Banbrook v Tan Che Hoe & Sons (Pte) Limited
[2019] NZHC 1415
•20 June 2019
IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY
I TE KŌTI MATUA O AOTEAROA TĀMAKI MAKAURAU ROHE
CIV-2018-404-002489
[2019] NZHC 1415
BETWEEN ANTHONY DAVID BANBROOK
Appellant
AND
TAN CHE HOE & SONS (PTE) LIMITED
Respondent
Hearing: 13 June 2019 Appearances:
Appellant in person
S Grant for the Respondent
Judgment:
20 June 2019
JUDGMENT OF MUIR J
This judgment was delivered by me on Thursday 20 June 2019 at 3.30 pm pursuant to Rule 11.5 of the High Court Rules.
Registrar/Deputy Registrar Date:…………………………
Counsel:
S Grant, Barrister, Auckland
Solicitors:
C Rickit, Rickit Law, Auckland Copy to: Appellant.
BANBROOK v TAN CHE HOE & SONS (PTE) LIMITED [2019] NZHC 1415 [20 June 2019]
Introduction
[1] Mr Banbrook appeals a decision of Judge GM Harrison in the District Court, granting summary judgment against him for the sum of $63,467.37 plus costs and disbursements. Because his notice of appeal was filed approximately two weeks late, he is also required to seek special leave to appeal. By minute dated 11 December 2018, Hinton J directed that the application for special leave and the appeal itself would be heard together.
[2] The respondent opposes the application for special leave on the primary ground that the appeal lacks merit. My decision in relation to the merits therefore dictates the ultimate outcome.
Background
[3] Mr Banbrook is a former barrister who practised in Auckland. He had premises in the West Plaza building which he leased from the respondent, Tan Che Hoe & Sons (Pte) Limited (Tan Che). The lease commenced on 1 December 2010. It was for an initial period of one year, with a right of renewal for a further period of three years. The final expiry date was 7 November 2014. On 1 December 2011 the lease was renewed for the renewal period.
[4] On 27 May 2014 Mr Banbrook wrote to the building’s property manager, indicating that he wished to take “a renewal of the lease and I do wish to occupy the same premises going forward”. The reference to renewal in this context was in error. What Mr Banbrook was in fact seeking was an extension of the lease on existing terms and conditions.
[5] Shortly thereafter, discussions took place between Mr Banbrook, the property manager and the lessee of an adjacent premise who was looking for additional space. Subject to authority from the building’s owner, they agreed that Mr Banbrook would extend the lease for a further three years to 30 November 2017, but with a reduction in his floor area and a corresponding increase in the floor area of the adjacent tenant.
[6] On 18 June 2014 the property manager wrote to Mr Banbrook and the adjoining tenant in terms:
Hi Tony and Alistair
I now have authority from the owner to proceed with our arrangement. As discussed:
· The adjacent office to Planning Focus in Tony’s premises will be incorporated into the Planning Focus space.
· The door will be removed and the gap filled in and a new door installed between Planning Focus and the office.
· Planning Focus will extend the current term of its lease to 30 November 2017 to be commensurate with Tony’s lease.
· Tony will take an extension of his lease through to 30 November 2017.
· Both leases will be varied to record the new floor areas.
· We will have both premises measured by Harrison Grierson to determine the new areas. Both parties will agree to accept these areas.
· The power in the office being leased by Planning Focus will be rewired to take it off Tony’s meter and on to Planning Focus meter.
· The costs of the wall, door and power alteration will be borne 50% by the owner and 50% by Tony/Planning Focus. Bruce will provide estimates shortly.
Can you both please confirm this arrangement and we will proceed. Once the work is complete and the premises re-measured we will have the legal documentation prepared.
[7] Both the adjoining tenant and Mr Banbrook confirmed their acceptance of these terms. Mr Banbrook’s confirmation was by email sent on 23 June 2014 at 12:09 pm. The email included his full letterhead and contact particulars. It read:
Hi Lynda and Alistair
Lynda thank you for your email of 23 June 2014 reference lease changes. Level 6, West Plaza.
I also received your email of 18 June 2014 and confirm that the changes outlined in that email are accepted by me.
Regards
Yours faithfully Tony Banbrook Barrister
[8] The property manager then made arrangements for relevant works to take place and each of Mr Banbrook and the adjoining tenancy were billed and paid 25 percent of the costs, in accordance with the agreement.
[9] On 20 November 2014 the property manager forwarded to Mr Banbrook a Deed of Partial Surrender and Extension of Lease. This identified the surrendered area as being 27.42 square metres and the revised tenancy area as 125.87 square metres. It provided for adjustments to rental and outgoings commensurate with these reductions and otherwise recognised the terms set out in the property manager’s email of 18 June 2014. It was never signed by Mr Banbrook.
[10] Mr Banbrook remained in possession of the premises through 2015 and 2016. By early 2017 he had, however, fallen behind in his lease commitments. On or about 20 February 2017 Tan Che served a notice pursuant to s 246 of the Property Law Act 2007 in respect of outstanding operating expenses of $8,540.97. The default was not remedied. Tan Che did not, however, seek to cancel the lease. Nor did it accept any surrender or abandonment of the lease. Mr Banbrook appears to have ceased practice in early/mid 2017 and not to have occupied the premises since that time. His last payment of rental was on 1 February 2017.
[11] In April 2018 Tan Che accordingly sought summary judgment for outstanding rental and operating expenses through to the conclusion of the extension period (30 November 2017).
[12] Immediately prior to the hearing it provided as an exhibit to an affidavit of Solicitor Mr Christopher Rickit, a schedule identifying an updated total for these arrears (including interest at the rate specified in the lease) in the sum of $63,467.37.
[13] Mr Banbrook filed a notice of opposition to the summary judgment application, in which he simply relied on the grounds of opposition identified in his statement of defence. In that document he:
(1)denied that he had ever executed the Deed of Partial Surrender and Extension or that an extension was otherwise “executed”;
(2)alleged that “as there was no lease in place” he was a monthly tenant;
(3)denied that the sums claimed by Tan Che were owing; and
(4)asserted a settlement in or about September 2017 whereby he would pay $8,000 in settlement of all claims and the adjoining tenant would take over his premises.
[14] The affidavit did not provide any further detail in relation to the pleaded defences. Indeed, Mr Banbrook did not even depose that his statement of defence was true and correct.
[15] To the extent any response was required, this was contained in Mr Rickit’s affidavit, in which he stated that there was neither an agreement to accept the sum of
$8,000 in full satisfaction of Tan Che’s claims nor an agreement that he would be released from ongoing commitments under the lease.
[16] Tan Che’s summary judgment application was set down for 9 October 2018. At an earlier conference, Mr Banbrook had foreshadowed a possible intention to seek security for costs. On 12 September he filed such an application. The grounds were that:
(1)the plaintiff was a company incorporated in Singapore and not therefore amenable to the jurisdiction of the New Zealand court on a costs order; and
(2)the fact that the claim was “fundamentally flawed”.
[17] In correspondence with the Registrar of the District Court, Mr Banbrook had earlier sought confirmation that he expected the summary judgment fixture to be vacated at the point he filed his security for costs application. The Court declined that request, however. It confirmed a one-day hearing for 9 October 2018.
[18] Mr Banbrook did not appear on that day. When the matter was called, counsel for Tan Che filed Mr Rickit’s affidavit containing the up to date calculations of quantum and his Honour proceeded with the hearing.
The District Court decision
[19] Judge Harrison delivered an oral judgment at the conclusion of the hearing. After referring to the Deed of Lease and its renewal to 1 December 2014, his Honour stated:
[2]On or about 23 June 2014 Tan Che and Mr Banbrook entered into a Deed of Partial Surrender and Extension of Lease….
[20] The balance of the judgment makes it clear, however, that the Judge well understood that no Deed of Partial Surrender and Extension had been executed. His conclusion that it had been “entered into” was based on the exchange of email correspondence which had occurred on 23 June 2014. He held that under the relevant provisions of the Contract and Commercial Law Act 2017, Mr Banbrook’s email of that date could be considered sufficient signature in writing for the purposes of an agreement entered into that day.1 He was also prepared to find actions of part performance by which Mr Banbrook was bound to the terms of the partial surrender and extension.
[21] His Honour then addressed the allegations of settlement in the statement of defence. He said that there was no evidence to support the allegation.
[22] He therefore concluded that there was no tenable defence. However, before formally entering judgment in favour of Tan Che, he said it was necessary for him to address the outstanding application for security for costs. He said that this was meritless and was “merely a tactic to endeavour to delay the hearing of the summary judgment application”. In particular, he pointed out that the plaintiff was not a Singaporean but a New Zealand registered company, and that as owner of the West
1 Although the Contract and Commercial Law Act 2017 was not in force at the time of the Partial Surrender and Extension Agreement, the relevant provisions (ss 209 and 226 – 228) materially duplicate provisions in the Electronic Transactions Act 2002 (ss 5 and 22 – 24).
Plaza building it clearly had assets within the jurisdiction to which Mr Banbrook could have recourse if successful.
[23]Sequentially, therefore, his Honour:
(a)dismissed the security for costs application; and
(b)entered summary judgment in favour of Tan Che for the sum identified in Mr Rickit’s updated affidavit ($48,686.88, plus accrued interest of
$14,780.49) for a total of $63,467.37.
[24] The Judge reserved leave to file a memorandum as to costs. These were subsequently fixed in the amount of $19,065.56, having regard to the indemnity of costs provisions in the lease.
Grounds of appeal
[25] In his amended notice of appeal dated 15 April 2019, Mr Banbrook advances three principal grounds, namely that:
(a)His application for security for costs was not allocated a hearing date and that Judge Harrison’s “ex parte” consideration of it on 9 October, was irregular. He says that the application for security for costs “should have been determined prior to the hearing of the substantive claim of the respondent”.
(b)The judgment proceeded on a “fundamental factual flaw, namely the promise (sic) that the parties had executed a Deed of Partial Surrender and Extension of Lease on 23 June 2018, when this never occurred”.
(c)The statement of claim contained sufficiently contradictory evidence about quantum that summary judgment was not safely or appropriately entered.
[26] These points were supported by a detailed written synopsis of argument on which Mr Banbrook relied. Although invited to supplement this with oral submissions, he did not consider that necessary.
Approach to appeal
[27] This is an appeal by way of rehearing and as such is governed by the principles set out in Austin, Nichols & Co Inc v Stichting Lodestar.2 Accordingly, the parties to the appeal are entitled to judgment in accordance with the opinion of the appellate Court even where that opinion involves an assessment of fact and degree and entails a value judgment.
Discussion
Security for costs
[28] There is no record of the District Court having allocated a hearing date for the security for costs application. Ms Grant, for Tan Che, was not aware the application had been filed when she attended the summary judgment hearing3 and, it appears that her instructing solicitors had not even been served with it. However, Mr Banbrook had been advised by the Court that the summary judgment hearing would not be vacated on account of any security for costs application and was further advised when the summary judgment hearing would occur. As a former barrister he would have fully understood that, absent a security for costs order on 9 October, Tan Che’s application would proceed at that time. However, he chose not to appear.
[29] There is no error in the District Court having considered both applications together. Had it been minded to grant security, it would inevitably have adjourned the summary judgment application. But in circumstances where it found that there was no basis to award security, it was entitled to proceed and hear the summary judgment application on its scheduled hearing date. The fact that one of the grounds for seeking security was the alleged inadequacy of the plaintiff’s case only reinforces the appropriateness of that approach.
2 Austin, Nichols & Co Inc v Stichting Lodestar [2007] NZSC 103, [2008] 2 NZLR 141.
3 Tan Chee Hoe & Sons (Pte) Limited v Banbrook [2018] NZDC 21311, at [10].
[30] It is apparent from the judgment that his Honour heard from Ms Grant on both the security for costs and summary judgment applications. He then delivered his judgment. The judgment is slightly unorthodox to the extent that it discusses the summary judgment application, pauses before entry of judgment, considers and rejects the security for costs application, and then concludes with formal entry of judgment. But nothing turns on this point. The security for costs application was considered and determined before his Honour entered summary judgment.
[31] His Honour was also clearly correct in dismissing the security for costs application based on Tan Che’s New Zealand incorporation and asset position. His Honour could have also taken a more fundamental point. Mr Banbrook is a litigant in person. He is no longer a practising barrister.4 He was not (absent special considerations, of which none were advanced) entitled to any award of costs on successful defence of Tan Che’s claims. The whole application was therefore misconceived. I have no doubt that Judge Harrison was also correct in concluding that it was simply a delaying tactic.
The alleged fundamental flaw in the judgment
[32] Mr Banbrook says there was a “fundamental flaw” in the judgment, to the extent it stated he had “entered into a Deed of Partial Surrender and Extension of Lease” on 23 June 2014. He emphasises that no such Deed was ever signed – a matter which is not in dispute.
[33] I accept that, if taken out of context, the reference to the parties having “entered into” the deed could be misconstrued. However, as I have indicated, it is clear that what his Honour essentially had in mind was deemed entry into the deed by virtue of the email exchange which occurred on 18 and 23 June 2014. This exchange constituted an agreement for partial surrender and extension. All relevant terms were set out with sufficient certainty. Equity will thereafter treat as done what ought to be done. The facts, in my view, represent a classic application of the principle established in Walsh v Lonsdale.5
4 Having been struck off the roll on 4 December 2017.
5 Walsh v Lonsdale (1882) 21 ChD.
[34] Moreover, to the extent that Mr Banbrook’s signature was required for the extension of lease to be enforceable,6 this requirement can be taken as met by Mr Banbrook’s email of 23 June 2014. The email is on his letterhead and is clear and unequivocal in its acceptance of the Property Manager’s proposals. It is sent from an email address which is stated (electronically) to be on behalf of
[email protected] and concludes “Regards Yours faithfully Tony Banbrook, Barrister”. Section 209 of the Contract and Commercial Law Act 2007 (for which the former equivalent was s 5 in the Electronic Transactions Act 2002) includes the following definition:
electronic signature, in relation to information in electronic form, means a method used to identify a person and to indicate that person’s approval of that information.
[35]Section 226(1) of the Contract and Commercial Law Act7 in turn provides:
226 Legal requirement for signature
(1)A legal requirement for a signature other than a witness’s signature is met by means of an electronic signature if the electronic signature
(a)adequately identifies the signatory and adequately indicates the signatory’s approval of the information to which the signature relates; and
(b)is as reliable as is appropriate given the purpose for which, and the circumstances in which, the signature is required.
[36] In the circumstances I have referred to, involving an orthodox email communication by a professional person, the Judge was, in my view, clearly correct in concluding that Mr Banbrook’s email of 23 June 2014 included an electronic signature which satisfied the requirements of s 226.
[37] I also accept his Honour’s findings in relation to part performance. Although Mr Banbrook is correct that the statement of claim did not include a pleading to this effect, that is unsurprising given that such an allegation typically only occurs in reply and in consequence of a denial of agreement. In any event, Tan Che’s affidavit in support for summary judgment by its Group General Manager deposed that, although
6 Property Law Act 2007, ss 24 – 25.
7 Being the equivalent of s 22 in the Electronic Transactions Act 2002.
Mr Banbrook never replied to the 20 November 2014 email annexing the Deed of Partial Surrender and Extension, he continued to occupy the premises in accordance with the agreement entered into in June 2014 and the provisions of the draft Deed.
[38] The evidence also established that Mr Banbrook surrendered part of the leased premises which were incorporated in the neighbouring tenancy and that he paid his agreed 25 per cent share of the cost. There were clearly multiple acts of part performance of the agreement for partial surrender and extension.8
Quantum
[39] Mr Banbrook makes much of a reference in paragraph 18 of the statement of claim to:
18.The total owing to the plaintiff at 30 November 2017 was $51,444.35 made up as follows:
(a)Balance carried forward from previous period
(prior to 30 September 2016) $40,646.04
…
[40]He says this contradicts paragraph 14 in terms:
14.As at 14 September 2017 $40,646.04 was outstanding under the Lease (excluding legal fees), made up as follows:
(a)Balance carried forward from previous period (prior
to 30 September 2016) $ 5,404.50
…
[41] Ms Grant concedes that the reference in paragraph 18(a) to 30 September 2016 is a typographical error. The reference should have been to 2017. But the point Mr Banbrook makes is, in my view, makeweight. Paragraph 14 of the statement of claim pleads that as at 14 September 2017, the amount outstanding was $40,646.04. That sum is built up from an opening balance of $5,404.50. The paragraph concludes with a bolded total of $40,646.04. Paragraph 15 then states that on 15 September
8 The doctrine of part performance is expressly recognised in s 26 of the Property Law Act 2007. Harrison DCJ also referred to the New Zealand decisions of Mahoe Buildings Ltd v Fair Investments Ltd [1994] 1 NZLR 281 (HC) and T A Dellaca Ltd v PBL Industries Ltd [1992] 3 NZLR 88 (CA).
2017, the plaintiff served a letter of demand for that amount, and paragraph 16, that the defendant had failed or refused to pay it. Paragraph 17, then alleges that the lease ended on 30 November 2017, and paragraph 18, that the amount outstanding as at that date was $51,444.35. The opening balance for that calculation is the $40,646.04 referred to in paragraphs 14 and 15.
[42] In the context of the pleading, the typographical error was obvious and not disqualifying. Significantly, the base amount subsequently sought on summary judgment was less than that identified in the statement of claim ($48,686.88 as opposed to $51,444.35). This reflected the up-to-date reconciliation provided by Mr Rickit on 9 October.
[43] Significantly also, there was nothing in Mr Banbrook’s affidavit in opposition to the summary judgment application (or indeed, in the annexed statement of defence) which established an arguable defence to any individual component of the plaintiff’s quantum calculations. The closest he got was a general denial.9 Nor did he choose to appear and be heard in support of his opposition in the District Court.
[44] I can, in these circumstances, identify no error in the entry of judgment for the sum identified in Mr Rickit’s schedule ($63,467.37 plus costs and disbursements). Nor does the amended notice of appeal contain any challenge to the quantum of the subsequent award of costs and disbursements.
Other grounds advanced in argument
[45] In his written submissions, Mr Banbrook ranged significantly outside the bounds of his amended notice of appeal. In particular, he stated that he had been substantially overcharged for the 2014 alterations (which he had paid for under protest) and that, when the boundaries between the tenancies were realigned, a mistake was somehow made in the wiring, with the result that he was billed for electricity reticulation across the entire floor. I am not prepared to consider these issues on appeal. For a start, there is no evidential basis for them. At a minimum, an application would have been necessary to adduce further evidence. No such application was made
9 Refer to paragraphs 15, 16, 20 and 21 of the statement of defence.
and there was no sworn evidence before this Court to support the submission. Judge Harrison was in exactly the same position in respect of the alleged defence based on accord and satisfaction.10
[46] In any event, the lease contained a no set-off provision,11 with the result that the argument was unsustainable as a matter of law.
Summary
[47] Mr Banbrook does not persuade me that special leave is appropriately granted to appeal the decision of the District Court. That is because the proposed appeal has insufficient merit.
[48] If I had been minded to grant the application for special leave, I would have dismissed the substantive appeal.
Result
[49]I dismiss the application for special leave to appeal.
[50] In respect of costs, I anticipate an application by Tan Che for indemnity costs under the relevant contractual provisions. If that is so, then memoranda may be filed on the following timetable:
(a)In support of the application for costs filed by 10 July 2019.
(b)In opposition by 24 July 2019.
(c)In reply (if any) by 31 July 2019.
10 I note that this defence was not relied on in either the original or amended Notice of Appeal.
11 Second Schedule, cl 1.1.
[51] All such memoranda are to be a maximum of three pages. I encourage the parties to reach agreement on costs.
Muir J
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