Coffey v Walker - [2019] NZHC 2795

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

I TE KŌTI MATUA O AOTEAROA TĀMAKI MAKAURAU ROHE

CIV-2019-404-0857

[2019] NZHC 2795

BETWEEN
PAUL CORNEL COFFEY and WILLIS

STREET TRUSTEE SERVICES LIMITED

as trustees of the PC Coffey Trust Plaintiffs

AND

MARK ALAN WALKER as trustee of the Wynsfield Family Trust

Defendant

Hearing: 3 September 2019

Appearances:

G E Slevin for the Plaintiffs

D J Clark and J Collett for the Defendant

Judgment:

31 October 2019

JUDGMENT OF ASSOCIATE JUDGE SMITH

This judgment was delivered by me on 31 October 2019 at 4.00 pm, pursuant to r 11.5 of the High Court Rules

Registrar/Deputy Registrar

Solicitors / Counsel:
Maude & Miller, Wellington G Slevin, Barrister, Auckland Wilson McKay, Auckland

COFFEY v WALKER [2019] NZHC 2795 [31 October 2019]

[1] The plaintiffs are the trustees of a trust called the PC Coffey Trust (Coffey). The defendant is, and was at all material times, a trustee of a trust known as the Wynsfield Family Trust (Wynsfield).

[2] In May 2008 Coffey entered into a written agreement with Wynsfield for the sale and purchase of 30 per cent of the shares owned by Coffey in the companies Alligator Ltd (Alligator) and Independent Monitoring Services Ltd (IMS) (the sale agreement).

[3]The purchase price for the shares was $700,000, and Wynsfield was to pay

$200,000 of that sum on the completion date. The balance of the purchase price was to be satisfied by a loan from Coffey, due for repayment on 1 June 2013.

[4] Wynsfield paid the $200,000 and the shares in Alligator and IMS were transferred to it.

[5] No repayment of principal or interest has been made on the $500,000 loan, and on 8 May 2019 Coffey issued this proceeding, claiming recovery of the loan and interest. Coffey says that there is no defence to its claim, and it has applied for summary judgment. That application is opposed by Wynsfield.

[6]I now give judgment on the application for summary judgment.

The evidence

Coffey

[7] Alligator was originally formed to supply and install CCTV, alarm and access control systems for customers. IMS mainly provided monitoring services for such systems, independently of the suppliers. Both companies were successful from the outset as they had taken over established businesses Mr Coffey had run with a previous business partner.

[8] Mr Coffey had known the defendant, Mr Walker, since the late 1980s. Mr Walker was then an owner of a private investigation company, and he later

established a security company that operated in the same field as Alligator. Later again, Mr Walker became the National Investigations Manager for the ASB Bank, which was then a significant client of IMS.

[9] Mr Coffey and Mr Walker discussed business matters frequently, and eventually Mr Coffey told Mr Walker he wanted to step back from the day-to-day operations of his companies. Mr Walker expressed an interest in taking up a 30 per cent stake in Alligator and IMS, and Mr Coffey regarded him as an ideal candidate. He instructed…

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.

Continue reading Coffey v Walker

Details

AGLC: Coffey v Walker [2019] NZHC 2795
Case: [2019] NZHC 2795
Decision Date: 31 October 2019

CaseChat Overview and Summary

The plaintiffs, trustees of the PC Coffey Trust, sought summary judgment against the defendant, trustee of the Wynsfield Family Trust, for the recovery of a loan of $500,000 and interest. The loan was part of an agreement to purchase 30 per cent of the shares in two companies, Alligator and IMS. The defendant argued that the sale agreement was induced by misrepresentations and breached by the plaintiffs. The court considered whether there was a reasonably arguable defence to the claim. The court found that the defendant had a reasonably arguable case that the plaintiffs had misrepresented the financial positions of the companies, which would have entitled the defendant to cancel the sale agreement. The court also found that the defendant had a reasonably arguable case that it had effectively cancelled the sale agreement in or about June 2009. The court concluded that the application for summary judgment should be refused as there was a real question to be tried. The application for summary judgment was refused and costs were reserved. The defendant was ordered to file and serve its statement of defence within 15 working days of the date of the judgment.

Orders