Amarco Construction Limited v Ambienti Fransden Architecture Limited (Trading as Ambienti) HC Tauranga CIV 2007-470-000381

[2008] NZHC 2521

IN THE HIGH COURT OF NEW ZEALAND TAURANGA REGISTRY

CIV 2008-470-000381

BETWEEN  AMARCO CONSTRUCTION LIMITED Applicant

ANDAMBIENTI FRANSDEN ARCHITECTURE LIMITED (TRADING AS AMBIENTI)

Respondent

Hearing:         20 August 2008 (Heard at Rotorua)

Counsel:         W T Nabney for applicant

R E Webby for respondent

Judgment:      21 August 2008

ORAL INTERIM JUDGMENT OF ASSOCIATE JUDGE ABBOTT

Solicitors:

Lyon O’Neale Arnold, PO Box 746, Tauranga

Sharp Tudehope, Private Bag 12020, Tauranga

AMARCO CONSTRUCTION LIMITED V AMBIENTI FRANSDEN ARCHITECTURE LIMITED (TRADING AS AMBIENTI) HC TAU CIV 2008-470-000381  21 August 2008

[1]      Amarco Construction Limited (Amarco) has applied to set aside a statutory demand  issued  by  Ambienti  Fransdsen  Architecture  Limited  (Ambienti).    The demand seeks payment of a balance of $10,712.02 claimed by Ambienti in respect of invoices issued to Amarco for architectural work.

[2]      Amarco has applied to set aside the demand on the basis that it has a genuine dispute.     There  is  a  second  ground  for  the  application,  that  Amarco  has  a counterclaim (in respect of a payment of $15,000 already made) which it is entitled to set off against the debt.   That appears, however, to be a somewhat secondary aspect.

[3]      At the outset of the hearing Mr Nabney put the case for Amarco on the basis that it had not received what it had contracted for.  He submitted that the contract was for a sum of $22,000, with one third payable on completion of sketch plans and the balance on completion of working drawings (to a state where a building consent could be applied for).  I note in passing that there is a minor issue as to whether the sum of $22,000 was inclusive or exclusive of GST.  It is not necessary to resolve that aspect today in light of what has developed in the course of the hearing.

[4]      During Mr Nabney’s submissions it became clear that the critical dispute was that Amarco maintained that there were five aspects of the designs with which it was dissatisfied, which it had raised with Ambienti in a meeting in December 2007, and which had still not been resolved.   Mr Nabney informed me that his instructions were that if those matters were resolved his client would accept that the fee for the second stage of the work (completion of working drawings) was payable.

[5]      The sum outstanding is relatively small (although still of significance to both parties).  I invited counsel to consider some means of resolving the matter rather than pursuing the application to a judgment which might, or might not, do so. I was concerned that if I decided that there was a dispute as to whether the contract had been fully performed, the parties would be left having to resolve that dispute in another forum.

[6]      As a consequence of this discussion, counsel have taken instructions and now seek  an  adjournment  of  the  application  (part  heard)  to  allow  Ambienti  the opportunity to complete the five design aspects with which Amarco takes issue. This would be on the basis that Amarco would settle the account promptly once that work has been completed.

[7]      I note, again in passing, that one issue raised on the pleadings is whether Ambienti has been in a position to complete the drawings up to this point.  There has been a suggestion that engineering advice was needed on some aspects of the design. Ms Webby informs me, following the adjournment, that this work may be needed to obtain a building consent but is not something which is needed to complete the design work.

[8]      The application is adjourned sine die, by consent, on the following terms:

a)       The parties are to meet (Mr Pilbrow for Amarco and Mr Little for Ambienti) within the coming week to review the five design issues raised by Amarco and discuss what is required to resolve those issues.

b)Ambienti  is  to  complete  the  working  drawings  by  amending  the drawings from their present state to take into account and resolve Amarco five points.

c)        Ambienti   is   to   provide   Amarco   with   final   working   drawings

(incorporating amendments to cover the five points) by 17 September

2008.

d)Armaco is to pay the sum of $10,712.02 within seven (7) days of delivery of the final plans.

[9]      Either party has leave to approach the Registrar for a telephone conference with me if there is any non-compliance with any of the above steps.

[10]     Having discussed costs briefly with counsel, I direct that costs to date are to lie where they fall.

[11]     The parties are to file notice of discontinuance following completion of the steps that I have identified.  The Registrar is to arrange a telephone conference with me if notice of discontinuance has not been filed by 30 September 2008.   The purpose of that telephone conference will be to determine whether the application

needs to proceed, and if so, to set a date for the resumed hearing.

Associate Judge Abbott