Riveroaks Farm Limited v Holland HC Tauranga CIV-2010-470-584 [2011] NZHC 2049 (2 June 2011)

Last Updated: 19 February 2012

IN THE HIGH COURT OF NEW ZEALAND TAURANGA REGISTRY

_{CIV-2010-470-584}

BETWEEN RIVEROAKS FARM LIMITED & ORS AS TRUSTEES OF THE INGODWE TRUST

Appellants

AND W B HOLLAND & ORS (TRADING IN PARTNERSHIP AS HOLLAND BECKETT)

Respondents

Hearing: On the papers

Counsel: G B Lewis for Appellants

S R J Hamilton for Respondents

Judgment: 2 June 2011 at 5:00 PM

_{COSTS JUDGMENT OF ALLAN J}

This judgment was delivered by

The Hon. Justice Allan on

2 June 2011 at 5:00pm

pursuant to Rule 11.5 of the High Court Rules

.....................................................

_{Registrar/Deputy Registrar}

Solicitors:

Grimshaw & Co (Gareth Lewis) Auckland

Email: [e-mail]

Kennedys (S Hamilton) Auckland

_{Email: [e-mail]}

RIVEROAKS FARM LIMITED & ORS AS TRUSTEES OF THE INGODWE TRUST V W B HOLLAND & ORS (TRADING IN PARTNERSHIP AS HOLLAND BECKETT) HC TAU CIV-2010-470-584 2 June 2011

[1] In a judgment given on 16 February 2011, I allowed an appeal against a decision of the Weathertight Homes Tribunal ordering the appellants to pay costs of

$36,312.38 to the respondents. I ruled that the appellants were entitled to costs on the appeal and directed the parties to file memoranda if they were unable to agree.

[2] Agreement not having been reached, memoranda have been filed on either side.

[3] The Tribunal’s order for payment of costs by the appellants was made on

16 June 2010. On 21 June 2010, the appellants filed the present appeal. On 2 July

2010 they paid to the respondents the costs awarded by the Tribunal. In consequence of my judgment, the respondents repaid those costs to the appellants on 28 February

2011.

[4] Costs on the present appeal had been agreed by the parties at $5672, but as at

the date of counsel’s memoranda those costs had not been paid.

[5] The appellants now seek the following orders:

(a) An order that the respondents repay the costs awarded by the Tribunal pursuant to r 20.20(2)(a) of the High Court Rules. The appellants say that this order is required to “regularise the payment made”.

(b) An order that the respondents pay interest on the costs awarded by the Tribunal for the period from 2 July 2010 (the date of payment by the appellants to the respondents) to 28 February 2011 (the date of repayment) at the rate of 8.4 per cent pursuant to r 20.20(2)(b) in the sum of $2014.76.

(c) An order that the respondents pay costs on the appeal of $5672 to the appellants.

[6] The appellants seek an order directing that the respondents pay the costs of

$36,312.38 in order to regularise the payment made. The respondents oppose that order as superfluous and an abuse of the Court’s process, given that it has repaid the costs award. While in principle that submission would appear to have merit, there is a jurisdictional objection to accepting it. The problem arises from the language of r 20.20(2)(b) concerning the award of interest. The Court’s jurisdiction to award interest arises only in respect of a “sum ordered to be repaid”. Accordingly, unless there is an order for repayment, no award of interest can be made. In those circumstances, I consider the appellants to be entitled to an order for repayment of the sum of $36,312.38 despite the fact that payment has already been made by the respondents. There will be an order accordingly.

[7] The respondents argue also that there is no need for an order in respect of the agreed costs of $5672 in respect of the present appeal. If these costs have in fact been paid, then I agree that an order is unnecessary, but it is unclear whether payments has as yet been effected. Accordingly, there will be an order fixing the costs of this appeal at $5672 and directing that they be paid by the respondents to the appellants.

[8] Finally, there is an issue as to the entitlement of the appellants to interest on the sum of $36,312.38 paid by them to the respondents on 2 July 2010 and refunded by the respondents on 28 February 2011. The respondents point out that there was no reference to interest on this sum in the appellants’ notice of appeal; neither was it raised as an issue during the hearing of the appeal. It is further argued that because the Court simply quashed the decision of the Tribunal without referring to interest, I must be taken to have concluded that the appellants were not entitled to any interest. That is not a proper conclusion. Questions of repayment of the costs and of interest thereon have not arisen to date and remain open for determination. The appellants are not estopped now from raising the interest point simply because there was no reference to it in the notice of appeal.

[9] Under r 20.20(2)(b), the Court has a discretion to direct the payment of interest on any sum repaid in consequence of this Court’s decision on appeal, but may not award interest at a rate greater than the prescribed rate within the meaning

of s 87(3) of the Judicature Act 1908. At present the prescribed rate is 8.4 per cent per annum. The appellants seek interest at that rate.

[10] The respondents advise the Court that the sum concerned has been held on interest-bearing deposit pending the outcome of the appeal. That was a responsible step for the respondents to take. I accept the submission for the respondents that, in the hands of the appellants, it is unlikely that they would have been able to derive a better return than was actually achieved. In the circumstances of the case, I consider the proper course to be to direct an accounting of the interest actually earned.

[11] There will therefore be an order directing the respondents to account to the appellants by way of interest for an amount equivalent to such interest, as was earned by the respondents while the fund was held on deposit by the respondents.

...................................... C J Allan J