Dawson & Maudsley Limited v McClune HC Rotorua CIV-2011-463-000145

[2011] NZHC 978

IN THE HIGH COURT OF NEW ZEALAND ROTORUA REGISTRY

CIV-2011-463-000145

BETWEEN  DAWSON & MAUDSLEY LIMITED Appellant

ANDJOAN PATSY MCCLUNE, TERENCE JAMES HIBBITT, JOHN ROBERT MCCLUNE AND WALTER HOLLAND MILICICH AS TRUSTEES OF THE MCCLUNE PROPERTIES TRUST Respondents

Hearing:         On the Papers

Counsel:         J H Olphert for Appellant

B P Rooney for Respondents

Judgment:      7 September 2011

INTERIM JUDGMENT OF WHATA J ON RELIEF

This judgment was delivered by Justice Whata on

7 September 2011 at 11.00 a.m., pursuant to r 11.5 of the High Court Rules

Registrar/Deputy Registrar

Date:

Solicitors:

Olphert & Associates Ltd, PO Box 1717, Rotorua 3040

Neumegen & Co., PO Box 99 680, Newmarket, Auckland

Copy to:

B P Rooney, PO Box 3320, Shortland Street, Auckland

DAWSON & MAUDSLEY LIMITED V MCCLUNE AS TRUSTEES OF THE MCCLUNE PROPERTIES TRUST HC ROT CIV-2011-463-000145 7 September 2011

[1]      At paragraph [36] of my judgment dated 12 July 2011 I provided that the appellant and respondent should have the opportunity to agree on relief, but if they were not able to reach such agreement that they were to file submissions within 14 days of my judgment.

[2]      The parties have not been able to reach agreement. [3]           The appellant requests the following relief:

(a)       Costs in the District Court should lie where they fall; (b)        Costs in this Court should lie where they fall;

(c)      That this matter not be referred back to the District Court with the result that the appellant would be required to pay the sums of $3,587 and $1,293.76 in terms of paragraphs [10] and [4] of the District Court judgment respectively.

[4]      The respondents seek:

(a)       That the District Court judgment should be set aside to the extent of

$5,616  plus  any interest  on  that part  of the judgment  specifically relating to the unpaid rental;

(b)      That costs should lie where they fall on this appeal.

Assessment

[5]      The appellant’s basic position is that having succeeded before me on the interpretation of the rent review clause, it ought not to be liable in any respect for any liability attached to the rent review issue, including any rental amount and any costs associated with the litigation concerning the rent review clause.

[6]      The respondent complains about this in the following terms:

In essence, what the appellant appears to be inviting is that there should be a judgment, subsequent to the judgment on the appeal, which adds a new ground and a new prayer for relief to the appeal, which should be determined in the appellant’s favour without a hearing, and which invites this court to reject the trial judge’s findings after he had heard evidence on the building warrant of fitness costs.

[7]      The respondents make the further point that these proceedings arose out of the appellant’s claim for an alleged breach of clause 35.1 of the lease and a claim for damages, which by the time of the trial, amounted to $200,000.   The respondents denied the claim against them and counterclaimed for $23,362.50 as damages and that costs in that amount were incurred by the respondents in enforcing their right to require payments due under the lease to be made as a condition of the assignment.

[8]      The $23,362.50 was awarded to the respondents in the District Court as damages.  This was not appealed by the appellant so the respondent says cannot be raised now.

Assessment

[9]      I am not in a position to unpick the District Court’s reasoning and the result arrived at in relation to the judgment sums not specifically subject to appeal.  All I can do is address the specific point of appeal, namely whether or not the increased rental was owing.  I have found specifically in favour of the appellants in that regard, but my finding cannot extend into the balance of the District Court judgment that was not appealed.

[10]     I also apprehend, as the respondents suggest that were I to refer this back to the District Court, the Judge would reach the same conclusion, namely that there was a proper basis for refusing to assign and any costs arising out of that dispute, must be born by the appellant.  Indeed, although I do not finally decide the point, it would seem to me that the jurisdiction of the District Court Judge to revisit its earlier decision is closely circumscribed to those matters associated directly with the rent review clause.

[11]     Having said all of that, it would be unrealistic to suggest that the rent review element of the case was not a primary, if not the most significant aspect of the issues as between the parties.   Undoubtedly, it was an aspect that would have resonated with the District Court Judge in reaching the views that the Court did in the ultimate judgment.

[12] Moving forward, it would seem utterly wasteful of resources to refer this matter back to the District Court with the prospect of further litigation in this Court. I am inclined to the view that some accounting needs to be had for the appellant’s success in this Court in terms of the balance of the District Court’s judgment. My current view, and at the risk of assuming an unmerited Soloman-like quality, that the judgment awarded to the respondent by the District Court referred to at [8] above should be reduced by fifty per cent, together with the setting aside of the judgment sum of $5,616 relating to the unpaid rental.

[13]     I therefore seek memoranda from counsel on my proposal within 14 days, specifically dealing with:

(a)       My jurisdiction;  and

(b)The reasons for and against reassessment of the judgment sum referred to at [8] above.

[14]     Obviously if agreement can be reached, joint memoranda should be filed accordingly.

[15]     Failing memoranda on this point I will make my final judgment on relief.

Whata J