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{\title IN THE COURT OF APPEAL OF THE COOK ISLANDS}{\author ruddley_e}{\operator hamilton_l}{\creatim\yr2011\mo2\dy11\hr8\min44}{\revtim\yr2011\mo5\dy9\hr16\min50}{\version6}{\edmins66}{\nofpages4}{\nofwords2098}{\nofchars11960}{\*\company scims}
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{\pntxtb (}{\pntxta )}}\pard\plain \qc \li0\ri0\widctlpar\faauto\adjustright\rin0\lin0\itap0\pararsid9391114 \fs20\lang1033\langfe1033\cgrid\langnp1033\langfenp1033 {\b\fs24\lang2057\langfe1033\langnp2057\insrsid1975490\charrsid160336 IN THE COURT OF A}{
\b\fs24\lang2057\langfe1033\langnp2057\insrsid9391114\charrsid160336 PPEAL OF THE }{\b\fs24\lang2057\langfe1033\langnp2057\insrsid1975490\charrsid160336 COOK ISLANDS}{\b\fs24\lang2057\langfe1033\langnp2057\insrsid9391114\charrsid160336 
\par }{\b\fs24\lang2057\langfe1033\langnp2057\insrsid1975490\charrsid160336 HELD AT AUC}{\b\fs24\lang2057\langfe1033\langnp2057\insrsid9391114\charrsid160336 K}{\b\fs24\lang2057\langfe1033\langnp2057\insrsid1975490\charrsid160336 LAND}{
\b\fs24\lang2057\langfe1033\langnp2057\insrsid9391114\charrsid160336 
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\par }\pard \qc \li0\ri0\widctlpar\faauto\adjustright\rin0\lin0\itap0\pararsid9391114 {\fs24\ul\lang2057\langfe1033\langnp2057\insrsid1975490\charrsid13575234 CA.3/99
\par }\pard \ql \li0\ri0\widctlpar\faauto\adjustright\rin0\lin0\itap0\pararsid9391114 {\fs24\lang2057\langfe1033\langnp2057\insrsid9391114\charrsid160336 
\par }\pard \qc \li0\ri0\widctlpar\faauto\adjustright\rin0\lin0\itap0\pararsid9391114 {\fs24\lang2057\langfe1033\langnp2057\insrsid9391114\charrsid160336 BETWEEN
\par }\pard \ql \li0\ri0\widctlpar\faauto\adjustright\rin0\lin0\itap0\pararsid9391114 {\fs24\lang2057\langfe1033\langnp2057\insrsid9391114\charrsid160336 
\par }\pard \qc \li0\ri0\widctlpar\faauto\adjustright\rin0\lin0\itap0\pararsid9391114 {\b\fs24\lang2057\langfe1033\langnp2057\insrsid1975490\charrsid160336 A STEPHEN FARNSWORTH & ANOTHER
\par }{\fs24\lang2057\langfe1033\langnp2057\insrsid1975490\charrsid160336 Appellants
\par }\pard \ql \li0\ri0\widctlpar\faauto\adjustright\rin0\lin0\itap0\pararsid9391114 {\fs24\lang2057\langfe1033\langnp2057\insrsid9391114\charrsid160336 
\par }\pard \qc \li0\ri0\widctlpar\faauto\adjustright\rin0\lin0\itap0\pararsid9391114 {\fs24\lang2057\langfe1033\langnp2057\insrsid1975490\charrsid160336 AND}{\fs24\lang2057\langfe1033\langnp2057\insrsid9391114\charrsid160336 
\par }\pard \ql \li0\ri0\widctlpar\faauto\adjustright\rin0\lin0\itap0\pararsid9391114 {\fs24\lang2057\langfe1033\langnp2057\insrsid9391114\charrsid160336 
\par }\pard \qc \li0\ri0\widctlpar\faauto\adjustright\rin0\lin0\itap0\pararsid9391114 {\b\fs24\lang2057\langfe1033\langnp2057\insrsid6901144 RONDO W PERKI}{\b\fs24\lang2057\langfe1033\langnp2057\insrsid1975490\charrsid160336 NS & OTHERS
\par }{\fs24\lang2057\langfe1033\langnp2057\insrsid1975490\charrsid160336 First-Second Respondents
\par }\pard \ql \li0\ri0\widctlpar\faauto\adjustright\rin0\lin0\itap0\pararsid9391114 {\fs24\lang2057\langfe1033\langnp2057\insrsid9391114\charrsid160336 
\par }{\b\fs24\lang2057\langfe1033\langnp2057\insrsid1975490\charrsid160336 Hearing}{\fs24\lang2057\langfe1033\langnp2057\insrsid1975490\charrsid160336 :}{\fs24\lang2057\langfe1033\langnp2057\insrsid9391114\charrsid160336  }{
\fs24\lang2057\langfe1033\langnp2057\insrsid1975490\charrsid160336 9 August 1999
\par }{\b\fs24\lang2057\langfe1033\langnp2057\insrsid9391114\charrsid160336 Coram}{\fs24\lang2057\langfe1033\langnp2057\insrsid1975490\charrsid160336 :}{\fs24\lang2057\langfe1033\langnp2057\insrsid9391114\charrsid160336  }{
\fs24\lang2057\langfe1033\langnp2057\insrsid1975490\charrsid160336 The Hon Si}{\fs24\lang2057\langfe1033\langnp2057\insrsid9391114\charrsid160336 r Graham Speight JA (Presiding)
\par }{\fs24\lang2057\langfe1033\langnp2057\insrsid1975490\charrsid160336 The }{\fs24\lang2057\langfe1033\langnp2057\insrsid6901144 Hon}{\fs24\lang2057\langfe1033\langnp2057\insrsid1975490\charrsid160336  Sir Ian Barker JA
\par His Honour Judge AG Mcllugh
\par }{\fs24\lang2057\langfe1033\langnp2057\insrsid9391114\charrsid160336 
\par }{\b\fs24\lang2057\langfe1033\langnp2057\insrsid1975490\charrsid160336 Counsel:}{\fs24\lang2057\langfe1033\langnp2057\insrsid9391114\charrsid160336  }{\fs24\lang2057\langfe1033\langnp2057\insrsid1975490\charrsid160336 J Katz QC for Appellants
\par GB Chapman & AM Manarangi for Respondents}{\fs24\lang2057\langfe1033\langnp2057\insrsid1975490 
\par }{\fs24\lang2057\langfe1033\langnp2057\insrsid13575234\charrsid160336 
\par }{\b\fs24\lang2057\langfe1033\langnp2057\insrsid9391114\charrsid160336 J}{\b\fs24\lang2057\langfe1033\langnp2057\insrsid1975490\charrsid160336 udgment:}{\fs24\lang2057\langfe1033\langnp2057\insrsid9391114\charrsid160336  }{
\fs24\lang2057\langfe1033\langnp2057\insrsid1975490\charrsid160336 9 August 1999
\par }{\fs24\lang2057\langfe1033\langnp2057\insrsid9391114\charrsid160336 
\par }\pard \qc \li0\ri0\widctlpar\faauto\adjustright\rin0\lin0\itap0\pararsid9391114 {\b\fs24\lang2057\langfe1033\langnp2057\insrsid7301479 (ORAL) JUDGMENT OF THE}{\b\fs24\lang2057\langfe1033\langnp2057\insrsid1975490\charrsid160336  CO}{
\b\fs24\lang2057\langfe1033\langnp2057\insrsid7301479 URT DELIVERED BY THE HON SIR IA}{\b\fs24\lang2057\langfe1033\langnp2057\insrsid1975490\charrsid160336 N BARKER JA
\par }\pard \ql \li0\ri0\widctlpar\faauto\adjustright\rin0\lin0\itap0\pararsid9391114 {\fs24\lang2057\langfe1033\langnp2057\insrsid9391114\charrsid160336 
\par }{\b\fs24\ul\lang2057\langfe1033\langnp2057\insrsid1975490\charrsid160336 Solicitors:
\par }{\fs24\lang2057\langfe1033\langnp2057\insrsid9391114\charrsid160336 
\par }{\fs24\lang2057\langfe1033\langnp2057\insrsid1975490\charrsid160336 Tim Arnold, Solicitor, Raroton}{\fs24\lang2057\langfe1033\langnp2057\insrsid6901144 ga}{\fs24\lang2057\langfe1033\langnp2057\insrsid1975490\charrsid160336 , for Appellants;
\par AM Manarangi, Solicitor, PO Box 514, Rarotonga, for Respondents.
\par }{\fs24\lang2057\langfe1033\langnp2057\insrsid9391114\charrsid160336 
\par }{\fs24\lang2057\langfe1033\langnp2057\insrsid1975490\charrsid160336 This is an appeal against a decision of Hillyer J given in the High Court of the Cook Islands held at Auckland on 19}{\fs24\lang2057\langfe1033\langnp2057\insrsid9391114\charrsid160336 
th}{\fs24\lang2057\langfe1033\langnp2057\insrsid1975490\charrsid160336 
 May 1999. His Honour awarded a global amount of $40,000 for costs and disbursements in favour of the respondents who became entitled to an award of costs upon the filing by the appellants of a}{\fs24\lang2057\langfe1033\langnp2057\insrsid7301479  }{
\fs24\lang2057\langfe1033\langnp2057\insrsid1975490\charrsid160336 
non-suit in civil proceedings in the High Court. Such filing was only one working day before the fixture allocated for the hearing of the claim and counterclaim in that Court. The Judge fixed the sum of $40,000 without, as is usual, allocating an amount f
or costs and then adding disbursements to be fixed by the Registrar.
\par }{\fs24\lang2057\langfe1033\langnp2057\insrsid9391114\charrsid160336 
\par }{\fs24\lang2057\langfe1033\langnp2057\insrsid1975490\charrsid160336 In his judgment, the learned Judge set out a brief history of the litigation which commenced only in January of this year. It had a fixture allocat}{
\fs24\lang2057\langfe1033\langnp2057\insrsid7301479 ed by the Chief Justice on 12}{\fs24\lang2057\langfe1033\super\langnp2057\insrsid7301479 th }{\fs24\lang2057\langfe1033\langnp2057\insrsid1975490\charrsid160336 March 1999 for a hearing in Auckland}{
\fs24\lang2057\langfe1033\langnp2057\insrsid7301479  on 12}{\fs24\lang2057\langfe1033\super\langnp2057\insrsid7301479\charrsid7301479 th}{\fs24\lang2057\langfe1033\langnp2057\insrsid7301479  }{
\fs24\lang2057\langfe1033\langnp2057\insrsid1975490\charrsid160336 April 1999.
\par }{\fs24\lang2057\langfe1033\langnp2057\insrsid9391114\charrsid160336 
\par H}{\fs24\lang2057\langfe1033\langnp2057\insrsid1975490\charrsid160336 
illyer J had received lengthy submissions from both counsel on the question of costs including particularly the amounts that had been billed to the respondents by their legal advisers in the Cook Islands, 
New Zealand and the State of Idaho, USA. These amounts totalled some $NZ88,733.00.
\par }{\fs24\lang2057\langfe1033\langnp2057\insrsid9391114\charrsid160336 
\par }{\fs24\lang2057\langfe1033\langnp2057\insrsid1975490\charrsid160336 After considering the submissions of both counsel, the Judge awarded "}{\i\fs24\lang2057\langfe1033\langnp2057\insrsid1975490\charrsid160336 
an amount of $40,000 which would be the minimum which should be awarded and would be fair to both parties. This would include the costs incurred in the applications before the Chief}{\i\fs24\lang2057\langfe1033\langnp2057\insrsid9391114\charrsid160336  J}
{\i\fs24\lang2057\langfe1033\langnp2057\insrsid1975490\charrsid160336 ustice, and disbursements}{\fs24\lang2057\langfe1033\langnp2057\insrsid1975490\charrsid160336 ".
\par }{\fs24\lang2057\langfe1033\langnp2057\insrsid9391114\charrsid160336 
\par }{\fs24\lang2057\langfe1033\langnp2057\insrsid1975490\charrsid160336 The litigation concerned a }{\fs24\lang2057\langfe1033\langnp2057\insrsid9391114\charrsid160336 dispute between shareholders in}{
\fs24\lang2057\langfe1033\langnp2057\insrsid1975490\charrsid160336  a company called Crown Beach Executive Villas Ltd which owned and operated a resort complex constructed on lan}{\fs24\lang2057\langfe1033\langnp2057\insrsid7301479 
d in the Cook Islands at Vaitamauga.}{\fs24\lang2057\langfe1033\langnp2057\insrsid1975490\charrsid160336 
 There was a deadlock between the two lots of shareholders; one represented by the appellants, and the other by the first respondents. This deadlock resulted in the litigation. The appellants applied, successfully, for an interi}{
\fs24\lang2057\langfe1033\langnp2057\insrsid6901144 m}{\fs24\lang2057\langfe1033\langnp2057\insrsid1975490\charrsid160336 
 injunction which was granted by the Chief Justice. The respondents did not seek to set aside that injunction. A defence and counterclaim were}{\fs24\lang2057\langfe1033\langnp2057\insrsid7301479  filed by the respondents on 9}{
\fs24\lang2057\langfe1033\super\langnp2057\insrsid7301479\charrsid7301479 th}{\fs24\lang2057\langfe1033\langnp2057\insrsid1975490\charrsid160336  March 1999: a Judicial Conference was conve}{\fs24\lang2057\langfe1033\langnp2057\insrsid7301479 ned b
y the Chief Justice on 12}{\fs24\lang2057\langfe1033\super\langnp2057\insrsid7301479\charrsid7301479 th}{\fs24\lang2057\langfe1033\langnp2057\insrsid1975490\charrsid160336 
 March 1999. The Chief Justice allocated an urgent fixture in Auckland because of the impasse in the management of the company.
\par }{\fs24\lang2057\langfe1033\langnp2057\insrsid9391114\charrsid160336 
\par }{\fs24\lang2057\langfe1033\langnp2057\insrsid1975490\charrsid160336 It was at this stage that the solicitors for the appellant in Rarotonga instructed senior counsel in New Zealand. The allocation of a fixture due to begin in Auckland}{
\fs24\lang2057\langfe1033\langnp2057\insrsid11216632  on 12}{\fs24\lang2057\langfe1033\super\langnp2057\insrsid11216632\charrsid11216632 th}{\fs24\lang2057\langfe1033\langnp2057\insrsid1975490\charrsid160336 
 April 1999, presented substantial difficulties to that counsel and also to the appellants who, like the respondents, were resident in the USA. New counsel for the appellants}{\fs24\lang2057\langfe1033\langnp2057\insrsid9391114\charrsid160336  sought 
an adjournment before H}{\fs24\lang2057\langfe1033\langnp2057\insrsid1975490\charrsid160336 illyer J. supported by a memorandum from counsel in support and a memorandum in opposition from the respondent's counsel.
\par }{\fs24\lang2057\langfe1033\langnp2057\insrsid160336\charrsid160336 
\par On 1}{\fs24\lang2057\langfe1033\langnp2057\insrsid1975490\charrsid160336 st April 1999, Hillyer J. declined the motion for an }{\fs24\lang2057\langfe1033\langnp2057\insrsid160336\charrsid160336 adjournment and confirmed the fix}{
\fs24\lang2057\langfe1033\langnp2057\insrsid1975490\charrsid160336 ture.
\par }{\fs24\lang2057\langfe1033\langnp2057\insrsid160336\charrsid160336 
\par }{\fs24\lang2057\langfe1033\langnp2057\insrsid1975490\charrsid160336 The appellants then sought}{\fs24\lang2057\langfe1033\langnp2057\insrsid11216632  leave to appeal to the Court of}{\fs24\lang2057\langfe1033\langnp2057\insrsid1975490\charrsid160336 
 Appeal against the refusal of the adjournment. The Chief Justice convened a telephone conference for the purposes of determining the motion for leave to appeal}{\fs24\lang2057\langfe1033\langnp2057\insrsid160336\charrsid160336  }{
\fs24\lang2057\langfe1033\langnp2057\insrsid1975490\charrsid160336 and to consider the parties' respective transcripts of the Judge's oral decision. The Chief Justice declined leave to appeal. The appellants}{
\fs24\lang2057\langfe1033\langnp2057\insrsid160336\charrsid160336  then decided, according to Mr}{\fs24\lang2057\langfe1033\langnp2057\insrsid1975490\charrsid160336  Katz, that their only course was to elect a non}{
\fs24\lang2057\langfe1033\langnp2057\insrsid160336\charrsid160336 -}{\fs24\lang2057\langfe1033\langnp2057\insrsid1975490\charrsid160336 suit. It appears from a memorandum lodged by }{\fs24\lang2057\langfe1033\langnp2057\insrsid160336\charrsid160336 Mr}{
\fs24\lang2057\langfe1033\langnp2057\insrsid1975490\charrsid160336  }{\fs24\lang2057\langfe1033\langnp2057\insrsid11216632 Katz that counsel considered he}{\fs24\lang2057\langfe1033\langnp2057\insrsid1975490\charrsid160336 
 could not, for various reasons, in his client's interests, go to}{\fs24\lang2057\langfe1033\langnp2057\insrsid160336\charrsid160336  trial on the pleadings as then}{\fs24\lang2057\langfe1033\langnp2057\insrsid1975490\charrsid160336 
 formulated and that he considered be would have }{\fs24\lang2057\langfe1033\langnp2057\insrsid160336\charrsid160336 no option but to elect a non-sui}{\fs24\lang2057\langfe1033\langnp2057\insrsid1975490\charrsid160336 t.}{
\fs24\lang2057\langfe1033\langnp2057\insrsid9391114\charrsid160336  }{\fs24\lang2057\langfe1033\langnp2057\insrsid1975490\charrsid160336 A further course of action was contemplated because there was additiona
l evidence which would not be available at the trial date.
\par }{\fs24\lang2057\langfe1033\langnp2057\insrsid160336\charrsid160336 
\par }{\fs24\lang2057\langfe1033\langnp2057\insrsid1975490\charrsid160336 Hillyer J. had declined leave to the appellants to amend their claim but had granted their request for additional discovery from the respondents.
\par }{\fs24\lang2057\langfe1033\langnp2057\insrsid160336\charrsid160336 
\par At the trial in Auckl}{\fs24\lang2057\langfe1033\langnp2057\insrsid1975490\charrsid160336 and on 12th April 1999, the respondents obtained declarations at a formal proof hearing. Th}{\fs24\lang2057\langfe1033\langnp2057\insrsid160336\charrsid160336 e}{
\fs24\lang2057\langfe1033\langnp2057\insrsid1975490\charrsid160336  appellants attended through counsel but offered no opposition: they did not consent.
\par }{\fs24\lang2057\langfe1033\langnp2057\insrsid160336\charrsid160336 
\par }{\fs24\lang2057\langfe1033\langnp2057\insrsid1975490\charrsid160336 There was then a subsequent }{\fs24\lang2057\langfe1033\langnp2057\insrsid6901144 h}{\fs24\lang2057\langfe1033\langnp2057\insrsid1975490\charrsid160336 
earing about costs buttressed by written submissions from both counsel before Hillyer J. This decision resulted in the judgment currently under appeal.
\par }{\fs24\lang2057\langfe1033\langnp2057\insrsid160336\charrsid160336 
\par }{\fs24\lang2057\langfe1033\langnp2057\insrsid1975490\charrsid160336 One prel}{\fs24\lang2057\langfe1033\langnp2057\insrsid160336\charrsid160336 im}{\fs24\lang2057\langfe1033\langnp2057\insrsid1975490\charrsid160336 
inary matter concerns the jurisdiction of the High Court to make costs orders in whatever amount is considered appropriate. Section 92 of the Judicature Act 1980-81 provides:
\par }{\fs24\lang2057\langfe1033\langnp2057\insrsid160336\charrsid160336 
\par }\pard \ql \li720\ri0\widctlpar\faauto\adjustright\rin0\lin720\itap0\pararsid160336 {\fs24\lang2057\langfe1033\langnp2057\insrsid1975490\charrsid160336 
"Costs. Subject to this Act and to the provisions of the Crimes Act 1969, the High Court shall have power to make such order as it thinks just f
or the payment of the costs of any proceedings by or to any party thereto. Such costs shall be in the discretion of the Court,}{\fs24\lang2057\langfe1033\langnp2057\insrsid160336\charrsid160336  and may, if}{
\fs24\lang2057\langfe1033\langnp2057\insrsid1975490\charrsid160336  the Court thinks fit, be ordered to be charged upon or paid out of any fund or estate before the Court."
\par }\pard \ql \li0\ri0\widctlpar\faauto\adjustright\rin0\lin0\itap0\pararsid9391114 {\fs24\lang2057\langfe1033\langnp2057\insrsid160336\charrsid160336 
\par }{\fs24\lang2057\langfe1033\langnp2057\insrsid1975490\charrsid160336 Rule 300(1) of the Code of Civil Procedure provides to similar effect. }{\fs24\lang2057\langfe1033\langnp2057\insrsid11216632 We do not read the provisions of Ru}{
\fs24\lang2057\langfe1033\langnp2057\insrsid1975490\charrsid160336 le 300(3) (which refers to a Scale of Costs) as requiring the scale to be applied in every case other than those which come under the exceptional provisions of R
ule 309 which deals with cases involving novel or important questions.
\par }{\fs24\lang2057\langfe1033\langnp2057\insrsid160336\charrsid160336 
\par }{\fs24\lang2057\langfe1033\langnp2057\insrsid1975490\charrsid160336 We consider the appropriate approach is that taken by Hardie Boys J in the High Court in New Zealand in }{\b\i\fs24\lang2057\langfe1033\langnp2057\insrsid1975490\charrsid160336 
Morton v Douglas Homes L}{\b\i\fs24\lang2057\langfe1033\langnp2057\insrsid160336\charrsid160336 td (No}{\b\i\fs24\lang2057\langfe1033\langnp2057\insrsid1975490\charrsid160336 .2)}{\b\fs24\lang2057\langfe1033\langnp2057\insrsid1975490\charrsid160336  }{
\fs24\lang2057\langfe1033\langnp2057\insrsid1975490\charrsid160336 [1984] 2 NZLR }{\fs24\lang2057\langfe1033\langnp2057\insrsid6901144 62}{\fs24\lang2057\langfe1033\langnp2057\insrsid1975490\charrsid160336 0 where His Honour indicated }{
\i\fs24\lang2057\langfe1033\langnp2057\insrsid1975490\charrsid160336 
"the scale of costs ... was a legislative direction as to what is to be regarded as a reasonable contribution in the ordinary kind of case. If in the circumstances of a particular case compliance with that direction would not achieve the purpose of an awa
r
d of costs, the Court is entitled to award more (or less). While the nature and course of the proceedings must always be the dominant consideration, there was room for recognising the amount of solicitor and client costs actually and reasonably incurred i
n the particular case. "}{\i\fs24\lang2057\langfe1033\langnp2057\insrsid1975490 
\par }{\i\fs24\lang2057\langfe1033\langnp2057\insrsid2193572\charrsid160336 
\par }{\fs24\lang2057\langfe1033\langnp2057\insrsid2193572 We therefore think}{\fs24\lang2057\langfe1033\langnp2057\insrsid1975490\charrsid160336 
 the Judge was quite entitled to award for costs whatever amount seemed just to him in all the circumstances of this case. We consider that this was a case, like that of }{\b\i\fs24\lang2057\langfe1033\langnp2057\insrsid1975490\charrsid11216632 
Commerce Commission v Qantas Airways Ltd}{\fs24\lang2057\langfe1033\langnp2057\insrsid1975490\charrsid160336  }{\fs24\lang2057\langfe1033\langnp2057\insrsid2193572 [1992] 5}{\fs24\lang2057\langfe1033\langnp2057\insrsid1975490\charrsid160336  PRNZ 457 "}{
\i\fs24\lang2057\langfe1033\langnp2057\insrsid1975490\charrsid2193572 where the Court cannot take a view as to the merits of the plaintiff's allegations}{\fs24\lang2057\langfe1033\langnp2057\insrsid1975490\charrsid160336 
". There the Court followed another decision in the New Zealand High Court; i.e. that of Henry J in }{\b\i\fs24\lang2057\langfe1033\langnp2057\insrsid1975490\charrsid11216632 Chase Corporation Ltd v. Rank Overseas Holdings Ltd}{
\i\fs24\lang2057\langfe1033\langnp2057\insrsid2193572  }{\fs24\lang2057\langfe1033\langnp2057\insrsid1975490\charrsid160336 [1988] 1 PRNTZ 426-430.}{\fs24\lang2057\langfe1033\langnp2057\insrsid9391114\charrsid160336  }{
\fs24\lang2057\langfe1033\langnp2057\insrsid1975490\charrsid160336 In that case, }{\fs24\lang2057\langfe1033\langnp2057\insrsid8459283 H}{\fs24\lang2057\langfe1033\langnp2057\insrsid1975490\charrsid160336 enry J indicated, "}{
\i\fs24\lang2057\langfe1033\langnp2057\insrsid1975490\charrsid2193572 I}{\i\fs24\lang2057\langfe1033\langnp2057\insrsid11216632 t is not possible ... to form a}{\i\fs24\lang2057\langfe1033\langnp2057\insrsid1975490\charrsid2193572 
 judgment as to real strength or weakness of the}{\i\fs24\lang2057\langfe1033\langnp2057\insrsid11216632  claims without undertaking a fu}{\i\fs24\lang2057\langfe1033\langnp2057\insrsid1975490\charrsid2193572 
ll evaluation of the evidence and the legal issues, a task which is presently quite unsuitable. There}{\i\fs24\lang2057\langfe1033\langnp2057\insrsid8459283  may be instances where a claim}{
\i\fs24\lang2057\langfe1033\langnp2057\insrsid1975490\charrsid2193572  is so obviously without basis or an abuse of procedure when it can be said with confidence it should never have seen the light of day.}{
\fs24\lang2057\langfe1033\langnp2057\insrsid1975490\charrsid160336 .. ".
\par }{\fs24\lang2057\langfe1033\langnp2057\insrsid2193572 
\par }{\fs24\lang2057\langfe1033\langnp2057\insrsid1975490\charrsid160336 In a similar decision made in }{\b\i\fs24\lang2057\langfe1033\langnp2057\insrsid1975490\charrsid2193572 Kupe Group Ltd v. Ariadne Australia Ltd }{
\fs24\lang2057\langfe1033\langnp2057\insrsid2193572 (unreported) 1}{\fs24\lang2057\langfe1033\langnp2057\insrsid1975490\charrsid160336 3}{\fs24\lang2057\langfe1033\super\langnp2057\insrsid2193572\charrsid2193572 th}{
\fs24\lang2057\langfe1033\langnp2057\insrsid2193572  }{\fs24\lang2057\langfe1033\langnp2057\insrsid1975490\charrsid160336 January 1992, High Court, Auck
land, CP.151/88. There the plaintiff had discontinued on the eve of trial and had sought to oppose an application for costs by a defendant on the basis that the defendant was likely to be made liable if the matter went to trial. It was considered in that 
case that the Court could not possibly attempt to decide that allegation.}{\fs24\lang2057\langfe1033\langnp2057\insrsid1975490 
\par }{\fs24\lang2057\langfe1033\langnp2057\insrsid2193572\charrsid160336 
\par }{\fs24\lang2057\langfe1033\langnp2057\insrsid1975490\charrsid160336 In the }{\b\i\fs24\lang2057\langfe1033\langnp2057\insrsid1975490\charrsid2193572 Qantas}{\fs24\lang2057\langfe1033\langnp2057\insrsid1975490\charrsid160336 
 (supra) case, it was also pointed out that the scale is irrelevant in commercial litigation and that there is a discretion to override the scale on an application for c
osts on a discontinuance. The issue arose from the ownership by Qantas of shares in Air New Zealan}{\fs24\lang2057\langfe1033\langnp2057\insrsid2193572 d and from an attempt by the Comm}{\fs24\lang2057\langfe1033\langnp2057\insrsid1975490\charrsid160336 
erce Commission to seek some relief from that situation. There were questions of interlocutory issues and was some urgency. $20,000 costs plus disbursements was made to one of the parties. It was noted in that case that costs awarded are no}{
\fs24\lang2057\langfe1033\langnp2057\insrsid2193572 t a complete indemnity by any m}{\fs24\lang2057\langfe1033\langnp2057\insrsid1975490\charrsid160336 eans but awards are normally regarded as a contribution t}{
\fs24\lang2057\langfe1033\langnp2057\insrsid2193572 o costs, bearing in mind the am}{\fs24\lang2057\langfe1033\langnp2057\insrsid1975490\charrsid160336 ount of time involved and the importance of the litigation.}{
\fs24\lang2057\langfe1033\langnp2057\insrsid1975490 
\par }{\fs24\lang2057\langfe1033\langnp2057\insrsid2193572\charrsid160336 
\par }{\fs24\lang2057\langfe1033\langnp2057\insrsid1975490\charrsid160336 Having held that the High Court was entitled to make an award of costs, it}{\fs24\lang2057\langfe1033\langnp2057\insrsid2193572  }{
\fs24\lang2057\langfe1033\langnp2057\insrsid1975490\charrsid160336 is now appropriate to consider, as did the trial Judge at first instance for what is it that the first respondents are being compensated, in p
art, and secondly, how much did they actually expend in costs?}{\fs24\lang2057\langfe1033\langnp2057\insrsid1975490 
\par }{\fs24\lang2057\langfe1033\langnp2057\insrsid2193572\charrsid160336 
\par }{\fs24\lang2057\langfe1033\langnp2057\insrsid1975490\charrsid160336 I have already listed, as did the learned Judge, the various interlocutory and other steps taken th}{\fs24\lang2057\langfe1033\langnp2057\insrsid2193572 at involved the Court from the}{
\fs24\lang2057\langfe1033\langnp2057\insrsid1975490\charrsid160336  date of commencement of the proceedings in January 1998 until the formal hea}{\fs24\lang2057\langfe1033\langnp2057\insrsid6750282 ring of the counterclaim on 12}{
\fs24\lang2057\langfe1033\super\langnp2057\insrsid6750282\charrsid6750282 th}{\fs24\lang2057\langfe1033\langnp2057\insrsid1975490\charrsid160336 
 April 1999. In addition, because the non-suit was elected only one working day prior to the trial, one must assume that the defendants are entitled to some contribution for the costs of preparing for trial.}{
\fs24\lang2057\langfe1033\langnp2057\insrsid9391114\charrsid160336  }{\fs24\lang2057\langfe1033\langnp2057\insrsid1975490\charrsid160336 Th
is preparation would have had some difficulty because the witnesses were resident in the USA. Fortunately it was possible to cancel the airline bookings: nobody arrived in Auckland needlessly on the part of the respondents.}{
\fs24\lang2057\langfe1033\langnp2057\insrsid1975490 
\par }{\fs24\lang2057\langfe1033\langnp2057\insrsid2193572\charrsid160336 
\par }{\fs24\lang2057\langfe1033\langnp2057\insrsid1975490\charrsid160336 The next point is the amount of costs claimed.}{\fs24\lang2057\langfe1033\langnp2057\insrsid9391114\charrsid160336  }{\fs24\lang2057\langfe1033\langnp2057\insrsid1975490\charrsid160336 
The costs and disbursements for the solicitors in the Cook Islands were $NZ22,180.76 (including VAT).}{\fs24\lang2057\langfe1033\langnp2057\insrsid9391114\charrsid160336  }{\fs24\lang2057\langfe1033\langnp2057\insrsid1975490\charrsid160336 
The costs of the solicitors instructed by them in New Zealand were $51,438.71 and the costs and disbursements relating to the litigation payable to US attorneys amounted to $NZ}{\fs24\lang2057\langfe1033\langnp2057\insrsid8459283 1}{
\fs24\lang2057\langfe1033\langnp2057\insrsid1975490\charrsid160336 5,113.11. A total of $88,732.58.}{\fs24\lang2057\langfe1033\langnp2057\insrsid1975490 
\par }{\fs24\lang2057\langfe1033\langnp2057\insrsid1975490\charrsid160336 
\par Before Hillyer J. it was submitted an order representing a reasonable contribution to the first defendant's costs would be $65,000. Copies of the accounts setting out fill details of the work done were supplied.
\par }{\fs24\lang2057\langfe1033\langnp2057\insrsid1975490 
\par }{\fs24\lang2057\langfe1033\langnp2057\insrsid6750282 There are cases which spea}{\fs24\lang2057\langfe1033\langnp2057\insrsid1975490\charrsid160336 
k of the `Rolls Royce' treatment for costs and that those liable to contribute to costs should not have to pay for Rolls Royce treatment. Whilst not necessarily categorising this }{\fs24\lang2057\langfe1033\langnp2057\insrsid1975490 case as displaying R
olls Royce tr}{\fs24\lang2057\langfe1033\langnp2057\insrsid1975490\charrsid160336 eatme}{\fs24\lang2057\langfe1033\langnp2057\insrsid1975490 n}{\fs24\lang2057\langfe1033\langnp2057\insrsid1975490\charrsid160336 
t, it seems clear that the preparation undertaken by the respondents was extremely thorough: no undue risks appeared to have been taken and a very thorough presentation resulted.}{\fs24\lang2057\langfe1033\langnp2057\insrsid1975490 
\par }{\fs24\lang2057\langfe1033\langnp2057\insrsid1975490\charrsid160336 
\par Mr Katz urged on us that this is litigation in the Cook Islands;}{\fs24\lang2057\langfe1033\langnp2057\insrsid9391114\charrsid160336  }{\fs24\lang2057\langfe1033\langnp2057\insrsid6750282 that no previous award of}{
\fs24\lang2057\langfe1033\langnp2057\insrsid1975490\charrsid160336 
 costs, even in this Court, produced more than $15,000. There was the sum of $20,000 awarded by this Court in 1994 in respect of litigation concerning constitutional provisions in the Electoral
 Act relating to the eligibility of public servants to stand for parliamentary office. However, those were, from my recollection, reasonably lengthy proceedings which went to the High Court, the Court of Appeal and then on an application for leave to appe
al, to the Privy Council.}{\fs24\lang2057\langfe1033\langnp2057\insrsid1975490 
\par }{\fs24\lang2057\langfe1033\langnp2057\insrsid1975490\charrsid160336 
\par }{\fs24\lang2057\langfe1033\langnp2057\insrsid1975490 As Eichelbau}{\fs24\lang2057\langfe1033\langnp2057\insrsid8459283 m}{\fs24\lang2057\langfe1033\langnp2057\insrsid1975490\charrsid160336  CJ put it in }{
\b\i\fs24\lang2057\langfe1033\langnp2057\insrsid6750282 Waiatarua Ac}{\b\i\fs24\lang2057\langfe1033\langnp2057\insrsid3636294 tion Group v.}{\b\i\fs24\lang2057\langfe1033\langnp2057\insrsid1975490\charrsid1975490  Minister of State Owned Enterprises}{
\fs24\lang2057\langfe1033\langnp2057\insrsid1975490\charrsid160336  [1990] 2 PRNZ 447-451, one s}{\fs24\lang2057\langfe1033\langnp2057\insrsid8413286 hould not approach the matter of}{\fs24\lang2057\langfe1033\langnp2057\insrsid1975490\charrsid160336 
 costs on the basis of the parties' natural desire to have the best representation possible or the costs that may be incurred might be on the "to leave no stone unturned" basis.}{\fs24\lang2057\langfe1033\langnp2057\insrsid1975490 
\par }{\fs24\lang2057\langfe1033\langnp2057\insrsid1975490\charrsid160336 
\par Although we acknowled}{\fs24\lang2057\langfe1033\langnp2057\insrsid8413286 ge this was a case involving par}{\fs24\lang2057\langfe1033\langnp2057\insrsid1975490\charrsid160336 ties from other jurisdic
tions, it was not a particularly complex case of the unusual sort. Company deadlock issues are not unusual certainly in a Court in New Zealand; the amount involved was wider $200,000. True, the hearing had to be in New Zealand}{
\fs24\lang2057\langfe1033\langnp2057\insrsid8413286  and witnesses}{\fs24\lang2057\langfe1033\langnp2057\insrsid1975490\charrsid160336  had to come from USA. But we do not think that those facts, on their own, justify putting the costs in a}{
\fs24\lang2057\langfe1033\langnp2057\insrsid1975490  }{\fs24\lang2057\langfe1033\langnp2057\insrsid1975490\charrsid160336 bra}{\fs24\lang2057\langfe1033\langnp2057\insrsid8413286 cket much higher than any cost}{
\fs24\lang2057\langfe1033\langnp2057\insrsid1975490\charrsid160336  ever b}{\fs24\lang2057\langfe1033\langnp2057\insrsid8413286 efore been awarded in the Cook I}{\fs24\lang2057\langfe1033\langnp2057\insrsid1975490\charrsid160336 
slands particularly for a case which never went to trial and which only took a little over three months from start to finish.}{\fs24\lang2057\langfe1033\langnp2057\insrsid1975490 
\par }{\fs24\lang2057\langfe1033\langnp2057\insrsid1975490\charrsid160336 
\par It will often be the way that in litigation involving the Cook Islands, there will be hearings in Auckland and Auckland counsel will be involved but}{\fs24\lang2057\langfe1033\langnp2057\insrsid1975490  this was categorised by Mr Ch}{
\fs24\lang2057\langfe1033\langnp2057\insrsid1975490\charrsid160336 apman as an international case. It does not strike us as being a case of vast public importance, it had a scope of a fairly routine nature involving warring blocks of shareholders.}{
\fs24\lang2057\langfe1033\langnp2057\insrsid1975490 
\par }{\fs24\lang2057\langfe1033\langnp2057\insrsid1975490\charrsid160336 
\par We are aware that Courts of Appeal should not, and do not, interfere lightly with cost awards and that this is an appeal from the exercise of a discretion. }{\b\i\fs24\lang2057\langfe1033\langnp2057\insrsid8413286 Wilson }{
\b\i\fs24\lang2057\langfe1033\langnp2057\insrsid8459283 & }{\b\i\fs24\lang2057\langfe1033\langnp2057\insrsid8413286 Horto}{\b\i\fs24\lang2057\langfe1033\langnp2057\insrsid1975490\charrsid1975490 n v. Attorney-General}{
\fs24\lang2057\langfe1033\langnp2057\insrsid1975490\charrsid160336  }{\fs24\lang2057\langfe1033\langnp2057\insrsid1975490 [1997] }{\fs24\lang2057\langfe1033\langnp2057\insrsid1975490\charrsid160336 2}{\fs24\lang2057\langfe1033\langnp2057\insrsid1975490 
 NZLR 513 is but one example (a}{\fs24\lang2057\langfe1033\langnp2057\insrsid1975490\charrsid160336 t p 529).of the Court being reluctant on appeal to interfere with a discretionary costs order but nevertheless should do so if it considered the J
udge had not proceeded on an incorrect basis.}{\fs24\lang2057\langfe1033\langnp2057\insrsid1975490 
\par }{\fs24\lang2057\langfe1033\langnp2057\insrsid1975490\charrsid160336 
\par }{\fs24\lang2057\langfe1033\langnp2057\insrsid1975490 In this present ca}{\fs24\lang2057\langfe1033\langnp2057\insrsid1975490\charrsid160336 se, we ar}{\fs24\lang2057\langfe1033\langnp2057\insrsid8413286 e of the view that the learned J}{
\fs24\lang2057\langfe1033\langnp2057\insrsid1975490\charrsid160336 udge, by making an award of this dimensio}{\fs24\lang2057\langfe1033\langnp2057\insrsid1975490 n}{\fs24\lang2057\langfe1033\langnp2057\insrsid1975490\charrsid160336 
, went beyond the acceptable limits of the discretion for a matter of t}{\fs24\lang2057\langfe1033\langnp2057\insrsid8413286 his nature. We acknowledge, as h}{\fs24\lang2057\langfe1033\langnp2057\insrsid1975490 e did, costs should not be puniti}{
\fs24\lang2057\langfe1033\langnp2057\insrsid1975490\charrsid160336 ve but we do not think the amount of $40,000 reasonable; even considering the amount that the respondents had incurred.}{\fs24\lang2057\langfe1033\langnp2057\insrsid1975490 
\par }{\fs24\lang2057\langfe1033\langnp2057\insrsid1975490\charrsid160336 
\par This is not one of those cases where solicitor/client costs should be ordered. There is a authority su
ggesting repayment of solicitor/client costs but usually where the party who has to pay has acted in a high-handed or extremely dilatory way. Nobody can say this case was in that category. A}{\fs24\lang2057\langfe1033\langnp2057\insrsid1975490  }{
\fs24\lang2057\langfe1033\langnp2057\insrsid1975490\charrsid160336 large costs order was made yet the case was really brief, lasting only three months. The total amount of the claim was not extraordinarily high.}{
\fs24\lang2057\langfe1033\langnp2057\insrsid1975490 
\par }{\fs24\lang2057\langfe1033\langnp2057\insrsid1975490\charrsid160336 
\par Giving the matter the best consideration we can, we consider that the amount of costs should be $15,000 plus disbursements as fixed by the Registrar but in any event, those di
sbursements are not to exceed $5,000, The appeal is accordingly allowed as indicated.
\par }{\fs24\lang2057\langfe1033\langnp2057\insrsid1975490 
\par 
\par 
\par 
\par }{\b\fs24\ul\lang2057\langfe1033\langnp2057\insrsid1975490\charrsid1975490 ADDENDUM
\par }{\fs24\lang2057\langfe1033\langnp2057\insrsid1975490\charrsid160336 
\par After hearing the oral submissions of counsel, we award to the appellants for this appeal $1,000 tests plus reasonable disbursements as fixed (if necessary) by the Registrar.
\par }}