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Grant v Bhana [2018] NZHC 1527 (25 June 2018)

Last Updated: 13 July 2018


IN THE HIGH COURT OF NEW ZEALAND ROTORUA REGISTRY
I TE KŌTI MATUA O AOTEAROA TE ROTORUA-NUI-Ā-KAHU ROHE
CIV-2014-463-000169
[2018] NZHC 1527
BETWEEN
DAMIEN GRANT AND STEVEN KHOV
as liquidators of RANOLF COMPANY LTD (In liquidation)
Applicants
AND
STEPHEN BHANA
First Respondent
JASU MATI BHANA
Second Respondent
On the papers Counsel:

B J Norling and A Cherkashina for the Applicants First and Second Respondents in person
Judgment:
25 June 2018


JUDGMENT OF WOOLFORD J

[As to costs]



This judgment was delivered by me on Monday, 25 June 2018 at 11:30 am pursuant to r 11.5 of the High Court Rules.


Registrar/Deputy Registrar








Solicitors: Waterstone Insolvency (Auckland) for Applicants (Copy to Respondents in person)



GRANT AND KHOV as liquidators of RANOLF COMPANY LTD (In liquidation) v BHANA [2018] NZHC 1527 [25 June 2018]

Introduction


[1] Mr and Ms Bhana, siblings, consistently acted to frustrate the liquidators of a company in their control. They failed to produce documents and provide information, even though I had ordered them to do so. Eventually, they were held in contempt of court. The liquidators were awarded indemnity costs in respect of the contempt application.

[2] Two questions now arise. First, whether the liquidators are entitled to costs given they were represented by in-house counsel? Second, if they are entitled to costs, what were their actual and reasonable costs?

Background


[3] The respondents are siblings. They were in a control of a company, Ranolf Company Limited. Mr Grant and Mr Khov, as liquidators, pursued the respondents for information about the company’s affairs.

[4] On 25 November 2014, I ordered the respondents to produce documents and provide information to the liquidators. They failed to do so. The liquidators applied, on 16 July 2015, for the respondents to be held in contempt of court.

[5] Brewer J held the respondents in contempt on 21 October 2015.1 The Judge said he was satisfied the respondents had deliberately frustrated the liquidation process. They persistently failed to produce books, records and documents relating to the company and an associated trust. Brewer J deferred the question of penalty, but said the liquidators were entitled to costs on an actual and reasonable basis.

[6] The respondents then claimed they were never served with the contempt application and maintained they were unaware of the 21 October 2015 hearing. But Brewer J confirmed his finding of contempt on 4 October 2016.2 The Judge was satisfied the respondents were served with notice of the 21 October 2015 hearing. They either overlooked the hearing or chose not to attend.

1 Grant v Bhana [2015] NZHC 2596.

2 Grant v Bhana [2016] NZHC 2352.

[7] On 17 November 2016, Brewer J fixed the respondents’ penalties for contempt.3 The Judge fined Mr Bhana $8,000 and Ms Bhana $5,000. Half was to be distributed to the liquidators and half to the Crown. Brewer J further awarded indemnity costs to the liquidators. He indicated he anticipated actual and reasonable costs would amount to around 2B costs with a 50 per cent uplift.

[8] The liquidators filed a memorandum on costs on 4 December 2016. They submitted their actual legal costs in the proceeding amounted to $159,875.88 (including GST). The respondents did not file any memoranda in response.

[9] Then, on 14 November 2017, the liquidators filed another memorandum. They said that the time had passed for the respondents to file a memorandum and asked that the Court determine costs.

[10] The respondents filed a memorandum on 27 November 2017. The memorandum addressed several matters, including an appeal, but did not substantively address costs in relation to the contempt application. The respondents also said they will file a further memorandum as to costs with supporting affidavits.

[11] On 29 March 2018, I gave the respondents the deadline of 20 April 2018 to file a further memorandum with supporting affidavits. On 20 April 2018, they filed a memorandum. It did not substantively address costs but asked for an extension. I granted the respondents an extension until 18 May 2018.

[12] Then on 18 May 2018, the respondents filed another memorandum. Again, it did not substantively address costs on the contempt application. Instead, they blamed the delay on the liquidators, and again referred to an appeal.

[13] I consider that costs should now be determined. The respondents have had enough notice, and more than enough time, to file memoranda on the question of costs. As they have failed to do so, I will determine costs based on the information available on the file.


3 Grant v Bhana [2016] NZHC 2755.

A preliminary point: the appeal


[14] The respondents appear to submit that an award of costs should be reserved until the determination of the appeal currently before the Court of Appeal, or there would be risk of a miscarriage of justice.

[15] I do not accept this submission. The subject matter of the decision on appeal has nothing to do with the current application.4 Rule 14.8 of the High Court Rules 2016 provides that costs on interlocutory applications should be treated separately from substantive proceedings and fixed on determination of the application unless there are special reasons to the contrary. The finding of contempt is not on appeal. It was initially appealed but that appeal has been withdrawn. There is no tenable argument that costs should be reserved.

Issue one: are parties represented by in-house counsel entitled to costs?


[16] The work on the application for which indemnity costs are claimed was completed by in-house counsel. The liquidators now express concern that the Court of Appeal’s decision in Joint Action Funding Ltd v Eichelbaum might apply to in-house counsel.5 If it applied, parties represented by in-house counsel would not be entitled to costs.

Joint Action Funding Ltd v Eichelbaum – the cases


[17] The Court of Appeal held in Joint Action Funding Ltd v Eichelbaum that lawyer-litigants, without separate legal representation, cannot be awarded costs.6 In other words, the lawyer-litigant exception is no longer available in New Zealand.

[18] The Court made clear that the issue depended on the proper interpretation of the costs rules in the High Court Rules:7

In our view the retention or otherwise of the exception to the general principle is not truly a matter of practice but turns on the proper construction of the rules relating to costs as set out in the High Court Rules.

4 Ranolf Company Ltd (in liq) v Bhana [2017] NZHC 1183, [2017] NZAR 1047.

5 Joint Action Funding Ltd v Eichelbaum [2017] NZCA 249, [2018] 2 NZLR 70.

6 At [44]–[45] and [58].

7 At [8], [23] and [57].

...

As earlier noted, we consider that whether the exception to the general rule currently applies turns not on a ruling as to practice by the courts but on the proper construction of the present costs rules. ...

...

We consider that the lawyer-litigant exception is inconsistent with the text of Part 14 of the High Court Rules and its retention would undermine the objectives of the current costs rules to a significant degree. We cannot discern anything in the purpose of the costs rules which counters that view.


[19] Therefore, s 5 of the Interpretation Act 1999 required the issue to be determined by ascertaining the meaning of the rules from its text and in light of its purpose.

[20] As regards the text, the Court noted that the word “costs” is used in conjunction with the word “incurred” to describe the successful party’s “expenditure or outgoings in connection with representation by a qualified lawyer”.8 For example:

(a) Rule 14.2(e) provides that the appropriate daily recover rate and what is reasonable time should not depend on the “costs actually incurred by the party claiming costs”.

(b) Rule 14.2(f) provides that “an award of costs should not exceed the costs incurred by the party claiming costs”.

(c) Rule 14.6(1)(b) provides that the court may make an order that the “costs payable are the actual costs, disbursements, and witness expenses reasonably incurred by a party”.

[21] What, then, is the meaning of “costs actually incurred”? The Court of Appeal explained that the phrase envisages invoices rendered for legal services provided by a legal practitioner to a litigant.9 It does not include a period of time spent in connection with litigation upon which some notional numerical value is placed, but which is not the subject of a bill of costs.10

8 At [31].

9 At [41].

10 At [41].

[22] The proper meaning of “costs actually incurred” is, therefore, confined to legal costs billed by a lawyer retained by a party litigant for legal services provided by the lawyer to that litigant.11 A lawyer-litigant who has no separate legal representation will not have liability for such costs. Per r 14.2(f), no award of costs should be made in favour of such a party.12

[23] As regards the purpose of the rules, the Court noted r 14.2(g) provides that so far as possible the determination of costs should be predictable and expeditious. But where a lawyer-litigant claims costs, an inquiry needs to be undertaken either as to the extent of the litigation conduct for which the lawyer should be compensated or in the assessment of the time expended as a measure of the lawyer’s opportunity cost.13 The fact that such an exercise must be undertaken dilutes the predictability and expedition in the costs determination.14 The Court, therefore, considered that the purpose of the rules counted against the retention of the lawyer-litigant exception.15

[24] The Court of Appeal subsequently observed in McGuire v Secretary for Justice that the conclusion in Joint Action Funding Ltd v Eichelbaum was consonant with the fundamental idea that costs should be for “professional legal costs actually incurred”.16 The Supreme Court has granted leave to appeal that decision in general terms which encompass all issues addressed by the Court of Appeal judgment.17

[25] Then, in Commissioner of Inland Revenue v New Orleans Hotel (2011) Ltd, Associate Judge Matthews declined to award the Commissioner costs on the basis that Joint Action Funding Ltd v Eichelbaum applied to in-house counsel.18 The Judge recognised that this was contrary to long-standing authority but considered that the Court of Appeal’s recent judgments demanded this approach. I understand that the Judge’s decision is being appealed to the Court of Appeal.



11 At [43].

12 At [44].

13 At [56].

14 At [57].

15 At [57].

16 McGuire v Secretary for Justice [2018] NZCA 37 at [72].

17 McGuire v Secretary for Justice [2018] NZSC 50.

18 Commissioner of Inland Revenue v New Orleans Hotel (2011) Ltd [2018] NZHC 971.

[26] Associate Judge Matthews considered that, given Joint Action Funding Ltd v Eichelbaum and McGuire v Secretary for Justice, costs should not be awarded where costs have not been billed by a lawyer retained by a party litigant for legal services provided by the lawyer to that litigant. The rules restricted costs awards to “costs actually incurred”, which the Court of Appeal made clear was “confined to legal costs billed by a lawyer retained by a party litigant for legal services provided by the lawyer to that litigant”. Associate Judge Matthews further said that:19

The interpretation set out by the Court excludes an award of costs to in-house counsel unless the circumstances of that counsels retainer fit within the terms of these cases.


[27] In a minute dated 10 May 2018, Associate Judge Bell recorded that he followed Associate Judge Matthews’ decision in that morning’s bankruptcy applications.20 But he also declared the amounts of costs he would have awarded if he was wrong and the Court could award costs to parties represented by in-house counsel. The Judge noted that the Commissioner is frequently represented by in-house counsel. He suggested that there may be an alternative pathway, through s 274 of the Insolvency Act 2006.

[28] In Greer v Klavenes, Palmer J awarded costs to a liquidator that acted for himself.21 The Judge considered that the line of authority outlined above did not apply to liquidators, as in substance the liquidator was acting in a representative capacity. Palmer J said:22

As Mr Greer submits, in substance, a liquidator is already acting in a representative capacity. There is no sense in which the costs of his appearance would not be incurred. It is inevitable they would be the subject of an invoice to the liquidated company, reflecting the opportunity cost of the liquidator’s time. If the liquidated company’s success is not reflected in an award of costs, the company, and its creditors in whose interests the liquidator acts, will be out of pocket. Fulfilling the purpose of the costs regime in relation to liquidators requires that their successful litigation on behalf of the company should be the subject of a costs award, even where they act personally. Such a result recognises the reality of the situation. Costs on a 2B basis, plus disbursements, is appropriate here.




19 At [18].

  1. Commissioner of Inland Revenue v Lau HC Auckland CIV-2016-404-565, 10 May 2018 (Minute of Associate Judge Bell).

21 Greer v Klavenes [2018] NZHC 1504.

22 At [39].

Discussion


[29] Associate Judge Matthews concluded that the interpretation set out by the Court of Appeal excludes an award of costs unless the circumstances of that counsel’s retainer fit within the terms of these cases.23 I consider, as Palmer J did in Greer v Klavenes, that the circumstances of the present case fit within those terms. As to whether parties represented by in-house counsel is entitled to costs more generally, I make no comment. That question is likely to be determined by the appellate courts.

[30] The in-house counsel that represented the liquidators in the present case billed their time just like counsel at a law firm would. But the time was billed to the company, which in substance, the liquidator was acting for. As Palmer J said, liquidators act in a representative capacity.

[31] In essence, the costs were therefore the subject of invoices rendered for legal services. The company has liability to pay those invoices. Pursuant to the Companies Act 1993, the liquidators have a first charge in relation to those costs.24

[32] Further, given the way the costs were billed, in contrast to the situation in Joint Action Funding Ltd v Eichelbaum, I do not consider an award in this case would be contrary to the principle that the determination of costs should be predictable and expeditious. It is not necessary to engage in the type of exercise described above at [23].

[33] Costs should be awarded to the liquidators. I consider, again as Palmer J concluded, that this result recognises the reality of the situation. If costs were not awarded, the company and the creditors will be out of pocket. Such a situation would not be consistent with the fundamental principle that the loser, and only the loser, pays costs.25





23 Commissioner of Inland Revenue v New Orleans Hotel (2011) Ltd [2018] NZHC 971 at [18].

24 Companies Act 1993, sch 7 cl 1(a).

  1. Shirley v Wairarapa District Health Board [2006] NZSC 63, [2006] 3 NZLR 523 at [19] and High Court Rules 2016, r 14.2(1)(a).

Issue two: if they are entitled to costs, what are their actual and reasonable costs?


[34] Indemnity costs are determined at the level of actual costs, disbursements, and witness expenses reasonably incurred by a party. The successful party cannot claim actual costs that were not reasonable based on the appropriate time taken, the significance and complexity of the work, and a reasonable median hourly rate.26

[35] The liquidators claim $159,875.88 as their actual and reasonable costs. Although I will determine the indemnity costs to be awarded by reference to the actual costs incurred and not the costs scale, it is nonetheless useful to consider what the plaintiffs would have been entitled to on the costs scale, as Brewer J suggested. This provides some benchmark as to reasonable costs.

[36] The plaintiffs submit they would be entitled to $70,523.75 on a 2B basis. I disagree because of four reasons.

[37] First, the time allocation for preparation of affidavits in the High Court Rules is 2.5 days. This refers to preparation of all affidavits for the proceeding. It is not appropriate, as here, to attempt to recover costs at that rate for preparation of each individual affidavit. The same is true of preparation of bundles.

[38] Second, this is not a particularly complex category 2 case. I do not consider certification for second counsel is justified.27

[39] Third, a number of other steps for which costs are claimed were less complex than would normally be expected in a category 2 case. I have reduced the days allocated in the table, where appropriate, to reflect the time that was likely required for the particular steps.28 These adjustments, along with the others mentioned, are visible in the table below. I add the following comments:

(a) The memorandum dated 15 October 2015 is barely half a page in length and did not deal with any complex matters. Similarly, the

26 Bradbury v Westpac Banking Corp [2008] NZHC 751; (2009) 18 PRNZ 859 (HC) at [209].

27 Nomoi Holdings Ltd v Elders Pastoral Holdings Ltd (2001) 15 PRNZ 155 (HC) at [17]–[22].

  1. Commissioner of Inland Revenue v Chesterfields Preschools Ltd [2010] NZCA 400, (2010) 24 NZTC 24,500 at [161] and [164].
memorandum dated 7 December 2015 is half a page and concerns simple matters. The memoranda dated 14 June 2016 and 5 July 2016 are similar. I consider none of these memoranda warrant more than
0.2 days, opposed to the 0.4 claimed.

(b) The memorandum dated 24 August 2016 is two paragraphs long. It informs the court of change of counsel and address for service. It does not warrant the 0.4 days claimed. I allow 0.1 days.

(c) The submissions dated 23 November 2015 are only two pages in length, and again deal with simple matters. It essentially only summarises or refers to events or documents that have already occurred. To contrast, the submissions dated 20 October 2015 was more than eight pages and dealt with more complex matters that required research. Yet, counsel has claimed 1.5 days of scale costs in relation to both. I consider the submissions dated 23 November 2015 required no more than 0.4 days.

(d) The submissions dated 2 March 2016 substantially reproduces much of the submissions dated 20 October 2015. While content was added, large parts are identical to the earlier version. It is not appropriate to then claim 1.5 days in relation to the second version. I consider no more than 0.7 days is warranted in relation to the 2 March 2016 submissions.

(e) The submissions dated 11 May 2016 again reproduce large parts of the earlier versions. I consider no more than 0.5 days is warranted, opposed to the 1.5 claimed.

(f) At this point an obvious pattern emerges. The submissions dated 13 October 2016 almost wholly consists of parts taken from earlier versions. There have only been minor edits, some of these as insubstantial as combining two paragraphs into one. No more than
[40] Third, while the Court does have jurisdiction to award costs on costs matters, it is generally reluctant to do so.29 I do not consider this is an appropriate case for costs on the costs application. The matter has been determined on the papers and the material filed by the defendants has not required extensive engagement of the applicants.

[41] Accordingly, in my view, appropriate costs calculated on a 2B basis would be as follows:
Item
Description
Daily rate
Days
Amount
22
Filing interlocutory application
$2,230
0.6
$1,338.00
11
Filing memorandum dated 15 October 2015
$2,230
0.4 0.2
$892.00 $446.00
30
Preparation of affidavit dated 19 October 2015
$2,230
2.5
$5,575.00
24
Preparation of written submission dated 20 October 2015
$2,230
1.5
$3,345.00
25
Preparation of the first bundle of documents
$2,230
0.6
$1,338.00
26
Appearance at the hearing on 21 October 2015 by principal counsel
$2,230
0.25
$557.50
27
Appearance at the hearing on 21
October 2015 by second counsel
$2,230
0.125
$278.75
30
Preparation of affidavits dated 4
November 2015
$2,230
2.5
$5,575.00
12
Appearance at mentions hearing on 5 November 2015 by video link
$2,230
0.2
$446.00
25
Preparation of the second bundle of
documents
$2,230
0.6
$1,338.00

29 Jeffreys v Morgenstern [2013] NZHC 1361 at [40].

Item
Description
Daily rate
Days
Amount
24
Preparation of written submissions dated 23 November 2015
$2,230
1.5 0.4
$3,345.00
$892.00
26
Appearance at the hearing on 4 December 2015 by principal counsel
$2,230
0.25
$557.50
27
Appearance at the hearing on 4
December 2015 by second counsel
$2,230
0.125
$278.75
11
Filing memorandum dated 7 December 2015
$2,230
0.4 0.2
$892.00 $446.00
12
Appearance at mentions hearing on 8 December 2015
$2,230
0.2
$446.00
30
Preparation of affidavit dated 2 March
2016
$2,230
2.5
$5,575.00
25
Preparation of the third bundle of
documents
$2,230
0.6
$1,338.00
24
Preparation of written submissions dated 2 March 2016
$2,230
1.5 0.7
$3,345.00
$1,561.00
11
Filing memorandum dated 7 March 2016
$2,230
0.4
$892.00
26
Appearance at the hearings on 9 March
2016 and 22 April 2016 by principal counsel
$2,230
2
$4,460.00
27
Appearance at the hearings on 9 March
2016 and 22 April 2016 by second
counsel
$2,230
1
$2,230.00
24
Preparation of written submissions dated 11 May 2016
$2,230
1.5 0.5
$3,345.00
$1,115.00
11
Filing memorandum dated 14 June 2016
$2,230
0.4 0.2
$892.00 $446.00
11
Filing memorandum dated 5 July 2016
$2,230
0.4 0.2
$892.00 $446.00
Item
Description
Daily rate
Days
Amount
11
Filing memorandum dated 24 August 2016
$2,230
0.4 0.1
$892.00 $223.00
25
Preparation of the fourth bundle of
documents
$2,230
0.6
$1,338.00
24
Preparation of written submission dated 13 October 2016
$2,230
1.5 0.3
$3,345.00
$669.00
30
Preparation of affidavit dated 7
November 2016
$2,230
2.5
$5,575.00
26
Appearance at the hearing on 8 November 2016 by principal counsel
$2,230
0.25
$557.50
27
Appearance at the hearing on 8
November 2016 by second counsel
$2,230
0.125
$278.75
24
Preparation of these submissions on
costs
$2,230
1.5
$3,345.00
30
Preparation of affidavit dated 2
December 2016
$2,230
2.5
$5,575.00
29
Sealing order
$2,230
0.2
$446.00
Total
$70,523.75
Revised total
$26,202.50

[42] Brewer J anticipated actual and reasonable costs should amount to around 2B costs with a 50 per cent uplift. That would amount to $39,303.75. This provides a very strong indication that the sum of indemnity costs claimed by the liquidators,
$159,875.88, is not reasonable.

[43] The amount claimed as indemnity costs also includes GST. But it is not appropriate to award indemnity costs on a GST inclusive basis if the successful party is GST-registered and thus able to recover GST. The Court will proceed on the basis
that the successful party is GST-registered, unless they inform the Court otherwise.30 I proceed on the basis the liquidators are GST registered as the liquidators have not informed the Court otherwise.

[44] Further, the liquidators’ actual costs have been presented to the Court in a manner that makes it very difficult to determine whether these costs were reasonably incurred. The costs are documented in timesheets attached to the 4 December 2016 affidavit of Kieran Michael Jones. The costs claimed should have been linked to specific steps in the proceeding, so that the Court can assess whether these amounts were reasonably incurred. Instead, there are over 150 single line entries, the entries are not grouped and the amounts are only totalled at the end.

[45] I have worked through these seven pages and have divided the entries into four categories. These categories are broad and necessarily overlap. This is because a considerable number of the entries are vague, or contain multiple different items without specifying the time dedicated to each. I made an assessment within each of these categories as to whether the costs were reasonably incurred, and if not, what amount would have been reasonable.

[46] In my judgment, the actual costs reasonably incurred by the liquidators are as follows:
Category
Actual costs claimed
Reasonable costs
General research and preparing application(s)
$4,012.50 (13.8 hours)
- $275/hr x 10.3
- $300/hr x 1.3
- $350/hr x 1.8
- $400/hr x 0.4
$3,380.00 (11.5 hours)
- $275/hr x 8
- $300/hr x 1.3
- $350/hr x 1.8
- $400/hr x 0.4
Preparing memoranda, submissions, affidavits and related matters
$42,075.00 (121.4 hours)
- $300/hr x 21.7
- $350/hr x 86.3
- $400/hr x 13.4
$15,200.00 (43 hours)
- $300/hr x 5
- $350/hr x 30
- $400/hr x 8
General hearing preparation, appearances and related
matters
$87,050.00 (240.8 hours)
- $300/hr x 40.9
$19,500.00 (50 hours)
- $350/hr x 10
  1. New Zealand Venue and Event Management Ltd v Worldwide NZ LCC [2016] NZCA 282, (2016) 23 PRNZ 260 at [16].
Category
Actual costs claimed
Reasonable costs

- $350/hr x 103.6
- $400/hr x 96.3
- $400/hr x 40
Miscellaneous items
$5,885.00 (16.3 hours)
- $300/hr x 1.4
- $350/hr x 9.9
- $400/hr x 5
$3,250.00 (9 hours)
- $300/hr x 1
- $350/hr x 5
- $400/hr x 3
Total
$139,022.50
$41,330.00

[47] I have reduced the amounts sought, in broad terms, because of two reasons.

[48] First, the amounts claimed seem grossly excessive at just about every stage. This was a relatively simple matter. It did not reasonably warrant the number of hours recorded. The points made above in relation to scale costs apply equally here. For example, 86.3 hours of mid-level in-house counsel time should not have been required for preparing memoranda, submissions, affidavits and related matters in this case. To use another example of the costs claimed, it is not reasonable to expect the respondents to pay for the lawyers’ time spent driving to and from Rotorua at their hourly charge out rates. There are further examples but it is not necessary to set each out in detail.

[49] Second, costs are claimed for several items that do not appear to have been reasonably necessary. For example, there appears to be significant repetition with similar work being done by different people. As outlined above, there is a significant amount of repetition in the submissions. Second counsel also attended hearings on multiple occasions, and recorded that time, including travel time. The attendance of second counsel was not warranted in this matter and it is unreasonable to expect the other party to now pay for that attendance.

[50] Accordingly, I fix sum of $41,330.00 as the liquidators’ actual costs that were reasonably incurred.

Disbursements


[51] The liquidators claim $4,601.25 in disbursements as follows:

Item
Amount claimed
Amount
excluding GST
a. Filing fee for interlocutory application
$200.00
$173.91
b. Service of the interlocutory application on Mr and Mrs Bhana
$299.00
$260.00
c. Service of Judgment of Brewer J dated 21 October 2015 on Mr and Mrs Bhana
$322.00
$280.00
d. Urgent filing of affidavits of service by the process servers
$46.00
$40.00
e. Service of submissions dated 23 November 2015 on Mr and Mrs Bhana
$310.50
$270.00
f. Return flight tickets for Damien Grant and Nicky Johnson from Auckland to Rotorua for appearance as witnesses at the hearing on 9 March 2016
$532.00
$462.61
g. Fee for attendance of hearing on 9 March 2016 as witnesses from Nicky Johnson and Sharon Dingwall
$927.55
$806.57
h. Accommodation in Rotorua for Counsel and one of the witnesses, Kieran Michael Jones, for hearing on 9 March 2016
$465.00
$404.35
i. Service of submissions dated 1 1 May 2016 on Mr and Mrs Bhana
$299.00
$260.00
j. Accommodation in Rotorua for Counsel for hearing on 8 November 2016
$282.20
$245.39
k. Service of submissions dated 13 October 2016 on Mr and Mrs Bhana
$299.00
$260.00
l. Costs of printing the bundles of documents (in 4 volumes) and authorities
$619.00
$538.26
Total
$4,601.25
$4,001.09

[52] Again, the amounts claimed include GST. The principle identified above in relation to indemnity costs also applies to disbursements.31 A party will not be
reimbursed for GST unless they show they will not be able to recover the GST from the Commissioner. I have calculated the amounts claimed excluding GST in the table above.

[53] Most of the disbursements claimed are uncontroversial. As regards counsel’s travel and accommodation costs, I accept these should be recoverable in this case.32 Similarly, I consider the witness fees and associated accommodation costs are reasonable and should be recoverable. I consider the remainder of the disbursements claimed are also recoverable.

Conclusion


[54] I make an order that Mr and Ms Bhana pay the liquidators:

(a) $41,330.00 for their actual and reasonable costs.

(b) $4,001.09 for disbursements.









Woolford J



















32 Buis v Accident Compensation Corp [2010] NZHC 280; (2010) 19 PRNZ 585 (HC) at [25].


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