$159,000 awarded to Matai associates

Press, 24 April 1986, Page 1

$159,000 awarded to Matai associates

In one of the biggest awards of costs made by a New Zealand court, Kevin Francis Meates, a Christchurch businessman, his relations and associates in the ill-fated Matai Industries venture on the West Coast, have been awarded $159,564 by the Court of Appeal.

Matai Industries, Ltd, which was set up under the auspices of Mr Norman Kirk and the Labour Government, was in business for only nine months and has been described as a financial disaster which cost the taxpayer a fortune. The costs have been awarded against the Crown. The Matai project, conceived by Mr Meates, set up plants on the West Coast to manufacture plastic and wood products such as toys. The Labour Government, which was elected in 1972, put up

two-thirds of the working capital and Mr Meates and his associates, onethird. Shareholders lost their equity in the ill-fated venture but Mr Meates and his associates sued the Crown for negligence and recovered compensation fixed by the Court of Appeal. The case in the Court of Appeal was presented by Messrs John Cadenhead and W. J. Gough. Messrs D. L. Mathieson and R. J. Buchanan appeared for the Crown. The appellants were

Kevin Meates; John David Meates, a company director, of Auckland; Jean Mary Meates, married; Brian Michael Meates, a company director, of Wellington; Roy John Connell, a company director, of Greymouth; Torro International (N.Z.), Ltd, Torro Industries, Ltd, Insulex Plastics, Ltd, and Parker Industries, Ltd, all of Christchurch. The Court of Appeal comprised Mr Justice Woodhouse (president), Mr Justice Cooke, and Mr Justice Ongley.

Mr Justice Woodhouse delivered the judgment on costs. He said that the drder for costs was sought in respect of proceedings 4 commenced in March, 1975, which ended in a successful appeal from the High Court to the Court of Appeal. It was a majority decision. The sum of $666,587 including interest, was awarded. The case concerned losses arising from the collapse of Matai Industries following the appointment of a receiver by the Crown. Damages were claimed on alleged breaches of contract or alternatively negligence, in particular negligent assurances alleged to have been given concerning assistance

which would be made available to Matai from Government controlled sources. This application was for an order in respect of costs and large sums for disbursements in both the High Court and the Court of Appeal. The Meates group had submitted that an exceptionally long period had been devoted to the preparation of both factual and legal issues. Accountancy assistance had to be employed to assess the losses at various periods and to establish shareholders’ funds when the receiver was appointed. Preparation was greatly affected by documents held by the Crown which required examination or which required an application to the Court because it was contended by the Crown that they could be properly withheld from

discovery. The initial affidavit of documents held by the Crown referred to as many as 1535 with privilege claimed in respect of 217 of them. About three weeks before the trial in the High Court discovery was made of a further 168 documents of which 71 were claimed to be privileged. Two counsel were occupied in the 16-day hearing in the High Court and there was a five-day hearing in the Court of Appeal. “We are asked in terms of the Court’s discretion to substantially increase the normal figures, taking into account the difficulty In assembling in a coherent form relevant facts and the difficulties and complexities associated with the whole case,” Mr Justice Woodhouse said. Solicitor and client

costs charged to the Meates group amounted to $lll,OOO and the figure did not appear at all unreasonable. Costs for hearings in both the High Court and the Court of Appeal would be allowed at $45,000. His Honour then detailed the disbursements which included $27,165 for accounting services and $21,433 for items under the heading of “Agreed documents.” By consent, an interim order was made on August 24, 1985, that the Crown should pay the Meates group $78,850. On terms that that sum be taken into account on payment there would be final order for costs in favour of the Meates group for $45,000 together with disbursements, a total of $159,564, Mr Justice Woodhouse concluded.