Zindia Limited v Arapawa Island Forestry Partnership

[2021] NZHC 274

IN THE HIGH COURT OF NEW ZEALAND DUNEDIN REGISTRY

I TE KŌTI MATUA O AOTEAROA ŌTEPOTI ROHE

CIV-2020-412-55

[2021] NZHC 274

UNDER

the Companies Act 1993

IN THE MATTER

of an application to set aside a statutory demand

BETWEEN

ZINDIA LIMITED

Applicant

AND

ARAPAWA ISLAND FORESTRY PARTNERSHIP

First Respondent

AND

VELIDE INVESTMENTS LIMITED

Second Respondent (DISCONTINUED)

Hearing:	(Determined on the papers)
Counsel:	Q A M Davies and J S Marshall for the Applicant T J Shiels QC for the Respondents
Judgment:	24 February 2021

JUDGMENT OF ASSOCIATE JUDGE LESTER (AS TO COSTS)

This judgment was delivered by me on 24 February 2021 at 4.45pm pursuant to Rule 11.5 of the High Court Rules

Registrar/Deputy Registrar 24 February 2021

ZINDIA LIMITED v ARAPAWA ISLAND FORESTRY PARTNERSHIP [2021] NZHC 274 [24 February 2021]

[1]                 Counsel have filed memoranda in respect of costs following my decision of 27 January 2021 granting Zindia Limited’s (Zindia) application to set aside a statutory demand.1

[2]                 There is no issue that costs should follow the event on a 2B basis. The issue is the travel costs of Zindia’s counsel and the costs incurred in printing the documents for service and in respect of service.

[3]Zindia’s counsel confirms that costs are not claimed for second counsel.

[4]                 Zindia’s counsel is based in Blenheim. There are no direct flights between Blenheim and Dunedin, resulting in airfares totalling $844 being claimed. Counsel’s accommodation costs are also claimed.

[5]                 The respondent resists these claims, saying in effect local counsel could have been briefed. Zindia’s registered office is in Auckland so out-of-town counsel was always on the cards. Counsel who appeared for Zindia had been involved in the matter for some time so I consider it was appropriate that he continued to be involved. Had Zindia’s counsel prepared the papers but arranged for Dunedin counsel to appear, the person instructed would have spent more time in getting up to speed with the detail of the material and issues than has been claimed for travel costs. Equally, if Dunedin counsel had had to start from scratch in terms of their preparation then further costs would have been incurred.

[6]I am satisfied that counsel’s travel was appropriate.

[7]                 The printing and service costs are also approved. Applications to set aside statutory demands are prepared under urgency. The material filed was of some size – hence my comments about the costs of instructing a local agent.

1      Zindia Ltd v Arapawa Island Forestry Partnership [2021] NZHC 29.

[8]                 Given the “drop dead” nature of the timeframes to file and serve the application, it is hard to be critical of counsel who take every precaution to meet those timeframes.

[9]                 Mr Shiels QC, counsel for the respondents, submitted the cost of physical service should be disallowed as counsel should have enquired of the director dealing with the issues whether they would accept service by email. Again, counsel facing the tight timeframes of an application to set aside a statutory demand cannot assume an agreement as to service can be reached. Indeed, they must assume none will be forthcoming and assume physical service will be required.

[10]             The statutory demand issued was for several million dollars. Hence, the amount spent on printing and service were proportionate.

[11]             Accordingly, there is an award of costs and disbursements in favour of the applicant  against  the  first  respondent  in   terms   of  the  schedule  annexed   to  the applicant’s memorandum of 10 February 2021.

Associate Judge Lester

Solicitors:

McMillan & Co, Dunedin Gascoigne Wicks, Blenheim

Copy to counsel:
T J Shiels QC, Barrister, Dunedin