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Confident Trustee Ltd v Garden and Trees Ltd

Confident Trustee Ltd v Garden and Trees Ltd

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Case Copied 8 December 2017 12 min read

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IN THE COURT OF APPEAL OF NEW ZEALAND

CA144/2017
[2017] NZCA 578

BETWEEN	CONFIDENT TRUSTEE LIMITED Appellant
AND	GARDEN AND TREES LIMITED Respondent

Hearing:	7 September 2017
Court:	Asher, Courtney and Gendall JJ
Counsel:	W A McCartney for Appellant D A Jaques for Respondent
Judgment:	8 December 2017 at 10 am

JUDGMENT OF THE COURT

A The appeal is allowed.

B        The statutory demand served by the respondent on the appellant is set aside.
C        The order for costs in the High Court in favour of the respondent is quashed.
DThe appellant is entitled to costs in the High Court on a category 2B basis together with any disbursements to be approved by the Registrar.
E        The respondent must pay the appellant costs for a standard appeal on a band A basis and usual disbursements.

____________________________________________________________________

REASONS OF THE COURT

(Given by Gendall J)

The appellant, Confident Trustee Ltd (CTL), appeals against a decision of Associate Judge Christiansen in the High Court at Auckland dated 16 March 2017 refusing to set aside a statutory demand served on it by the respondent, Garden and Trees Ltd (Garden and Trees).[1] The statutory demand claimed payment of $21,753.36 described as “the balance cost of services provided under invoice 1057 dated 8 March 2016”.

Background

[1]Confident Trustee Ltd v Garden and Trees Ltd [2017] NZHC 470.

Garden and Trees were contracted by CTL to clear a large 7.3 hectare site prior to earthworks for a residential subdivision development CTL was to undertake there. A contract price quote/estimate for the work of $58,420 was provided on 1 February 2016.
Timing was important. It is accepted by the parties that Garden and Trees had agreed to complete the required work under the contract within three weeks of commencement. CTL says time was of the essence because it had contracted with Cameron Civil Ltd for civil engineering earthworks to commence on the site in mid‑February 2016. Garden and Trees says, however, that when it planned to start the work early in February 2016 CTL advised it that it could not commence due to “consent” not being issued.
Although there is some dispute over what this might have meant, it is accepted now that earlier on 26 January 2016 resource consent for the work on the property had been issued to CTL.
Garden and Trees’ position, however, is that CTL did not advise it until 4 pm on 15 February 2016 that work could commence to clear and remove the vegetation on the site and it commenced work shortly thereafter. CTL says this was clearly not the case. It maintains that Garden and Trees had started work early in February 2016 but it was incapable of fulfilling the contract because its machinery was not suitable and it had insufficient labour to complete the work within the required three-week period. Bearing in mind that crucial and mandatory three-week requirement for completion, this progress was entirely unacceptable.
On 24 February 2016, CTL brought in another contractor to the…

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] NZCA 578
Decision Date: 8 December 2017 at 10 am

CaseChat Overview and Summary

The Court of Appeal of New Zealand heard an appeal by Confident Trustee Ltd (CTL) against the decision of the High Court to refuse to set aside a statutory demand served by Garden and Trees Ltd (Garden and Trees). The statutory demand claimed payment of $21,753.36 for services provided under a contract for site clearance work. CTL argued that Garden and Trees was unable to complete the work within the agreed three-week timeframe and that CTL had paid Garden and Trees $35,000, which was more than half of the contract price. CTL also claimed that it had to pay Tree Safe Ltd an additional $66,684.02 to complete the job. The central legal issue was whether there was a substantial dispute over the debt that would justify setting aside the statutory demand.

The Court of Appeal found that there were significant material conflicts in the evidence presented by the parties. The conflicting evidence included the date when Garden and Trees started the work, the adequacy of their equipment and labour, and the circumstances surrounding the termination of the contract. The Court concluded that the conflicts in the evidence were such that it could not be said that CTL did not have a credible defence to Garden and Trees' statutory demand. The appeal was therefore allowed, and the statutory demand was set aside. CTL was awarded costs in the High Court and on appeal, and Garden and Trees was ordered to pay these costs.

Orders