Court of Appeal unsticks adhesive company spat

Legal action by an adhesive manufacturer against its Australian rival, which backfired when the Hamilton-based company was ordered to pay almost $60,000, has finally been successful with a ruling from the Court of Appeal.

Holdfast NZ began High Court proceedings in April 2003 against Selleys over its All Fix product, which Holdfast claimed was confusingly similar to its trade mark Fix All.

Holdfast made a "last ditch" attempt to settle out of court but its offer was rejected by Selleys which, two months later, came back with a counter-offer. Holdfast declined the offer, indicating a "nominal payment would suffice", but in February 2004 rejected Selleys' $5000 offer.

A month before the matter was to go to trial, Holdfast tried to cancel the hearing while trying to join Orica New Zealand as a second defendant. Orica NZ and Selleys are subsidiaries of Orica.

Selleys sought costs on the original claim, then increased costs when that failed, and failing that, scale costs calculated at $15,940.

Justice Rhys Harrison ruled Holdfast's stance was unreasonable and ordered it to pay Selleys' increased costs of $58,141, almost four times scale costs. However, the Court of Appeal found his approach was "fundamentally wrong".

It overturned the High Court order and ordered Holdfast to pay Selleys' scaled costs of $15,940.

It also ordered Selleys to pay Holdfast $4000 plus disbursements for its costs in appealing against the High Court decision.

- NZPA