East Developments Limited v ALV Developments Limited - [2018] NZHC 3456

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

I TE KŌTI MATUA O AOTEAROA TĀMAKI MAKAURAU ROHE

CIV-2017-404-001117

[2018] NZHC 3456

BETWEEN
EAST DEVELOPMENTS LIMITED

Applicant

AND

ALV DEVELOPMENTS LIMITED

Defendant

Hearing: 24 October 2018

Appearances:

R Parmenter for the Plaintiff I Bassett for the Defendant

Judgment:

21 December 2018

JUDGMENT OF ASSOCIATE JUDGE SARGISSON

This judgment was delivered by me on 21 December 2018 at 3.30 p.m. pursuant to Rule 11.5 of the High Court Rules.

Registrar/Deputy Registrar Date.......................................

Solicitors / Counsel:

Botting Legal Ltd, Auckland East Law, Auckland

R Parmenter, Auckland I C Bassett, Auckland

EAST DEVELOPMENTS LTD v ALV DEVELOPMENTS LTD [2018] NZHC 3456 [21 December 2018]

Introduction

[1] In this proceeding, the plaintiff seeks leave to make a second summary judgment application and applies for the Court to grant summary judgment on its amended statement of claim which relates to a cancelled agreement for sale and purchase.

[2] The plaintiff and the defendant, East Developments Ltd and ALV Developments Ltd, were parties to an agreement for the sale and purchase of a residential property at 20 Waterloo Street, Howick. ALV failed to settle the purchase and forfeited the deposit of $98,000 paid pursuant to the agreement. Within a matter of weeks of ALV’s failure to settle, East Developments commenced this proceeding. The statement of claim, filed with an application for summary judgment, sought specific performance of the agreement. The claim for specific performance was doomed to fail as in fact East Developments had, shortly before commencing the proceeding, exercised its contractual right to cancel the agreement.1 Before long, East Developments withdrew the summary judgment application with the Court’s leave. It advised the Court that it had not served ALV with the proceeding.

[3] ALV in fact knew nothing of the proceeding for some time. The proceeding lay inactive until after East Developments finally resold the property in February 2018
- at a loss. Dissatisfied with the price achieved on resale, it filed and served an amended statement of claim – with a second application for summary judgment – seeking contractual damages for the loss suffered on the resale.2 At the same time East Developments filed an application for leave to bring the second summary judgment application under High Court Rule 12.4(2).

[4] ALV acknowledges East Developments is entitled to retain the forfeited deposit, but opposes summary judgment on the damages claim. Its challenge is essentially twofold:

1 Notice of cancellation was given on 31 May 2017. The proceeding was commenced on 6 June 2017.
2 On 1 June 2018.

(a)First, that the High Court Rules do not allow a plaintiff to bring multiple applications for summary judgment, and the Court therefore lacks jurisdiction to grant East Developments leave to make its second application. And even if a second application were permissible, the merits of East Developments’ case are not so obviously strong as to deserve determination by way of a second summary judgment application made at time later than ordinarily prescribed by the Rules.

(b)Secondly,…

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 East Developments Limited v ALV Developments Limited

Details

AGLC: East Developments Limited v ALV Developments Limited [2018] NZHC 3456
Case: [2018] NZHC 3456
Decision Date: 21 December 2018

CaseChat Overview and Summary

East Developments Limited sought leave to file a second summary judgment application against ALV Developments Limited. The original claim, seeking specific performance of a property sale agreement, was doomed to fail when the plaintiff cancelled the agreement before filing the claim. The second claim sought damages for the loss incurred on the resale of the property. ALV argued that the High Court Rules did not allow for a second summary judgment application and, even if they did, the merits of the case were not so strong as to warrant a second application. ALV also argued it had an arguable defence to the damages claim, which should be heard at trial.

The Court found that High Court Rule 12.4(2) allowed a second application for summary judgment if there were special circumstances, and in this case, there were. However, the Court was not satisfied that the merits of the second summary judgment application were so strong as to deserve determination at a time later than ordinarily prescribed by the Rules. The Court found that there were unanswered questions regarding the GST status of the property, and the plaintiff had not acted reasonably in mitigating its losses. The Court denied leave to file the second summary judgment application and reserved costs.

No further orders were made.

Orders