BETWEEN PAUL ALEXANDER Appellant AND RUDOLF PETER GITMANS First Respondent

In the appeal brought by Paul Alexander against Rudolf Peter Gitmans, the Court of Appeal of New Zealand was tasked with reviewing a judgment issued by Chambers J. The judgment ordered Alexander to pay Gitmans $2.2 million in damages. The case stemmed from a complex property development venture involving Messrs Alexander and Gitmans, who jointly developed the Gladstone Apartments through Parkbrook Holdings Ltd. Alexander and Gitmans had initially intended to extract part of their anticipated profit in the form of completed apartments, leading to an agreement where Gitmans' family trust acquired two apartments. However, disagreements arose, leading to a series of agreements and subsequent litigation over the ownership and transfer of these apartments.

The legal issues before the Court of Appeal revolved around the obligations under the 9 June 2000 agreement and whether Alexander's obligations were contingent upon Gitmans calling on Parkbrook to settle the sale of the apartments. Alexander argued that his obligations were never triggered because Gitmans did not call upon Parkbrook to settle, and further contended that Gitmans never complied with his obligations under the agreement, particularly clause 4. The Court of Appeal examined these arguments closely, considering the implications of an order for specific performance and the principles governing such orders.

The Court of Appeal found that Alexander's obligations under the 9 June 2000 agreement were not contingent upon Gitmans calling on Parkbrook to settle. The Court further held that once an order for specific performance had been made, the contract was under the control of the Court, and the Court had the authority to substitute an award of damages when performance became impossible. The Court concluded that Alexander's actions, or lack thereof, constituted a repudiation of the contract, warranting an award of damages. Therefore, both grounds of appeal were dismissed, and the appeal was ultimately unsuccessful. The Court ordered Alexander to pay Gitmans the $2.2 million, along with costs and disbursements.