VERSCHAFFELT V SUNDAY STAR-TIMES NEWSPAPER AND ANOR HC AK CIV 2008-404-008390 [2009] NZHC 1475 (29 October 2009)

IN THE HIGH COURT OF NEW ZEALAND
AUCKLAND REGISTRY
                                                                  CIV 2008-404-008390

              UNDER                        the Defamation Act 1992


              BETWEEN                      PETER VERSCHAFFELT
                                           Plaintiff

              AND                          SUNDAY STAR-TIMES NEWSPAPER
   
                                       First Defendant

              AND                          HOUSING NEW ZEALAND
         
                                 CORPORATION LIMITED
                                           Second Defendant

              (on
the papers)

Counsel:      E Orlov for plaintiff
              RKP Stewart for first defendant
              MA Gilbert for second
defendant

Judgment:     29 October 2009 at 4:45 pm


                JUDGMENT OF ASSOCIATE JUDGE FAIRE
                        
    [on costs]




Solicitors:   Dennis Jay Gates, PO Box 222, Whangaparaoa for plaintiff
              IzardWeston, PO Box 5348,
Wellington for first defendant
              Gilbert Walker, PO Box 1595, Auckland for second defendant




VERSCHAFFELT V SUNDAY
STAR-TIMES NEWSPAPER AND ANOR HC AK CIV 2008-404-008390 29
October 2009

[1]    On 14 May 2009 I struck out the plaintiff's claim.
No appearance was
entered on the plaintiff's behalf at that time. The order I made was made in reliance
on r 15.2 of the High Court
Rules.


[2]    Rule 15.2 provides:

       15.2    Dismissal for want of prosecution

       Any opposite party may apply to have
all or part of a proceeding or
       counterclaim dismissed or stayed, and the court may make such order as it
       thinks just,
if--

       (a)     the plaintiff fails to prosecute all or part of the plaintiff's proceeding
               to trial and judgment;
or

       (b)     the defendant fails to prosecute all or part of the defendant's
               counterclaim to trial and judgment.

[3]    In this proceeding the plaintiff pleads six causes of action seeking relief in the
form of damages.


[4]    At the first
case management conference held on 17 February 2009 I fixed
the costs category for the proceeding at Category 3. Security for costs
was raised as
a potential interlocutory application. Counsel for the plaintiff indicated that an
application for legal aid had been
made. I adjourned the proceeding to 2:15 pm on
26 March 2009 to check the position in relation to legal aid.


[5]    Counsel filed
a memorandum shortly before the chambers listing of the
proceeding.    As a result, I issued a minute of 25 March 2009 adjourning
the
proceeding for further mention at 2:15 pm on 14 May 2009.


[6]    On 14 May 2009 no appearance was entered on the plaintiff's
behalf.
Appearances were entered by other counsel. I then struck the proceeding out based
on r 15.2 as earlier indicated. A copy
of my minute was sent to Mr Orlov, counsel
for the plaintiff, and to his instructing solicitors. I reserved the question of costs
and
gave directions for the filing of memoranda.


[7]    The plaintiff then filed an application to recall the judgment striking
out. It
was opposed. I was concerned about its content. Directions were given concerning

the filing of an amended application.
        No amended application was filed.      On
14 August 2009 I dismissed the application and reserved costs. I gave directions
in
relation to the filing of costs in respect of that matter.


[8]     Counsel for the first defendant has filed a memorandum seeking
costs at a
figure less than the standard costs based on Category 3 and Band B in the sum of
$6,805.20 which counsel confirms to me
are, in fact, the costs charged to the first
defendant. Counsel for the second defendant has filed and served a memorandum
seeking
costs at the figure charged to the second defendant in the sum of $4,404.35,
plus disbursements of $90.


[9]     No memorandum in
answer has been filed on the plaintiff's behalf. The Case
Officer who has charge of this file has emailed counsel for the plaintiff. The only
response received from counsel for the plaintiff
was that he was going to seek leave
to withdraw as counsel. No such application, however, has been filed.


Principles applicable
in awarding costs


[10]    Rule 14.1 gives the Court a discretion to order costs in relation to a step taken
in a proceeding. That
discretion is generally to be exercised in accordance with the
specific Rules contained in rr 14.2-14.10:        Glaister v Amalgamated
Dairies Ltd
 [2004] 2 NZLR 606 [19]. In Mansfield Drycleaners Ltd v Quinny's Drycleaning
(Dentice Drycleaning Upper Hutt) Ltd  (2002) 16 PRNZ 662 at 668 the Court of
Appeal said of the costs regime contained in what is now rr 14.2-14.10 that:

        there is a strong implication
that a Court is to apply the regime in the
        absence of some reason to the contrary

The test to be applied is entirely an
objective and not a subjective one. The only
reference which it is necessary to make towards actual costs is to be found in
r 14.2(f),
namely that an award of costs should not exceed the costs incurred by the
party claiming the costs: Glaister v Amalgamated Dairies
Ltd at 610 [14].


[11]    Rule 14.2 lists the principles applying to a determination of costs. Subrule (a)
affirms the principle
that the losing party should pay the costs to the successful party.

Subrule (b) requires that the costs reflect the complexity
and significance of the
proceedings and refers specifically, therefore, to the categorisation of a proceeding
which is provided for
in r 14.3. Subrule (c) requires a consideration of each step for
which costs are sought and an application of the daily rate having
regard to the
appropriate band which is to be applied after a consideration of r 14.5(2) and the
Third Schedule to the High Court
Rules.


[12]   Where a proceeding is withdrawn or struck out the position which arises on
the filing of a notice of discontinuance
will often apply by analogy. That is set out in
r 15.23 of the High Court Rules and applies with the result that the plaintiff must
pay
the costs to the defendant of an incidental to the proceeding up to and including the
order that is made unless, of course, the
Court orders otherwise. The Court usually
does not speculate on the merits of the case. That is because it has not heard the
case.
The reasonableness of the stance of both parties has to be considered: Kroma
Colour Prints v Tridonicatco New Zealand Ltd  (2008) 18 PRNZ 973 at 975.


[13]   The process that I must now embark upon is to consider the actual steps taken
in terms of r 14.5 and the Third Schedule.
        Counsel have identified, in their
respective memoranda, that that involves considering:

       Item 2    The commencement
of the defence

       Item 3    Appearances at a case management conference on 17 February 2009

                 Appearances at
a mention hearing on 14 May 2009.


[14]   Were it not for r 14.2(f) which sets out one of the general principles applying
in the
determination of costs, namely that an award of costs should not exceed the
costs incurred by the party claiming costs, the allowance
for the steps that I have
identified which would be justified for the first defendant total $7,347, based on the
Category 3 designation.
In the case of the second defendant, the costs on the same
basis amount to $5,925.


[15]   I see no reason for departing from the
costs category or for changing the steps
that were taken and the allowance for them on a Band B basis. That being the case

the
question is how to deal with the fact that what has been charged to the clients is
less than the entitlement under the costs regime
which now applies under the High
Court Rules.    I conclude that the wording of r 14.2(f) permits me, in these
circumstances, to
award the actual costs of both first and second defendants, because
same do not exceed the allowance which is otherwise justified
pursuant to
Category 3 Band B of the Second and Third Schedules to the High Court Rules.


[16]   Accordingly I order:


       a)
     The plaintiff shall pay the first defendant's costs in the sum of
               $6,805.20 together with disbursements as fixed
by the Registrar;


       b)      The plaintiff shall pay the second defendant's costs in the sum of
               $4,404.25 together
with disbursements as fixed by the Registrar.




                                                           _____________________

                                                                            JA Faire
                                          
                          Associate Judge