Tomita v The Unnamed Vessel
Formerly Known as "Amami Taiki Go" and Also Known as "Intrepid" (No 4)

IN THE HIGH COURT OF NEW ZEALAND
AUCKLAND REGISTRY
IN ADMIRALTY

AD36/00

ADMIRALTY ACTION IN REM

BETWEEN Y TOMITA
Plaintiff

AND THE UNNAMED VESSEL FORMERLY KNOWN AS "AMAMI TAIKI GO" AND ALSO KNOWN AS "INTREPID"
Defendant

AND M YOKOYAMA
Third Party

Dates of hearing: 4 and 8 November 2002

Counsel: Andrew Tetley and Shee-Jeong Park for the Plaintiff
John Gresson for Boyd Smith, the owner of the vessel
Philip Rzepecky for the Registrar of the High Court

Date of judgment: 6 May 2003

JUDGMENT OF CHAMBERS J

Lawyers:
Wilson Harle, PO Box 4539, Shortland Street, Auckland, for the Plaintiff
Norton White, PO Box 6623, Wellesley Street, Auckland, for Boyd Smith
McElroys, PO Box 835, Auckland, for the Registrar of the High Court

Costs following arrest of a vessel

[1] In August 2000, a vessel, formerly known as Amami Taiki Go, and also known as Intrepid, was arrested in New Zealand. Its owner at that time was a New Zealander, Boyd Smith. The ship was arrested at the instigation of a Japanese company director, Yoshinari Tomita. Mr Tomita claimed that he had a mortgage over the vessel and that it had been wrongly sold by the mortgagor, Hirosuke Komeiyama, eventually being bought by Mr Smith. Mr Tomita commenced an admiralty action in rem in the High Court of New Zealand.

[2] Last year, he discontinued the proceeding. That discontinuance has prompted an application for costs by Mr Smith against Mr Tomita. Mr Tomita has opposed that application. It is that application with which this judgment is primarily concerned.

[3] Mr Tomita has also made a claim of his own. He had to pay to the registrar of the High Court the sum of $23,618.80 to maintain and preserve the vessel under arrest. Mr Tomita claims that Mr Smith is bound to reimburse him for that cost.

Issues

[4] There are three principal issues which I must determine. The first relates to a plea of issue estoppel. Mr Smith brought a claim against Mr Tomita in the Osaka District Court in Japan. He sought as part of the damages he was seeking reimbursement of his legal costs in New Zealand. The claim failed. Mr Tetley, for Mr Tomita, has submitted that Mr Smith is now estopped from seeking recovery of costs in New Zealand. He says that the issues have already been determined by the Japanese court and "it would be a wrong to allow [Mr Smith] to re-litigate the same issues in this proceeding". The first issue, therefore, is to determine whether Mr Smith is estopped from seeking costs by reason of the Japanese judgment.

[5] If he is not estopped, then the second issue is the amount of any costs award. Mr Gresson, for Mr Smith, has sought an award of "increased costs" as defined in r 48C of the High Court Rules. Mr Tetley opposes any award of increased costs. He submits that costs should be awarded according to scale. He further submits that, with respect to any step of the proceeding in which Mr Tomita was successful, Mr Tomita should get an award of costs to be offset against the costs to which Mr Smith would otherwise be entitled on the discontinuance.

[6] The third issue relates to Mr Tomita's claim to be entitled to reimbursement of the money he paid to the registrar to maintain and preserve the vessel while it was under arrest. Mr Tetley submitted that, on a correct interpretation of r 778(8) of the High Court Rules, Mr Boyd was liable to reimburse Mr Tomita for that expenditure. Mr Gresson resists that interpretation.

[7] Before I turn to consider those issues, I should refer to one matter which Mr Smith raised but then dropped. In his notice of application, he had sought an order against the registrar and/or Mr Tomita "for payment to [Mr Smith] of costs reasonably incurred or to be incurred in repairing damage to and accelerated deterioration of the [vessel] whilst in the custody of the Registrar during the period from August 2000 to July 2002". Before the hearing, Mr Gresson advised that he did not intend to pursue that application at this stage. He accordingly withdrew it whilst purporting to reserve rights he may have against the registrar and Mr Tomita in this respect. Neither Mr Tetley nor Mr Rzepecky, for the registrar, opposed the withdrawal of this application.

Estoppel

[8] Mr Tetley submitted that Mr Smith was estopped from seeking recovery of costs in New Zealand as a result of a decision in litigation Mr Smith had commenced against Mr Tomita in Japan. Because while this litigation was in foot the parties were also litigating in Japan, giving rise to a number of decisions in their courts, some of which have a bearing on the issues with which I have to deal, I shall begin this section of the judgment with a reference to the Japanese decisions and the names by which I shall be referring to them in an attempt to minimise confusion. The first Japanese judgment was a judgment of the Osaka District Court dated 12 July 1999: the July 1999 judgment. The second was also a judgment of the Osaka District Court, this time dated 25 April 2001: the April 2001 judgment. That judgment went on appeal. The Osaka High Court delivered its decision on 27 September 2001: the High Court judgment. Mr Tomita sought to appeal against that judgment to the Japanese Supreme Court, but it declined leave on 26 March 2002: the Supreme Court judgment. Finally, there was another decision of the Osaka District Court on 12 September 2002: the September 2002 judgment. It is this last decision which is said to found the estoppel.

[9] In the proceeding which led to the September 2002 judgment, Mr Smith alleged that Mr Tomita had negligently caused the vessel to be arrested on the basis that he was "the hypothecator of the vessel" when he was not. A hypothecator in Japanese law has a status something like a mortgagee or charge-holder in our law. Mr Smith claimed damages totalling in excess of 53 million yen. Part of that sum comprised Mr Smith's legal expenses in New Zealand. Judge Nakamoto dismissed Mr Smith's claim. He noted that the neteito-ken (or hypothec) had been held void in the High Court judgment. Notwithstanding that, the judge considered that Mr Tomita could not be judged to have been negligent in having the vessel arrested in reliance on the hypothec since at the date of arrest the hypothec was registered and Mr Tomita was entitled to presume that such registration was valid. Mr Smith had not therefore proved negligence and his claim must fail. The court did not need to consider the damages claim as Mr Smith failed to establish liability.

[10] Mr Tetley submitted that the September 2002 judgment was "final": there had been no appeal. The costs now claimed are the same costs that were claimed in that Japanese proceeding. Mr Smith could not now re-litigate that matter. Mr Tetley cited as authority Halsbury's Laws of England, vol 16, para 977.

[11] Mr Gresson submitted that Mr Smith was not estopped from seeking costs by virtue of the September 2002 judgment. I agree. The issue determined by the Japanese judgment was whether Mr Tomita had negligently arrested the vessel. The court determined that issue in Mr Tomita's favour. The court never dealt with the question of what the appropriate damages would have been had negligence been established. The issue the Japanese court grappled with was accordingly different from the issue I need to determine, namely the costs, if any, which should be awarded to Mr Smith on Mr Tomita's discontinuance of his New Zealand admiralty proceeding. One of the essential conditions for the application of the issue estoppel doctrine is missing. The question I have to decide is not the same question as was determined in the Japanese court.

[12] Mr Gresson's next point on this topic also has validity. Mr Gresson submitted that the "supposed monetary tie-up" between the claim for damages, including legal expenses in Japan, and the claim for costs in New Zealand was "more apparent than real". In Japan, he said, Mr Smith was seeking as part of his damages his actual legal expenses. That was not what he was seeking in New Zealand. Rather, he was seeking to persuade the court that Mr Tomita should pay costs under the costs regime established by the High Court Rules. That costs regime is not based on actual costs at all. The principles in r47 make that clear: see in particular paras (c) and (e) and see also r48A and the Second Schedule. Indeed, in the normal case, it is inappropriate for counsel to refer to a party's actual costs on an application for costs: see Nomoi Holdings Ltd v Elders Pastoral Holdings Ltd (2001) 15 PRNZ 155, paras 33-34. I agree with Mr Gresson that there is a fundamental difference between a claim for damages which includes a claim for actual legal expenses and a claim for costs under the High Court's discretion.

[13] Mr Gresson raised a further argument on this topic. He submitted that the Japanese judgment had not been properly proved. A Japanese lawyer swore an affidavit in which the September 2002 judgment was annexed as an exhibit. The lawyer then undertook a translation which he also annexed as an exhibit. He did not translate all the judgment: he omitted part. While he did not give an explanation for that omission, it would seem in the context that he regarded the omitted part as irrelevant for current purposes. Probably his assessment in that regard was correct. Mr Gresson submitted, however, that the omission was fatal to a finding that the foreign judgment had been properly proved. I do not need to determine whether Mr Gresson's submission in that regard was correct as I am satisfied for the other reasons given that the plea of issue estoppel must fail.

Award of costs

[14] Having determined that Mr Smith is not estopped from pursuing his claim for costs, I turn now to considering what the quantum of costs should be. Rule 476(1)(a) of the High Court Rules read at the relevant time:

Unless the defendant otherwise agrees or the Court otherwise orders, a plaintiff who discontinues a proceeding under rule 474 shall pay to the defendant the costs of the proceeding and of all incidental steps up to and inclusive of the discontinuance.

[15] In determining what those costs should be, one then refers back to the general costs rules beginning at r46. Those general rules and r476 apply to admiralty proceedings by virtue of r766.

[16] At an evaluation conference I conducted on 6 June 2001, I recorded counsel's agreement that this was a category 2 proceeding. I agreed with counsel's assessment and did so categorise it. Mr Gresson, in his submissions, suggested that "any acquiescence by Mr Smith to that categorisation was specifically in the context of fixing security for costs only". I do not accept that. The purpose of the categorisation was to provide greater certainty to the parties as to the basis on which future costs were likely to be awarded: see r48(2). Of course, such future categorisation is not irrevocable. Nor does it prevent applications for increased or reduced costs. But it is not correct to say that my categorisation was solely for the limited purpose suggested.

[17] Mr Gresson, in a schedule to his submissions, set out a claim for costs on a 2C basis. Excluding disbursements, the total came to $41,665. Mr Gresson argued that, whether the matter was calculated on a 2B basis, as Mr Tetley submitted, or a 2C basis, there should be an uplift for factors he mentioned and to which I shall come. In reality, it was those same factors which led to Mr Gresson's advocacy of a band C time allowance for every step in the proceeding. He did not independently advance a submission demonstrating that every step had taken much longer than normal: see r48B(2)(c). Indeed, he did not show that any step was worthy of the higher banding.

[18] On a 2B basis, Mr Smith's claim for costs came to $25,870, excluding disbursements. But Mr Tetley argued that he should not recover that much. That was because, Mr Tetley submitted, Mr Smith's claim included two interlocutory applications on which Mr Tomita was successful. With respect to those, he submitted, not only should Mr Smith not get costs but Mr Tomita should, thus providing an offset. Such an approach is consistent, Mr Tetley said, with r48E, which in effect provides a general rule that the party successful on an interlocutory application should receive costs in respect of it. I agree with Mr Tetley that that is the general rule.

[19] The first of the two applications to which Mr Tetley referred was a stay application filed by Mr Smith in September 2000. Mr Tomita opposed the application. Rodney Hansen J heard the application in November 2000. His Honour delivered his decision on 8 December 2000: now reported at 16 PRNZ 459. He refused a stay and reserved costs. I see no reason why Mr Tomita should not have costs with respect to that application to which his opposition was successful.

[20] In October 2001, Mr Tomita sought a number of interlocutory orders, including an order for stay pending judgment by the Supreme Court of Japan on Mr Tomita's appeal from the High Court judgment. Mr Smith opposed the applications. The hearing of these applications took place before Potter J in November 2001. She delivered a reserved decision on 5 December 2001. Although Mr Tomita was successful in obtaining an order for stay, he was unsuccessful with respect to the other orders he sought. Potter J said nothing about costs. Mr Tetley told me that she had enquired about costs and that neither side had sought them, at least at that stage. For costs purposes, I regard that application as an overall draw. Neither side was totally successful or totally unsuccessful. Costs should lie where they fall.

[21] With respect to the first stay application, Mr Smith had claimed 1.6 days before uplift. That time should be deducted from the total time claim. Mr Tomita should be given an offset allowance of 1.6 days for his successful opposition to that application.

[22] With respect to the second application I have discussed, Mr Smith claimed 1.6 days. That claim should be deleted. That brings the claim to 15.1 days at $1300 a day. The claim becomes $19,630.

[23] Before I go on to deal with disbursements, about which there is also dispute, I shall deal with Mr Smith's claim for increased costs under r 48C(1)(a). Mr Gresson put this argument on a number of bases. First, he submitted that the proceeding was "unfounded". He suggested that Mr Tomita's reliance on the neteito-ken was doomed from the start. Mr Gresson said that Mr Tomita "well knew his claims were unfounded" from the time of the July 1999 judgment. On that occasion, Mr Gresson submitted, the Osaka District Court delivered a judgment "to the effect that [Mr Tomita] had no rights in the vessel".

[24] Mr Tetley described Mr Gresson's representation of that decision as "highly misleading". I have no expertise in Japanese law. From my reading of the July 1999 judgment, however, I would have to agree with Mr Tetley that the judgment did not declare that Mr Tomita had no rights in the vessel. Rather, Mr Tomita's application to detain the vessel in Japan (which is where the vessel was at the time) appears to have failed because he did not present the right legal documents.

[25] Further, it cannot be overlooked that Mr Tomita's claim based on the neteito-ken succeeded in the Osaka District Court in April 2001. I accept that that decision was subsequently reversed, but the fact that a judge at first instance accepted Mr Tomita's argument suggests that the argument was not wholly without merit. In addition, the failure of Mr Smith's negligence claim and the reasons for that failure support the view that, while Mr Tomita was eventually unable to sustain a property claim to the vessel, his attempts were not wholly unreasonable.

[26] I also note that Mr Smith did not seek to have the New Zealand proceeding struck out on the basis that it did not disclose a cause of action or was otherwise an abuse. Nor did he seek summary judgment. Mr Tomita's claim in New Zealand was ultimately unsuccessful, but it has not been shown that he knowingly pursued a meritless claim.

[27] For these reasons, I reject the first ground advanced for increased costs.

[28] The second ground advanced was that Mr Tomita wrongly commenced this proceeding in New Zealand. Mr Gresson submitted that "it was inevitable that [Mr Tomita's] claims would either have to be considered by a Japanese court, or would require significant Japanese law expertise to resolve". It was therefore necessary and reasonable, Mr Gresson contended, for Mr Smith to seek a stay of this proceeding in favour of Japanese proceedings.

[29] Effectively, Mr Gresson is asking me to review the wisdom of Rodney Hansen J's decision to decline Mr Smith's stay application. That decision was not appealed. I decline to review it. Later, after substantive Japanese proceedings were commenced by Mr Smith, it was Mr Tomita who sought a stay of the New Zealand proceedings pending determination of the Japanese proceedings by the Japanese Supreme Court. On that occasion, it was Mr Smith who opposed the application for stay. His opposition was unsuccessful.

[30] I do not consider that Mr Tomita was unreasonable in commencing proceedings in New Zealand. This was a case without a clear-cut forum conveniens. Mr Tomita was in Japan and was mounting a claim founded on Japanese law. But Mr Smith and the vessel were in New Zealand. As Rodney Hansen and Potter JJ's respective stay decisions make clear, the situation was fluid as to which country's courts should take priority at different stages of the dispute resolution process.

[31] Mr Gresson's next argument in favour of increased costs was that Mr Tomita had been guilty of "numerous delays" in advancing his claim. I am not persuaded that that is the case, but even if it is, such delays were not of such magnitude as to justify increased costs in Mr Smith's favour. Both sides engaged in interlocutory warfare, each having a share of success and failure. Each side sought at different stages a stay: in Mr Smith's case unsuccessfully, and in Mr Tomita's case successfully. Each application was opposed. Litigation was being pursued both in Japan and here. That did, for understandable reasons, lead to some delay.

[32] So far as I can ascertain, at no stage during the interlocutory skirmishing did Mr Smith advance an argument for increased costs, whether on the basis of delay or for any other reason. Indeed, it is noteworthy that on very few occasions did Mr Smith ever seek costs during the interlocutory phase. The new costs regime encourages costs orders to be made as the proceeding progresses. Part of the reason for that is that the judicial officer who deals with each application is in a much better position to assess an appropriate costs order than a judge coming to the matter cold at a proceeding's end. This file is now extremely large. It is very difficult to assess the reasonableness of each party's conduct at each stage.

[33] Mr Gresson's final point was that increased costs were justified in cases where the arrest of a ship was shown to be unjustifiable. Mr Gresson submitted that arresting a ship is a "draconian step". It is, he submitted, "well nigh impossible" to have an arrest set aside prior to a substantive hearing. Even if the arrest is later shown to be unjustifiable, an innocent defendant ship-owner who has suffered loss by the arrest cannot recover that loss unless he or she is able "to establish malice or crassa negligentia". In these circumstances, Mr Gresson submitted, increased costs for the ship-owner are "an appropriate balancing response". As authority, Mr Gresson cited The Kommunar (No. 3) [1997] 1 Lloyd's Rep 22, 33 and Mobil Oil New Zealand Limited v The ship "Rangiora" [2000] 1 NZLR 49, 65. In essence, what Mr Gresson was arguing is that admiralty law is defective in recompensing innocent ship-owners whose vessels are unjustifiably arrested. One way to assist them is to award them higher costs than would otherwise be the case.

[34] I am not convinced that the current "balance" of admiralty law is wrong. I would certainly need much more argument before I could safely conclude that. Even if it is wrong, however, the way to remedy that is to change that aspect of admiralty law which is perceived to be erroneous, and that is probably best done by Parliament: see Armada Lines Limited (now Clipper Shipping Lines) v Chaleur Fertilizers Limited [1997] 2 SCR 617, 627. It is not the function of the costs regime to remedy perceived defects in other areas of the law.

[35] Accordingly, I reject all of Mr Gresson's grounds for an award of increased costs. Mr Smith will be entitled to costs on an effective 2B basis. After allowing for offsets, I award him $19,630.

[36] I now turn to disbursements.

[37] There is no dispute about filing fees in the sum of $625.

[38] The remaining disbursements claimed were all disputed. They fall into three groups. The first group comprises the fees incurred by Mr Smith in retaining a Japanese lawyer, Tsuguo Fujimaki, to advise on Japanese law and prepare affidavits. Mr Fujimaki prepared five affidavits. His fees came to almost $40,000. Mr Tetley opposed any recovery with respect to Mr Fujimaki's fees. The first three affidavits, he submitted, were filed with respect to Mr Smith's application for stay, which was unsuccessful. The fourth affidavit was filed with respect to Mr Tomita's application for sale, which was never determined. The fifth affidavit was prepared in relation to an application which was never filed in court. Mr Tetley submitted that Mr Smith could not recover costs for a step which was not taken.

[39] I have already held that Mr Smith is not entitled to costs with respect to his unsuccessful application for stay. Indeed, in respect of that application, I have allowed an offset for costs in Mr Tomita's favour. It would be inconsistent to allow Mr Smith disbursements on an application for which he has been denied costs. Mr Smith cannot therefore recover Mr Fujimaki's costs with respect to the first three affidavits.

[40] Mr Fujimaki's fourth affidavit was filed in relation to an application which I have held was effectively a draw: see para 20. I awarded no costs in respect of that application. It follows no disbursements should be awarded either.

[41] The final affidavit was purportedly sworn in support of "defendant's application to strike out proceeding and set aside arrest". So far as I can ascertain from the court file, Mr Tetley's submission that such an application was never filed appears to be right. Certainly none of the decisions refers to such an application. In the circumstances, therefore, the costs incurred in having this affidavit prepared cannot be recovered. I therefore decline the claim for disbursements in so far as Mr Fujimaki's fees are concerned.

[42] The second category relates to a fee of Wilfred Wakeley. Mr Wakeley was originally a Canadian lawyer, but for more than 20 of the past 35 years he has lived and worked in Japan as a lawyer. He swore an affidavit on 2 October 2001. The primary purpose of the affidavit was to provide translations of various Japanese judgments. In addition, however, Mr Wakeley expressed some limited opinions on matters of Japanese law. Mr Tetley accepted that it was reasonable to provide the New Zealand court with translations of the relevant Japanese judgments. He submitted, however, that those translations could have been supplied at a much lower cost. Mr Wakeley appears to have billed for this work 42.5 hours for a total fee of 1,501,000 yen. At the conversion rate used by Mr Smith, 60 yen to NZ$1.00, that equates to a fee of approximately NZ$25,000. Marjory Nixon swore an affidavit on behalf of Mr Tomita indicating that two local Japanese translators would have been prepared to translate the judgments, in one case for $2,025, and in the other for approximately $1,200. The law does not require translations of judgments to be provided by lawyers. It is unreasonable for Mr Smith to expect Mr Tomita to pay for such a deluxe translation service. It would obviously have been much cheaper for an ordinary translator to have provided the translations. Mr Wakeley might have undertaken an editing role and might have provided some supplementary comment.

[43] I am not going to limit Mr Smith's recovery with respect to Mr Wakeley's fee to the cost of local translators because I accept that Mr Wakeley did provide some additional comment, albeit very limited. In the circumstances, I shall allow under this head $10,000.

[44] The final disbursement claimed was Darrell Daish's fee. Mr Daish is a master mariner and an experienced vessel valuer and appraiser. His fee was $949. He swore an affidavit in support of Mr Smith's opposition to Mr Tomita's application for sale pendente lite. That application was one of the collection of applications dealt with by Potter J in her judgment of 5 December 2001. While overall the result that day was a draw, Mr Tomita's application for sale pendente lite failed. Since Mr Daish's affidavit related solely to that application, it is fair that Mr Smith recover Mr Daish's fee. That seems particularly appropriate given that Mr Daish's opinion was expressly referred to by Potter J in her decision and was a powerful factor in her decision to reject that particular application advanced by Mr Tomita: see Potter J's judgment at para 34.

[45] If I determined that Mr Smith could claim with respect to Mr Daish, then Mr Tetley had no submission with respect to quantum. I therefore allow Mr Smith in respect of Mr Daish's fee the full fee, $949.

Rule 778

[46] While Mr Tomita did not make a claim for his legal costs in connection with the arrest of the vessel, he did claim that Mr Smith should reimburse him for the "operational expenses necessarily incurred by the Registrar for the upkeep of the vessel" while it was under arrest. Mr Tomita said that he had paid a little over $23,000 to the registrar to maintain the vessel under arrest. Mr Tetley submitted that Mr Tomita was entitled to reimbursement of that sum under r778(8) of the High Court Rules. That subclause reads as follows:

Before property under arrest is released in compliance with a release issued under this rule, the party at whose instance it was issued must, in accordance with the directions of the Registrar, either pay the cost, charges, and expenses due in connection with the care and custody of the property while under arrest or give a written undertaking to pay those costs, charges, and expenses.

[47] It was common ground that the registrar had not, at least yet, given any directions under that subclause. But Mr Gresson did not take that point. He, like Mr Tetley, wanted me to give an interpretation of subcl(8). If it was in favour of Mr Tomita, then Mr Gresson was prepared to concede that the registrar's failure to give directions was wrongful and could be remedied. Mr Gresson's submission was that the registrar's "failure" to give directions was deliberate. The registrar was fully paid up. Nothing was due to him. Hence there was no need for "directions".

[48] Before I turn to counsel's respective submissions on subcl(8), I need to set out briefly the procedural history relevant to it.

[49] On 20 June last year, the parties were before Potter J. By this stage, it was known that Mr Tomita's application for leave to appeal to the Japanese Supreme Court had been unsuccessful. Mr Gresson submitted that, in light of that, there was "nothing left for [Mr Tomita] in these proceedings, and … the vessel should be released". Mr Tetley had opposed that. He sought an adjournment as he had been unable to obtain instructions from Mr Tomita in Japan. He submitted that Mr Tomita's claim was not necessarily dead as he might still be able to claim pursuant to "an equitable mortgage". Potter J, on that day, made the following order:

Unless [Mr Tomita] within 14 days takes further steps in the proceedings to satisfy the Court that the vessel should not be released from arrest, an order will be made for the release of the vessel at the expiration of 14 days, costs to be reserved for further submission.

[50] The parties appeared before Potter J again on 4 July last year. Potter J delivered a minute, part of which read as follows:

[Mr Tomita] having taken no steps, pursuant to [5] of my minute of 20.6.02, the vessel is released from arrest.

[51] Potter J also noted in that minute that Mr Gresson foreshadowed a strike out application. Mr Tetley foreshadowed an appeal.

[52] The matter then came before Priestley J on 22 August last year. It was at that stage that Mr Tomita discontinued the proceeding. Priestley J noted that a "related appeal" to the Court of Appeal had been abandoned.

[53] There can be no doubt therefore that this vessel was released from arrest at the instance of Mr Smith: see r778(4). Prima facie, therefore, it was Mr Smith who was bound to pay "the costs, charges, and expenses due in connection with the care and custody of the property while under arrest". The issue is as to the meaning of "due". Mr Gresson submits that that term means "outstanding at the date of release". There was no sum then due or outstanding. Mr Tetley submits that "due" in subcl(8) means "already incurred" as in Order 75, rule 13(7) of the Rules of the Supreme Court 1965 (England).

[54] I do not consider that there is any difference in meaning between that English rule and ours. In both cases, the arresting official, the registrar in New Zealand, the marshal in England, looks to the party who has obtained the release only with respect to unpaid fees and fees yet to be billed.

[55] Mr Tetley was not able to cite any authority, either New Zealand or English, for his interpretation. Mr Tetley's interpretation would lead to an anomalous result. Suppose the release is made at the instance of the arresting party under r778(2). That arresting party may already have paid costs to the registrar pursuant to the warrant of arrest. On Mr Tetley's interpretation of r778(8), the arresting party would presumably have to pay the same costs again, only then presumably to have the second payment refunded. That makes no sense at all.

[56] Further, Mr Tetley's interpretation would mean that these detailed rules would have a lacuna. If, as Mr Tetley submits, the registrar ends up getting paid twice for past services, once by the arresting party and again by the party obtaining the release, then one would expect the rules to provide for what the registrar is to do with the second payment. The rules contain nothing. The reason they contain nothing is that they do not envisage double payment.

[57] I hold that the registrar acted correctly in giving directions to Mr Smith under r778(8), there being no costs, charges and expenses due in connection with the care and custody of the property while under arrest. Everything was apparently paid up. Mr Smith was not bound to reimburse the registrar with respect to the costs Mr Tomita had earlier paid to the registrar. It follows that the registrar was not bound to pay anything to Mr Tomita. Mr Tomita's hope of recovering those expenses was lost when he discontinued this proceeding.

Result

[58] I find that Mr Smith is not estopped from pursuing a costs application by reason of the September 2002 judgment.

[59] I order Mr Tomita to pay to Mr Smith costs in the sum of $19,630, together with disbursements totalling $11,574, made up thus:

[a] Filing fees $625

[b] Mr Wakeley's fees $10,000

[c] Mr Daish's fee $949

[60] I dismiss Mr Tomita's application under r778(8) for reimbursement of the sum he had paid to the registrar to maintain the vessel while under arrest.