Henry v Auckland Council - [2015] NZHC 435

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

CIV-2012-404-006420 [2015] NZHC 435

BETWEEN
TREVOR ERIC HENRY, HONG TAN

and SWL TRUSTEE COMPANY LIMITED (AS TRUSTEES OF THE THP TRUST)

Plaintiffs

AND

AUCKLAND COUNCIL Defendant

Hearing: 25-29 August and 2 & 4 September 2014

Appearances:

I J Thain and K R Pengelly for the Plaintiffs
D J Heaney QC and K B Dillon for the Defendant

Judgment:

11 March 2015

JUDGMENT OF ELLIS J

This judgment was delivered by me on 11 March 2015 at 4.00 pm pursuant to Rule 11.5 of the High Court Rules.

Registrar/Deputy Registrar

Date:………………………….

Counsel/Solicitors:
I J Thain, DLA Phillips Fox, Auckland
K R Pengelly, DLA Phillips Fox, Auckland
D J Heaney QC, Heaney and Partners, Auckland
K B Dillon, Heaney and Partners, Auckland

HENRY & ORS v AUCKLAND COUNCIL [2015] NZHC 435 [11 March 2015]

[1] 114A Clovelly Rd, Buckland’s Beach, Auckland, is a property located on the edge of a cliff, with spectacular eastern views over the Hauraki Gulf. In August
2008, a catastrophic slip cut a swath across the bottom of the property. It is now known that the slip originated from deep below the ground on the seaward side of the next-door property to the south. As a result of the slip, the house located on the property, which had been completed just two years earlier, was subsequently demolished.

[2] 114A Clovelly Rd (114A) is owned by the plaintiffs in their capacity as trustees of the THP Trust.1 They say that the Council’s negligence in preparing a Land Information Memorandum (LIM) for the property is the cause of the economic loss they have suffered as a result of the slip.

[3] Before turning to consider the legal aspects of the plaintiffs’ claim, it is necessary to set out the events leading to the drafting of the 114A LIM in some detail. The detail is important because the nature and extent of the information known to the Council about the land, and the decisions that were then made about how that information was to be recorded on the LIM, have considerable bearing on whether the Council has been negligent here.

Background

[4] In January 2002, Yvonne McCracken purchased 114 Clovelly Rd. At that time the property comprised a single section with one dwelling on it. Ms McCracken had plans to demolish that dwelling, subdivide the property and build a new house on each of the resulting sections.

[5] In July 2003 Ms McCracken received a report from Geotek Services Limited (Geotek) in relation to her proposed development. In the introduction to the report Geotek noted that it was anticipated that the report would be submitted to Council in support of a building consent application and, more particularly, providing material relevant to the Council’s obligations under s 36 of the Building Act 1991. In general
terms, and subject to limited exceptions, s 36 prohibits a territorial authority from

1 Buckland’s Beach SWL Trustee Company Ltd, Mr Trevor Henry and Ms Hong Tan (the…

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: [2015] NZHC 435
Decision Date: 11 March 2015

CaseChat Overview and Summary

The plaintiffs, Trevor Eric Henry, Hong Tan, and SWL Trustee Company Limited, brought an action against Auckland Council for damages arising out of a catastrophic slip that occurred at 114A Clovelly Rd, Buckland's Beach, Auckland. The property was located on the edge of a cliff with spectacular eastern views over the Hauraki Gulf. The slip originated from deep below the ground on the seaward side of the next-door property to the south, causing the house on the property to be demolished. The plaintiffs claimed that the Council's negligence in preparing a Land Information Memorandum (LIM) for the property was the cause of the economic loss they suffered as a result of the slip. The Council denied the claim, asserting that it had relied on professional geotechnical and legal advisors in preparing and drafting the LIM notation, which adequately summarised the position at the time. The court found that while the Council owed a duty of care to the plaintiffs in relation to the advice/information contained on the LIM, the Council was not in breach of that duty. The court held that the purpose of s 44A(2) was to give potential purchasers notice of any special features pertaining to the land in order that they could take them into account when deciding whether to make further inquiries, negotiate on price, or decide whether to purchase at all. It was not the purpose of the provision to give advice about what course of action a potential purchaser should take in response to the existence of any such special feature and it was not its purpose to give advice about what course of action a potential purchaser should take in response to the existence of any such special feature. The court found that the losses for which the plaintiffs now claim were not within the scope of the Council's duty and, accordingly, could not in law be said to have been caused by the Council's negligence. The plaintiffs' claim against the Council must fail, and costs should follow the event in the usual way.

Orders