Charming Group (NZ) Limited v Singh - [2017] NZHC 1217

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

CIV-2016-404-1714 [2017] NZHC 1217

IN THE MATTER
of an appeal pursuant to s 72 District

Courts Act

BETWEEN

CHARMING GROUP (NZ) LIMITED Appellant

AND

PRITHI PAL SINGH AND GENDO SINGH AS TRUSTEES OF THE BASRA FAMILY TRUST

Respondent

Hearing: 1 December 2016

Appearances:

BG Hong for Appellant (granted leave to withdraw)

Ms Cheng in person (granted leave to appear for the appellant company)

I Hutcheson for Respondent

Judgment:

6 June 2017

JUDGMENT OF TOOGOOD J

This judgment was delivered by me on 6 June 2017 at 3.30 pm
Pursuant to Rule 11.5 High Court Rules

Registrar/Deputy Registrar

Charming Group (NZ) Limited v Singh [2017] NZHC 1217 [6 June 2017]

Introduction

[1] Charming Group (NZ) Limited appeals against the decision of Judge K G Smith in the North Shore District Court entering judgment for Prithi Singh and Gendo Singh (the Singhs/the landlords) as trustees of the Barsa Family Trust.1 It
also appeals against the subsequent judgment of the Court as to costs.2

[2] The essence of the dispute concerns the Singhs’ sale of fixtures, fittings, plant and equipment and other chattels (the disputed property) at restaurant premises which had been leased by a Mr Yeoh and a Ms Li. The disputed property was sold to new tenants3 as part of a sale and purchase of the business by the landlords after termination of the lease.

[3] Charming claims it was the true tenant and that it owned the disputed property and that the landlord had no lawful right to sell them. The Singhs contend that ownership of the disputed property passed to them in accordance with the agreement to lease, and they were lawfully entitled to sell it.

[4] Charming brought five causes of action in the District Court:

(a) The landlord’s seizure of the disputed property was unlawful because it was in breach of the Property Law Act 2007;

(b)Alternatively, it was unlawful for the landlord to seize the belongings in breach of the lease;

(c) The landlord tortiously interfered with goods, committing conversion when it seized the disputed property without legal right;

(d)The landlord in trade engaged in misleading and deceptive conduct when it deceived Charming to give it access and keys to the lease

1      Charming (New Zealand) Ltd v Singh [2016] NZDC 5346 (24 June 2016).
2      Charming (New Zealand) Ltd v Singh [2016] NZDC 5346 (sic) (22 September 2016).
3      Although it might be more strictly correct to refer to the parties as lessors and lessees, I adopt the terms “landlords” and “tenant” or “tenants” as used by the parties and as appears in the District Court’s judgment.

premises on the pretext it wanted to find a replacement tenant, breaching the Fair Trading Act 1986; and

(e) Charming made a unilateral mistake in terms of the Contractual Mistakes Act 1977 by not recording in writing an agreement of which the landlord was aware.

[5] The Singhs denied any breach, and additionally pleaded an affirmative defence that Charming…

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: [2017] NZHC 1217
Decision Date: 6 June 2017

CaseChat Overview and Summary

The High Court of New Zealand was called upon to determine an appeal filed by Charming Group (NZ) Limited against a decision of the North Shore District Court, which had ruled in favour of the Singhs, who were the trustees of the Basra Family Trust, in a dispute concerning the ownership of fixtures, fittings, plant, and equipment, as well as other chattels at a restaurant leased by Mr Yeoh and Ms Li. Charming argued that it was the true tenant and owner of the disputed property, while the Singhs contended that ownership passed to them in accordance with the lease agreement. The High Court's task was to decide whether the District Court's judgment was correct in law and fact, and if the award of increased costs was justified.

The High Court found that the District Court was entitled to conclude that Charming was estopped from denying that Ms Li and Mr Yeoh were the lawful owners of the disputed property. The Court found that the evidence supported the District Court's conclusion that there was a peaceable re-entry by the landlords, resulting in the termination of the agreement to lease. The High Court was satisfied that the Judge was entitled to find on the evidence that Charming was the true owner of the disputed property, but it was estopped from denying that Ms Li and Mr Yeoh were the lawful owners. The Court held that the substantive appeal was without merit.

Regarding the costs appeal, the High Court upheld the Judge's decision to award increased costs to the Singhs, finding that the appellant's approach to the case was unrealistic and doomed to fail from the outset. The Judge's analysis of the evidence and the appellant's pleaded case entitled him to exercise the discretion to award increased costs.

The High Court dismissed both the substantive appeal and the costs appeal. The Singhs were awarded costs and disbursements on both appeals, to be calculated on a category 2B basis. If the parties could not agree on costs, the Singhs were required to file and serve a costs memorandum by 30 June 2017, and the appellant was to file and serve a memorandum in reply by 28 July 2017. Costs were to be determined on the papers unless the Court directed otherwise.

Orders