Insato Furniture Limited v Star Moving Limited

[2018] NZHC 3

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

I TE KŌTI MATUA O AOTEAROA TĀMAKI MAKAURAU ROHE

CIV-2017-404-003017

[2018] NZHC 3

BETWEEN

INSATO FURNITURE LIMITED

First Plaintiff

INSATO FURNITURE TRADING PTY LIMITED
Second Plaintiff

AND

STAR MOVING LIMITED

Defendant

Hearing:	11 January 2018
Appearances:	J A McMillan and C L P Smith for Plaintiffs P W Michalik for Defendant
Judgment:	12 January 2018

JUDGMENT OF HINTON J

This judgment was delivered by Justice Hinton on 12 January 2018 at 5.30 pm

pursuant to R 11.5 of the High Court Rules Registrar / Deputy Registrar

Date………………………

INSATO FURNITURE LTD & OR v STAR MOVING LTD [2018] NZHC 3 [12 January 2018]

[1]        Insato Furniture Ltd (Insato) is an importer and wholesaler of consumer furniture.

[2]        Star Moving Ltd (Star) was a contractor to Insato, arranging for the storage and delivery of Insato’s products to its customers, who include Harvey Norman and Hunter Furniture. Star holds a significant amount of Insato’s stock in two warehouses, an Auckland warehouse and a Christchurch warehouse. The contract has been cancelled.

[3]        Insato and a related company apply for a mandatory injunction that Star make all of the furniture available for Insato’s collection immediately.

[4]In the alternative, Insato seeks orders under r 7.78 of the High Court Rules.

[5]        Rule 7.78 enables the Court to make orders for interim payment into court and delivery up of property where a lien is claimed.

[6]        In essence, neither party really disputes the application of r 7.78 or the desirability of Insato’s goods being released, with Star being adequately covered for its claimed lien. The terms of the orders that should be made are disputed.

[7]        In any event, I consider this is clearly a situation where r 7.78 should be applied.

[8]The notice of lien dated 5 December 2017 claims an amount due at that date of

$50,680.64 inclusive of GST. However, as Insato pointed out, the accompanying statement appears to include a number of amounts that on the face of it are not due until 20 December 2017. These total approximately $13,000. The statement also refers to amounts that were allegedly due in September 2014 and April 2016 totalling a further $1,400. These entries seem very strange.

[9]        In those circumstances there is a very clear question mark over the amount in respect of which the lien is claimed. Insato says there are significant further issues. It essentially disputes the right to a lien at all.

[10]      Mr Michalik, for Star, says that in terms of the Contract and Commercial Law Act 2017 (CCLA) a carrier can claim a lien for freight and “recoverable expenses” which includes all expenses reasonably incurred by the carrier in removing, preserving and storing the goods pending settlement of the carrier’s claim.

[11]      On that basis, Mr Michalik seeks that a total sum of approximately $80,000 be paid into court under r 7.78 to allow for future costs, whereas Insato has offered to pay the amount of the lien notice. Of that amount Insato does not dispute that $33,932.77 is properly due.

[12]      My reading of r 7.78, the commentary to it, and s 286 of the CCLA would suggest that if there is any amount which I should order be paid into court as a minimum, it is the amount of the actual notice ($50,680). I propose to allow an additional sum of just under $10,000 to round the payment up to $60,000.

[13]Both parties agree that the money should be placed on interest-bearing deposit.

[14]      There is a remaining issue, which is the date of delivery of the goods. Insato says it needs to have delivery at the latest by Thursday, 25 January 2018, with the first delivery being available in each warehouse by 15 January 2018 at the latest.

[15]      Mr Michalik is adamant that the goods can only be available for collection in accordance with the timetable which Star dictates.

[16]      I have decided to accede to Star’s position in this regard, but it will obviously be relevant to the ultimate resolution of this case.

[17]      I now make the following orders in terms of r 7.78, the form of which was canvassed with counsel yesterday:

(a)On or before Tuesday, 16 January 2018, the plaintiffs are to pay $60,000 into the High Court at Auckland, to be placed on interest-bearing deposit;

(b)All goods held by the defendant on behalf of the plaintiffs are to be made available for collection by the plaintiffs and to be collected from Star’s Auckland and Christchurch warehouses on the following basis:

(i)Star is to make 100 cubic metres available per week ex the Auckland warehouse and 200 cubic metres per week ex the Christchurch warehouse;

(ii)The first collection is to take place on Wednesday, 17 January 2018;

(iii)All goods must be made available for collection by Wednesday, 7 February 2018, this provision to prevail over

(i)above;

(iv)Insato can nominate the order in which goods are to be made available so that it can prioritise goods required by customers and minimise any loss.

(c)Within three working days of all goods being collected from Star, Insato will request the Court to pay the undisputed sum of $33,932.77 to Star.

(d)The remaining balance of $26,067.23 plus any accruing interest will be held by the Court until the result of the substantive proceeding is known, or the parties otherwise agree.

[18]The question of costs was not addressed and costs are reserved.

Hinton J