Herbert v Duncan - [2013] NZHC 565

IN THE HIGH COURT OF NEW ZEALAND CHRISTCHURCH REGISTRY

CIV-2013-409-558 [2013] NZHC 565

BETWEEN JOHN HERBERT
LOUISE ANNETTE CLEM Plaintiffs

ANDRICHARD PETER DUNCAN WENDY ANN RUSCOE Defendants

Hearing: 20 March 2013

Appearances: G Hair for the Plaintiffs
S Dwight for the Defendants

Judgment: 20 March 2013

ORAL JUDGMENT OF FOGARTY J

[1] This is an application by the plaintiff’s for an interim injunction to prevent the defendants, by themselves or their agents, cancelling an agreement for sale and purchase between the plaintiffs as purchasers and the defendants as vendors, dated
23 November 2012, in reliance upon the settlement notice issued by the defendants, dated 5 March 2003, and/or the decision of Mr Lindsay Lloyd, dated 25 February
2013, pending further order of the Court.

[2] The application was filed on 18 March 2013, and is being heard today, as the settlement notice expires tomorrow afternoon at 5.00 pm.

[3] The agreement for sale and purchase is of a rural property and is for the value of $725,000. After the agreement became unconditional the property was damaged by fire. The property is of approximately five hectares, and contained various improvements, including: a dwelling, a garage, a utility shed, a small shed, a fowl
house, four loose boxes, extensive lawns, gardening and landscaping, boundary and

HERBERT & Anor V DUNCAN & Anor HC CHCH CIV-2013-409-558 [20 March 2013]

internal fencing, pumps and a water tank, a spa pool, a single row of established pinus radiata shelterbelt trees along the full length of the western boundary and two- thirds of the length of the eastern boundary, plus established native plantings along the extended section with the dwelling, and two main internal shelterbelts, including a double fence, a pinus radiata shelterbelt adjacent to the rear paddock, and a poplar tree shelter belt to the north of the extended section. There is a dispute as to whether or not there was an underground irrigation system, and there was also a dressage arena.

[4] The agreement became unconditional on 21 December 2012. On 11 January

2013, the property was significantly damaged by fire. Damage caused by the fire included destruction of the boundary shelterbelts and most of the internal shelterbelts, loss of outbuildings, damage to the dressage area, loss of fencing, loss of water supply services, loss of the spa bath, loss of landscaped areas around the dwelling and loss of pasture. Part of the damage was covered by the defendants’ insurance policies. However, the defendants’ policy was limited to the sum of
$2,500 in respect of items that did not form part of the buildings and structures on the property. Therefore, the internal and boundary shelterbelt trees, landscaping, irrigation (if there was some), pasture and dressage arena areas were not covered by the defendants’ insurance. The defendants obtained quotes to reinsure the uninsured damage, which totalled $267,490.54. This is made up of reinstatement of the dressage arena, $62,100; felling and removal of the boundary and internal shelterbelt trees, $59,512.50; replacement of the shelterbelt trees, $122,125.50;…

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.

Continue reading Herbert v Duncan

Details

AGLC: Herbert v Duncan [2013] NZHC 565
Case: [2013] NZHC 565
Decision Date: 20 March 2013

CaseChat Overview and Summary

The case of Herbert v Duncan involves an application for an interim injunction by the plaintiffs, John Herbert and Louise Annette Clem, to prevent the defendants, Richard Peter Duncan and Wendy Ann Ruscoe, from cancelling an agreement for the sale and purchase of a rural property. The agreement became unconditional, but the property was damaged by fire. The defendants issued a settlement notice and relied on a decision by an experienced property lawyer, Mr Lindsay Lloyd, to determine the interim amount to be placed on an interest-bearing call deposit. The plaintiffs disagree with Mr Lloyd's decision and seek interim relief, fearing that if the settlement notice expires, their remedies may be limited to damages only, and they will lose the right to obtain specific performance of the contract. The legal issues in this case revolve around the interpretation of clauses 4 and 7 of the agreement and whether the interim amount determined by Mr Lloyd is a reasonable sum. The court considered whether there was a serious question to be tried and where the balance of convenience lay before deciding whether to grant the interim injunction. The court concluded that there was a serious argument regarding the interpretation of clause 4.2(2), but the defendants had the better of the two arguments. The court also took into account the structure of the contract, which anticipated a dispute and provided for an interim assessment by an experienced property lawyer. Ultimately, the court decided to refuse the interim injunction and ordered costs for the defendants on a 2B basis.

The final orders of the court are as follows: the interim injunction is refused, and the defendants are to bear the costs of the application on a 2B basis. If the parties cannot agree on the quantum of costs, the court will fix the costs upon receipt of submissions, limited to no more than three pages each.

Orders