Appleton v Tauranga Law - [2013] NZCA 420

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IN THE COURT OF APPEAL OF NEW ZEALAND

CA858/2011 [2013] NZCA 420

BETWEEN
JOHN APPLETON AND NATALIE

MARIE RYAN AS TRUSTEES OF THE APPLETON FAMILY TRUST

First Appellants

AND

JOHN APPLETON Second Appellant

AND

TAURANGA LAW Respondent

Hearing: 22 July 2013

Court:

O’Regan P, French and Winkelmann JJ

Counsel:

D W Grove for Appellants
P J Napier and A K Hyde for Respondent

Judgment:

6 September 2013 at 4 pm

JUDGMENT OF THE COURT

A The appeal is allowed.

BJudgment will be entered for the appellants. We seek submissions on the judgment amount as set out in [55] of the Reasons of the Court.

CThe respondent must pay to the appellants costs for a standard appeal on a band A basis and usual disbursements.

DCosts in the High Court should be determined in accordance with this judgment. If an award of costs has been made in the High Court, we set it aside so that costs can be redetermined in accordance with this
judgment.

APPLETON & ANOR v TAURANGA LAW CA858/2011 [2013] NZCA 420 [6 September 2013]

REASONS OF THE COURT

(Given by O’Regan P)

[1] The second appellant, Mr Appleton, invested in a property investment scheme promoted by the group of companies associated with Blue Chip New Zealand Limited (Blue Chip). His investment was funded by the first appellants, the trustees of the Appleton Family Trust, raising money from the Bank of New Zealand on the security of the Appleton family home. Blue Chip referred the appellants to the respondent, Tauranga Law (the law practice of Mr Kevin Olivier) for advice. Mr Appleton’s investment was lost and the Trust and Mr Appleton, who had guaranteed the obligations of the Trust to the Bank of New Zealand in relation to the funds that the Trust borrowed to invest in the Blue Chip Scheme, suffered loss. They sued Tauranga Law for negligence.

[2] The focus of the High Court judgment and of this judgment was on the position of Mr Appleton. We will refer to him in this judgment but note that the Trust also has an interest in the outcome.

[3] In the High Court, Allan J found that the advice given by Tauranga Law was negligent but that Mr Appleton had not established that this negligent advice had caused his loss.1 The appellants appeal against that decision. They argue that on the evidence before the High Court, the Judge should have found that the negligent advice was causative of Mr Appleton’s loss. Tauranga Law supports the Judge’s analysis and, in addition, supports the judgment on the ground that, as Tauranga Law
had specifically advised Mr Appleton that he could lose his deposit, and that was what came to pass, it could not be liable to him because it failed to advise of other
risks.

1 Appleton v Tauranga Law HC Tauranga CIV-2010-070-385, 12 December 2011 [High Court judgment].

Issues on appeal

[4] The parties filed an agreed list…

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 Appleton v Tauranga Law

Details

AGLC: Appleton v Tauranga Law [2013] NZCA 420
Case: [2013] NZCA 420
Decision Date: 6 September 2013 at 4 pm

CaseChat Overview and Summary

The Court of Appeal of New Zealand was asked to determine whether the appellants, John Appleton and the Trustees of the Appleton Family Trust, could recover damages for a property investment that failed. The appellants sued Tauranga Law for negligent advice in relation to the investment. The High Court had dismissed the appellants' claim, finding that the negligent advice did not cause the appellants' loss. The appellants appealed this decision. The Court of Appeal allowed the appeal and found that the negligent advice did cause the appellants' loss. The Court of Appeal found that the advice provided by Tauranga Law was negligent in a number of respects. The advice failed to inform the appellants of the right to cancel the transaction and failed to properly explain the risks associated with the transaction. The Court of Appeal found that the negligent advice did cause the appellants' loss because if the appellants had received proper advice, they would have cancelled the transaction. The Court of Appeal also found that Tauranga Law was liable for its failure to provide proper advice even though it had warned the appellants of the risk that came to pass. The Court of Appeal ordered that judgment be entered for the appellants and that Tauranga Law pay the appellants' costs for the appeal and in the High Court.

Orders