South Canterbury Finance Limited (in rec) v Vegar HC Auckland CIV 2011-404-001995 [2011] NZHC 366 (19 April 2011)

Last Updated: 3 June 2011

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

_{CIV 2011-404-001995}

IN THE MATTER OF Section 143 of the Land Transfer Act 1952

BETWEEN SOUTH CANTERBURY FINANCE LIMITED (IN RECEIVERSHIP) Applicant

AND PATRICIA VEGAR AND KEVIN FITZGERALD

Respondents

Hearing: 19 April 2011

Counsel: T J G Allan for applicant

Judgment: 19 April 2011

_{ORAL COSTS JUDGMENT OF ASSOCIATE JUDGE ABBOTT}

Solicitors:

Grove Darlow & Partners, PO Box 2881, Auckland for applicant

SOUTH CANTERBURY FINANCE LIMITED (IN RECEIVERSHIP) V VEGAR & ANOR HC AK CIV 2011-

404-001995 19 April 2011

[1] This application for removal of a caveat was brought by the applicant as mortgagee of the property. The caveat was lodged to protect an interest claimed under an agreement for sale and purchase entered into without the applicant’s knowledge, and after registration of its mortgage.

[2] Mr Allen informs me that the caveat has been withdrawn, but after the applicant was put to the cost of having to file the present application. He wishes to withdraw the application, but seeks costs against the respondents on an indemnity basis. The reason for that request is that the respondents had no prospect of sustaining the caveat, and this was pointed out to them, in a very detailed letter sent to their solicitors on 17 March 2011. The letter was supported by copies of a number of authorities which support the applicant’s positions.

[3] I consider that this is a case which warrants the somewhat exceptional step of awarding indemnity costs against a party issuing a proceeding. Normally parties to litigation should be entitled to bring claims subject to usual rules as to payment of costs in the event that the claims are unsuccessful. In this case, however, I can see no basis on which the respondents might have been able to sustain their caveat, and this view is supported by the letter sent to the respondents by the applicant’s solicitor ahead of filing of the application together with the authorities that were enclosed.

[4] I have also weighed up whether the applicant acted precipitously in filing its application after sending the letter of 17 March 2011. I am satisfied that it did not, and that there was ample time for the respondents to reflect on their position. The letter was sent on 17 March 2011. It called for removal of the caveat within

5 working days and advised that an application for removal would be made if that did not occur, and that indemnity costs would be sought. As it happens the present application was not filed until 6 April 2011, nearly three weeks later. Mr Allen informs me from the bar that the applicant twice agreed to extension of time to allow the respondents time to consider their position.

[5] The applicant has filed an affidavit setting out the costs being sought. The costs being sought appear to be twice what would be awarded in any event on a scale

2B basis. Nevertheless, I regard the costs sought as reasonable having regard to the usual criteria, including urgency with which caveat applications tend to be addressed.

[6] The application is withdrawn. The respondents are to pay the applicant costs in the total sum of $6,220.07.

Associate Judge Abbott