Gedye v South

For a Court ready (fee required) version please follow this link

IN THE SUPREME COURT OF NEW ZEALAND

SC 56/2010
[2010] NZSC 97

BETWEENNATHAN STANLEY GEDYE
Applicant

ANDCOLIN ROBERT SOUTH, DIANA LEE SOUTH AND RICHARD JAMES BURRELL (AS TRUSTEES OF THE SOUTH FAMILY TRUST)
Respondents

Court:Elias CJ, Blanchard and Tipping JJ
Counsel:J A MacGillivray for Applicant
M H Benvie for Respondents

Judgment:5 August 2010

JUDGMENT OF THE COURT

The application for leave to appeal is dismissed with costs of $2,500 to the respondents.

REASONS
[1] The applicant, Mr Gedye, and his wife had building work done on their residence in 1997 for which a permit or building consent was required. In 2003 they sold the property to the respondent trustees, warranting in the sale and purchase agreement that in connection with such works done or caused to be done by them on the property all obligations imposed under the Building Act 1991 were fully complied with. In August 2008 the respondents commenced proceedings against Mr and Mrs Gedye alleging breach of that warranty in relation to the works done in 1997.
[2] Mr and Mrs Gedye applied for summary judgment relying on s 91(2) of the Building Act:
Civil proceedings relating to any building work may not be brought against any person 10 years or more after the date of the act or omission on which the proceedings are based.

[3]       The High Court[1] and the Court of Appeal[2] have refused summary judgment, holding that the act or omission on which the proceedings are based is not the carrying out of the building works but the breach of warranty in 2003 (and thus within the six year limitation period in the Limitation Act 1950 which applies by virtue of s 91(1)).
[1]South v Auckland City Council HC Auckland CIV-2008-404-5116, 20 August 2009 per Associate Judge Sargisson.
[2]      Gedye v South [2010] NZCA 207 per Arnold, Panckhurst and Harrison JJ.
[4]       We consider that this view is undoubtedly correct. The act or omission is the breach of contract. The claim against the Gedyes, as framed, could not succeed simply and only if the building works were non-compliant and the contractual warranty had not been given. It was in respect of the latter event that the claim arose. Furthermore, on the argument proposed for the applicant, if the warranty had been given on a sale more than 10 years after the building works were done, it would never be enforceable by proceedings. That cannot be the position.
[5]       Leave is declined because there is no prospect of the proposed appeal succeeding.
Solicitors:
Tompkins Wake, Hamilton for Applicant
Lovegroves, Auckland for Respondents

CaseChat Overview and Summary

The applicant, Nathan Stanley Gedye, sought leave to appeal against the decision of the Court of Appeal, which dismissed his application for summary judgment in proceedings brought by the respondents, Colin Robert South, Diana Lee South, and Richard James Burrell (as trustees of the South Family Trust). The respondents had commenced proceedings against the Gedyes in 2008, alleging breach of warranty in relation to building works carried out in 1997 on a property which the Gedyes had sold to the respondents in 2003. The Gedyes had warranted that all obligations under the Building Act 1991 were complied with in connection with the works. The Gedyes applied for summary judgment relying on the ten-year limitation period in the Building Act, but the High Court and the Court of Appeal held that the act or omission on which the proceedings were based was the breach of warranty in 2003, which fell within the six-year limitation period in the Limitation Act 1950. The Supreme Court dismissed the application for leave to appeal, holding that the Court of Appeal was undoubtedly correct that the act or omission was the breach of contract and there was no prospect of the proposed appeal succeeding.

The legal issue before the Supreme Court was whether the limitation period under the Building Act or the Limitation Act applied to the respondents' proceedings against the Gedyes for breach of warranty in relation to building works carried out in 1997. The Gedyes argued that the ten-year limitation period in the Building Act applied to the act of building, while the respondents argued that the six-year limitation period in the Limitation Act applied to the omission of breach of warranty in 2003. The Supreme Court held that the act or omission on which the proceedings were based was the breach of warranty, which fell within the six-year limitation period in the Limitation Act. The Court of Appeal was undoubtedly correct in its decision, and the Gedyes' application for leave to appeal was dismissed with costs of $2,500 to the respondents.

The Supreme Court held that the act or omission on which the proceedings were based was the breach of warranty in 2003, not the carrying out of the building works in 1997. The claim against the Gedyes, as framed, could not succeed simply and only if the building works were non-compliant and the contractual warranty had not been given. It was in respect of the latter event that the claim arose. The Court of Appeal was undoubtedly correct in its decision, and the Gedyes' application for leave to appeal was dismissed with costs of $2,500 to the respondents. The Supreme Court found no prospect of the proposed appeal succeeding.

The final orders of the Supreme Court were that the application for leave to appeal was dismissed with costs of $2,500 to the respondents.

CaseChat Overview and Summary

Orders of the court

Background to the litigation

Evidence Before The Court

Reasons for decision

Legal Principle Established