Cox v Kastos Acquisitions Limited

[2012] NZHC 956

IN THE HIGH COURT OF NEW ZEALAND WELLINGTON REGISTRY

CIV2011-485-002534 [2012] NZHC 956

IN THE MATTER OF     the Land Transfer Act 1952

BETWEEN  KEMAL LINCOLN COX Applicant

ANDKASTOS ACQUISITIONS LIMITED Respondent

Hearing:         7 May 2012

Appearances: BJJ Sheehan for the Applicant

J A Langford for the Respondent

Judgment:      8 May 2012

JUDGMENT OF ASSOCIATE JUDGE CHRISTIANSEN

This judgment was delivered by me on

08.05.12 at 4:30pm, pursuant to

Rule 11.5 of the High Court Rules.

Registrar/Deputy Registrar

Date……………

Solicitors:

B Sheehan, ARL Lawyers, Lower Hutt –  [email protected]

J Langford, Langford Law, Wellington –  [email protected]

KEMAL LINCOLN COX V KASTOS ACQUISITIONS LIMITED HC WN CIV 2011-485-002534 [8 May

2012]

The application

[1]      The applicant applies under Section 143 of the Land Transfer Act to remove

the respondent’s caveat lodged against the title to his property.

[2]      The application was due to be heard on 3 February 2012 but at that time was not heard, at the request of counsel.

[3]      Submissions for the respondent filed by Mr Langford at that time noted that the case concerned one basic factual issue only, which could readily be resolved. As Mr Langford noted the factual issue was as to the precise time at which facsimile communications were sent.  Counsel needed to make further enquiries.

[4]      Further affidavits have now been filed.   The matter was called for hearing yesterday for determination.

Background

[5]      The applicant and respondent entered into an agreement for sale and purchase for a sum of $610,000.   The agreement was conditional upon the respondent undertaking due diligence and confirming the agreement by 7 October 2011.

[6]     On 7 October 2011 the respondent requested an extension of time for confirmation of the due diligence clause, from 7 October 2011 until 6 April 2012. The request was declined.

[7]      Later  on  7  October  2011  the  respondent  made  a  further  request  for  an extension of time for confirming the due diligence clause, until 12 noon on 10

October 2011. This extension was granted by the applicant.

[8]      On  10  October  2011  at  12:02pm  Telecom’s  call  records  show  that  the applicant’s solicitors sent a facsimile to the respondent’s solicitors cancelling the agreement.

[9]     On 10 October 2011 at 12:03pm Telecom’s call records show that the respondent’s solicitors sent a facsimile to the respondent’s solicitors purporting to confirm the agreement.

[10]     On 10 October 2011 at 5:08pm the applicant’s solicitors sent a facsimile to the  respondent’s  solicitors  advising  that  the  purported  confirmation  was  not accepted, the agreement having been earlier cancelled.

[11]     On 16 October 2011 the applicant entered into another agreement for sale and purchase  in  respect  of  the  property  for  the  sum  of  $620,000  with  a  different purchaser. This agreement is now unconditional.

The parties’ agreement

[12]     The  relevant  provision  dealing  with  the  delivery  of  notices  between  the parties is contained in clause 1.2(4)(c).

[13]     It provides:

1.2  (1)     All notices must be served in writing

...

(3)     All other notices... must be served by one of the following means:

...

(b)     On the party or parties’ lawyer:

...

(iii)    by facsimile, or by email...

(4)     In  respect  of  the  means  of  service  specified  in  subclause

1.2(3)(b), a notice is deemed to have been served:

...

(c)     in  the  case  of  facsimile  transmission,  when sent  to the facsimile number notified in writing by the party or to the facsimile number of the lawyer’s office...

Considerations

[14]     For the respondent, Mr Hoggard, solicitor deposed that he personally dealt with, sent and received, the communications which are at the centre of this dispute.

[15]     He noted in relation to the transmission report provided by the applicant’s solicitor it states that the applicant’s facsimile was sent at 12:00noon and took one minute and 41 seconds to transmit.   The “report time”, at the top of the page is

12:05pm.  Mr Hoggard commented that he found it unusual that the report did not print   out   until   about   three   minutes   after   the   transmission   was   completed. Accordingly he says he does not accept without question the accuracy of the timer/clock on the applicant’s solicitors’ photocopier/fax/scanner.

[16]     Mr Hoggard then deposed:

I state with absolute certainty that the cancellation facsimile had not been received by my firm at the time I sent the confirmation facsimile.  Several minutes  elapsed  before  the  cancellation  facsimile  was  received,  and according to my firm’s fax machine, was timed at 12:07pm.  Our copy of the letter bears imprints... [which] shows “12:05” which may be the time transmission commenced.

[17]     Mr Hoggard questioned the timing on the electronic devices concerned.  He noted the applicant’s solicitors evidence was that the fax was fed into the machine at noon or 12:01 or thereabouts; that according to the imprint the fax required one minute 41 seconds to transmit; that the solicitor then re-fed the document for faxing and then scanned it to her computer – a process Mr Hoggard assumes took in excess of two minutes, probably three or four minutes.   He considers it strange then that when the other solicitor returned to her computer it showed that the scanned copy of the fax had been received by her at 12:01pm.  He says that would be impossible if the cancellation fax was indeed sent at 12:00noon.

[18]     Mr Hoggard said his own fax, confirming the contract, was, according to his firm’s fax journal report, sent at 12:04pm.  Since he has confirmed with Telecom that it was sent at 12:03pm.

[19]     Due  to  the  issues  raised  by  Mr  Hoggard  and  due  also  to  fax  records confirming the sending of a fax from the applicant’s solicitors to the respondent’s solicitors at 12:06pm on 10 October 2011, it was agreed the matter be referred to Telecom to assist the parties’ enquiries.  The matter was attended to by Mr Fleet of Telecom who has sworn an affidavit containing his report on the timing of the faxes.

[20]     Mr Fleet’s affidavit annexes copies of letters of enquiry and copies of his letters of response.  In one of his exhibits Mr Fleet attaches a copy of an ‘Outward Trace’ on communications from the applicant’s solicitors to the respondent’s solicitor on 10 October 2011.   It shows, in relation to the applicant’s solicitor’s fax a start time of 12:02pm, a duration time for the communication (in this case 35 seconds) and the Trace records that the communication at that time was “Effected”.  The same report records a second communication at 12:06pm taking 42 seconds, and it too was “Effected”.

[21]     Upon receipt of that report the applicant’s solicitors asked Mr Fleet why the trace should show the sending of two faxes when, as they say no second fax was sent at 12:06pm.

[22]     Mr Fleet’s response was that Telecom could not differentiate between the two transmissions as to what time the fax referred to was in fact sent (whether this was the first, or the second communication in the Trace), or if the second transmission was a redial.

[23]     Mr Fleet’s report also stated:

The indication in the ‘Effected’ column of the call trace shows that both communications successfully connected to the terminating location.   This simply means that a connection was established at the terminating party, and there are multiple and various reasons as to why a fax communication may be ‘effected’ yet the fax not be physically sent through.

[24]     Mr  Langford  on  behalf  of the respondent  places  a lot  of emphasis  with respect to this response.   Whilst the trace record may show the fax was sent at

12:02pm, in fact it may have been sent at 12:06pm or as Mr Fleet stated there are multiple various reasons why a fax may not physically be sent through even though a trace records its sending as being ‘effected’.

[25]     Mr  Langford  concedes  it  is  not  in  dispute  (under  the  standard  form agreement) that in the case of service by facsimile, the notice may be deemed to have been served when sent to the facsimile number of the receiving parties’ solicitor.  Mr Langford concedes that service of a fax may be effected even though the receiving party not have picked it up or have read it.

[26]     Mr Langford submits that the Telecom evidence raises more questions than it answers.  It confirms the crucial fax was “sent” at 12:02pm and not 12:01pm as the applicant’s solicitors originally alleged.   Also, according to Telecom’s records the crucial fax was of 35 seconds duration and not one minute 41 seconds as the applicant’s solicitors advised.

[27]     Mr Langford says of most concern is that the fact that a second transmission was sent at 12:06pm and that this was done without a further document being fed into the applicant’s solicitor’s fax machine.  Relying on Mr Fleet’s statement that “if a transmission has not been successfully sent on the first occasion, the machine may automatically attempt the second transmission”, Mr Langford submits that this calls into question whether the first transmission was successful or whether it can be “deemed” to have been sent, as claimed, at 12:02pm.

[28]    It seems to the Court that Mr Langford’s analysis relies very much on assumptions formed around the trace report reference to a second fax being sent at

12:06pm.

[29]     In response to issues raised in this connection with Mr Fleet he responded:

The duration as recorded in the call data provided is the duration for which the communication is recorded by Telecom.  There are many reasons as to why the fax machine may record a different duration to this.  The Telecom call data provided shows the duration as recorded by Telecom only.

The effected column indicates that the transmission noted at 12:02pm was sent from the originating number to the terminating number successfully. There are various reasons why the fax ultimately may not have transmitted fully through the terminating fax machine, however the sending machine effectively  sent  through  the  fax  to  the  terminating  number.    Based  on Telecom call records, this reason for a fax not being transmitted fully cannot be confirmed.

[30]     In  this  case  the  applicant’s  have  accepted  the  claim  of  the  respondent’s solicitors that Telecom’s records confirm the respondent’s solicitor’s confirmation letter was sent at 12:03pm.  It is that very same evidence which the applicants rely upon  as  confirmation  that  its  rejection  letter  was  sent  at  12:02pm.    For  the respondent it is claimed that a Court will have to hear evidence in order to determine arguable deficiencies with the applicant’s claim that its rejection facsimile was sent at 12:02pm as claimed.   Respectfully, I disagree.   The clear evidence is that one minute  before  the  respondent’s  acceptance  facsimile  was  sent  the  applicant’s rejection letter had already been sent.  It matters not that factors may have intruded to effect the timing of its delivery.   It is sufficient if the facsimile having been properly addressed  (as  here  it  was) Telecom  can  confirm  according  to  its  own records that it was sent at the time its records disclose that sending was “effected”.

Decision

[31]     The application to remove the respondent’s caveat is granted.

[32]     The respondent shall pay the applicant’s costs on a 2B basis together with

disbursements approved by the Registrar.

Associate Judge Christiansen