood them to be. Similarly, Mr Verry submits that Mr Scurr confirmed that the terms of the agreement were as Mr Verry understood them to be in a telephone conversation that took place soon after Mrs Jopp’s acknowledgement.

[111]

Mr Till submits that no estoppel arose.There was no representation by Mrs Jopp and the Trustees amounting to an acceptance of the terms of the agreement as understood by Mr Verry.Instead they wished to leave the discussion of fees until the proceedings had ended.In any event, it would have been irresponsible for Mr Verry to have ceased acting for Mrs Jopp and the Trustees just before the proceedings began.

Heron J’s judgment

[112]

Heron J found no actionable estoppel.Instead he considered that the parties’ positions remained the same, but with both parties being aware that after the proceedings had ended there might be some dispute as to whether a successful outcome had been achieved.Heron J appears to have accepted that, to Mr Verry, Mrs Jopp may have appeared to have accepted his position as to the fee arrangement in February 1997.Heron J said, however, that because the contract existed Mr Verry could not assert a position different from the actual contractual position and then claim that the other side was estopped from saying that a positive outcome was not achieved.That would amount to changing the terms of the contract unilaterally.

Discussion

[113]	The starting point for any actionable estoppel in a case such as the present is the need for a clear representation or promise by one party to the other.The representation or promise must be unambiguous.There is no such unambiguous representation or promise in this case and, even if there had been, it could not change the terms of the engagement before such representation or promise was made.
[114]	Even if we assume that Mrs Jopp, though she does not remember it, did discuss fees with Mr Verry in the telephone call of 8 February and even if she agreed both at their January meeting and in that telephone call that the fees basis was as set out in Mr Verry’s 4 February letter, the decision was not Mrs Jopp’s alone.Clearly the Trustees would need to have been involved.Mr Verry says he assumed the Trustees had a copy of his 4 February letter (as they had agreed at the beginning of the assignment that any letter received by one would be circulated to all).He also says that he assumed that Mrs Jopp was acting with their knowledge.He does not, however, say that Mrs Jopp assured him that she was acting with the concurrence of the Trustees.Mr Verry’s assumption that Mrs Jopp was acting with the Trustees’ knowledge cannot create an unambiguous representation on behalf of the Trustees, whatever the situation with Mrs Jopp.
[115]	We also remark that it may be thought somewhat strange that Mr Verry, on a point so important as this, would not follow up any conversation with Mrs Jopp with a written confirmation.Finally we note that, once Mr Mirkin’s letter was passed to Mr Verry in late May, it must have been clear to Mr Verry that there was a dispute over the terms of the arrangement but that resolution was left until after the court decision.The same considerations apply regarding anything Mr Scurr may have said to Mr Verry.
[116]	As there was no unambiguous representation we agree with Heron J there was no actionable estoppel.

Should Mr Verry’s bill have been discounted?

Submissions of the Parties

[117]	Mr Till submits that Mr Verry breached a term of his contract of engagement in that the time he expended was in many respects unreasonable.He submits that the judge’s finding in this regard was justified on the basis of the evidence of Mr Fogarty and Mr Irvine, and the judge’s own assessment of what he saw during the course of evidence as to what was undertaken by Mr Verry and the time expended on those tasks.Mr Till submits that, as Mr Irvine said in evidence, the nature of some of the tasks that Mr Verry chose for himself were not within the realm of an accounting professional at all.(Mr Irvine was the managing partner of Deloitte Touche Tohmatsu, and experienced in litigation support roles.He gave evidence of a review he had undertaken of Mr Verry’s role in the case).
[118]	Mr Till further submits that the parties had asked that the matter be dealt with in a broad brush manner by the judge (rather than for example asking a Master to do a detailed review) and there was more than sufficient evidential basis for the Judge’s decision in this regard.
[119]	Mr Verry agrees that there is an implied condition for all professional engagements that fees will be reasonably incurred.Indeed we note that there may be an express condition in this contract as Mr Verry’s 9 October letter said that he would endeavour to minimise costs.Mr Verry, however, submits that any queries in this regard should have been taken up on receipt of the accounts.It is unfair to attempt to review accounts several years after the event.
[120]	Mr Verry criticises Mr Irvine’s review as being merely a desktop review and undertaken without an appreciation of the role Mr Verry was called upon to undertake.It was not a litigation support role.Mr Verry says that he tried to pass on the work where appropriate but the nature of the case and the witnesses and the defaults of others had meant that this was not always possible.

Discussion

[121]	It is clear that Mr Verry was taking a much larger role in the litigation than would normally be undertaken by accountants providing litigation support.We accept that this was to a large extent a function of the nature of his instructions and the reliance placed on him by his clients and also a function of the difficulties inherent in the case itself.This said it is also clear that Mr Verry was undertaking some work that would normally have been undertaken by or under the direction of an experienced litigation lawyer (and we emphasise the fact that we are talking of experience of litigation as a litigation lawyer rather than the fact of legal qualifications or experience outside of the court setting).While Mr Verry is of course a very experienced and senior accountant and one who has had experience in litigation matters he is not an experienced litigation lawyer in the sense described above.
[122]	We have carefully considered the evidence of Mr Fogarty, Mr Kellar (a barrister assisting Mr Fogarty) and Mr Irvine (both in evidence in chief and in cross-examination) and also Mr Verry’s responses to that evidence.After that analysis we are of the view that Mr Verry’s work in some cases may not have been as tightly focussed as a client paying $250 an hour would have been entitled to expect.This is particularly the case in relation to the type of work discussed in the preceding paragraph and also in the light of Mr Irvine’s comments that a charge out rate of $250 would have been much higher than what would have been charged by partners of accounting firms (in the South Island at least) at the requisite time.The same considerations may apply even to the $80 rate but not to such an extent.
[123]	We also accept the evidence of Mr Irvine that a client would be entitled to expect that all work that could be done at a lower charge out rate by a person of less experience would be handled at that level rather than by a person charging $250 an hour.Of course the fact that Mr Verry’s rate has been held to be only $80 an hour renders this criticism irrelevant.We note that Mr Irvine did some calculations as to what his firm would have charged for the work Mr Verry carried out and also did some adjustments to take account of what he saw as unnecessary work.Even with those adjustments the fees that would have been charged by Mr Irvine’s firm were above the figure charged by Mr Verry when calculated at $80 an hour.
[124]	We consider also that, particularly in circumstances where there are budget constraints on the conduct of litigation as there were here, the professionals involved must try to minimise duplication of effort and this applies whatever the charge out rate.In this case senior counsel was employed.It can only be seen as duplication for instance for Mr Verry to have spent 65.75 hours analysing the statement of claim (as compared to Mr Fogarty who recorded only 30.3 hours) – see para 68 of Mr Irvine’s evidence.Mr Verry may have had valuable input into the statement of claim and in a case with an unlimited budget that input may have justified such duplication, but it cannot be justified in this case where there was no such unlimited budget, where Mr Verry knew of the cashflow constraints and where senior counsel was involved.
[125]	We also note two further specific items. Mr Irvine notes that Mr Verry charged 76 hours for attendance at court.Mr Irvine’s evidence was that only 22 hours of the recorded 76 hours were spent on preparing for and providing evidence to the court and associated travel.Mr Fogarty did not require Mr Verry’s attendance other than to give evidence.Mr Verry says (para 182 of his brief) that he said he would waive his fees for the duration of his stay in Dunedin for the court case (and this concession appears even to have covered attendances to give his evidence).Mr Verry says that he considered that the concession had been gained unfairly so he reversed it and billed for the services rendered.Even if this were correct, we do not consider that it would justify Mr Verry charging for his attendance at court in circumstances where Mr Fogarty did not require him to be present.Heron J disallowed all attendances in Dunedin, including the attendances required to give evidence, on the basis that it was improper to charge after Mr Verry had said he would not do so.Mr Verry says that the decision not to charge was his alone and thus we agree that Heron J’s approach was appropriate.
[126]	Heron J also disallowed 100 hours travelling time for the reason that Mr Verry had said he was not going to charge for this but later did so, perhaps as Heron J said, out of anger at the denial by Mrs Jopp and the trustees of what Mr Verry claimed was his proper rate.Mr Irvine’s evidence was that it appeared that Mr Verry might have already charged travel time in his monthly invoices in some instances over the period and thus there could have been some duplication of travel charges.Mr Irvine could not ascertain this for certain given that the timesheet narratives tended to group other activities on the same day as the travel (Brief of Evidence, para 31).Whether or not there was duplication we agree with the reason given by Heron J that this part of the claim should be disallowed.Heron J also however, considered that 13 hours should be allowed for the period of December/January to cover travelling and thinking time.Although in the event this amount does not in fact appear to have been taken into account in Heron J’s calculations we will allow for it.
[127]	Further, Heron J came to the conclusion that excessive time had been taken by Mr Verry.This was on the basis of the evidence of Mr Irvine, Mr Fogarty and his own experience.However he did indicate that, although Mr Verry put more in time than he needed to in the circumstances, he should not be judged too harshly on that as Mr Verry’s role had been substantial.The discount he set for excessive time taken was 25%.In our view this discount, even on a broad brush basis, is too high.
[128]	The judge began his analysis by indicating that a bill in excess of $300,000 for the work performed by Mr Verry could rightly be seen as outrageous, especially for work that was in many cases fairly routine staff solicitor type undertakings.It appears to us that the discount figure was set having regard to the $250 an hour figure (which the judge had held was not payable).As set out above at $250 an hour there would have been much more of a concern about the charges.In our view the reduction of 25%, while it may well have been justified at the $250 an hour rate, was not justified at the $80 an hour rate.We hold that the appropriate adjustment should rather have been in the order of 5%.
[129]	Therefore we begin with Mr Verry’s figure of 1378 (hours billed), less 76 (Dunedin time) less 100 (travelling time) and add back 13 hours (as per Heron J).This makes a total of 1215 billable hours.Discounting this time by 5% means Mr Verry’s billable hours total 1155 after having been rounded up to the nearest whole hour.As we have found that Mr Verry’s fees remained at $80 per hour, the fees payable by Mrs Jopp and the trustees to Mr Verry are $92,400.When disbursements and GST are added this gives a rounded total of $121,320 that Mr Verry is entitled to.

Further matters

[130]	One of Mr Verry’s grounds of appeal was that, because Heron J was terminally ill at the time of hearing the case and writing the judgment, his consequent physical and psychological impairment rendered him incapable of giving proper consideration to the evidence.In particular, Mr Verry says that Heron J relied solely on impressions of the witnesses and had not analysed the evidence given for the respondents against the contemporary documentation.
[131]	Mr Till’s position was that the personal attack on the trial judge was scurrilous and without foundation and indicated from the Bar his view that the conduct of the trial had been exemplary.
[132]	The appeals process exists to correct mistakes made by judges during the hearing process that may be made for various reasons, including illness.Because of Mr Verry’s concerns the approach we took, as can be seen from the analysis set out above, was to review the evidence and relevant documents and effectively to deal with the matter of the trigger for payment afresh.This would not be the normal approach of this Court.Factual findings based on credibility can be challenged on appeal only where there is no evidence to support them or where the judge is clearly wrong in the conclusion reached.
[133]	As a result of our review, we came to similar conclusions on the issue of the trigger for payment of the further fee as Heron J did.We did differ from Heron J as to the 25% reduction of Mr Verry’s fees but this was because we considered the criticism of the time spent, while justified at a $250 an hour rate for the reasons set out by the judge, did not apply with such force to an $80 an hour rate, particularly in the light of the extensive role Mr Verry played in the litigation.
[134]	We put on record that we are satisfied from our examination of the conduct of the case and our analysis of the judgment that Heron J had plainly fully grasped the evidence and that Mr Verry’s concerns as to the judge’s health having affected the hearing and judgment at first instance are unfounded.

Result and Costs

[135]	For the reasons given above the appeal is allowed but only to the extent that the amount ordered to be paid to Mr Verry is increased to $121,320 including GST and disbursements (less the amount already paid).There may be some consequential adjustments to costs and interest in the High Court, which that Court can deal with if necessary.
[136]	In this court the major part of Mr Verry’s appeal has failed.It is therefore appropriate that he pay some costs to the respondents.We set the figure at $4,000 plus all reasonable disbursements (including travel and accommodation costs of counsel) to be set by the Registrar if necessary.

Solicitors:

Richard Burtt & Andrew Logan, Christchurch for Respondents