J G Matthews, K W Clay and D J Taylor for Respondent
Judgment:24 May 2007 at 4 pm
JUDGMENT OF THE COURT
AThe appeal is dismissed.
BThe respondent will have costs of $6,000 in this Court, plus usual disbursements. We certify for two counsel.
REASONS OF THE COURT
(Given by Arnold J)
Table of Contents
PARA NO.
Introduction [1]
Background [2] Basis of appeal [28]
Unconscionable dealing – the principles [29] Was there unconscionable dealing in this case? [33] The decision of the High Court [34] Was Mr Parkinson suffering under a disability or disadvantage? [45] Did Macfield have the requisite knowledge? [63] Decision [88]
Introduction
[1] This case concerns a claim of unconscionable dealing in the context of a commercial land transaction. The dispute between the parties focussed more on the application of the relevant principles to the facts than on the principles themselves.
Background
[2] Mr Parkinson, the sole director of the appellant company, had been involved in property development on a fulltime basis for a decade in the Christchurch area. While he was not regarded as one of the major property owners or developers in Christchurch, he had undertaken a range of property developments, some reasonably substantial, in and around the city.
[3] In April 2003, Mr Parkinson received medical advice that he had cancer in his liver and had only six to nine months to live. This was the result of the spread of cancer from his bowel, which had been discovered and treated in 2001.
[4] One of Mr Parkinson’s neighbours was a real estate agent who specialised in commercial property, Mr Craig Thiele. Mr Thiele’s partner was a solicitor, Ms Standage. Although not close friends, Mr Parkinson and Mr Thiele were on friendly terms and Mr Parkinson told Mr Thiele that he had been diagnosed with cancer in the liver and given only six to nine months to live.
[5] At this time, Mr Parkinson had several property developments underway through various companies. He continued to work on these, although increasingly as his health deteriorated he operated from his home rather than his office. From about August 2003 the running of his office was left in the hands of an assistant, Ms Rona East, who took care of accounts, the preparation of GST returns and suchlike.
[6] In his property development activities Mr Parkinson utilised various professional advisors, including in particular Mr Brown, an accountant, and Mr Jones, a solicitor. They held shares in several of his development companies, including the appellant Gustav & Co Limited (Gustav), as trustees for his family interests. Mr Parkinson advised them of his illness. Mr Jones, who regarded Mr Parkinson as a friend as well as a client, said that he was shocked and upset to hear the news.
[7] Because his illness…
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
AGLC
Gustav & Co Ltd v Macfield Ltd [2007] NZCA 205
Case
[2007] NZCA 205
Decision Date
CaseChat Overview and Summary
Gustav & Co Ltd appealed against the decision of the High Court that the contract for the sale of the Union Centre was not unconscionable. Gustav argued that the contract should be set aside because Mr Parkinson, who was the sole director of Gustav, was suffering from terminal cancer and was under a disability. Macfield argued that Gustav had failed to prove that it had the requisite knowledge of Mr Parkinson's disability. The Court of Appeal dismissed the appeal, finding that Gustav had failed to discharge the burden of showing that the contract was unconscionable. The Court found that Mr Parkinson was suffering under a disability at the time of confirmation of the contract, but that Macfield did not have the requisite knowledge of this disability. The Court noted that the evidence showed that Macfield's representatives were unaware that Mr Parkinson was not coping with the transaction in the way that he had dealt with others. The Court concluded that it was not unconscionable for Macfield to insist on its strict legal rights.