Highgate on Broadway Limited v Devine [2013] NZCA 213 (10 June 2013)

Last Updated: 20 June 2013

_{IN THE COURT OF APPEAL OF NEW ZEALAND}

CA814/2011 [2013] NZCA 213

BETWEEN	HIGHGATE ON BROADWAY LIMITED Appellant
AND	ARTHUR LAWRENCE MICHAEL DEVINE Respondent

Court: Wild J

Counsel: D J Clark for Appellant

_{L P Radich for Respondent}

Judgment:

_{(On the papers)}

10 June 2013 at 10 am

JUDGMENT OF WILD J: COSTS ON ABANDONMENT OF APPEAL

Respondent allowed costs in the sum of $4,500.
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[1] I have considered Mr Radich’s memorandum of 23 May for the respondent, and Mr Clark’s of 4 June for the appellant.
[2] The chronology of relevant events is this:

Date	Event
August 2011	Respondent tenant evicted by appellant landlord.
Shortly afterwards	Appellant acknowledges eviction was wrongful but refuses to allow respondent back into premises unless rent paid for period of eviction.
10 November 2011	High Court grants respondent’s application for relief against forfeiture.
8 December 2011	Appellant appeals.
Later in December 2011	Respondent cancels lease.
March 2012	Appellant cancels lease.
25 September 2012	Fixture for hearing of appeal on 20 May 2013 advised to parties.
19 April 2013	Appellant’s submissions in support of appeal due – not filed.
8 May 2013	Appellant abandons appeal.

[3] For the respondent, Mr Radich claims increased costs of $5,560, the amount of security paid into Court. He does so on these grounds (and I summarise):

(a) The appeal was brought for the improper purpose of delaying the respondent’s claim for damages for unlawful eviction. It successfully delayed that claim for about a year.

(b) After the Court pointed out to the appellant’s solicitor^[1] that the relief sought in the notice of appeal seemed inappropriate, given that the respondent had cancelled the lease, the appellant undertook to file an amended notice of appeal “within 10 working days” but did not do so, thereby breaching its undertaking to the Court.

(c) The appellant rejected reasonable settlement offers by the respondent.

[4] Those grounds invoke various provisions of r 53E of the Court of Appeal (Civil) Rules 2005.
[5] Mr Radich advises that the respondent’s actual costs (undercharged by Radich Law) amount to $6,300.
[6] In his memorandum in response Mr Clark made these points:

(a) The respondent’s action of cancelling the lease the day after this appeal had been served indicated acceptance by the respondent that the appeal had some merit. Mr Clark amplified what he considers that merit was. I need not do so.

(b) When seeking relief against forfeiture Arthur Devine Ltd (now in liquidation) failed to disclose its “extremely parlous financial state”. While that company was not the tenant, it was the company formed by the respondent to conduct the business from the demised premises and was “the company” referred to by the respondent’s solicitors in correspondence about the dispute. In the end the appellant decided not to introduce this non-disclosure as a ground of appeal.

(c) The appellant did not breach an undertaking to the Court – at least not an undertaking in the sense that word is used in r 53E(3)(b).

(d) The settlement offers detailed by Mr Radich were in respect of all matters in dispute between the parties. Further, when its counter-offer of 19 April was rejected the appellant offered to accept the respondent’s offer of 18 April, only to be told that that offer was no longer open and a higher amount was required to settle.

(e) The respondent has not made out grounds for increased costs. In particular, it did not need to prepare its submissions on appeal.

[7] Mr Clark accordingly submitted that an appropriate allowance of costs to the respondent was one day of time at $1,990 (adopting Category 2, Schedule 2 High Court Rules – rr 53C and 53D of the Court of Appeal (Civil) Rules).
[8] Having considered the opposing submissions, and worked my way through the appeal file, I consider the appropriate costs order is $4,500. That is one and a half days at the daily rate of $1,990, uplifted by 50 per cent. I have allowed one and a half days as my estimate of the amount of time the respondent’s solicitors have had to put into dealing with this appeal until it was abandoned. They filed memorandums on 15 February 2012 (in relation to security for costs), 13 February 2013 (in response to the appellant’s memorandum of 1 February 2013) and 3 May 2013 (following the notice of abandonment). There is also a substantial amount of correspondence on the Court file, not to mention that directly between the parties’ solicitors concerning the appeal and the underlying dispute. Acknowledging the limited relevance of actual costs, I have nevertheless borne in mind that the respondent’s solicitors have charged the respondent $6,300, and say that does not reflect their full time input.
[9] I have applied the 50 per cent uplift because I accept Ms Radich’s submission that this appeal was brought for the improper purpose of attempting to delay, defeat or game down the respondent tenant’s claim for damages for wrongful eviction. I also consider that the ultimate abandonment of the appeal, immediately before submissions were due, was an acknowledgment that the appeal lacked any real merit.
[10] Accordingly, I allow the respondent costs in the sum of $4,500.
[11] I direct the Registry to pay that sum out to Radich Law from the security for costs held, and to pay the balance of the security plus interest accrued on it out to Wisheart Macnab and Partners, the appellant’s solicitors.

Solicitors:
Wisheart Macnab & Partners, Blenheim for Appellant
Radich Law, Blenheim for Respondent

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^[1] Minute of Wild J, 7 February 2013.