Amende v Kennedy - [2017] NZHC 1593

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

CIV-2017-404-396 [2017] NZHC 1593

BETWEEN
DAVID REINHARD AMENDE AND

RONDA LOUIS AMENDE Applicants

AND

SHARYN KENNEDY, DANIEL MARK KENNEDY AND CAMERON JAMES KENNEDY

Respondents

Hearing: On the papers

Counsel:

H Fulton for Applicants

Judgment:

11 July 2017

JUDGMENT OF WHATA J

This judgment was delivered by me on 11 July 2017 at 3.00 pm, pursuant to Rule 11.5 of the High Court Rules.

Registrar/Deputy Registrar

Date: ………………………….

Solicitors R S Wood, Auckland

AMENDE v KENNEDY [2017] NZHC 1593 [11 July 2017]

[1] I have an application for the following orders:

(a) Releasing and discharging the undertaking given by Bradley Reuben

James Botting, of Auckland, a barrister and solicitor, on 21 February

2012, in favour of Sharyn Kennedy, Daniel Kennedy and Cameron

Kennedy (the respondents).

(b)Authorising payment of the funds, the subject of the undertaking, to the applicants on terms requiring the funds to be applied:

(i)For the purpose of obtaining from Auckland Council a code compliance certificate for the property at 21 Woodlands Crescent, Browns Bay, Auckland in respect of renovation work completed in June 2006.

(ii)For the costs of and incidental to this proceeding incurred by the applicants and Mr Botting.

(iii)In respect of any balance then remaining to pay the same to the applicants absolutely.

[2] I have an affidavit of service in respect of this application, confirming that the respondents were served in the manner required by an order for substituted service.

The issues

[3] There are two key issues in this matter, namely:

(a) whether Mr Botting may be released from his undertaking, in circumstances where the persons taking the benefit of the undertaking have not performed the condition necessary to enforce the undertaking; and

(b)whether the discharge of the undertaking means that the cash sum subject to it reverts to the applicants.

Evidence

[4] I have two affidavits in support of the application, of Mr Botting, the applicants’ solicitor, and David Reinhard Amende, one of the applicants. Those affidavits, in short, attest to the background facts underlying the claim.

Background

[5] The affidavits summarise the key background as follows. The applicants and respondents are parties to an agreement for sale and purchase dated 9 February 2014 (the agreement). The applicants agreed to purchase the property owned by the respondents at 21 Woodlands Crescent, Browns Bay, Auckland.

[6] Clause 6.2 of the agreement provides:

6.2 The vendor warrants and undertakes that at settlement:

…

(5) Where the vendor has done or caused or permitted to be done on the property any works:

…

(c) where appropriate, a code compliance certificate was issued for those works.

[7] The respondents had completed renovation works in June 2006 in respect of which no local body code compliance certificate had been issued. As such, cl 18 of the agreement provides:

The vendor agrees to a retention of $50,000, being part of the purchase price, to be held by the purchasers’ solicitor until a code compliance certificate is issued in respect of…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

Continue reading Amende v Kennedy

Details

AGLC: Amende v Kennedy [2017] NZHC 1593
Case: [2017] NZHC 1593
Decision Date: 11 July 2017

CaseChat Overview and Summary

The High Court of New Zealand was asked to consider an application regarding the release of funds held under an undertaking by a solicitor, Bradley Reuben James Botting. The applicants, David Reinhard Amende and Ronda Louis Amende, sought to discharge the undertaking and have the funds paid to them. The respondents, Sharyn Kennedy, Daniel Kennedy, and Cameron Kennedy, had failed to perform certain conditions required for the release of the funds. The legal issues in the case were whether Mr Botting could be released from his undertaking when the respondents had not fulfilled the necessary conditions, and whether the discharge of the undertaking meant the cash sum subject to it would revert to the applicants.

The court reasoned that the respondents had not fulfilled the conditions necessary to enforce the undertaking, and it would not be equitable to leave Mr Botting in the position of maintaining the undertaking indefinitely. The court had inherent jurisdiction over law practitioners to enforce undertakings. The court also considered the issue of whether the payment of the undertaking sums could be made to the applicants. The court found that the discharge of the undertaking did not necessarily mean that the funds should be paid to the applicants, as they were prima facie entitled to the sums held by Mr Botting as part of the purchase price payable to them. However, rewarding the respondents for their breach of contract by paying the funds to them would not be appropriate. Instead, the court proposed to make orders for the undertaking sum to be paid into court, to be held on an interest-bearing account.

The court made orders discharging Mr Botting from his undertaking and directing that the undertaking sum be paid into court, to be held on an interest-bearing account. The court also gave the respondents ten working days to indicate an interest in the proceedings. If the respondents did not indicate an interest, the applicants would have leave to seek judgment for damages to remedy the breach and to enforce any judgment sum against the amount paid into court. The court granted leave to the applicants to seek further or amended orders if necessary. The applicants were also required to file any submissions as to costs within ten working days.

Orders