Gerrie v New Vision Properties Limited - [2024] NZHC 3660

IN THE HIGH COURT OF NEW ZEALAND WELLINGTON REGISTRY

I TE KŌTI MATUA O AOTEAROA TE WHANGANUI-A-TARA ROHE

CIV-2024-485-561

[2024] NZHC 3660

UNDER The Contract and Commercial Law Act 2017 and the Building Act 2004

IN THE MATTER

of a breach of contract for the construction of a house

BETWEEN

MATTHEW PAUL GERRIE AND KIRSTY FRANCES WEIR

Plaintiffs

AND

NEW VISION PROPERTIES LIMITED

Defendant

Hearing: 28 November 2024

Appearances:

M Freeman for Plaintiffs

Judgment:

4 December 2024

JUDGMENT OF McQUEEN J

Table of Contents

Para Nos

Introduction [1]

The requirements of formal proof [5]

Background [9]

The Contract [11]

Progress of the building work [18]
Cost of completion [53]

The claim [58]

GERRIE AND WEIR v NEW VISION PROPERTIES LIMITED [2024] NZHC 3660 [4 December 2024]

First cause of action repudiation/breach of the Contract [61]

Repudiation under s 36 of the CCLA [65]

Breach under s 37 of the CCLA [71]

Damages [83]

Second cause of action—breach of statutory warranties [95]

Deposit [106]

Interest and costs [111]

Orders [113]

Introduction

[1] Dr Matthew Gerrie and Dr Kirsty Weir purchased a section from the defendant, New Vision Properties Ltd (NVP), a builder/developer. Dr Gerrie and Dr Weir were required to contract with NVP to build a house on the section. Dr Gerrie and Dr Weir entered a building contract with NVP (the Contract).

[2] Dr Gerrie and Dr Weir terminated the Contract, for repudiation and breach, on 31 May 2024.

[3] Dr Gerrie and Dr Weir filed and served a statement of claim on 26 August 2024. No statement of defence has been filed by NVP in the time specified in the notice of proceeding accompanying the statement of claim. Both Dr Gerrie and Dr Weir have filed affidavits setting out the background to the claim. An affidavit confirming service of the Court documents on NVP has also been filed.1

[4]Dr Gerrie and Dr Weir now seek formal proof of the claim.

The requirements of formal proof

[5] Rule 15.9 of the High Court Rules 2016 (the Rules) provides for the formal proof of claims. This is available where the defendant does not file a statement of

1 An affidavit of service of the statement of claim and notice of proceeding must be filed before judgment by default can be sealed; High Court Rules 2016, r 15.4.

defence in accordance with the timeframe required by the notice of proceeding and the plaintiff seeks judgment by default for other than a liquidated demand.

[6] The plaintiff must, before or at the formal proof hearing, file affidavit evidence establishing, to a Judge’s satisfaction, each cause of action relied on and, if damages are sought, providing sufficient information to enable the Judge to calculate and fix the damages.2

[7] The relevant principles in relation to formal proof under r 15.9 of the Rules were considered by Duffy J in Ferreira v Stockinger.3 Her Honour said:

[33] Now r 15.9 of the High Court Rules applies to a formal proof hearing when no statement…

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: [2024] NZHC 3660
Decision Date: 4 December 2024

CaseChat Overview and Summary

The case of Gerrie v New Vision Properties Limited, heard in the High Court of New Zealand, involves a dispute between Matthew Paul Gerrie and Kirsty Frances Weir (the plaintiffs) and New Vision Properties Limited (the defendant), a builder/developer. The plaintiffs had entered into a building contract with the defendant for the construction of a house on a section they had purchased from the defendant. The plaintiffs terminated the contract, alleging repudiation and substantial breach by the defendant, and filed a statement of claim seeking formal proof of their claim. The defendant failed to file a statement of defence, prompting the plaintiffs to seek judgment by default.

The court was required to determine whether the plaintiffs were entitled to judgment by default based on the defendant's failure to respond and to assess the merits of the plaintiffs' claims for repudiation, breach of contract, and statutory warranties under the Building Act 2004. The court also needed to decide on the appropriate quantum of damages, including the cost of completion, remedial work, wasted expenditure, and the return of the deposit.

The court found that the defendant had repudiated the contract by its conduct, including the failure to progress the building work and its refusal to continue unless additional payments were made. The court concluded that the plaintiffs were entitled to cancel the contract under sections 36 and 37 of the Contract and Commercial Law Act 2017. The court further determined that the defendant had breached multiple obligations under the contract, fulfilling the criteria for cancellation under section 37. The plaintiffs were entitled to damages calculated as the cost to complete the building work, the cost of remedial work for defective framing, and wasted expenditure on joinery that was never supplied. The court also found that the plaintiffs were entitled to the return of their deposit and awarded interest on the judgment sum and costs.

In summary, the court granted the plaintiffs' claims, ordering the defendant to pay the judgment sum, return the deposit, and cover interest and costs.

Orders