Freshmax NZ Ltd v Oak Glen Orchards Ltd - [2012] NZHC 1560

IN THE HIGH COURT OF NEW ZEALAND NAPIER REGISTRY

CIV-2011-441-000827 [2012] NZHC 1560

BETWEEN FRESHMAX NZ LIMITED Plaintiff

ANDOAK GLEN ORCHARDS LIMITED First Defendant

ANDFAMILY TRIO LIMITED Second Defendant

ANDMICHAEL JOHN ALCOCK Third Defendant

ANDDONALD BRUCE STEEDMAN Fourth Defendant

Hearing: 31 May 2012 (Heard at Napier)

Appearances: M Keall for Plaintiff
D Kerr for Defendants

Judgment: 4 July 2012

JUDGMENT OF ASSOCIATE JUDGE OSBORNE [on plaintiff ’s summary judgment application]

Introduction

[1] This case concerns the relationship between an apple marketer and an apple grower. Once bound by contract and financial arrangements to one another, their contractual relationship is gone. This dispute concerns a final wash-up as to who
should pay what to whom.

FRESHMAX NZ LIMITED V OAK GLEN ORCHARDS LIMITED HC NAP CIV-2011-441-000827 [4 July
2012]

[2] The case comes before the Court on the plaintiff’s (“Freshmax”) application for summary judgment for $96,556.93, together with interest, as the amounts allegedly owing on finance contracts.

[3] The calculation of the Freshmax claim is essentially not in dispute.

[4] The defendants say they have set-offs for generally unquantified sums. Their notice of opposition identified 17 specific grounds of opposition, three of which were conclusory.

[5] For the hearing, Mr Kerr focussed on six grounds and conclusions from those. Many of the original points of opposition were no longer advanced as grounds on their own but simply as background to the six grounds developed in argument.

The parties

[6] The key parties are as follows:

“Freshmax” (Freshmax New Zealand Limited) (plaintiff) is a marketer and distributor of fresh produce and one of the largest fresh produce companies in New Zealand. It is a successor to ENZA in that Freshmax’s current business originates in a management buy-out of ENZA subsidiaries, Freshmax and Frucor in the mid-1990’s. It trades also under the name “Applemax” – I will
refer to the entity simply as “Freshmax”.

“Oak Glen” (Oak Glen Orchards Limited) (first defendant) is an Onekawa
(Napier) company which grows pipfruit on land bought by George Steedman in 1934 and subsequently expanded by him and his extended family.

“Family Trio” (Family Trio Limited) (second defendant) is a related

company, also involved as a pipfruit grower from Oak Glen’s Onekawa base.

Michael John Alcock (third defendant) is Donald Steedman’s brother-in-law, also with interests in Oak Glen.

Donald Steedman (fourth defendant) is a son of George Steedman, with

interests in Oak Glen.

Principal debtor and guarantors

[7] Oak Glen is the principal debtor. The other three defendants are sued as guarantors.

The contractual arrangements

Introduction

[8] To read Freshmax’s statement of claim, one might infer that Freshmax and the defendants had been contractually bound simply by loan contracts. Freshmax relies on two loan contracts, although it sues under one cause of action.

The 2009 loan contract

[9] Freshmax says it lent a total of $190,000 plus GST on the 2009 loan contract. It sues for $7,847.45 interest calculated to 5 December 2011 still owing on the 2009 loan contract. It says that by deed on 11…

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: [2012] NZHC 1560
Decision Date: 4 July 2012

CaseChat Overview and Summary

The case of Freshmax NZ Ltd v Oak Glen Orchards Ltd was heard in the High Court of New Zealand and concerned the relationship between an apple marketer and an apple grower. Freshmax NZ Ltd, the plaintiff, sought summary judgment for $96,556.93, together with interest, as the amounts allegedly owing on finance contracts. The defendants, Oak Glen Orchards Ltd and others, opposed the application on various grounds. The primary legal issues in this case were whether the defendants had any arguable defences or set-offs to Freshmax's claim. The court found that the defendants had arguable set-offs in two instances: the alleged breach of a fixed price agreement for Braeburn apples, and the increased accountancy costs caused by Freshmax's poor documentation. However, the court ruled that Freshmax was entitled to summary judgment for the indisputable sums. The court ordered judgment for the plaintiff in the sum of $80,349.99 plus GST, interest on the sum of $80,349.99 calculated from the date of the advances making up that sum down to today, and interest in the sum of $7,847.45. Costs were reserved, with the plaintiff and defendants to file memoranda if the quantum of costs was not agreed. The proceeding, as it affected the balance of the plaintiff's claim, was adjourned to a telephone conference with counsel to file a memorandum as to any agreement reached or proposals made for the cost-effective disposal of the balance of the plaintiff's claim.

Orders