Hankins v Jamieson-Bell HC Wanganui CIV 2008-483-2

[2008] NZHC 2590

IN THE HIGH COURT OF NEW ZEALAND WANGANUI REGISTRY

CIV 2008-483-2

BETWEEN  PETER MURRAY HANKINS AND DVM TRUSTEE LIMITED AS TRUSTEES OF THE D V MCLACHLAN FAMILY TRUST NO. 2

Plaintiffs

ANDRONALD JAMIESON-BELL AND ELIZABETH MARY JAMIESON-BELL Defendants

Hearing:         17 September 2008

Appearances: B. Pearse - Counsel for Plaintiffs

G. Takarangi - Counsel for Defendants

Judgment:      24 September 2008 at 4.00 pm

JUDGMENT OF ASSOCIATE JUDGE D.I. GENDALL

This judgment was delivered by the Registrar on 24 September 2008 at

4.00 p.m. pursuant to r 540(4) of the High Court Rules 1985.

Solicitors:           Cooper Rapley, Lawyers, PO Box 1945, Palmerston North

Graham Takarangi & Co, Solicitors, PO Box 72, Wanganui 4540

PM HANKINS AND DVM TRUSTEE LIMITED AS TRUSTEES OF THE D V MCLACHLAN FAMILY TRUST NO. 2 V R JAMIESON-BELL AND EM JAMIESON-BELL HC WANG CIV 2008-483-2  24

September 2008

Introduction

[1]      On  15  February  2008  I  issued  a  judgment  in  this  proceeding  granting summary judgment to the plaintiffs for the possession of certain land occupied by the defendants.

[2]      In that judgment I noted that prayer (b) of the plaintiffs’ statement of claim which sought “damages for lost rent for the period of unlawful possession” was still to be determined.  As to that quantum claim, I directed the filing of further affidavits by the plaintiffs and the defendants and that a quantum hearing take place.  It is that quantum hearing which occurred on 17 September 2008.

[3]      I now give my judgment as to quantum.

Preliminary Matter

[4]      At the outset of the hearing a preliminary matter was raised by counsel for the  plaintiffs.    This  registered  an  objection  to  the  Court  considering  a  second affidavit of the first-named defendant, Mr Ronald Jamieson-Bell dated 4 September

2008 which was filed only on 8 September 2008 some 9 days before the scheduled hearing date of the present application.

[5]      On various grounds, counsel for the plaintiffs objected to the reading of this affidavit given its late filing.

[6]      At the hearing I ruled, however, that this affidavit was to be read.  I indicated that my reasons for making this decision would follow.  I now set out those reasons.

[7]      As  I have  noted, the  present  application  before the Court  is  a summary judgment application with regard to the quantum of a damages award sought by the plaintiffs.    Obviously,  it  is  important  that  the  Court  has  before  it  all  available material to properly consider and decide that quantum issue.

[8]      The affidavit of Mr Jamieson-Bell dealt in some detail with the amounts claimed and, as will be seen later in this judgment, what amounts effectively to a

counter-claim from the defendant.  In my view, these aspects are clearly relevant to matters before the Court.

[9]      Although it is unfortunate that this affidavit was filed late and the plaintiffs have had no opportunity to respond to it, as I see the position, this material should be before the Court.   That the plaintiffs have had no opportunity to respond to this affidavit will of course be taken into account.  On this basis, the affidavit was read and considered.

Counsel’s Arguments and My Decision

[10]     In my liability judgment dated 15 February 2008, I found that the defendants were wrongfully in occupation of an area of farm land owned by the plaintiffs, comprising as I understood it, approximately 125.3 hectares, for a period from 20

August 2007 until it was finally vacated by the defendants on 14 March 2008.  This is some 207 days.

[11]     This farm land was previously leased by the plaintiffs for many years to a Mr Nevill as tenant at an annual rental which had increased at the time to $53,000.00 plus GST (being $59,625.00 p.a. including GST).  In addition, Mr Nevill was to pay rates on the property.

[12]     In this quantum hearing the defendants therefore sought damages for lost rent which  they  calculated  for  this  period,  20  August  2007  to  14  March  2008  at

$33,722.34 (including GST) together with a recovery for rates paid to the Rangitikei

District Council (at a quarterly rate amount of $1,234.65) totalling $2,793.14.

[13]     In addition the plaintiffs seek an order that the defendants pay interest on these sums at the Judicature Act 1908 rate of 7.5% p.a. from 14 March 2008 to the date of final payment by the defendants.

[14]     The plaintiffs also seek costs with respect to the present quantum hearing.

[15]     The defendants in response do not appear to dispute the actual quantum calculations of the plaintiffs’ damages claim for lost rent, rates and interest.  Instead,

they claim that the plaintiff Trust itself owes to the defendants rent, rates and certain other payments for a 7.9 hectare portion of the defendants’ adjacent farm which it is said the plaintiffs and their previous tenant, Mr Nevill have occupied rent free for some time.

[16]     The  first-named  defendant,  Mr  Jamieson-Bell,  has  deposed  in  his  4

September 2008 affidavit that the plaintiffs therefore owe to the defendants some

$15,559.87 for rental and $2,793.14 for rates on the 7.9 hectare area for the period in question which he states is from 17 October 2003 (being the date of death of the plaintiff Trust’s principal beneficiary) to 31 March 2007.  In addition, Mr Jamieson- Bell  maintains  that  a  rental  adjustment  calculated  on  the  reduced  area  of  the plaintiffs’ land which was being occupied by the defendants (117.4069 hectares as opposed to 125.3 hectares) needs to be made.

[17]     According to Mr Jamieson-Bell’s affidavit, in summary and taking these figures into account, the amount now due to the plaintiffs is not the figure claimed by the plaintiffs but is in fact $10,551.85.

[18]     So far as the defence advanced by the defendants is concerned, as a starting point the position under the plaintiffs’  lease  to  Mr  Nevill  appears  to  me  to  be reasonably clear.   This lease provided specifically that it was to be for an area of

125.3 hectares at a total rent figure noted in the lease.  In addition the lease itself provided at no further charge for a right of access over a right of way area owned by the defendants “… and the use of the woolshed and stock handling facilities situated on the land in CT 323/71” which I understand was also land owned by the defendants.  Clause 4 of the lease itself also referred to Mr Nevill as tenant having the benefit of a give and take arrangement set out in a 30 April 1993 agreement between the plaintiffs and the defendants for “land occupation and the use of woolshed and stock handling facilities” during the term of the lease.

[19]     That 30 April 1993 agreement is annexed to the third affidavit of Mr Hankins dated 12 August 2008.   It records that the defendants granted to the plaintiffs’ trustees on a give and take basis a right of way, access to facilities and a right to occupy portions of the defendants’ farm known as the “Island paddock” and the

“Shed paddock”.  In return, the plaintiffs allowed the defendants to occupy some of their land known as the “Triangle and Bush paddocks”.  No payments were to pass for  these  arrangements.    And,  these  access  and  occupation  rights  were  only to terminate when the plaintiff Trust “ceased to be the registered proprietors of …”  its adjoining farm land.

[20]     The parties all acknowledge this give and take arrangement was in place for some time since 1993.  As I understand the position, however, the defendants dispute that the arrangement is still in existence as it came to an end in 2003, but the plaintiffs contend otherwise.  This is a clear factual dispute upon which there is little evidence before the Court.

[21]   Instead, in considering what is effectively a counter-claim here by the defendants  against  the  plaintiffs,  at  the  outset  it  needs  to  be  noted  that,  the defendants’ claim has been raised reasonably late in the piece.   According to Mr Jamieson-Bell’s 4 September 2008 affidavit the rental and rates claimed from the plaintiffs relate to a period 17 October 2003 to 31 March 2007.  Mr Jamieson-Bell deposes that this rental totals $15,559.87 and the rates $2,793.14.   These amounts have only recently been quantified, however, and it is only now that a demand for these  sums  is  being  pursued  against  the  plaintiffs.    This  must  be  regarded  as somewhat  unusual  given  that  the  total  amount  claimed  which  is  a  little  over

$18,000.00 has been accruing and outstanding for some period.   In addition, as I understand it, no tax invoices for the rent and rates have been issued by the defendants.

[22]     Notwithstanding that, and given particularly that the present application seeks summary judgment for which the plaintiffs must establish that the defendants have no arguable defence to the quantum claim, in my view the proper approach here is to grant summary judgment to the plaintiffs for the full amount claimed but, except as to $10,551.85 (acknowledged by the defendants to be due) to stay execution of this summary judgment  as  to  the  balance  amount,  pending  proper  resolution  of  the defendants’ counter-claim against the plaintiffs.

[23]     In my view, the defendants alleged claim against the plaintiffs should not fairly be categorised here as a set-off but is more properly seen as a counter-claim.  It relates to a separate claim which the defendants state they have against the plaintiffs under what is a notional lease arrangement for the 7.9 hectare area which it is said was or should have been reached between these parties when the primary beneficiary of the plaintiff Trust died in 2003.

[24]     As such, in my view the defendants here should not be considered as having a set-off or cross-claim which in itself would provide a valid defence to the plaintiffs’ present application.

[25]     Given  what  I  see  as  a  possible  counter-claim  here,  in  McGechan  on

Procedure at para:  HR142.02 the learned authors note:

“In cases where the defendant has a counter claim which cannot be classified as a set off, the question arises as to whether the Court should stay execution of the summary judgment pending resolution of the counterclaim.   The defendant should therefore apply for a stay at the time of filing the counterclaim:   Roberts Family Investments Limited v Total Fitness Centre (Wellington) Limited [1989] 1 NZLR 15 ….

The  decision  to  grant  a  stay  rests  essentially on  whether  it  would  be  a miscarriage of justice to allow execution of the plaintiff’s judgment – see NZ Apple & Pear Marketing Board v Wallis (1990) 4 PRNZ 713, where there was a possibility of the defendant being declared bankrupt before the counterclaim could be heard.”

[26]   The factual basis surrounding the defendants’ counter-claim against the plaintiffs  regarding the  7.9  hectare  area  at  this  stage  appears  somewhat  murky. Clearly, the lease with Mr Nevill which ran to August 2007 contained provisions covering the inclusion of the 7.9 hectares in question on a give and take basis.  But, there is an evidential conflict before the Court over whether this arrangement as between the defendants and the plaintiffs continued beyond 2003.   As I see the

position therefore, a full and proper consideration of the defendants’ claims to determine whether they might constitute a valid counter-claim is required here.

[27]     In my view, there could be a possible miscarriage of justice in the present case if the plaintiffs were allowed to execute the summary judgment which I am about to grant (except as  to  the  agreed  $10,551.85)  against  the  defendants  (for example by having them declared bankrupt) before the defendants’ alleged counter- claim could be fully heard – on this see New Zealand Apple & Pear Marketing Board v Wallis (1990) 4 PRNZ 713.

[28]     Rule 142(2) High Court Rules clearly envisages that an approach such as I am contemplating here, which is to include a partial stay of the summary judgment order I am about to grant, is often appropriate.  Rule 142(2) provides:

“2.If it appears to the Court on an application for judgment under r 136 or r 137 that the defendant has a counter claim that ought to be tried, the Court –

(a)       May give judgment for the amount that appears just on any terms it thinks fit …”  (emphasis added)

[29]     That approach is confirmed in the decision of Roberts Family Investments Limited v Total Fitness Centre (Wellington) Limited [1989] 1NZLR 15 where McGechan J states at page 92:

“Rather than give an immediately enforceable judgment to the plaintiff on the plaintiff’s (summary judgment) claim, perhaps allowing the plaintiff to bankrupt the defendant before the latter’s counter claim can be brought to judgment and off set, the Court may and commonly does grant the plaintiff summary judgment accompanied by stay of execution of such judgment pending resolution of the counter claim, or occasionally dismisses the summary judgment application, directing trial of both claim and counter claim.”

On this aspect see also McGechan on Procedure para. HR142.01.

Conclusion

[30]     For all these reasons I am satisfied the plaintiffs here have done enough to satisfy the onus upon them to show that the defendants have no defence to their summary judgment quantum claim for their period of unlawful occupation of the farm land in question.

[31]     That said the present application largely succeeds.   An order for summary judgment against the defendants is to follow.

[32]     A further order is to be made, however, staying execution of this summary judgment (except so far as the undisputed $10,551.85 is concerned) pending proper resolution of the defendants’ counter-claim against the plaintiffs.

[33]     Orders are now made therefore as follows:

a)       An order for summary judgment is now made in this proceeding in favour  of  the  plaintiffs  against  the  defendants  in  the  sum  of

$36,515.48 plus interest thereon at 7.5% p.a. from 14 March 2008 to the date of payment subject to paragraphs [33] b) and c) below.

b)Except as to the sum of $10,551.85 (plus interest thereon) which is payable  immediately,  execution  of  this  order  is  stayed  as  to  the balance of $25,963.63 (plus interest thereon) pending further order of this Court once the defendants’ counter-claim against the plaintiffs is properly resolved.

c)        This stay is conditional upon the following:

(i)The defendants within 10 working days of the date of this judgment issuing proceedings against the plaintiffs in terms of their counter-claim; and

(ii)The defendants then taking all reasonable steps to pursue and prosecute this counter-claim to completion with all due expedition; and

(iii)Leave is reserved for the plaintiffs to approach the Court at any time on 48 hours notice to apply to have the stay lifted or to   seek   any   further   orders   or   directions   that   may   be appropriate  in  the  event  that  the  plaintiffs  consider  the

defendants are  failing to comply with these conditions.

Costs

[34]     As  to  costs,  the  plaintiffs  have  effectively  succeeded  in  their  present application and I see no reason why they should not be entitled to an order for costs on the quantum application in the usual way.   Costs are therefore awarded on the present quantum application and hearing to the plaintiffs against the defendants on a Category 2B basis together with disbursements (if any) as approved by the Registrar.

‘Associate Judge D.I. Gendall’