Norman Glass Services Limited v Norman

[2019] NZHC 113

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

I TE KŌTI MATUA O AOTEAROA TĀMAKI MAKAURAU ROHE

CIV 2017-404-000611

[2019] NZHC 113

BETWEEN

NORMAN GLASS SERVICES LIMITED

Plaintiff

AND

MARK NORMAN

Defendant

Hearing:	On the papers
Judgment:	11 February 2019

COSTS JUDGMENT OF DUFFY J

This judgment was delivered by me on 11 February 2019 at 2.00 pursuant to

Rule 11.5 of the High Court Rules.

Registrar/ Deputy Registrar

Solicitors:

Richard Wood, Auckland

Hugh Fulton, Barrister, Auckland

Robert Burns & Associates, Auckland Rennie Cox, Auckland

NORMAN GLASS SERVICES LIMITED v NORMAN [2019] NZHC 113 [11 February 2019]

[1]    In preparation for the trial of this proceeding the defendant was granted non- party discovery from Robert Yarnton, registered valuer of Eyles McGough Limited.1 This was followed by a dispute regarding the scope of any costs award that Mr Yarnton might receive, which necessitated a return appearance before Whata J on 1 June 2018.2

[2]    A dispute subsequently arose between the defendant and Mr Yarnton regarding whether Mr Yarnton had fully complied with the order for non-party discovery as well as whether he was entitled to costs relating to this discovery, and if so, how and by whom should those be quantified.

[3]    The defendant was so dissatisfied with the scope of the non-party discovery provided by Mr Yarnton that he gave notice of his intent to summons Mr Yarnton to attend the trial, and to produce documents relevant to the trial pursuant to a subpoena duces tecum. However, the trial did not eventuate as the parties settled their dispute. Because the trial did not proceed there is nothing to indicate whether the affidavit of documents that Mr Yarnton provided did disclose less than he may have provided in answer to the subpoena duces tecum. Accordingly, there is nothing to show that the affidavit of documents was in any way deficient.

[4]    Nonetheless, the question of the defendant’s liability for payment of costs relating to his non-party discovery application and the subsequent provision of this discovery remains live.

[5]    Rule 8.22 of the High Court Rules makes it clear that a non-party is entitled to recover reasonable costs that arise when a party to litigation seeks non-party discovery. The relevant case-law makes it clear that, in the ordinary run of cases, what is a reasonable amount should reflect the time and labour expended in complying with the non-party discovery order.3 Further, in the absence of good reasons to the contrary, the full reasonable costs of compliance should be recoverable.4

1      See minute of Whata J dated 28 May 2018.

2      See minute of Whata J dated 1 June 2018.

3      Berryman Properties Ltd v Colonial Mutual General Insurance Company Ltd (1987) 1 PRNZ 196 (HC).

4      Clear Communications Ltd v Telecom Corporation of New Zealand Ltd (1994) 8 PRNZ 200 (HC).

[6]    At stake here is the total sum of $9,959.75 plus a further unspecified sum to cover the cost of the submissions that Mr Yarnton has had to prepare on this costs application. It is regrettable that so much legal time and attention has been devoted to what should be a straightforward exercise.

[7]    Instead, the defendant has attempted to portray Mr Yarnton as someone whose intransigence brought about the non-party discovery application, and that this is disentitling conduct when it comes to awarding costs. This portrayal of Mr Yarnton is wrong, and completely overlooks the fact that a non-party is under no obligation to provide any party to litigation with information. Whilst a non-party’s opposition to an application for non-party discovery can in certain circumstances adversely affect the non-party’s entitlement to costs, that circumstance is quite different from the present.5 Here, once the application for non-party discovery was made Mr Yarnton did not oppose it.

[8]    The defendant has also sought to limit Mr Yarnton’s entitlement to costs through an overly restrictive interpretation of Whata J’s minute of 28 May 2018. This restrictive view necessitated the parties returning to Whata J to obtain clarification on the scope of the costs award available to Mr Yarnton. Despite the minute of 1 June 2018 that Whata J issued on the availability of costs for the trouble of preparing the non-party discovery, the defendant has continued, for alternative reasons, to maintain that Mr Yarnton should not be entitled to receive such costs.

[9]    Mr Yarnton has provided copies of invoices issued by his counsel. Those invoices reveal that Mr Yarnton’s counsel was engaged with matters relevant to the non-party discovery exercise on many occasions.

[10]    I acknowledge that expenses sought by a non-party need to be properly verified.6 However, such verification needs to be realistic and viewed in the context of the award of costs sought as well as the circumstances surrounding the non-party discovery. I am satisfied that for the purposes of this matter Mr Yarnton has provided

5      See Clear Communications Ltd v Telecom Corporation of New Zealand Ltd (1994) 8 PRNZ 200 (HC); and Westpac New Zealand Ltd v Adams [2013] NZHC 3113 at [73].

6      Westpac New Zealand Ltd v Adams [2013] NZHC 3113 at [76].

sufficient verification of the costs he seeks. To require him to embark on the exercises sought by the defendant would be excessive, given the sum involved. The cost of the time it would take to do so would outweigh the benefit of ultimately receiving those costs.

[11]   The defendant’s conduct at the hearing before me as well as his present opposition to costs informs me that what should have been a straightforward issue has become overly complicated and bedevilled by timewasting arguments made by the defendant. Not being content with asserting that Mr Yarnton should bear costs because he did not provide discovery informally, the defendant then:

(a)wrongly attempted to curtail Mr Yarnton’s entitlement to costs to the award made by Whata J on 28 May 2018;

(b)complained that the discovery he received from Mr Yarnton was inadequate, which should reduce if not remove any award of costs to Mr Yarnton; and

(c)argued that the costs sought by Mr Yarnton should be subject to a New Zealand Law Society costs revision process.

[12]   Responding to such conduct necessarily engages more legal attention than would be required if the defendant had approached the application for non-party discovery in a straightforward way. In such circumstances, I consider that the invoices for the time and attendances Mr Yarnton’s counsel was obliged to undertake are reasonable. It follows that I find they should form the basis for the costs’ award.

[13]   Accordingly, I am satisfied that Mr Yarnton is entitled an award of costs as follows:

(a)Invoice for time and attendances between May and 15 June 2018

$4,600 plus $110 disbursement for High Court filing fee (being a total of $4,710.00);

(b)Invoice for time and attendances from 15 June 2018 up to 9 July 2018

$4,743.75.

[14]   Mr Yarnton also sought an award of $506 for “Cost to complete in proscribed form and dispatch at, say .8 of an hour at $440 plus GST $66 a total of $506”. No invoice is provided for this claim. I cannot readily make sense of the narration in the costs memorandum. I do not propose to award this sum.

[15]   Mr Yarnton also sought costs on the present submissions for costs. However, in the second invoice the narration includes the words “ …Court attendance 9 July and in anticipation memorandum for cost determination.” I understand this narration to advise that the invoiced costs included a sum in anticipation of the costs to be incurred for preparing the present costs memorandum. If that is the case there is no basis for me now making an additional award of costs to cover the present costs arguments. Accordingly, I am not prepared to make any further costs award for that effort.

[16]   The findings I have reached bring the total amount of costs and disbursements to the sum of $9,453.75.

Result

[17]   The defendant is ordered to pay costs and a disbursement to Mr Yarnton in the total sum of $9,453.75.

Duffy J