Claims Resolution Service Ltd v Dowsett [2017] NZDC 22965

Published 24 January 2019

Insurance advocacy — cost contribution — summary judgment — Earthquake Commission — EQC — unjust enrichment — High Court Rules 14.2 (a). The plaintiff was an insurance advocacy and funding service. The defendant had a policy of insurance for his earthquake damaged property with his insurance company. The defendant made a claim both with the insurance company together with claims to the Earthquake Commission (EQC). In 2013 the parties entered into a written agreement whereby the plaintiff would supply insurance advocacy and funding services in respect of the defendant’s insurance claims on a no-win/no claim basis. EQC and the insurance company agreed to settle the defendant's claim. The issue in this case is whether the respondent was entitled to retain the sum of money paid by EQC towards the respondent's costs in circumstances where those costs were not incurred by the respondent but incurred on his behalf by the plaintiff. The court noted that the plaintiff's business is to cover the costs of litigation for those who cannot afford those costs up front. In return for the plaintiff assuming the litigation risks, the plaintiff undertook they were entitled to be paid a commission. On the clear wording of clause 7 of the Service Agreement, the court was satisfied that the respondent could not retain possession of the sum of $25,615.08 as these were costs that he did not incur. These costs were incurred on his behalf by the plaintiff in the prosecution of his claim against both EQC and the insurance company. The court was satisfied that there was no arguable defence to the claim and summary judgment was entered in favour of the plaintiff in the sum of $25,615.08 plus interest. Interest was to be calculated from the date that the respondent received the EQC payment. Costs were also awarded on a 2B basis plus disbursements. Judgment Date: 10 October 2017