Bridgecorp Limited (in receivership and in liquidation) v Certain Lloyd's Underwriters Under Policy No. 888/50405V04A [2014] NZHC 1047 (19 May 2014)

Last Updated: 5 June 2014

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

CIV 2013-404-003595 [2014] NZHC 1047

BETWEEN	BRIDGECORP LIMITED (In Receivership & In Liquidation) Plaintiff
AND	CERTAIN LLOYD'S UNDERWRITERS UNDER POLICY NO. 888/50405V04A First Defendants CERTAIN LLOYD'S UNDERWRITERS UNDER POLICY NO. 888/51296V04A Second Defendants CERTAIN LLOYD'S UNDERWRITERS UNDER POLICY NO. 888/51296V05A Third Defendants .../cont

Hearing:	On the papers.
Appearances:	M J Tingey and W D Hofer for the Plaintiff W A Holdern and M J Francis for the Sixth Defendants
Judgment:	19 May 2014

_{COSTS JUDGMENT OF GILBERT J}

BRIDGECORP LTD (In R’Ship & In Liq) v CERTAIN LLOYD'S UNDERWRITERS & ORS

[2014] NZHC 1047 [19 May 2014]

CERTAIN LLOYD’S UNDERWRITERS UNDER POLICY NO. 888/51296V06A Fourth Defendants

CERTAIN LLOYD’S UNDERWRITERS UNDER POLICY NO. 888/51296V07A Fifth Defendants

CERTAIN LLOYD’S UNDERWRITERS

UNDER POLICY NO. B0701LS05809

Sixth Defendants

Introduction

[1] In a judgment delivered on 28 April 2014 I dismissed the plaintiff’s application to set aside the sixth defendants’ appearance filed under protest to jurisdiction.¹ I ordered the plaintiff to pay the sixth defendants’ costs on the application on a 3B basis. The parties have been unable to agree on the calculation of these costs for two reasons. First, the plaintiff disputes the sixth defendants’ claim for costs under item 2 in Schedule 3 of the High Court Rules which relates to the commencement of defence by a defendant. Second, the plaintiff disputes the sixth defendants’ claim for second counsel under item 27.

Item 2 – commencement of defence

[2] The sixth defendants contend that costs should be allowed for this step even though they did not file a statement of defence. They note that the claim against the sixth defendants is for $20 million, the statement of claim is 71 pages long and has

284 paragraphs, the initial disclosure provided by the plaintiff comprised nine lever arch files and the claim against the sixth defendants relates to multiple allegations of negligence against the first to fifth defendants. They submit that the sixth defendants would have been expected to progress their defence promptly had they lost the jurisdiction argument. They further submit that the time allocation under item 8 relating to the preparation and filing of a notice of appearance protesting jurisdiction does not adequately reflect the amount of work undertaken in this case.

[3] While costs are always in the discretion of the Court, the costs regime is intended to be predictable and expeditious. The sixth defendants did not need to prepare their response to the claim and have not filed a statement of defence. I do not consider that the sixth defendants are entitled to costs for this step in the circumstances. They have been spared that cost by successfully protesting jurisdiction. Counsel on both sides accepted at the hearing that costs should be awarded to the successful party on a 3B basis. The order for 3B costs was made accordingly. I do not consider that the sixth defendants can now revisit this issue and assert that band B does not allow sufficient time for preparing and filing the notice of

appearance under protest to jurisdiction. Nor can this be a reason for allowing costs for a step that was not taken.

[4] For these reasons, I do not consider that the sixth defendants are entitled to the costs they claim under item 2.

Item 27 - second counsel

[5] All parties accept that this proceeding is a category 3 proceeding. As Chambers J said in Nomoi Holdings Ltd v Elders Pastoral Holdings Ltd ² it will be a rare category 3 case where the Court will not certify for second counsel. Both parties were represented at the hearing by two counsel. I consider that this was appropriate having regard to the importance and complexity of the issue. I allow

_{costs for second counsel.}

M A Gilbert J