City costs continue to rise in Shadbolt case

The Invercargill City Council’s costs in a legal battle against former mayor Sir Tim Shadbolt have risen above $280,000.

‘‘As of September 30 . . . $281,000 is the total amount in legal costs the council has paid to fight Sir Tim Shadbolt’s bid to get the council to pay for the court case he won,’’ a council spokesperson said.

Shadbolt was sued for defamation by city councillor Karen Arnold in 2018. But after a lengthy trial he was cleared of the charge.

The costs were awarded in favour of Shadbolt, but they were unrecoverable as Arnold was subsequently adjudicated bankrupt.

In 2018 he asked the city council to cover his costs under an indemnity clause in the Local Government Act, but the council refused to do so, and its insurer, Riskpool, also declined cover.

Shadbolt subsequently filed court proceedings against the council in 2020 in a bid to recover the costs, before later including Riskpool in the proceedings.

In addition to seeking the order that he was entitled to be indemnified, Shadbolt alleges the council was negligent in failing to arrange insurance cover that would have indemnified him, or negligent in failing to challenge Riskpool’s initial rejection of the council’s insurance claim.

In October, council chief executive Clare Hadley said that Riskpool was approached for cover in April 2015, when Shadbolt was served with the defamation proceedings, and before it went to court.

‘‘Sir Tim requested that both council and Riskpool cover the cost of defence, but this was ultimately declined, and he was advised of this before incurring his costs.’’

The case between Shadbolt and the council next goes to a High Court conference in Christchurch on February 1, 2023.

It is understood talks have been ongoing between lawyers for the parties involved in a bid to resolve the issue.

Shadbolt’s 24-year mayoral reign ended in October, when he was defeated by Nobby Clark.