Judge finds lessor’s claimed quantum of costs wholly reasonable
In a proceeding involving a lease with an annual consumer price index (CPI) rental increase, the New Zealand High Court awarded the lessor $2,868 in costs upon finding its requested quantum of costs entirely appropriate and reasonable.
In Caisteal An Ime Limited v Mount Cass Holdings Limited [2026] NZHC 2810, the plaintiff leased an Akaroa property from the defendant under a standard-form agreement to lease and deed of lease.
The plaintiff asserted that there would be no rent reviews within the term of the lease or any renewal because the agreement stated no specific date for such. The defendant disagreed.
Under ss 245 and 246 of the Property Law Act 2007, the defendant served on the plaintiff a notice requiring payment of alleged rent shortfalls.
At the plaintiff’s request, on 22 August 2023, Justice Churchman issued a without-notice interim injunction preventing the defendant from cancelling the lease until a further court order. The judge reserved costs.
Eventually, the parties referred the underlying dispute to arbitration. In a 17 December 2023 award, the arbitrator favoured the defendant.
On 6 December 2024, Justice Preston dismissed the plaintiff’s appeal from the arbitral decision and awarded the defendant costs on a 2B basis.
Justice Preston denied the plaintiff’s application for leave to bring a second appeal. On 10 September 2025, the judge awarded the defendant indemnity costs in connection with this leave application.
On 8 March 2024, the plaintiff discontinued this proceeding. Accordingly, Associate Judge Lester issued directions ultimately ending the proceeding. The associate judge reserved costs.
Pending the determination of that appeal, the parties agreed that:
The proceedings have since been resolved on their merits. In a joint memorandum dated 3 September 2026, counsel asked the court to determine the issue of costs.
The High Court found the defendant, as the successful party, entitled to the costs of the proceeding. The court acknowledged that the defendant incurred costs for taking steps in the proceeding before the parties’ agreement to a discontinuance.
Agreeing with the defendant, the court held that the plaintiff:
Lastly, the court did not consider the ruling in Chapman v Badon Ltd [2010] NZCA 613, cited by the plaintiff, helpful to its determination.
Here are some other recent property-related decisions by the High Court of New Zealand.
On 9 July 2026, the court awarded costs of $37,030 to a testator’s half-brother, who was the most successful party in the estate proceedings, given that he obtained two investment properties based on his testamentary promises claim.
In an estate dispute between siblings, the court issued an 8 July 2026 order for the brother to vacate and give up possession of the property where he was residing to his sister as administrator of the estate of their late father.
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