Bishop Industries (Wellington) Limited v Construction Labour Hire Limited
[2016] NZHC 2848
•28 November 2016
IN THE HIGH COURT OF NEW ZEALAND WELLINGTON REGISTRY
CIV-2016-485-287 [2016] NZHC 2848
UNDER the Companies Act 1993 IN THE MATTER OF
an application to set aside a statutory demand
BETWEEN
BISHOP INDUSTRIES (WELLINGTON) LIMITED
Applicant
AND
CONSTRUCTION LABOUR HIRE LIMITED
Respondent
Hearing: 18 July 2016 Appearances:
G R Grant for the applicant
G J Mowbray for the respondentJudgment:
28 November 2016
JUDGMENT OF ASSOCIATE JUDGE SMITH
[1] This is an application by the applicant (Bishop) to set aside a statutory demand for $76,215.63 served on it by the respondent (CLH). The substantive application was heard on 18 July 2016. On 16 September 2016, an application to adduce further evidence was filed by the applicant. A notice of opposition and further submissions were filed by the respondent on 30 September 2016.
Introduction
[2] Bishop is a construction company, and it has done work on schools for the Ministry of Education (the Ministry). Bishop says that in late 2015 it had the head contract with the Ministry to carry out construction work on West Park School,
Johnsonville, Wellington (the School).
BISHOP INDUSTRIES (WELLINGTON) LIMITED v CONSTRUCTION LABOUR HIRE LIMITED [2016] NZHC 2848 [28 November 2016]
[3] CLH is a specialist construction labour hire company which is in the business of supplying skilled and unskilled personnel to companies engaged in construction projects.
[4] In late November 2015, Bishop engaged CLH to supply qualified carpenters and other personnel for the School, on the basis that Bishop would be invoiced for the personnel at hourly rates which were agreed at the outset. Bishop was to pay CLH on the 20th of the month following invoice.
[5] Over the period from December 2015 to the end of February 2016, CLH billed Bishop a total of $119,103.22. However there were delays in payment. CLH says that, as at 31 January 2016, it had issued invoices totalling $85,384.06 but had received no payments from Bishop. On 1 February 2016 Bishop made a payment of
$21,540.94.
[6] Mr Mulholland, a director of CLH, says that on 2 February 2016 he telephoned Ms Lisa Bishop, who is a director of Bishop, to discuss the matter. He says that the conversation went on for about 40 minutes, in the course of which Ms Bishop explained that Bishop was awaiting payment for another job it was working on, and that things would be a bit tight until they were paid. Mr Mulholland says that he offered to give Bishop payment terms extended to the end of the calendar
month (instead of the due date, being on the 20th of the month) and that that was
accepted by Ms Bishop. Mr Mulholland says that Ms Bishop did not raise any concerns over workmanship or other matters.
[7] When no further payment was received by CLH at the end of February 2016, it removed its workers from the School site.
[8] On 3 March 2016 Bishop made a payment of $20,000. The same day it wrote to CLH complaining about a number of aspects of the services provided by CLH. Bishop’s complaints included alleged poor workmanship in the bathrooms, poor quality of the staff supplied by CLH, and an over-supply of staff by CLH (i.e. more personnel supplied, and/or at too low a level, than were required for the job).
[9] CLH rejects those complaints. It says that the only performance issues raised by Bishop while CLH personnel were carrying out their work related to an incident where one of CLH’s junior apprentices cut through a lead on a skill saw, setting off an alarm and leading to a call-out, and an issue over the installation of linings to the bathroom block. Bishop initially attempted to get CLH to pay for the call-out, but in the end did not pursue that claim. Apart from those matters, CLH says that no complaint was raised by Bishop until it sent CLH the letter of complaint on 3 March
2016.
[10] In total, Bishop has paid $41,540.94. The balance claimed by CLH is
$77,562.28.
[11] CLH issued a statutory demand under s 289 of the Companies Act 1993 (the Act) on 14 April 2016, claiming a balance of $76,215.63 which was said to be owing to it. That figure is slightly less than the total CLH had invoiced to Bishop less the two payments made by Bishop, but that small discrepancy was not explained in the evidence or addressed by counsel at the hearing.
[12] Bishop now applies to set aside that statutory demand. It estimates that it is owed $37,443.83 by CLH for the extra work carried out by Bishop to rectify the work undertaken by CLH, and that it incurred a cost of $19,890.40 for CLH’s oversupply of staff.
[13] Mr Mulholland says that even if Bishop’s calculation of its alleged losses on
remedial work and over-supply of staff were accepted, there would be at least
$20,228.05 owing to CLH on the basis of the amounts invoiced.
Applications to set aside statutory demands – legal principles
[14] A statutory demand is a demand, made in accordance with s 289 of the Act, by a creditor in respect of a debt owing by a company to the creditor.1 The statutory demand must be in respect of a debt that is due and is not less than the prescribed
amount (currently $1,000.00), and it must require the company to pay the debt, or
1 Companies Act 1993, s 289(1).
enter into a compromise or otherwise compound with the creditor, or give a charge over its property to secure payment, to the reasonable satisfaction of the creditor, within fifteen working days of the date of service of the demand.2 If a company fails to comply with a statutory demand, that failure provides prima facie proof that the company is unable to pay its debts – a ground on which the creditor may apply to put the company into liquidation.3
[15] Section 290 of the Act materially provides:
290 Court may set aside statutory demand
(1) The court may, on the application of the company, set aside a statutory demand.
…
(4) The court may grant an application to set aside a statutory demand if it is satisfied that—
(a) there is a substantial dispute whether or not the debt is owing or is due; or
(b) the company appears to have a counterclaim, set-off, or cross-demand and the amount specified in the demand less the amount of the counterclaim, set-off, or cross-demand is less than the prescribed amount; or
(c) the demand ought to be set aside on other grounds.
(5) A demand must not be set aside by reason only of a defect or irregularity unless the court considers that substantial injustice would be caused if it were not set aside.
(6) In subsection (5), defect includes a material misstatement of the amount due to the creditor and a material misdescription of the debt referred to in the demand.
(7) An order under this section may be made subject to conditions.
[16] The onus is on the applicant to show that there is a genuine and substantial dispute as to the existence of the debt. The dispute must be real and not fanciful or insubstantial; the applicant must show a fairly arguable basis upon which it is not liable for the amount claimed. The mere assertion that a dispute exists is not
sufficient. An applicant must establish that any counterclaim or cross-demand is
2 Companies Act 1993, s 289(2).
3 Sections 287(a) and 241(4)(a).
reasonably arguable in all the circumstances. The obligation is not to prove the actual claim; such an obligation would amount to the dispute itself being tried on the application.4
[17] If an application to set aside a statutory demand is made on the basis that the debt is disputed, proof of solvency is not determinative but will support the applicant’s case that the dispute is genuine.5
[18] The court is entitled to allow statutory demands to stand in reduced amounts representing items not open to dispute.6
Application for leave to give further evidence after the hearing
[19] On 1 September 2016, Mr Mowbray advised that CLH wished to adduce further evidence. I directed that any application for leave to adduce further evidence7 be filed and served by 16 September and any opposition be filed by
30 September. Any reply affidavit was to be filed by 7 October. I indicated that I
would deal with the application on the papers.
[20] CLH duly filed an application to adduce the further evidence set out in an affidavit sworn by Mr Mulholland on 15 September 2016. In reply, Bishop filed a notice of opposition and a supporting memorandum of counsel.
[21] Mr Mulholland’s affidavit alleged that Bishop did not in fact hold the contract for the School job: it suggested that the contract was or may have been held by RVB Contracting Limited (RVB), a company that was placed into liquidation on 19 May
2016.
4 Howes & Ors Brookers Company and Securities Law (looseleaf ed, Brookers), at CA290.02 citing
North Harbour Equine Hospital Limited v Little HC Auckland CIV-2006-404-7585,
19 February 2007.
5 AMC Construction Limited v Frews Contracting Limited [2008] NZCA389, (2008) 19 PRNZ 13 at [7].
6 United Homes (1998) Limited v Workman [2001] 3 NZLR 447 (CA) at [46]; 21st Century
Investments Limited v ANZ National Bank [2011] NZCA 548 at [39].
7 Evidence Act 2006, s 98.
[22] Mr Mulholland’s additional evidence was to the effect that the sole director of RVB was Lisa Bishop, and the shareholders were Lisa Bishop and Raymond Bishop (the same individuals who are directors of, and shareholders in, Bishop). The significance of this connection was said to be that:
(a) Bishop has inaccurately held itself out as being the party that contracted with the School. The fact that it was not should have been disclosed.
(b)Bishop may be using different entities to shield itself from liability or avoid creditors. Its conduct appears to have been misleading and may have been unlawful.
(c) Bishop’s contention that it has a counterclaim, set-off or cross demand against CLH was dependent on the existence of a contractual relationship between the School and Bishop. Based on Mr Mulholland’s new evidence, no such contractual relationship existed.
[23] CLH submits that it had no reasonable opportunity to introduce this evidence at the hearing, as Bishop had not only not disclosed the true position but had made numerous statements to the effect that it had contracted directly with the School.
[24] Bishop submits that CLH’s application is premised on a fundamental misunderstanding or error. Bishop says the head contract was between itself and the School. Ms Grant provided with her memorandum opposing the application copies of invoices showing that it was indeed Bishop that invoiced the School for the work.
[25] Ms Grant also referred to a report by the liquidator of RVB, available on the Companies Office website, which stated that RVB stopped trading in September 2015. The School contract was entered into on 29 November 2015, more than two months after the date on which RVB’s liquidator stated that RVB had stopped trading.
[26] Ms Grant advised that Bishop has gone “to great lengths” to locate a copy of
the head contract, but has been unable to locate a copy.
Conclusion on CLH’s application to adduce further evidence
[27] Section 98 of the Evidence Act 2006 provides:
Further evidence after closure of case
(1) In any proceeding, a party may not offer further evidence after
closing that party’s case, except with the permission of the Judge.
…
[28] For a party to be allowed to produce new evidence after a hearing has concluded, there must be “exceptional circumstances” that justify its admission.8 I do not consider the affidavit filed by CLH meets that standard.
[29] Mr Mulholland’s point was presumably that Bishop could not have suffered loss sufficient to support a counterclaim if it was not exposed to any contractual liability to the owner of the School, but I do not think that follows, even without considering the fact that RVB had ceased trading before the contract was made between Bishop and CLH and it appears that Bishop invoiced the School for the work. Any claim by the owner of the School against the head contractor (if the head contractor was not Bishop) would presumably have resulted in a third party claim by the head contractor against Bishop in any event.
[30] I am accordingly satisfied that there are no exceptional circumstances here which would justify the admission of Mr Mulholland’s further affidavit. CLH’s application to adduce the evidence in that affidavit is accordingly refused.
The issues to be decided
[31] The following issues fall to be determined:
8 Equiticorp Industries Group Ltd (In stat man) v Hawkins [1996] 2 NZLR 82, (1995) 9 PRNZ
313 at 85, 317.
(1) What were the terms of the contract entered into between the parties?
1.1Did CLH agree to provide a site supervisor, foreman or qualified builders for the School job, and if so, did CLH thereby assume responsibility for the quality of the workmanship?
1.2. Did the terms include the exclusion clause which was
contained in CLH’s Terms and Conditions of trade?
(2) If that exclusion clause formed part of the contract, to what extent are
Bishop’s claims excluded by the operation of the exclusion clause?
(3) Has Bishop shown that it has a reasonably arguable claim that:
(a) CLH made misrepresentations about the skills and quality of the building staff it supplied; and
(b)those misrepresentations induced Bishop to enter into the contract with CLH (or otherwise caused Bishop to rely on the misrepresentations to its detriment); and
(c) as a result, Bishop suffered loss that it is entitled to counterclaim from CLH?
(4)Has Bishop shown that it has a reasonably arguable counterclaim for its costs of rectifying allegedly defective work performed by CLH staff?
(5)Has Bishop shown that it has a reasonably arguable claim or set-off, in the sum of $19,890.40, for the over-supply by CLH of lesser skilled staff?
(6)Are there any other grounds on which the demand should be set aside?
(7)If the statutory demand is not set aside as to all of the amount demanded, what orders should be made?
[32] I will address each of those issues in turn.
Issue 1 – What were the terms of the contract entered into between the parties? Did the terms include an exclusion clause contained in CLH’s terms and conditions of trade?
1.1Did CLH agree to provide a site supervisor, foreman and qualified builders for the School job, and if so, did CLH thereby assume responsibility for the quality of the workmanship?
1.2 Did the terms include the exclusion clause which was contained in
CLH’s Terms and Conditions of trade?
The evidence
The meeting on 4 November 2015
[33] At relevant times, Mr Saunders was the Managing Partner of CLH. His evidence was that the first contact CLH had with Bishop in relation to providing services to Bishop was in the form of a telephone call from Mr Roy Bishop in or about early November 2015. A meeting was arranged between Mr Saunders and Mr Bishop, and that meeting took place at Mr Bishop’s home/office in Palmerston North on 4 November 2015. Mr Saunders stated that the purpose of the meeting was to allow CLH to present a description of its services and business terms, and to have Bishop complete a credit application form.
[34] Mr Saunders said that he made CLH’s trading terms clear to Mr Bishop at the meeting. He presented to Mr Bishop a document setting out CLH’s charge-out rates for different categories of employees (“Labourer”, “Hammer Hand/Apprentice Level
1”, “Hammer Hand/Apprentice Level 2”, “Hammer Hand/Apprentice Level 3”, “Carpenter Level 1”, “Carpenter Level 2”, “Leading Hand”, and “Foreman”),9 and
he gave Mr Bishop a credit application form for Bishop to complete.
9 Rates set out in the form ranged from $22.50 per hour for a Level 1 Labourer, up to $36.00 -
$40.00 for a Level 2 Carpenter. Rates at the higher end, for a Leading Hand or a Foreman, were
“TBC” (to be confirmed).
[35] Mr Saunders said that he made it clear to Mr Bishop at the meeting that CLH’s contractors at any level were always led by the lead contractor. In this case, that would be Bishop. Responsibility for the workmanship would lie with Bishop’s leading hand, foreman and site manager.
[36] Mr Saunders’ evidence was that he left it to Mr Bishop to complete the credit
application form, and to review and confirm approval of CLH’s trading terms.
[37] In his affidavit sworn in support of the setting aside application, Mr Bishop made no mention of the meeting of 4 November 2015. Nor did he mention it in his affidavit filed in reply.
The credit application form and CLH’s trading terms
[38] The credit application form, in CLH’s standard format, was completed by Bishop on 26 November 2015. It was signed by Ms Lisa Bishop. Ms Bishop also signed a personal guarantee, guaranteeing the due and punctual payment of all monies which would become payable by Bishop to CLH.
[39] On part of the form, which appears to have been completed in Ms Bishop’s handwriting, Bishop provided three trade references. Further down on the same page, under the heading “Terms and Conditions”, there was a statement that CLH’s standard terms and conditions of business were accepted by the applicant for credit. And in a section headed “Customer Acceptance”, an applicant completing the form confirmed that he or she agreed to be bound by all the terms and conditions contained in the form. The form contained acknowledgements by the applicant that the credit application would form the basis on which CLH would transact business with him or her, and that all services supplied would be subject to CLH’s standard terms and conditions of business.
[40] CLH’s standard terms and conditions of business (the Terms and Conditions)
were attached to the credit application form.
[41] The Terms and Conditions included sections headed “CLH Obligations” and
“Client Obligations”. In the section headed “CLH Obligations”, CLH guaranteed to
replace any CLH staff member who was not reasonably satisfactory for the placement. CLH staff members supplied to the client would remain employees or contractors of CLH, and not of the client, and CLH would pay their wages and make such deductions from the wages as were required by law.
[42] The section of the Terms and Conditions headed “Client Obligations”
contained the following clause (the exclusion clause):
The CLH Staff member shall be under the control and direction of the Client for the duration of the Placement. The Client is responsible for all acts, errors, or omissions of the CLH Staff member whether wilful, negligent or otherwise. CLH shall not accept any liability for any loss, expense, damage or cost as a result of the Placement of the CLH Staff member however arising.
Site supervision during Placement it (sic) is the responsibility of the Client
CLH will guarantee to replace any CLH Staff Member who is not reasonably satisfactory for the Placement.
Mr Bishop’s account of the making of the contract with CLH
[43] Contrary to Mr Saunders’ evidence, Mr Bishop stated that Bishop had used CLH for the supply of unskilled workers on two or three projects before the School job. He stated that Bishop would use other labour hire companies from time to time when it needed unskilled labourers, but when it needed skilled workers (trade- certified builders or apprentice builders) it used CLH. He stated that Bishop would pay a premium for this, given the higher qualifications and experience of skilled workers.
[44] Mr Bishop said that on the first project where Bishop approached CLH to provide skilled labour, CLH provided “paperwork” which Bishop signed. The “paperwork” consisted of the credit application form signed by Ms Lisa Bishop. Mr Bishop asserted that this “paperwork” pre-dated the School job and was not specific to it.
[45] Mr Bishop said that in late November 2015 or thereabouts he spoke to one of CLH’s bosses, either Dave (surname unknown) or Mr Saunders, to ask if CLH could provide skilled labour for a re-fit of classrooms at the School. Mr Bishop stated that
he asked the CLH person with whom he spoke to provide someone qualified who could become the site foreman, and other skilled labour (qualified carpenters). He noted in his evidence that this was unusual for Bishop, as on the previous two or three jobs where Bishop had used CLH personnel Bishop had its own staff on site who ran the job, gave necessary instructions, and oversaw the CLH tradesmen. For the School job, that would not be possible, as Bishop did not have any available builders to run the project. Mr Bishop stated that he explained this to the CLH bosses and asked if it would be possible for them to provide a site supervisor as well as other qualified builders. His evidence was that CLH agreed to provide the skilled labour and supervisor at a premium, and that he accepted the premium. He stated that the conversation ended with him telling CLH that a Bishop employee, Mr Paese, would be communicating with CLH to provide further details of the skilled labour requirements for the job.
Mr Saunders’ account of the making of the contract with Bishop
[46] Mr Saunders stated in his affidavit that on Friday 27 November 2015
Mr Bishop requested staff for the School project, which was to commence in the first week of December 2015. His evidence was that Mr Bishop asked for two carpenters, two experienced apprentices, and two less experienced hammer hands/labourers. Mr Saunders stated that his initial response was that CLH could only provide two individuals at the time, a UK-qualified carpenter and a second-year apprentice. However he did offer to make available CLH’s operations manager, Mr David Barton, to oversee the transition of CLH’s staff at the beginning of the project. Mr Saunders stated that he made that offer because Mr Bishop had told him that Bishop’s new site manager, Ms Clemence Latour, had not yet started, and that Bishop’s Mr Paese, who was a Leading Hand/Foreman, would need some support.
[47] Mr Saunders stated that he made it clear to Mr Bishop that it would be out of the ordinary for CLH to provide its operations manager to a customer, but as a sign of good faith to a new client CLH would be willing to lend its aid. However Mr Barton would only be on the School site part-time to help with the short-staff issue and the inexperience of Bishop’s current personnel.
[48] Mr Saunders denied that there were any special, or “premium” rates agreed with Bishop. He said in his evidence that all CLH staff were on a set rates structure, that being the structure which he handed to Mr Bishop at the first meeting in November 2015. The structure document was later also given to Mr Paese at the beginning of the project, and later again (on her request) to Ms Latour. Mr Saunders drew attention in his evidence to the statement in the rates document “still under Leading Hand/Foreman direction”. That statement applied to carpenters at both levels one and two, which Mr Saunders said was the highest staff position supplied to the School job.
Mr Saunders’ email of 26 November 2015
[49] Mr Bishop produced with his reply affidavit a copy of an email dated
26 November 2015 from Mr Saunders to him. Mr Saunders had not referred to it in his evidence, and nor had Mr Bishop. It was presumably located after Mr Bishop had sworn his first affidavit.
[50] The email advised that Mr Saunders would be heading off on leave the following day, and that he wanted to ensure that CLH had all details confirmed for its workers to start on the School site the following Monday. The email confirmed that Mr David Barton would be “the key contact and temporary foreman for this project”.
[51] Mr Saunders asked who Bishop’s key contacts on-site would be, particularly site manager/foreman and other relative parties. Mr Saunders also asked if Bishop required any details about the CLH individuals who would be placed on the project.
[52] Mr Saunders said in the email that he had printed off plans and details for Mr Barton to take to the site on the Monday, but that he wanted a brief outline of the project, with more specifics. He advised that Mr Barton would complete a job safety analysis form on the following Monday and send it to Bishop.
[53] Mr Saunders noted that, “as pointed out before”, Mr Barton would “head this job up in the first instance”. Mr Saunders went on to say that CLH had a few other
high level carpenters it intended to place “as our head of team/foreman as requested”, but those individuals were all currently finishing up jobs.
Counsel’s submissions on issue 1
[54] For Bishop, Ms Grant submits that the terms of the initial agreement were varied and supplemented by the conversations between Mr Bishop and Mr Saunders and the email exchange on 26 November 2015. She submits that such variation was necessary to give commercial efficacy to the contract, particularly where Bishop at the time had no spare builders or a supervisor, as they were all committed on other projects. At the time, Bishop only had administration project and operational managers – no one who could be on-site on a daily basis and oversee the quality of the work.
[55] Ms Grant submits that Mr Saunders agreed that CLH would provide a supervisor to Bishop, together with six qualified carpenters. She notes that Mr Saunders accepted in his affidavit that six builders had been requested, and she refers to Mr Saunders’ email of 26 November 2015, submitting that the email evidences CLH’s undertaking to provide high level carpenters and a supervisor.
[56] As for the exclusion clause, Ms Grant submits that the clause was effectively overridden by the variation and the express oral undertaking by CLH to provide a supervisor. It would not make commercial sense for Bishop to accept all liability for the quality of work which CLH had undertaken to perform and supervise. The effect of the variation, under which CLH agreed to provide a supervisor was to override the exclusion clause and render it inapplicable: when CLH agreed to provide a supervisor it assumed responsibility for site supervision and (accordingly) for the acts, errors or omissions of its staff.
[57] As an alternative argument, Ms Grant submitted orally that the exclusion
clause was insufficiently drawn to Bishop’s attention.
[58] For CLH, Mr Mowbray notes that the School job began not long before Christmas, and that CLH was not able to provide as many qualified builders as Bishop had been seeking. He submits that it is not credible to suggest that CLH took
on the role of “site supervisor”, and observes that any delegation of its contractual obligations by Bishop would presumably have been a breach of its contractual obligations to the Ministry. Any such delegation would also have exposed CLH to liability under health and safety legislation, and required it to take on a level of responsibility in excess of that for which it was being paid.
[59] Mr Mowbray also points to the evidence relating to the Bishop staff members Clemence Latour and Pat Paese. Ms Latour described her role as being “to project manage” the School contract for Bishop, and Mr Paese was described by Mr Bishop in his affidavit as “Bishop’s site foreman” and in the minutes of site meetings held during the course of the construction work as foreman for Bishop.
[60] Mr Mowbray submits that Bishop never accepted responsibility for controlling the site. It did no more than provide workers of varying degrees of experience and expertise, who would operate under Bishop’s supervision.
[61] Mr Mowbray submits that the exclusion clause was and remained part of the contract, and that CLH is entitled to rely on it.
Discussion and conclusions on issue 1
[62] The best evidence of what CLH agreed to provide is Mr Saunders’ email of
26 November 2015. The email was sent very close to the time the contract was made, and its terms were never disputed by Bishop. Indeed, in his reply affidavit Mr Bishop said that this email “clearly refers to our requirements in terms of skill levels and supervision”.
[63] The email did not describe Mr Barton as a “site supervisor”: Mr Barton was described only as CLH’s “key contact and temporary foreman” for the School project. Mr Saunders noted that, “as pointed out before”, Mr Barton would “head up this job” in the first instance, and that Mr Barton would later be replaced by other “high level carpenters” who would act as CLH’s “head of team/Foreman” when those carpenters had finished working on the jobs they were then on. Furthermore, Mr Saunders expressly asked in the email who Bishop’s “key contacts would be on- site, particularly site manager/foreman …” (emphasis added). Mr Saunders would
not have been enquiring who Bishop would nominate as “site manager/foreman” if the understanding was that his own company would be supplying someone to fill that role.
[64] The point is perhaps reinforced by Mr Saunders’ request in the email for a “brief outline of the project we are working on”. It seems highly improbable that CLH would have agreed on Friday 27 November 2015 to assume full legal responsibility for the quality of the work to be performed by its staff on a project due to commence on the following Monday or Tuesday, if it did not even have a “brief outline” of the work to be performed. Perhaps consistently with that view, Mr Paese said in his evidence for Bishop that when Mr Barton arrived at the site in early December 2015, “he was expecting a Bishop Industries employee to be there to discuss personnel”.
[65] Nor did the email make any reference to CLH assuming responsibility (as a subcontractor might have been expected to do) for the quality of the work.
[66] Mr Saunders appears to have provided ‘bios’ for the CLH personnel who would be in the CLH team for the job, and those bio’s included the charge-out rates for the personnel. While the bios themselves have not been produced in evidence, it appears that Bishop did not raise any concerns over them.
[67] Mr Saunders’ evidence was that he gave Mr Bishop a copy of a standard form
setting out CLH’s charging rates for its employees at various levels, at the meeting of
4 November 2015. He stated that Mr Bishop accepted those rates. That evidence was not disputed by Mr Bishop in his reply affidavit. The charge-out rates form lists the highest qualified person supplied by CLH as “Foreman” and describes the foreman’s role as “Manage a team and project under direction of Site Manager” (emphasis added). So even a foreman supplied by CLH would not be responsible for the overall supervision of the work on the site.
[68] While Mr Saunders did acknowledge in his affidavit that it was “out of the ordinary” for CLH to offer to provide its Operations Manager to assist Bishop in the early stages of the project, and to “oversee” the beginning of the project, I do not
consider it arguable for Bishop that this amounted to an acceptance by CLH of legal responsibility to Bishop for the quality of the work to be carried out by the CLH personnel. What was “out of the ordinary” was CLH’s offer to make its (corporate) Operations Manager available for a temporary period to play the foreman role on one specific site.
[69] Summing the position up to there, Mr Saunders’ email of 26 November contemplated nothing more than the provision of a foreman, who in the short term would be Mr Barton. Both sides knew that any foreman CLH supplied would be subject to direction from its client’s site manager. There was nothing in the
26 November 2015 email which could have been read as “overriding”, or varying, CLH’s Terms and Conditions (including the exclusion clause), which were accepted by Bishop at about the same time, and Bishop has failed to point to any other arguable basis for a conclusion that the contract was varied.
[70] Standing back from the detail of the 26 November email (which Mr Bishop accepts as an accurate reflection of the parties’ understanding), these were experienced commercial parties who understood CLH’s business model perfectly well. Bishop knew that CLH did not act as a subcontractor, with the responsibilities to its contractor that that would normally entail (including, in most cases, an assumption of responsibility for defective work). There was never any suggestion that the Construction Contracts Act 2002 would apply to the relationship, as one might have expected if CLH had undertaken to perform the relevant work (on a contract basis) without any direction or supervision from Bishop at all.
[71] In those circumstances it must have been obvious to Bishop that if it wanted CLH to assume responsibility for the quality of the work performed by its personnel, the Terms and Conditions would need substantial amendment. The exclusion clause, in particular, would no longer be appropriate. But Bishop did not reject the Terms and Conditions.
[72] Furthermore, the hourly rates charged for the staff provided by CLH do not in fact appear to reflect any premium (none of the rates charged exceeded $40 per hour). It must have been clear to Mr Bishop from fairly early after the project
started, and Bishop began to receive invoices from CLH, that CLH was not charging any premium for site supervision. The fact that Bishop continued to put forward Mr Paese as its “foreman” at site meetings held in the course of the work is also consistent with its belief that it, rather than CLH, had accepted responsibility for the supervision of the work on site.
[73] Having regard to those considerations, I answer issue 1.1 as follows. CLH did not agree to provide a site supervisor for the School project. It agreed to provide Mr Barton as a temporary foreman, whose job would be to lead the CLH personnel on site subject to the overall direction of a site manager to be provided by Bishop. It further agreed to replace Mr Barton with other CLH employees who would act as foreman when they became available, and to provide at the commencement of the project the other staff whose names, biographies and charge-out rates were provided with Mr Saunders’ email of 26 November 2015. In agreeing to provide those people for the School project, CLH did not assume responsibility for the quality of their workmanship.
[74] I do not consider Bishop’s submission to the contrary to be reasonably
arguable.
[75] Turning to issue 1.2, the exclusion clause was accepted by Bishop, and it did
form part of the contract. It was not inconsistent with Mr Saunders’ email of
26 November 2015, and I do not think it reasonably arguable for Bishop that the exclusion clause was not sufficiently drawn to Bishop’s attention, or was “overridden” or otherwise varied or rendered inapplicable by any matter discussed orally between Mr Bishop and Mr Saunders (or set out in Mr Saunders’ email of
26 November 2016).
[76] I am reinforced in my conclusion that the exclusion was accepted by Bishop and formed part of the contract, when I have regard to the commercial context of this
arrangement. The Law of Contract in New Zealand says:10
10 Burrows, Finn and Todd Law of Contract in New Zealand (5th ed, Lexis Nexis, Wellington,
2016) at 176.
Contracts have to be interpreted in the light of all the background knowledge which would reasonably have been available to the parties at the time of the agreement. This may be thought to state a truism. To take an example, a person will better understand, and more accurately interpret, a construction contract if he or she is familiar with the construction industry and its practices, and is acquainted with the particular needs which led to the making of the contract in question. Such a contextual approach should lead to decisions which are more in line with business sense.
[77] In this case, Bishop was familiar with the construction industry and it was well aware of the business model operated by CLH. Notwithstanding that knowledge, it accepted CLH’s Terms and Conditions, including the exclusion clause.
Issue 2 – If the exclusion clause formed part of the contract, to what extent are
Bishop’s claims excluded by the operation of the exclusion clause?
[78] Ms Grant did not suggest that Bishop’s counterclaim or set-off relating to defects in the work performed by CLH personnel would not be caught by the wording of the exclusion clause if it applied. Her argument was limited, I think correctly, to the submission that the exclusion did not form part of the parties’ contract (either originally or as allegedly varied).
[79] I have now rejected that argument, and I think it inevitably follows that the counterclaim or set-off based on the allegation of defective work performed by CLH is not reasonably arguable. With regard to exclusion clauses that exclude liability for negligence, the courts have held that “clear and unambiguous language” is needed.11
In this case, the exclusion clause provided unambiguously that Bishop would be
responsible for all “acts, errors or omissions” [of CLH staff members], whether wilful, negligent or otherwise”, and that “CLH shall not accept any liability for any loss, expense, damage or cost as a result of the placement of [a CLH staff member] however arising”. The exclusion clause was expressed in unambiguous terms, and I am satisfied that Bishop has no reasonable argument that it does not apply to Bishop’s claim for the $37,443.83 costs of repairing allegedly defective work
(whether that claim is framed in contract or in the general law of negligence).
11 See for example Shipbuilders Ltd v Benson [1992] 3 NZLR 549 (CA).
Issue 3 – Has Bishop shown that it has a reasonably arguable claim that:
3.1CLH made misrepresentations about the skills and quality of the building staff it supplied; and
3.2Those misrepresentations induced Bishop to enter into the contract with CLH (or otherwise caused Bishop to rely on the misrepresentations to its detriment); and
3.3as a result, Bishop suffered loss that it is entitled to counterclaim from CLH?
Counsel’s submissions on issue 3
[80] Ms Grant submits that CLH made representations about the skills and quality of the building staff which proved to be inaccurate. She submits that the representations induced Bishop to enter into the contract with CLH, and that Bishop reasonably relied upon the representations to its detriment. In her submissions, Ms Grant relies on s 9 of the Fair Trading Act 1986 and s 6 of the Contractual Remedies Act 1979.
[81] Section 9 of the Fair Trading Act 1986 provides:
Misleading and deceptive conduct generally
No person shall, in trade, engage in conduct that is misleading or deceptive or is likely to mislead or deceive.
[82] Section 6(1) of the Contractual Remedies Act 1979 provides:
Damages for misrepresentation
(1) If a party to a contract has been induced to enter into it by a misrepresentation, whether innocent or fraudulent, made to him by or on behalf of another party to that contract—
(a) he shall be entitled to damages from that other party in the same manner and to the same extent as if the representation were a term of the contract that has been broken; and
(b) he shall not, in the case of a fraudulent misrepresentation, or of an innocent misrepresentation made negligently, be entitled to damages from that other party for deceit or negligence in respect of that misrepresentation.
[83] Ms Grant submits that each section requires proof of a misstatement or misstatements, reasonable reliance by the claimant, and resulting loss suffered by the claimant.
[84] On the facts of this case, she submits that CLH held itself out as a professional supplier of personnel who takes special care in the recruitment and placement of its builders. In support, she refers to the following statement on Bishop’s website, which was referred to by Mr Bishop in his first affidavit:
Our recruitment is conducted by Trade Qualified Carpenters with a wealth of experience in both commercial and residential construction. They use this experience to assess job requirements on site and match this with the worker, or team of workers, with the right skill sets, attitude and ability to get the job completed.
All CLH staff members are reference checked and undergo a full police vetting process.
[85] Ms Grant also relies specifically on alleged representations to Mr Bishop that CLH would supply “high level carpenters”, and a “head of team/foreman as requested” for the School job. Ms Grant submits that the representations about the experience level of CLH’s builders and the provision of a supervisor, were material terms of the contract and induced Bishop to enter into the contract. She submits that Bishop reasonably relied upon the alleged representations, and that it suffered loss as a result (caused by delay, poor performance, failure to supervise and/or CLH staff being surplus to requirements or not fit for the role).
[86] For CLH, Mr Mowbray submits that Bishop has failed to raise any genuine substantial dispute, and the burden is on Bishop to do so. He submits that the disputes were not raised by Bishop prior to 3 March 2016, and they are not sustainable based on the clear and unequivocal contractual terms between the parties. He submits that Bishop’s claims generally lack credibility and substance.
[87] Beyond those general submissions, Mr Mowbray did not address Ms Grant’s submissions based on misrepresentation under the Contractual Remedies Act 1979 or misleading or deceptive conduct under the Fair Trading Act.
Discussion and conclusions on issue 3
[88] In my view Bishop has not shown that there is a genuine and substantial dispute based on misrepresentation. First, it is a fundamental requirement for misrepresentation, whether under the Contractual Remedies Act or as alleged misleading or deceptive conduct under the Fair Trading Act, that there must be some express or implied representation of an existing fact.12 And whether at common law or under the Fair Trading Act, there must be proof that the claimant relied on the misrepresentation to his or her detriment.
[89] Any statement by Mr Saunders that he would supply “high level carpenters”, or a “head of team/foreman as requested” is not a statement of existing fact which could be the subject of a claim for pre-contractual misrepresentation.
[90] Secondly, there is no evidential basis for the submission based on CLH’s website. While Mr Bishop refers to CLH’s website in his evidence, he has given no evidence that he actually looked at the website before Bishop entered into the contract. There is accordingly no basis for the submission that Bishop was induced by the statements on the website to enter into the contract. This is a matter which was clearly within Bishop’s knowledge, and Mr Bishop could quite easily have given evidence that he relied on the statements in deciding to enter into the contract if that was in fact the case.
[91] Furthermore, the evidence shows that CLH provided biographical particulars for each of the workers it would supply for the start of the School job. Bishop has not produced those “bios”, nor pointed to anything in them which might have been misleading or deceptive. On the evidence, it appears that the job commenced with Bishop being fully aware of the names of the individuals who would start on the job, and details of their experience. The issue is not one of pre-contract misrepresentation inducing a contract, but whether or not CLH fulfilled a contractual
obligation to provide workers with particular skills and/or experience.
12 Ware v Johnston [1984] 2 NZLR 518 CA (see also Burrows, Finn and Todd The Law of Contract in New Zealand, above n 10. chpt 11.
[92] Having regard to the foregoing matters, I conclude on issue 3 that Bishop has failed to show that it has any reasonably arguable case based on misrepresentation, whether under the Contractual Remedies Act 1979 or under s 9 of the Fair Trading Act.
Issue 4 – Has Bishop shown that it has a reasonable counterclaim for its costs of rectifying allegedly defective work performed by CLH staff?
[93] This question has already been answered under issue 2 above. For the reasons set out in the answers to issues 1 and 2, the exclusion clause precludes any claim by Bishop for the costs of rectifying the allegedly defective work. The answer on issue 4 is therefore “no”.
Issue 5 – Has Bishop shown that it has a reasonably arguable claim or set-off, in the sum of $19,890.40, for the over-supply by CLH of lesser skilled staff?
The evidence
[94] Bishop contends that CLH provided too many unsuitably skilled staff. It says that CLH had ten workers on the site, none of them qualified. Some were asked to leave by Bishop, but it says that it has been wrongly charged for these people’s time, as they were not required in the first place.
[95] Mr Paese stated that he soon found that only one of the four men initially provided by CLH for the job was a qualified builder. That was Mr Barton. His evidence was that the others either had no qualification at all, or were apprentices. Mr Paese stated that he told Mr Barton that qualified builders would be required to carry out the refit work, and that his understanding was that CLH would provide six to eight builders for the refit, four of whom would be qualified builders. Mr Paese stated that Mr Barton told him that he had another builder coming to take over from him to supervise the job, and that other qualified builders would be coming from CLH.
[96] Mr Paese’s evidence was that Mr Barton told him that a worker who I will refer to as Mr S would replace Mr Barton and act as “advisor” for CLH. According to Mr Paese, Mr S acted as site supervisor on the job from the time of Mr Barton’s
effective departure (one week after the job commenced) until Mr S was asked to leave in or around mid/late January 2016, because of criminal convictions which made him unsuitable for employment on the School site.
[97] Mr Paese stated that Mr S took a long time (one to two days) to read the plans, and that he failed to organise CLH’s men to do the work in a timely manner. There were delays with the construction as a result. He stated that Mr S told him that he was really only a leading hand, that this was his first time as a supervisor, and that he was not comfortable with the role.
[98] According to Mr Paese, CLH kept saying that more qualified builders were coming, but they only sent unqualified people. Mr Paese said that on occasion he had to tell workers supplied by CLH to leave, as they were not performing and obviously were not qualified, and/or were not capable of carrying out the building work needed for the job. As he put it in his evidence, they didn’t know how to do anything useful. Mr Paese’s evidence was that he had to tell at least five or six CLH staff to leave the site because they were not competent to carry out the work.
[99] Mr Paese’s principal complaint about the quality of the workers supplied by CLH was that (with a few exceptions) they were not qualified builders. He said that at one stage there were ten CLH people on site, none of them qualified. At that point the work was at finishing stage, and ten people were not required. Six qualified builders would have been adequate. Mr Paese’s evidence was that he repeatedly asked Mr S and Mr Barton (when Mr Barton rang up, or on the odd occasion when he visited the site) for qualified builders as promised. They kept saying that qualified builders were coming, but it did not happen.
[100] Mr Paese stated that from the time Mr S left the site in January through to the middle of February, the work was being carried by two CLH workers, one of whom was a third year apprentice and the other a second year apprentice. CLH did not supply anyone at qualified carpenter level to act as site supervisor after Mr S left.
[101] Mr Coffey also gave evidence for Bishop on this issue. He is a qualified
quantity surveyor with approximately seven years’ experience, and he carried out a
costing exercise on Bishop’s over-supply of staff claims. In his first affidavit, Mr Coffey worked from the time sheets completed for the CLH staff and estimated that the cost to Bishop of the surplus of unqualified builders was approximately
$10,000.
[102] Mr Coffey filed a second affidavit, in which he reworked his estimate taking into account a rates sheet for individual CLH staff which he had not seen when he swore his first affidavit. In his second affidavit, Mr Coffey said that he had “attempted to reconcile the rates sheet with the personnel supplied by CLH to obtain a more accurate figure for over-supply”.
[103] Mr Coffey went on to say that he had taken CLH’s invoices and identified which personnel were on site each week. His starting point was that six workers were requested by Bishop, and that Bishop requested qualified personnel, meaning qualified carpenters. Mr Coffey estimated the costs of labour by allowing for six or seven qualified workers over the period of four weeks in January 2016 (when there were “far in excess of six personnel”). He estimated the total charge by CLH for the remaining lower skilled workers on site at $19,890.40 (including GST). That figure allowed for six to seven most senior/skilled workers on site being charged in full by CLH, but no charge being made for the workers Bishop considered were surplus to requirements.
[104] In his evidence, Mr Saunders stated that CLH did have six staff working on the site before the end of December 2015. There were three carpenters (including Mr Barton), two year-two apprentices, and one unskilled hammer hand (level 1). As the job progressed, further staff were provided as requested by Mr Paese or Ms Latour. He acknowledged that at times CLH was unable to fill some of the staffing requests, particularly for carpenters.
Counsel’s submissions
[105] Ms Grant referred to Redwood Group Ltd Specialist Recruitment (Australia) Pty Ltd,13 in support of the proposition that there is an implied contractual duty for
13 Redwood Group Ltd v Hays Specialist Recruitment (Australia) Pty Ltd HC Auckland CIV-2009-
recruiters and labour hire suppliers to take reasonable care in selecting workers they will provide. She submits that the obligation is to take care in providing workers who, in terms of employment, history and qualifications, will suit the needs of their clients. In this case, she says that while Bishop required a dedicated team of six qualified builders under CLH’s supervision to complete the School project, CLH provided a “continuous rota of building staff with various levels of skills and experience in breach of the contract”.
[106] Ms Grant refers to Mr Saunders’ acceptance that Mr Bishop had requested six carpenters, noting that CLH initially provided two carpenters, two apprentices, and two less experienced hammer hands. By the end of December, there were three carpenters onsite, two apprentices and one (unskilled) hammer hand. Ms Grant submits that was clearly not what Bishop had contracted for – it wanted and expected qualified builders.
[107] Ms Grant refers to the evidence that, for four weeks in January 2016, CLH had at least ten to thirteen men on its site. She then refers to Mr Coffey’s evidence, calculating the cost of the oversupply of unskilled workers to Bishop at $19,890.40.
[108] In reply, Mr Mowbray submits that if Bishop did not want the staff CLH sent to it, it was entitled to send them away at any time. If CLH staff remained working for a client, then CLH was entitled to charge the client for their work. He points to the fact that Mr Paese did send CLH staff away from the site as evidence that Bishop fully understood its entitlement to reject CLH staff.
[109] Mr Mowbray also submits that if Bishop had concerns about the number of staff supplied by CLH, those concerns should have been raised far earlier. In his submission, it was not part of CLH’s contract to quantify the number of staff required on site at any given time: the client orders the staff, and CLH’s job is to provide them.
[110] On the question of the qualifications of the staff supplied by CLH, Mr Mowbray acknowledges that, when the job started, CLH was not able to provide
404-2702, 15 July 2009.
as many qualified builders as Bishop was seeking. However Bishop was only charged for the workers it accepted on the job, at the rates applicable to the individual skill levels of those workers.
Discussion and conclusions on issue 5
[111] CLH’s invoices dated 18 January 2016 and 26 January 2016 show that it had no fewer than eleven workers on the School site in the weeks preceding those invoices. The total hours billed for those workers in the 26 January 2016 invoice was 405, or an average of approximately 37 hours per worker for the week. Those figures seem broadly consistent with Mr Paese’s evidence that CLH supplied an excessive number of under-qualified staff. On the other hand, Mr Bishop’s evidence was that it was Mr Paese’s role to “ensure that the correct number of persons attend a site and are getting the job done with the suitable materials, etc …”. And Mr Paese’s own evidence confirms that he had the ability to reject workers put forward by CLH
– he did that on several occasions.
[112] However I accept that the Redwood Group case referred to by Ms Grant is helpful to her submission to the extent that it says there may be an implied term, in cases such as this that on an objective basis a candidate should not be clearly unsuitable for the job. Furthermore, the exclusion clause included a guarantee by CLH to replace any CLH staff member who was not reasonably satisfactory for the placement. I am satisfied from Mr Paese’s evidence that CLH arguably did provide workers who were not reasonably satisfactory for the School job, including Mr S, who did not have the required police clearance, and that at least some of the other workers were sent home by Mr Paese. I am also satisfied that Bishop has produced sufficient to establish a genuine, arguable case that CLH did not promptly replace the unsatisfactory workers (presumably because it did not have sufficient qualified staff to do so). In those circumstances, I consider it reasonably arguable that CLH acted in breach of the implied duty and/or the guarantee in the exclusion clause.
[113] Mr Saunders says that Bishop was only charged for the time of workers who were actually on the site. Mr Paese’s evidence is that he had to tell four particular
workers to leave the site due to poor workmanship, and that he sent one other worker
(“Ian”) home. Mr Paese’s evidence is that “Ian was there for a day”.
[114] Looking at CLH’s invoices, it supplied only one worker with the name “Ian”. “Ian’s” time was in fact charged at $36.00 per hour for a total of 36.5 hours in CLH’s invoice dated 18 January 2016 – far longer than a day. CLH’s invoices show that it billed Bishop a substantial amount for the time of four other workers Mr Paese says he had to send home from the site because they were “just standing around on [Bishop’s] time (and cost) doing nothing because they did not know how to do anything useful”. It appears that several hundred hours of time was billed for these four workers. Whether these workers’ time has been properly billed is something which cannot be resolved solely on the affidavit evidence.
[115] I do not consider the exclusion clause should be read as entitling CLH to recover its charges for workers supplied to the site regardless of their suitability for the work. Any such interpretation would not make commercial sense, as it could effectively require Bishop to pay when it was receiving nothing of value in return. Nor would any such interpretation be consistent with CLH’s guarantee to replace any worker who was found to be unsatisfactory – the guarantee would have no efficacy if CLH was entitled to replace one unsatisfactory worker with another.
[116] With those considerations in mind, I am satisfied that Bishop has shown that there is a genuine and substantial dispute on this issue. In his evidence Mr Coffey started with CLH’s invoices, and identified which CLH personnel were on site in the four weeks in January 2016. He estimated the cost of the alleged surplus of labour supplied by CLH by allowing for the costs of six (and in some cases seven) qualified workers, and identifying as “surplus” the amount billed by CLH to Bishop for the period which was in excess of that figure. Mr Coffey’s “surplus” figure calculated on that basis was $19,890.40, and I am satisfied that Bishop has an arguable defence which may be up to that figure. On that basis, the statutory demand bill be set aside to the extent of the arguable amount of $19,890.40 identified by Mr Coffey.
Issue 6 - Are there any other grounds on which the demand should be set aside?
[117] Bishop has not advanced any other basis on which the statutory demand should be set aside.
Issue 7 – If the statutory demand is not set aside as to all of the amount demanded, what orders should be made?
[118] In the result, the statutory demand was validly issued, and will be upheld accordingly, as to $56,325.23 of the amount demanded. The statutory demand will be set aside to the extent that it claims more than that sum.
[119] In the circumstances of this case, Bishop’s failure to comply with the statutory demand within the prescribed fifteen working day period will not provide CLH with evidence to commence a liquidation claim against Bishop, unless further orders of the Court are made. That is because s 288(1) of the Act provides that a failure by a company to comply with a statutory demand is not admissible in a liquidation proceeding as evidence of the company’s inability to pay its debts unless the liquidation application is made within 30 working days after the last date for compliance with the demand. In this case the time for Bishop to comply with the statutory demand has not been extended under s 290(3) of the Act, and the 30 day period prescribed by s 288 of the Act has long expired.
[120] The appropriate course in such circumstances is to make an order under s 291 of the Act, requiring the company to pay the amount demanded (or such part of the demand as the court may have upheld on a setting aside application filed by the company), within a specified period. Section 291 of the Act provides:14
291Additional powers of court on application to set aside statutory demand
(1) If, on the hearing of an application under section 290, the court is satisfied that there is a debt due by the company to the creditor that is not the subject of a substantial dispute, or is not subject to a counterclaim, set-off, or cross-demand, the court may—
14 Section 291 of the Companies Act 1993.
(a) order the company to pay the debt within a specified period and that, in default of payment, the creditor may make an application to put the company into liquidation; or
(b) dismiss the application and forthwith make an order under section 241(4) putting the company into liquidation,—
on the ground that the company is unable to pay its debts.
(2) For the purposes of the hearing of an application to put the company into liquidation pursuant to an order made under subsection (1)(a), the company is presumed to be unable to pay its debts if it failed to pay the debt within the specified period.
[121] I am satisfied that it is appropriate to make an order under s 291 in this case. There will be an order that Bishop is to pay the sum of $56,325.23 to CLH within ten working days of the date of this judgment, and that, in default of such payment, CLH may make an application to put Bishop into liquidation.
Result
[122] The statutory demand is set aside as to the sum of $19,890.40. It is upheld as to the balance of $56,325.23.
[123] Bishop is ordered to pay the sum of $56,325.23 to CLH within ten working days of the date of this judgment. In default of such payment, CLH may make an application to put Bishop into liquidation.
Costs
[124] CLH has substantially succeeded on the application, and it appears that
Bishop accepts that it never had any arguable basis for failing to pay approximately
$18,880 of the amount demanded (ie the amount of the statutory demand reduced by Bishop’s alleged and quantified losses). On the other hand, CLH’s application to adduce further evidence was without merit, and the setting aside application was successful to the extent of $19,890.40 of the amount demanded. Ms Grant has asked for costs on the application to adduce further evidence.
[125] In the circumstances, I think the overall justice of the case would probably be met if CLH were awarded all of its disbursements (as approved by the Registrar),
together with 60 per cent of its costs calculated on a 2B basis up to the conclusion of the hearing on 18 July 2016. An allowance to Bishop for its costs on CLH’s unsuccessful application to adduce further evidence would be included within that award. That said, I did not hear submissions from counsel on costs, and in case there are other relevant considerations I will refrain from making any costs order at this stage. If counsel are unable to agree on costs, CLH may file and serve a memorandum setting out its costs submissions, within fifteen working days. Any memorandum by Bishop in reply is to be filed and served within ten working days of its receipt of CLH’s memorandum.
Associate Judge Smith
Solicitors:
Rainey Law, Auckland for the applicant
Kapiti Law, Paraparaumu for the respondent
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