Nelson Bays Realty Limited v Hattersley DC Nelson CIV-2012-042-67 [2012] NZDC 2037 (6 December 2012)

Last Updated: 27 September 2016

IN THE DISTRICT COURT AT NELSON

_{CIV-2012-042-000067}

BETWEEN NELSON BAYS REALTY LIMITED Plaintiff

AND IAN FREDERICK HATTERLSEY Defendant

Hearing: In chambers on the papers

Counsel: J Waymouth for the Plaintiff

N Ironside for the Defendant

Judgment: 6 December 2012

JUDGMENT OF JUDGE A A ZOHRAB [as to costs]

Introduction

[1] The plaintiff is a real estate company and it has filed proceedings against the defendant seeking payment of commission allegedly owing to it following the sale of the plaintiff’s property. The defendant denies he is liable for payment of commission.

[2] Through counsel’s oversight the plaintiff did not pursue its claim under r 2.17 of the District Courts Rules 2009 within the 90 day working period stated in r 2.17.4. As a consequence, r 2.17.4 provides that the proceedings come to an end, with r

2.17.6 providing that a proceeding that comes to an end in such a way is treated as having been discontinued by the plaintiff.

[3] The defendant seeks costs upon the discontinuance on an indemnity basis. In the alternative he seeks costs on an increased basis or on a scale basis.

NELSON BAYS REALTY LIMITED V IAN FREDERICK HATTERLSEY DC NEL CIV-2012-042-000067 [6

December 2012]

[4] The plaintiff does not oppose costs on a 2B basis, but if indemnity or increased costs are to be awarded seeks a hearing in person.

Defendant’s submissions

[5] The defendant has referred the Court to r 4.2 which sets out the general principles applicable to the determination of costs together with r 4.6 which deals with increased costs and indemnity costs.

[6] The defendant seeks an order for indemnity costs for the following reasons:

(a) The plaintiff failed to pursue its claim under r 2.17 within the 90 working day time limit and therefore indemnity costs should follow the non pursuit of the claim.

(b) The plaintiff acted unnecessarily in bringing and/or continuing its claim against the defendant. In the alternative the defendant seeks increased costs on the grounds that the plaintiff contributed unnecessarily to the defendant’s time and expense by bringing a claim that lacked merit.

[7] The defendant contends that the appropriate classification for this proceeding is category 2.

[8] In support of the claim for both indemnity costs and increased costs the defendant contends that the plaintiff’s claim lacked merit and has critiqued the plaintiff’s claim and asks the Court to make a broad assessment of the merits.

[9] The defendant asks the Court to conclude that there is no merit to the claim for commission.

[10] Finally, the defendant asks the Court to note that the actual costs arising out of the legal proceedings amount to $10,086 excluding GST but including disbursements of $211.

Plaintiff ’s submissions

[11] The plaintiff’s solicitor acknowledges there was an error on his part in failing to pursue the claim and the submissions seemed to contemplate fresh proceedings being filed.

[12] In any event, plaintiff ’s counsel submits that the claim does have merit and in counsel’s failure to pursue the matter should not be taken as an indication of acceptance of lack of merit.

[13] Counsel for the plaintiff also contends that the matter is not complex and that there is no detailed analysis required.

Discussion and decision

[14] I of course bear in mind the principles applying to the determination of costs, together with those applicable to increased and indemnity costs, but in my view one has to take account of the fact that this was a claim for a relatively modest amount, the factual matrix is not complex, and the law in the area is relatively straightforward. Furthermore, whilst I appreciate that the defendant contends that the case against them is unmeritorious, it is not possible for me to be able to form an assessment such as to determine that the plaintiff ’s claim is completely without merit and has been pursued in an irresponsible fashion.

[15] The defendant emphatically denies liability but I see no reason to award costs over and above scale. Accordingly the plaintiff is ordered to pay costs on a 2B basis together with reasonable disbursements.

A A Zohrab

District Court Judge