PGG Wrightson Real Estate Limited v Routhan [2023] NZCA 405 (30 August 2023)

Last Updated: 7 September 2023

IN THE COURT OF APPEAL OF NEW ZEALAND I TE KŌTI PĪRA O AOTEAROA

CA53/2022 [2023] NZCA 405

	BETWEEN	PGG WRIGHTSON REAL ESTATE LIMITED Appellant
	AND	PHILIP WILLIAM ROUTHAN AND JULIE VERONICA ROUTHAN AS TRUSTEES OF THE KANIERE FAMILY TRUST Respondents

Court:	Gilbert, Mallon and Wylie JJ
Counsel:	L J Taylor KC and M E Parker for Appellant D R Kalderimis, T Nelson and O T H Neas for Respondents
Judgment: (On the papers)	30 August 2023 at 2 pm

JUDGMENT OF THE COURT
[on recall application]

1. The application for recall is declined.
2. The appellant must pay costs to the respondents for a standard application on a band A basis and usual disbursements.

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REASONS OF THE COURT

(Given by Gilbert J)

• [1] This judgment responds to an application by the appellant for recall of this Court’s judgment delivered on 24 April 2023 (Substantive judgment).^[1]
• [2] The Substantive judgment reduced the damages awarded by the High Court in favour of the respondents from $1,697,600 to $300,000. In both courts, interest on the judgment sum was awarded under the Interest on Money Claims Act 2016 from late 2010 until payment was made in full. The respondents were ordered to pay costs to the appellant on the appeal. The respondents’ entitlement to costs in the High Court was left undisturbed because the outcome on appeal confirmed that judgment had been properly entered in the respondents’ favour, albeit it should have been for a lesser sum.^[2]
• [3] The recall application is advanced on the basis that neither this Court nor the High Court was made aware of three Calderbank offers made by the appellant prior to trial. The appellant contends these offers justify a different costs outcome in the High Court in view of the damages fixed by this Court. The appellant therefore seeks recall of the Substantive judgment, revocation of the order in respect of costs in the High Court, and substitution of an order directing that this issue be remitted to that court for reconsideration in the light of this Court’s judgment.
• [4] The respondents strongly oppose the application for recall. For the reasons that follow, we have concluded that the recall application should be declined.
• [5] The general rule is that a judgment, once delivered, must stand for better or worse, subject to appeal. A decision to recall a judgment other than under the slip rule (which does not apply here) will only be made in exceptional circumstances:^[3]

(a) where, since the hearing, there has been an amendment to a relevant statute or regulation, or a new judicial decision of relevance and high authority;

(b) where counsel have failed to direct the court’s attention to a legislative provision or authoritative decision of plain relevance; or

(c) where for some other very special reason justice requires that the judgment be recalled.

• [6] The appellant submits that the principle underlying the second of these grounds applies even though the application does not squarely come within this category. The basis for this submission is that senior counsel considered (rightly or wrongly) that it was neither necessary nor appropriate to bring the Calderbank offers to the attention of the Court before the appeal was determined. The difficulty with this submission is that there was no “failure” by counsel. A considered choice was made, presumably for good strategic reasons. It seems to us that it would be unjust, and well outside the very limited scope of the recall jurisdiction, to permit the appellant now to depart from its chosen course. The appellant sought an order from this Court awarding it costs in the High Court. It did not ask this Court to remit the question of costs to the High Court for reconsideration in the light of its judgment. Nor did the appellant ask for the issue of costs in the High Court to be reserved to enable further submissions to be made after the Substantive judgment was issued. This Court dealt with the issue on the basis of the notice of appeal and the submissions filed, as it was asked to do.
• [7] Nor do we consider this is a case where the third ground for recall applies.
• [8] In addition to the matters just referred to, we consider that the Calderbank offers would not affect the respondents’ entitlement to costs in the High Court in any event.
• [9] Rule 14.11 of the High Court Rules 2016 provides:

14.11 Effect on costs

(1) The effect (if any) that the making of an offer under rule 14.10 has on the question of costs is at the discretion of the court.

(2) Subclauses (3) and (4)—

(a) are subject to subclause (1); and

(b) do not limit rule 14.6 or 14.7; and

(c) apply to an offer made under rule 14.10 by a party to a proceeding (party A) to another party to it (party B).

(3) Party A is entitled to costs on the steps taken in the proceeding after the offer is made, if party A—

(a) offers a sum of money to party B that exceeds the amount of a judgment obtained by party B against party A; or

(b) makes an offer that would have been more beneficial to party B than the judgment obtained by party B against party A.

(4) The offer may be taken into account, if party A makes an offer that—

(a) does not fall within paragraph (a) or (b) of subclause (3); and

(b) is close to the value or benefit of the judgment obtained by party B.

• [10] The respondents commenced these proceedings in 2018 and the trial commenced on 3 August 2021. Three Calderbank offers were made, each with a denial of liability and on conditions there would be no issue as to costs and the terms of the settlement would be confidential:

(a) $350,000 on 10 December 2020.

(b) $350,000 on 21 April 2021.

(c) $500,000 on 22 July 2021.

• [11] All of these offers fell short of the amount to which the respondents were entitled at the relevant times (based on the outcome in this Court) after taking account of accrued interest and costs entitlements. The respondents calculate that the shortfall ranges between 24 per cent (in respect of the second offer) and 18 per cent (in respect of the third offer). The appellant says there is a dispute as to whether the amount of the judgment, including interest, exceeds the offers made. However, the relevant comparison must take into account the accrued entitlement to costs and disbursements up to the date of each offer.^[4] The appellant has not attempted to demonstrate any error in the detailed calculations supplied by the respondents showing the accrued entitlements on the relevant dates with interest and costs added. Rule 14.11(3) does not appear to apply.
• [12] The appellant submits that the offer (presumably the third) was “close to the value or benefit of” the judgment sum, and it may therefore be taken into account in fixing costs in terms of r 14.11(4)(b). We doubt this. We do not consider a shortfall of 18 per cent or more can be described as “close”. We also accept the respondents’ submission that by proceeding to trial and judgment the respondents achieved public vindication of their claims, whereas if they had accepted any of the Calderbank offers, there would have been no admission or finding of liability and the terms of the settlement would have to have been kept confidential. In these circumstances, we do not consider the respondents acted unreasonably in rejecting these offers. It is also relevant that the best offer was not made until very shortly prior to the commencement of the trial.

Result

• [13] The application for recall is declined.
• [14] The appellant must pay costs to the respondents on this application on a band B basis and usual disbursements.

Solicitors:
Parker Cowan Lawyers, Queenstown for Appellant
Luke Cunningham Clere, Wellington for Respondents

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^[1] PGG Wrightson Real Estate Ltd v Routhan [2023] NZCA 123, (2023) 24 NZCPR 97.

^[2] At [152].

^[3] Horowhenua County v Nash (No 2) [1968] NZLR 632 (SC) at 633 approved in Saxmere Co Ltd v Wool Board Disestablishment Co Ltd (No 2) [2009] NZSC 122, [2010] 1 NZLR 76 at [2].

^[4] Tower Insurance Ltd v Kilduff [2019] NZCA 82 at [35].