Waiheke Marinas Ltd (“Wml”)
| Jurisdiction | New Zealand |
| Judge | LJ Newhook |
| Judgment Date | 09 February 2016 |
| Neutral Citation | [2016] NZEnvC 18 |
| Docket Number | (ENV-2013-AKL-000174) |
| Court | Environment Court |
| Date | 09 February 2016 |
In the Matter of Resource Management Act 1991 ( RMA) and in the matter of a notice of motion under s87G requesting the granting of resource consents to Waiheke Marinas Ltd to establish a marina at Matiatia Bay, Waiheke Island in the Hauraki Gulf
[2016] NZEnvC 18
Principal Environment Judge LJ Newhook sitting alone
(ENV-2013-AKL-000174)
BEFORE THE ENVIRONMENT COURT
Application for costs following the refusal by the Environment Court (EnvC) of a notice of motion for consents to establish a marina — three of the four applicants (a society that represented the s274 parties, the local council and the Crown) sought considerable sums in costs — the applicant was now in liquidation and the liquidator advised that he would not be participating in the costs hearing, but that he had an obligation to receive any claims relating to this matter — the applicants submitted that the applicant's case contained Bielby factors, including that arguments were advanced without substance, the process of the Court was abused, and the case was poorly pleaded or presented and unnecessarily lengthened the hearing — both the council and the Crown sought 100 per cent of their costs — consideration of s285 (7) and (8) Resource Management Act 1991 (RMA) as amended — what were the general principles applying to costs in direct referral applications — what was the meaning of “having regard to the fact that the proceedings are at first instance” in s285(5) RMA — whether there were Bielby factors present, justifying costs above the normal range — whether the council and Crown should receive 100 per cent of their costs — what was the effect of the liquidation on the costs application.
K R M Littlejohn for Direction Matiatia Inc (“ DMI”)
B Parkinson for K Lewis and T Greve
M C Allan for Auckland Council
Registrar of the Environment Court on behalf of the Crown
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A. Costs awarded to DMI in the sum of $198,848.00.
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B. Costs awarded to K Lewis and T Greve in the sum of $10,914.20.
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C. Costs awarded to Auckland Council of $530,423.96.
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D. Costs awarded to the Crown of $427,404.33.
(All sums inclusive of GST).
In decision number [2015] NZEnvC 218, the Court refused the notice of motion by WML seeking consents to establish a marina at Matiatia Bay, Waiheke Island.
Applications for costs have been received from direction Matiatia Inc, a major entity that represented the majority of the s274 parties (there were 310 such parties in total); K Lewis and T Greve, Auckland Council, and the Crown. Three of the four applications seek an award of a very significant sum.
The processing of these applications has confronted a slightly unusual circumstance. On 6 January 2016, apparently in consequence of the decision of the Court refusing the notice of motion, WML resolved placed itself in liquidation.
After apparently providing the liquidator with information and advice that he was entitled to take steps to oppose the applications for costs, senior and junior Counsel for WML, Mr R Brabant and Mr J Brabant, sought leave of the Court to withdraw as Counsel due to absence of instructions from the liquidator.
On 5 February 2016 I issued a Minute recording that I doubted that such leave was necessary, but in case it was, I granted it.
In that Minute I also recorded the circumstances in which it appeared that the liquidator was taking no steps to oppose the applications for costs, but was nevertheless calling for proofs of debt to be lodged with him by 10 February 2016. I recorded the following matters and directed that the Minute be served on the liquidator as well as the parties:
[4] The Crown, through the Registrar of the Court, has endeavoured to contact the liquidator to ascertain whether he wishes to discuss processes around issues of costs to the Crown. The Registrar has received no response.
[5] Messrs Brabant have recorded in this week's memorandum, that Mr R Brabant has communicated with the liquidator Mr Whittfield by email on several occasions during January 2016, making him aware of costs applications lodged by Auckland Council and s274 parties; also that the Brabants were on the Court record jointly as Counsel for WML; and that as liquidator Mr Whittfield needed to resolve the question of legal representation (if any) with respect to the claims for costs.
[6] Messrs Brabant further recorded that Mr Whittfield had requested that the Court be advised that he had been appointed liquidator and that all further correspondence should be addressed to him (he indicated that he would also personally communicate with the Court in this regard).
[7] Messrs Brabant advised that no further instructions had been received by them from the liquidator.
[8] Mr Whittfield has communicated with the Court. On 26 January 2016 Mr Whittfield wrote to my Hearings Manager confirming that on 6 January 2016 he was appointed liquidator of the company, and that he was in receipt of “various documents in relation to the application for costs”. He then simply recorded that he was attaching a copy of his first report as liquidator, and a claim form.
[9] The final paragraph of the report indicates that “all proofs of debt must be submitted by 10 February 2016”. A proof of debt form accompanied the report.
[10] I infer that the liquidator has been offered opportunity from 3 sources (Messrs Brabant, the Registrar of the Court, and my Hearing Manager), to engage in issues concerning claims for costs, and that he has chosen to do nothing other than await proofs of debt.
[11] I have no knowledge of whether parties would be legally or factually disadvantaged in endeavouring to prove debts if the Court were not to make orders for costs by the 10 th February to enable them to lodge proofs of debt by that date.
[12] If the liquidator wishes to disabuse the Court of the inference that he does not wish to lodge submissions concerning the costs claims, he should do so immediately. Otherwise I shall have to consider whether I will process the costs applications that are now before the Court and issue urgent decisions, which will be no mean feat given the intervening long holiday weekend.
[13] I imagine that if the liquidator were suddenly to advise that he wished to take active steps to resist the costs applications, he would need to move the proof date back sufficient time to accommodate that process, and allow for the Court to issue decisions after considering the arguments; then also giving claimants time to lodge proofs of debt (should awards be made).
[14] I give notice to the liquidator that if by 10.00am on Tuesday 9 February 2016, the Court has not received persuasive input from him to the contrary, the Court will endeavour to proceed to issue urgent costs decisions.
The liquidator responded by email to my Registry staff dated Saturday 6 th February, received by me this morning, 9 February. He advised that he would not be making any representation to the Court about the applications for costs, or instructing counsel. He commented that whist having nominated 10 February as the date for proofs of claim to be lodged, he was aware of the costs claims, and recorded that he had an obligation to receive any claims after that date relating to this matter as he was aware that they could crystalise at a later date. Having prepared this decision over the weekend I have proceeded to issue it today, 9 February, in any event.
This decision will effectively deal with three kinds of costs claims, first the claims by s274 parties, secondly that by the Council, and thirdly that by the Crown.
Under s285 RMA the Environment Court has a broad discretion to order any party to pay costs to any other party to the proceedings. Section 87G(5) provides that Part 11 of the Act — which includes s285 — applies to direct referral proceedings under s87G.
The principles applying to costs awards in direct referral proceedings have previously been considered in decisions of the Environment Court — Road Metals Company Limited, 1 Canterbury Cricket Association Incorporated; 2 and Skydive Queenstown Limited. 3 Each of these cases considered matters in relation to awards of costs to s274 parties.
In those cases the Court held, in summary, that the general principles for awards of costs apply in relation to applications for costs on direct referrals. The general principles include:
(a) Section 285(1) confers a broad discretion on the Environment Court to award costs to any party, with the requirement that they be reasonable. 4
(b) An award is imposed to compensate what is just, not to penalise. 5
(c) Orders for payment of costs are commonly made against a party who has put another party to unnecessary cost. 6
(d) The factors in Bielby apply to the consideration of costs above the “normal range”. 7
Subsections 5, 7 and 8 of s285 RMA set out special criteria for costs on direct referrals. Given the date at which the WML application was lodged, subsections 7 and 8 have not taken effect having regard to the transitional provisions, although I shall have more to say about the flavour of them shortly. Section 285(5) provides as follows:
(5) In proceedings under s87G … the Environment Court must -
(a) When deciding whether to make an order under subsection ( 1) or (3) -
(i) Apply a presumption that costs under subsections (1) and (3) are not to be ordered against a person who is a party under s274(1); and
(ii) Apply a presumption that costs under subsection (3) are to be ordered against the applicant; and
(b) When deciding on the amount of an order it decides to make, have regard to the fact that the proceedings are at first instance.
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