Avon Parnell Limited v Chevin - [2021] NZHC 650

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

I TE KŌTI MATUA O AOTEAROA TĀMAKI MAKAURAU ROHE

CIV 2019-404-001119

[2021] NZHC 650

BETWEEN
AVON PARNELL LIMITED

First Plaintiff

AND

RYAN MATTHEW LEGGATT

Second Plaintiff

AND

PETER LOUIS CHEVIN

First Defendant

AND

CLARK VINCENT VALMONT and RUSSELL PKR TRUSTEE LIMITED

Second Defendant (Discontinued)

continued overleaf…

Hearing: 22 March 2021

Appearances:

D J Chisholm QC & M J W Lenihan for the Plaintiff

Judgment:

29 March 2021

JUDGMENT OF VAN BOHEMEN J

This judgment was delivered by me on 29 March 2021 at 4.00pm Pursuant to Rule 11.5 of the High Court Rules

…………………………

Registrar/Deputy Registrar

Solicitors/Counsel:
Brown Partners Auckland
D J Chisholm QC, Auckland
M J W Lenihan, Barrister, Auckland

AVON PARNELL LIMITED v CHEVIN [2021] NZHC 650 [29 March 2021]

AND

continued from previous page…

GRAEME HAYWARD SKEATES
Third Defendant (Discontinued)

AND

NORTHERN INVESTORS TRUSTEE LIMITED

Fourth Defendant

AND

VIADUCT HARBOUR NOMINEES LIMITED

Fifth Defendant

AND

BASECORP FINANCE LIMITED

Sixth Defendant (Discontinued)

AND

TIMOTHY LAIRD EDNEY

Third Party (Stayed)

Introduction

[1] The plaintiffs, Avon Parnell Ltd (Avon Parnell), the owner of properties at 20 and 22 Avon Street Parnell (the Avon properties), and Ryan Leggatt, the sole director and shareholder of Avon Parnell, seek declaratory and injunctive relief and damages of $256,432.32, plus interests and costs, from the first defendant, Peter Chevin.

[2] The proceeding was filed after Mr Chevin had caused the Companies Office to alter Avon Parnell’s registration details to show Avon Parnell’s sole director and sole shareholder respectively as being the second defendants, Clark Valmont and Russell PKR Trustee Ltd (Russell PKR), a trustee company whose shares Mr Valmont held on trust for Mr Chevin.

[3] Following the changes to Avon Parnell’s Companies Office registration details, the sixth defendant, Basecorp Finance Ltd (Basecorp), agreed to lend Avon Parnell approximately $1.1 million, secured by a mortgage against the Avon properties.1 Mr Valmont signed the loan and mortgage documentation as apparent director of Avon Parnell.

[4] At Mr Valmont’s instruction, Basecorp advanced the loan monies to the third defendant, Mr Skeates of Skeates Law Ltd, who was acting for Mr Chevin and Mr Valmont. The loan monies were then transferred, via a new Avon Parnell bank account established for the purpose, to entities owned or controlled by Mr Chevin, including the fourth defendant, Northern Investors Trustee Ltd (NI Trustee), and the fifth defendant, Viaduct Harbour Nominees Ltd (VH Nominees).

[5] Mr Valmont says he acted on the basis of an assurance from Mr Chevin that these arrangements had been agreed orally between Mr Chevin and the third party, Timothy Edney, who is the beneficial owner of the Avon properties.

[6] Avon Parnell, Mr Leggat and Mr Edney deny there was any legal basis for any of these transactions, which took place without their knowledge or agreement. Once they became aware of what had happened, they took urgent steps to try to halt the

1 The agreed loan amount was slightly higher but the amount advanced was $1,000,000.

transactions…

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.

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Details

Case: [2021] NZHC 650
Decision Date: 29 March 2021

CaseChat Overview and Summary

In the High Court of New Zealand, Avon Parnell Limited and Ryan Leggatt filed a lawsuit against Peter Louis Chevin, the first defendant, alleging that he had unlawfully altered the registration details of Avon Parnell Limited to falsely represent Clark Valmont as the sole director and Russell PKR Trustee Ltd as the sole shareholder. They further claimed that, relying on these falsified records, Mr Chevin arranged a loan from Basecorp Finance Limited, secured by a mortgage over properties owned by Avon Parnell. The plaintiffs sought declaratory and injunctive relief, as well as damages and costs. Mr Chevin's defense was struck out for non-compliance with court orders, and the court found that Mr Chevin acted without the authorization of either Mr Leggatt, the sole director and shareholder of Avon Parnell, or Mr Edney, the beneficial owner of the properties, when he made the changes to the company's registration and facilitated the loan. The court concluded that Mr Chevin's actions were dishonest and intended to defraud the plaintiffs. The court held that Mr Chevin contravened section 9 of the Fair Trading Act by engaging in misleading and deceptive conduct. It granted the plaintiffs a declaration that Mr Leggatt is the sole director and shareholder of Avon Parnell, an injunction restraining Mr Chevin from acting on behalf of Avon Parnell, and damages of $256,432.32 plus interest and costs totaling $83,971.30.

Orders