Ross v Ross HC Wellington CIV-2010-485-2515 [2011] NZHC 1289 (17 October 2011)

Last Updated: 2 November 2011

IN THE HIGH COURT OF NEW ZEALAND WELLINGTON REGISTRY

_{CIV-2010-485-2515}

IN THE MATTER OF the Insolvency Act 2006

AND IN THE MATTER OF the bankruptcy of BRYAN KEITH ROSS

BETWEEN TEDDI ALISON ROSS Judgment Creditor

Judgment: 17 October 2011 at 3:00 PM

_{JUDGMENT AS TO COSTS OF ASSOCIATE JUDGE D.I. GENDALL}

This judgment of Associate Judge Gendall was delivered on 17 October 2011 at 3.00 pm under r 11.5 of the High Court Rules.

Solicitors: Macky Robertson, Solicitors, PO Box 37-622, Auckland

_{Buddle Findlay, Solicitors, PO Box 2694, Wellington 6140}

TA ROSS v BK ROSS HC WN CIV-2010-485-2515 17 October 2011

[1] In a judgment I gave in this proceeding on 29 September 2011 I dismissed an application by Mr Bryan Keith Ross (Mr Ross) for approval of a Part 5 Creditors’ Proposal under the Insolvency Act 2006 and made an order adjudicating Mr Ross bankrupt.

[2] The bankruptcy proceedings were brought by Mr Ross’ former wife, Ms Teddi

Alison Ross (Ms Ross).

[3] In my 29 September 2011 judgment I ordered costs in favour of Ms Ross as the judgment creditor on both the Bankruptcy Application and on her successful opposition to the application for approval of the Part 5 Creditors’ Proposal. Those costs were awarded on a category 2B basis together with disbursements as fixed by the Registrar.

[4] An issue has now arisen here as to the correct approach which is to be taken to calculation of costs in the two proceedings which were before the Court.

[5] On this, counsel for Ms Ross has filed a memorandum dated 10 October 2011 in which costs are claimed on the Part 5 proposal proceeding totalling $5,076.00 and on the bankruptcy proceeding totalling $3,760.00 together with disbursements.

[6] Counsel for Mr Ross has indicated that she will not be filing a memorandum on this costs question but will simply await the decision of the Court based on matters raised in the

10 October 2011 memorandum from counsel for Ms Ross.

[7] A breakdown of the category 2B costs claimed by Ms Ross here as outlined in her

counsel’s memorandum is as follows:

	Proposal Proceeding
2	Commencement of defence by defendant (receiving instructions, researching facts and law, and preparing, filing and serving statement of defence or notice of opposition)	2 days	$3,760.00
4.14	Preparation for hearing of defended interlocutory application (excluding summary judgment application); The time occupied by the hearing measured in quarter days	0.25 day	$ 470.00
4.15	Appearance at hearing of defended interlocutory application (excluding judgment summary application) for sole or principal counsel; Appearance in court measured in quarter days	0.25 day	$ 470.00
4.18	Sealing order or judgment	0.2 day	$ 376.00
	Total Costs Proposal Proceeding		$5,076.00
	Adjudication Proceeding
4.12	Preparing and filing interlocutory application (excluding summary judgment application) and supporting affidavits	0.3 day	$564.00

4.14	Preparation for hearing of defended interlocutory application (excluding summary judgment application); The time occupied by the hearing measured in quarter days.	0.5 day	$940.00
4.18	Sealing order or judgment	0.2 day	$376.00
17	Preparing, filing and serving bankruptcy notice	0.2 day	$376.00
18	Preparing bankruptcy petition and other documents	0.4 day	$752.00
19	Appearance at hearing	0.4 day	$752.00
	Total Costs Adjudication Proceeding		$3,760.00
	Total for Both Proceedings		$8,836.00

[8] Despite the fact that counsel for Mr Ross does not intend to file a memorandum on the costs issue here, as I understand the position, issues raised by her for Mr Ross are as follows:

(a) In the Part 5 Creditors’ Proposal proceeding Ms Ross should not be able to claim as Item 2 for commencement of defence and specifically referring to filing this or a Notice of Opposition.

(b) As both proceedings were heard together the appearance time should be divided between the two separate proceedings and not double counted.

[9] In addition issues have been raised by High Court registry staff on the costs orders sought by Ms Ross. These are:

(a) In the bankruptcy proceeding Ms Ross is not able to claim Items 4.12 and

4.14 – being preparing and filing interlocutory application and preparation for a defended interlocutory application; and

(b) It is agreed that in the Part 5 Creditors’ Proposal proceeding Item 2 cannot be claimed – it is suggested that this should be replaced with Item 4.13 alone.

[10] I now turn to address all issues concerning these costs questions.

[11] Turning first to consider the bankruptcy proceedings, Items 17-20 inclusive of Schedule 3 to the High Court Rules set out in some detail costs allowances for these proceedings.

[12] On this the judgment creditor, Ms Ross is clearly entitled to the following:

(a) Item 17 – preparing filing and serving Bankruptcy Notice 0.2 day

(b) Item 18 – preparing Bankruptcy Petition and other documents 0.4 days

_{(c) Item 19 – appearance at hearing 0.4 days}

Total 1 day

[13] In addition, Ms Ross is entitled under Item 4.18 to 0.2 days for sealing the order or judgment.

[14] As to the claim made by Ms Ross under Items 4.12 and 4.14 for “preparing and filing interlocutory application and supporting affidavits” and “preparation for hearing of defended interlocutory application”, totalling in all an additional 0.8 of a day, these items do not appear to be provided for in Schedule 3 to the High Court Rules. On this I acknowledge the arguments advanced for Ms Ross that there does not appear to be any further time allocation for cases involving what may be hotly disputed bankruptcy proceedings. Notwithstanding this, in the present case in my view these matters will be properly addressed when considering the costs claim for the Part 5 Creditors’ Proposal.

[15] I can conclude therefore that, on the bankruptcy proceeding, Ms Ross is entitled to category 2B costs under Items 17, 18, 19 and 4.18 of Schedule 3 totalling in all 1.2 days amounting to $2,256.00 plus disbursements as approved by the Registrar. An order for category 2B costs of $2,256.00 on the bankruptcy application, together with disbursements as fixed by the Registrar, in favour of Ms Ross is now made.

[16] Turning now to Ms Ross’ costs claim for her successful opposition to the Part 5

Creditors’ Proposal, as noted above her costs claim is for the total sum of $5,076.00 calculated as set out at para [7] of this judgment.

[17] In my view this claim includes certain specific items which are not properly claimable but it also omits other items which are. I now set out this analysis.

[18] First, Ms Ross claims under Item 2 of the Third Schedule for “commencing of

defence by defendant (receiving instructions, researching facts and law and preparing,

filing, and serving statement of defence or Notice of Opposition)” being 2 days totalling

$3,760.00. As I see the position, this Item 2 amount is not claimable here. It relates directly to the commencement of a defence in general substantive civil proceedings and not in a case such as the present which simply involves a Notice of Opposition by Ms Ross to her former husband’s Part 5 Creditors’ Proposal. The application for Court approval of that proposal is more in line with an interlocutory application than a general civil proceeding. I disallow this Item 2 claim for $3,760.00.

[19] In its place, however, in my view an appropriate allowance should be made under Item 4.13 for “preparing and filing opposition to interlocutory application ... and supporting affidavits” amounting to 0.6 of a day. As I have noted above, the Part 5

Creditors’ Proposal here is akin to an interlocutory application and Ms Ross is clearly entitled to costs on putting forward an opposition to that application. Under Item 4.13 on a Category 2B basis this amounts to 0.6 of a day. A claim for this $1,128.00 is allowed here.

[20] Next Ms Ross claims under Items 4.14 and 4.15 for preparation for the hearing of what she acknowledges as the “defended interlocutory application” and appearance at that hearing. The amounts claimed in each case are 0.25 of a day. These amounts are properly claimed. As to the assessment of time occupied by the hearing at 0.25 of a day in my view this is appropriate here.

[21] These claims under Item 4.14 of $470.00 and 4.15 of a further $470.00 are allowed. In my view there is no double counting of hearing time here. The assessment of a total 0.5 of a day for both hearing and preparation for the Part 5 Creditors’ Proposal is appropriate here.

[22] Next, Ms Ross claims under Item 4.18 for sealing of the order or judgment at 0.2 of a day, an amount of $376.00. This is also an order.

[23] The total amount by way of costs to be awarded for Ms Ross’ successful opposition

to the Part 5 Creditors’ Proposal is therefore 1.3 days totalling $2,444.00.

[24] An order for category 2B costs amounting to this $2,444.00 in favour of Ms Ross on her successful opposition to the Part 5 Creditors’ Proposal is now made together with disbursements on that application (if any) as approved by the Registrar.

[25] In conclusion the total amount awarded by way of category 2B costs to Ms Ross on these applications is $4,700.00 which in my view is an appropriate amount given the nature of this proceeding.

[26] Orders are now made as to costs and disbursements for the two applications involved in this proceeding as set out at paras [15] and [24] above.

‘Associate Judge D.I. Gendall’