BDM Grange Ltd v Trimex Pty Ltd - [2015] NZHC 2469

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

CIV-2013-404-4460 [2015] NZHC 2469

BETWEEN
BDM GRANGE LIMITED

Plaintiff

AND

TRIMEX PTY LIMITED Defendant

Hearing:
24-28 November 2014, 1-5 December 2014, 8-9 December

2014

Appearances:

L J Turner for Plaintiff
MHL Morrison and C M Hanafin for Defendant

Judgment:

8 October 2015

JUDGMENT OF DUFFY J

This judgment was delivered by me on 8 October 2015 at 4.00 pm pursuant to
Rule 11.5 of the High Court Rules.
Registrar/ Deputy Registrar

Solicitors:
Whaley Garnett, Auckland
Lowndes Jordan, Auckland

Counsel:
L Turner, Auckland

BDM GRANGE LIMITED v TRIMEX PTY LIMITED [2015] NZHC 2469 [8 October 2015]

[1] Between October 1984 and September 2012 the plaintiff, (BDM Grange), and the defendant, (Trimex) Pty Ltd, were engaged in a business arrangement (the arrangement) that initially involved the wholesale of Clarins beauty products in New Zealand on an exclusive basis, and later was extended to include other similar products as well.1 After a dispute about whether BDM Grange had claimed impermissible deductions for expenditure Trimex ended the arrangement.

[2] BDM Grange contends that it was entitled to make the disputed deductions for expenditure. In addition, it claims that the arrangement was conducted under a partnership agreement, or alternatively a joint venture that gave rise to fiduciary duties, and so the taking of an account between the parties is now required.

[3] Trimex denies that the parties were ever in a partnership or a joint venture, and so it disputes that there should be the taking of an account. Trimex contends that from the outset, and certainly by the time the arrangement came to an end, it was operating as a distribution agreement with Trimex as the overseas distributor and BDM Grange as the New Zealand wholesaler of the Trimex products. Trimex claims that the disputed expenditure deductions have led to a short fall in royalty payments that BDM Grange owed to it.

[4] Each makes claims against the other based upon their respective view of their arrangement.2 Trimex also has a claim for injurious falsehood which relates to BDM Grange’s conduct after the arrangement had ended.

Background

[5] In 1984, Denis Black, the then managing director of BDM Grange contacted

Clarins Paris to see if BDM Grange could be their agent in New Zealand. However,

1 In the last two years of the arrangement the Trimex products and included the brands Clarins, Hermès, TMP, Azzaro, Aqua, Oscar de la Renta, Swarovski, RoC, Puig Group. Trimex had distribution rights for these products as well as for Clarins. However, Clarins always made up the substantial proportion of the Trimex products. The products will be referred to collectively as the Trimex products.
2 The partnership/joint venture allegations are contained in BDM Grange’s statement of claim; Trimex has a counterclaim in which it sues BDM Grange for breach of the distribution agreement.

Trimex, which is an Australian registered company, held the Clarins licence for

Australasia. So Clarins Paris referred Mr Black to Trimex.

[6] At the time New Zealand…

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: [2015] NZHC 2469
Decision Date: 8 October 2015

CaseChat Overview and Summary

The plaintiff, BDM Grange, and the defendant, Trimex, were involved in a business arrangement that initially involved the wholesale of Clarins beauty products in New Zealand on an exclusive basis, later extended to include other similar products. After a dispute over whether BDM Grange had claimed impermissible deductions for expenditure, Trimex terminated the arrangement. BDM Grange sought a declaration that it was entitled to the disputed deductions and that the arrangement was conducted under a partnership or joint venture agreement that gave rise to fiduciary duties, requiring a taking of account between the parties. Trimex denied these claims and argued that the arrangement was a distribution agreement, with BDM Grange owing Trimex money due to excessive deductions. Each party made counterclaims against the other based on their respective views of the arrangement. The court was required to decide whether BDM Grange was entitled to the disputed deductions, whether the arrangement was a partnership or joint venture, and whether Trimex was owed money due to excessive deductions. The court also needed to determine if Trimex's claim for injurious falsehood was valid. The court found that there was no partnership or joint venture, and BDM Grange's claims were dismissed. The court established that Trimex was owed money due to excessive deductions by BDM Grange, awarding Trimex $1,537,643 in contractual damages. The court also found Trimex's claim for injurious falsehood valid, awarding Trimex $150,000 in damages. The court entered judgment for Trimex against BDM Grange for the awarded sums, along with interest pursuant to the Judicature Act 1908.

Orders