John Young Farming Limited v Ngai Tahu Farming Limited

[2019] NZHC 1333

IN THE HIGH COURT OF NEW ZEALAND INVERCARGILL REGISTRY

I TE KŌTI MATUA O AOTEAROA WAIHŌPAI ROHE

CIV-2019-425-25

[2019] NZHC 1333

BETWEEN

JOHN YOUNG FARMING LIMITED

Plaintiff

AND

NGĀI TAHU FARMING LIMITED

Defendant

Hearing:

5 June 2019

Appearances:

G L Wilkin for plaintiff

W J Hamilton for defendant

Judgment:

13 June 2019

JUDGMENT OF ASSOCIATE JUDGE JOHNSTON

TABLE OF CONTENTS

Introduction  [1]

Background  [7]

Summary judgment principles  [29]

The competing cases  [31]

The implied term  [39]

Request for information  [55]

Actual health of the animals  [59]

Damages  [61]

Interest  [67]

Costs  [69]

JOHN YOUNG FARMING LIMITED v NGĀI TAHU FARMING LIMITED [2019] NZHC 1333 [13 June 2019]

Introduction

[1]    On 6 August 2017, the plaintiff, John Young Farming Ltd, and the defendant, Ngāi Tahu Farming Ltd, entered into a contract pursuant to which John Young Farming agreed to sell and Ngāi Tahu Farming agreed to purchase 1,000 Friesen rising one-year-old bulls at $3 plus GST per kilogram live weight to be delivered — or, rather, collected — between 1 March 2018 and 31 May 2018. Importantly for present purposes, the contract provided:

...

2.The cattle shall be in good health and free from injury or disease.

3.The Purchaser has the right to reject cattle which do not meet specification.

…

[2]    John Young Farming now sues Ngāi Tahu Farming alleging that Ngāi Tahu Farming breached the contract when on 18 May 2018 it indicated that it was not prepared to take delivery of the cattle. Summary judgment is sought.

[3]    John Young Farming’s application for summary judgment is supported by an affidavit sworn by one of the company’s directors, Mr John Young.

[4]    Ngāi Tahu Farming opposes the application for summary judgment. It has filed and served a statement of defence and counterclaim and a notice of opposition. These are supported by four affidavits. The first is sworn by the company’s Chief Executive Officer,  Mr  Andrew  Priest,  the  second  by  its  General   Manager   –   Grazing, Mr Peter Roberts,  the  third  by  its  General   Manager   –   Finance   and   Risk,   Mr Stephen Ware, and the fourth by an expert witness, Mr Peter Mills, who is employed by ANZCO Foods as a livestock agent.

[5]    John Young Farming has filed  and  served  affidavits  in  reply  sworn  by  Mr Young, Mr Layne Morresey, a livestock agent employed by Progressive Livestock Ltd, which acted as John Young Farming’s agent throughout, and an expert witness, Mr Gene March, who is a consultant employed by LIC FarmWise.

[6]    Finally, Mr Roberts has sworn a supplementary affidavit, which is said to respond to matters raised for the first time in the reply affidavits filed and served by John Young Farming.

Background

[7]    It seems doubtful that any New Zealander has not heard of the bacterial disease Mycoplasma bovis. It is a disease that, as the name suggests, affects cattle. Once it gets a toe hold on a farm or in a herd its effects are catastrophic.

[8]    Mr Mills’ unchallenged evidence is that prior to mid-2017 there was no reported case in this country. However, on 22 July 2017 samples taken from one herd of cattle spread over two South Canterbury farms tested positive for the disease. At that  stage  there  was  no  suggestion  that  the  disease  was   present   outside   South Canterbury. The Ministry for Primary Industries’ public announcement about this was made less than a fortnight prior to John Young Farming and Ngāi Tahu Farming entering into their contract.

[9]    As  already  said,  the  parties  in  this  case  entered  into  their  contract  on  6 August 2017. John Young Farming then set about acquiring the necessary stock to fulfil its obligations under the contract, which Mr Young says was done, through the company’s agents, Progressive Livestock, during November and December 2017.

[10]   Mr Mills’ evidence is that on 12 December 2017 the Ministry announced that herds on three Southland properties had tested positive for Mycoplasma bovis.

[11]   The affidavit evidence of Mr Priest and Mr Roberts is that Ngāi Tahu Farming developed a set of protocols to safeguard its farms and stock from the spread of Mycoplasma bovis, which were implemented during late 2017 and early 2018. They both emphasise the importance that Ngāi Tahu Farming placed on the protection of the company’s herds. The evidence is that Ngāi Tahu Farming’s protocols required it to establish beyond reasonable doubt — my term rather than theirs — that any cattle introduced to their farms were free of the bacterium.

[12]   There is no evidence that John Young Farming was informed of the steps that Ngāi Tahu Farming was taking.

[13]   On 15 March 2018, John Young Farming, through Mr Young, presumably at the request of Ngāi Tahu Farming, provided a declaration concerning the provenance of the cattle and the risk of them having been exposed to the Mycoplasma bovis bacterium. In effect, Mr Young’s declaration was that “…to the best of [his] knowledge and belief …” the cattle had not been so exposed.

[14]   Clearly, that declaration did not satisfy Ngāi Tahu Farming because the company then engaged Mr Mills to make further enquiries about the provenance of the cattle. In his affidavit, Mr Mills says:

47.I phoned Mr Young and had a discussion with him about the herd. I asked him if he knew where all of the animals had come from. By this I meant, did he know what farms the cattle had been born on and reared on before coming to his farm.

48.Mr Young replied that he only knew where “about 80%” of the animals had come from. When I asked for more detail about that, he explained that for “about 80%” of the animals he knew who the calf rearer was, but the remainder of the herd had been made up of stock purchased from saleyards and via stock agents.

49.Mr Young was also not now able to identify which of the animals comprised the 80% in respect of which he advised he knew the calf rearer, and which comprised the remaining 20% which were from entirely unknown origin.

[15]   Mr Young denies having said or implied that any of the cattle had been acquired from stockyards. I accept his evidence in relation to this. Both he and Mr Morresey have given evidence that none of the cattle in question were acquired from stockyards and it seems very unlikely that Mr Young would have indicated otherwise. In my view, the most likely explanation for this conflict between the evidence of Mr Mills and Mr Young is that when asked about the provenance of the animals Mr Young said that, off the cuff, he could not say exactly where they all came from and Mr Mills inferred from this that some were acquired, or may have been acquired, from stockyards. In his evidence, Mr Young explains that the phone call “came out of the blue” and that he “struggled to follow what was being said”.

[16]   Presumably Mr Mills reported the substance of the conversation as he recalled it to Ngāi Tahu Farming.

[17]   The next contact between the parties occurred on 30 April 2018 (two months into the period during which the cattle were to change hands) when Ngāi Tahu Farming’s livestock agent, Mr  David  Hardy  of  Peter  Walsh  and  Co,  emailed  Mr Tim Bell, a representative of John Young Farming’s livestock agent, Progressive Livestock. Mr Hardy’s email was headed “Bull calves to Ngai-Tahu” [sic] and said “Can you please address this! Bloody vets”. He attached an email that the evidence indicated he had received from Ngāi Tahu Farming concerning a query raised by a veterinary surgeon advising that company which said:

Hi Dave,

The Manager of Ngai-Tahu Farming has asked me to make contact with you with regard to the upcoming delivery of the bull calves from John Young.

What he is asking is that John makes contact with MPI to confirm that in their eyes there won’t be any issues with moving the cattle to Balmoral.

The question is raised by a local vet questioning whether Ngai-Tahu should be bringing these animals into the Amuri Basin at all.

As you can imagine this is a very delicate situation and this vet has put a doubt in the minds of Ngai-Tahu management.

The eyes are on corporate farmers! Please let me know how this goes.

[18]   This email apparently resulted in Mr Bell forwarding to Mr Hardy a copy of the NAIT records for the cattle. In his evidence, Mr Mills explains that, in conjunction with the industry, the Ministry is involved with a company called NAIT Ltd, the purpose of which is to operate an  animal  identification  scheme  under  the  National Animal Identification and Tracing Act 2012.

[19]   Ngāi Tahu Farming did not regard the NAIT records as providing them with sufficient evidence as to the provenance of the cattle because they did not disclose the farms from which the cattle came. Mr Roberts’ evidence in reply to Mr Morresey’s evidence is that, having received the NAIT records, Ngāi Tahu Farming (he does not say who) contacted the Ministry to obtain more information as to exactly where the

stock came from, and whether the farms in question were suspected of being infected with Mycoplasma bovis, but was told that the Ministry could not disclose this.

[20]   By that stage, Ngāi Tahu Farming was not satisfied that it had sufficient information about the cattle to be sure that their introduction to its farms would meet the protocols it had put in place, but obviously concluded that it could take its enquiries no further.

[21]   The next contact between the parties was in the form of a text from Ngāi Tahu Farming’s agent to John Young Farming’s agent. This is the communication referred to at the outset in which John Young Farming was advised that Ngāi Tahu Farming was not prepared to take delivery of the cattle. The text said:

Call you soon. Ngai Tahu are out on calves based on the clause in the contract that the animals have to be healthy and free of disease. Their lawyer has stated that this cannot be proven so they will not be proceeding.

[22]   Delphic as the text may have been, it is common ground that it constituted notice to John Young Farming from Ngāi Tahu Farming that the latter was not prepared to proceed with the transaction and thus a repudiation of the same.

[23]   Correspondence between John Young Farming’s solicitors and Ngāi Tahu Farming’s in-house solicitor followed. It is unnecessary to describe this in detail. The essential position adopted by Ngāi Tahu Farming is captured in its in-house solicitor’s last letter dated 22 May 2018. Here is what he said as to why Ngāi Tahu Farming refused to take delivery of any cattle:

Clause 2 of the contract provides that The Cattle shall be in good health and be free from injury or disease. In accordance with this requirement it is incumbent upon your client to satisfactorily demonstrate that the cattle are indeed in good health and free from disease. Thus far, and despite requests, your client has failed to do this.

[24]   Faced with Ngāi Tahu Farming’s refusal to accept delivery of  the  cattle, John Young Farming sold them to other buyers through its livestock agent.

[25]   Mr Young’s evidence is that whereas the contract price agreed between the parties would have resulted in a total sale and purchase price of $568,972.95, the best

prices that could be achieved in mid-2018 resulted in  a  return  of  $456,957.35. John Young Farming claims the difference of $112,015.60.

[26]   Mr Young also gives evidence that because John Young Farming had to hold on to the cattle for longer than expected it incurred additional costs in relation to labour, feed and transport. He puts additional labour costs at $2,300.00 (incl of GST) and additional feed and transport costs at $33,807.80.

[27]   Finally, Mr Young says that pasture damage caused by the cattle remaining for longer than planned on the property leased for the purpose resulted in John Young Farming incurring re-grassing costs of $63,250.00.

[28]   Taking the GST components out of the claim for damages contained in the prayer for relief, my arithmetic indicates that the total claim for damages is

$211,073.40.

Summary judgment principles

[29]The principles governing summary judgment are now well settled.

[30]   The plaintiff must satisfy the Court that defendant has no arguable defence.1 If the defendant is to oppose the application for summary judgment on the basis that it has an arguable defence that it is entitled to run at trial, it will generally need to show that there is a legal basis for the defence and be able to point to evidence supporting the same.2 If the defendant is able to do that then the onus is on the plaintiff to satisfy the Court that there is no real question to be tried. Courts will not normally resolve significant conflicts of evidence or assess creditability on affidavit evidence, but nor will the Court uncritically accept evidence that is inherently lacking in credibility or inherently improbable. The Court is entitled to take a robust and realistic approach where this is warranted. In the end, the Court must be left with no real doubt or uncertainty as to the merits of the plaintiff’s claim in order to grant summary judgment.3

1      High Court Rules 2016, r 12.2(1).

2      Middleditch v New Zealand Hotel Investments Ltd (1992) 5 PRNZ 392 (CA) at 394.

3      Krukziener v Hanover Finance Ltd [2008] NZCA 187, (2008) 19 PRNZ 162 at [26].

The competing cases

[31]   John Young Farming’s case as pleaded and as described by Mr Young in his primary affidavit could not be more straightforward. The company’s contention is that it agreed to sell, and Ngāi Tahu Farming agreed to purchase, the cattle; that it was ready, willing and able to deliver the cattle from 1 March 2018; and that Ngāi Tahu Farming repudiated the contract on 18 May 2018 when it indicated that it was not prepared to go through with it.

[32]That, Mr Wilkin submitted, is the beginning and end of the case.

[33]   Ngāi Tahu Farming’s case is captured in the following paragraphs of the statement of defence and notice of opposition:

Statement of defence

4.2… the agreement contained an implied term that the plaintiff would,  if necessary, provide proof that the animals were in good health and free from injury or disease …

Notice of opposition

3(b)The contract between the plaintiff and the defendant contained essential express and implied terms that:

…

c.If required, the plaintiff would provide evidence to establish  that the cattle are in good health and free from injury or disease;

[34]   In short then, Ngāi Tahu Farming’s position, as articulated by its in-house solicitor in correspondence, and as pleaded, is that it was an implied term of the parties’ contract that Ngāi Tahu Farming was only obliged to accept the cattle if John Young Farming was able to provide it with evidence establishing that the cattle were in good health and free from injury or disease.

[35]   In the course of argument, Mr Hamilton put Ngāi Tahu Farming’s case slightly differently. He submitted that the implied term required John Young Farming to provide Ngāi Tahu Farming, on request, with all information it had at its disposal as to the provenance of the cattle, so as to enable Ngāi Tahu Farming to make an informed

judgement about whether it accepted that the cattle were in good health and free from injury or disease — particularly, of course, from Mycoplasma bovis.

[36]   Ngāi Tahu Farming’s counterclaim — supported by Mr Ware’s evidence — alleges that John Young Farming breached this implied obligation and as a result Ngāi Tahu Farming had to purchase cattle from elsewhere at a higher price. It claims damages reflecting the difference between the contractual price and the price it had to pay.

[37]   Thus, the defence to John Young Farming’s claim, and the basis of Ngāi Tahu Farming’s counterclaim, are both dependent on the implication of the term propounded by it. Against that background, it appears to me that the dispositive issues in the case will be:

(a)First, whether the Court should imply into  the  contract  between  John Young Farming and Ngāi Tahu Farming the term propounded by the latter.

(b)Second, if such a term is to be implied, whether John Young Farming breached the same, justifying Ngāi Tahu Farming’s refusal to proceed with and (acknowledged) repudiation of the contract.

[38]   In the context of a summary judgment application, the immediate issue for determination resolves itself into whether John Young Farming has established that there is no arguable case for the implication of the term propounded, or that the company breached the same.

The implied term

[39]   The courts imply terms into contracts in a range of circumstances. Here, most are irrelevant. The contention advanced by Mr Hamilton on behalf of Ngāi Tahu Farming is that the Court should imply the term propounded by it into the contact between the parties on the basis that it is an obvious omission.

[40]   That ground for implying terms into contractual arrangements is one that has undergone some reformulation over the years.

[41]   It is unnecessary to go into a detailed analysis of the development of the law. The most appropriate starting point is the principle formulated by MacKinnon LJ in Shirlaw v Southern Foundries (1926) Ltd, where his Lordship said:4

Prima facie that which in any contract is left to be implied and need not be expressed is something so obvious that it goes without saying; so that, if, while the parties were making their bargain, an officious bystander were to suggest some express provision for it in their agreement, they would testily suppress him with a common “Oh, of course!”

[42]   What is commonly referred to as the officious bystander test was reformulated by the Privy Council in BP Refinery (Western Port) Pty Ltd v Shire of Hastings, where the Privy Council said:5

… for a term to be implied, the following conditions (which may overlap) must be satisfied: (1) it must be reasonable and equitable; (2) it must be necessary to give business efficacy to the contract so that no term will be implied if the contract is effective without it; (3) it must be so obvious that “it goes without saying”; (4) it must be capable of clear expression; (5) it must not contradict any express term of the contract.

[43]   With the benefit of hindsight, it might be thought that BP Refinery conflated two different circumstances in which a court must consider whether or not to imply a term, the first being where the propounded term arises naturally from the circumstances of the case and the language actually used by the parties such that it is so obvious that it goes without saying, and the second being where the term is necessary to give effect to the commercial intentions of the parties.

[44]   In Attorney-General of Belize v Belize Telecom Ltd, Lord Hoffmann, on behalf of a unanimous bench of the Privy Council, explained that the BP Refinery conditions are:6

… best regarded, not as a series of independent test which must each be surmounted, but rather as a collection of different ways in which judges have

4      Shirlaw v Southern Foundries (1926) Ltd [1939] 2 KB 206 at 227.

5      BP Refinery (Westernport) Pty Ltd v Shire of Hastings (1977) 180 CLR 266 (PC) at 376.

6      Attorney-General of Belize v Belize Telecom Ltd [2009] UKPC 10, [2009] 1 WLR 1988 at [27].

tried to express the central idea that the proposed implied must spell out what the contract actually means ...

[45]   This approach was adopted by the Court of Appeal in Hickman v Turn and Wave Ltd.7 In McNeil v Gould, the Court of Appeal cautioned against a strict application of the BP Refinery test in cases not involving complicated contractual documents. The Court preferred to adopt the formulation provided by a passage from Chitty on Contract, which emphasised that the Shirlaw and business efficacy tests may not necessarily apply to the same situations: 8

An implication of this nature may be made in two situations: first, where it is necessary to give business efficacy to the contract, and secondly, where the term implied represents the obvious, but unexpressed, intention of the parties.

[46]   More recently, the United  Kingdom  Supreme  Court  has  reconsidered  Lord Hoffmann’s formulation of the BP Refinery test in Marks and Spencer plc v BNP Paribas Securities Services Trust Co (Jersey) Ltd, emphasising that the courts will only imply a term into a contract if it is necessary to make the contract work, and not merely because it would be reasonable to do so.9 Lord Neuberger also accepted that obviousness and business necessity can be alternatives in the sense that only one of them needs to be satisfied, although he remarked that in practice it would be a rare case where only one of those two requirements would be satisfied.10

[47]   That brings me full circle back to Shirlaw and MacKinnon LJ’s officious bystander test, which, in my view, is the most apt test here.

[48]   On that test, the question the Court must ask itself is whether, having regard to the context in which the contract was entered into, and the express terms employed by the parties, it is obvious that the parties’ collective intention was to include the implied term or terms contended for.

7      Hickman v Turn and Wave Ltd [2011] NZCA 100, [2011] 3 NZLR 318 at [247]–[248]. Overturned by Hickman v Turner and Waverley Ltd [2012] NZSC 72, [2013] 1 NZLR 741, but not on this point.

8      McNeil v Gould (2002) 4 NZ ConvC 193,557 at [26] per Hammond J. See H G Beale (ed) Chitty on Contracts: Volume 1 General Principles (33rd ed, Sweet and Maxwell, London, 2018) at [14- 006].

9      Marks and Spencer plc v BNP Paribas Securities Services Trust Co (Jersey) Ltd [2015] UKSC 72, [2016] AC 742 at [23] per Lord Neuberger, [59] per Lord Carnwath and [77] per Lord Clarke.

10 At [21].

[49]I am far from convinced that if it had been suggested by an officious bystander

—  let us abandon the man on the Clapham omnibus, who is unlikely to have anything to say about contracts for the sale of cattle in Southland, and instead think in terms of the woman leaning on the stockyard railings observing the business being transacted at a Southland livestock sale — that the contract included a provision to the effect contended for by Ngāi Tahu Farming, the parties’ collective response would have been, as MacKinnon LJ put it: “Oh, of course”.

[50]   For a start, it seems to me to be entirely probable that reasonable people in the positions of the parties would have had different responses in this case.

[51]   The view I take is that this case concerns how risk was to be managed in connection with disease that might not be immediately obvious. The affidavit evidence from Mr Mills is that testing for Mycoplasma bovis was possible but difficult at the time because of the pressure on resources following the outbreak of the disease. The parties entered into a contract that did not expressly address that risk. In those circumstances, it was for each party to manage the risk that it perceived itself to have under the contract. I cannot see why it should be regarded as so obvious as to go without saying that that risk ought to be imposed entirely on John Young Farming.

[52]   One perfectly rational response to our officious bystander would have been to say: No, certainly there is an express obligation on the part of John Young Farming to deliver cattle that are healthy and free from injury and disease and an entitlement on the part of Ngāi Tahu Farming to reject injured  and  diseased  beasts;  no  doubt John Young Farming would be liable if it delivered injured or diseased cattle; but, the parties are left to manage their own risk in relation to undetected disease as they see fit; either could, for example, have insisted on arranging quarantine and testing before agreeing to give or take delivery.

[53]   If one were to apply the BP Refinery test, it seems to me that the argument being advanced by Ngāi Tahu Farming would fail on a number of counts. I do not view the implied term contended for as being reasonable and equitable, as it benefits Ngāi Tahu Farming over John Young Farming for no explicable reason. It is certainly not necessary to ensure that the contract is efficacious from a business perspective, as

the contract appears to me to be entirely effective without it, once one recognises that it was open to either party to manage their own risks as they perceived them to be. And, as already said, I do not perceive the clause suggested as being so obvious that it goes without saying.

[54]   For those reasons, I am satisfied that John Young Farming has established that Ngāi Tahu Farming has no reasonable prospect of successfully persuading the Court that the clause it propounds should be implied into contract.

Request for information

[55]   As Mr Hamilton formulated it in the course of argument, the implied obligation on the part of John Young Farming would be that if requested to do so it would provide Ngāi Tahu Farming with all information available to it in relation to the provenance of the cattle — in particular, from where they had been acquired by John Young Farming

—   so as to enable Ngāi Tahu Farming to make an informed decision as to the risk of Mycoplasma bovis in the herd.

[56]   Even if I were to conclude that such a term could and should be implied into the parties’ contract, I am not satisfied that it would assist Ngāi Tahu Farming.

[57]   In my judgement, at no stage was a clear request made of John Young Farming that would have triggered an obligation to provide the information that Ngāi Tahu Farming now says that it was looking for. All this required was a letter, email or other communication explaining and articulating its requirements. Nothing of the sort was in evidence. Certainly, Mr Mills did not do this in his telephone conversation with Mr Young, even on his description of what he said — “I asked him if he knew where all the animals had come from.”   Similarly,  the request that Mr Hardy passed on    on 30 April 2018 does not constitute such an explanation and request.

[58]   From the evidence of Mr Young and Mr Morresey, it is clear that John Young Farming had access to detailed information as to the provenance of the cattle. There is no reason at all to think that John Young Farming would not have provided this to Ngāi Tahu Farming had it been requested in clear terms.

Actual health of the animals

[59]   Although it was not clearly pleaded, and not the focus of argument before me, I refer briefly to the submission advanced by Mr Hamilton that there is a genuine dispute of fact over the actual health status of the cattle in May 2018 that must be tested at trial. It might have been open to Ngāi Tahu Farming to argue that John Young Farming would have been in breach of its express obligation under the contract to supply cattle that were in good health and free from injury or disease by offering to supply cattle that were in fact infected by Mycoplasma bovis (or any other ailment for that matter). That would have entitled Ngāi Tahu Farming to reject the cattle in accordance with clause 3 of the contract, arguably irrespective of whether that was their stated reason for doing so at the time.

[60]   The difficulty, however, is that there is no evidential foundation for such an agreement. On the contrary, Mr Young’s evidence is that he has received no complaints from the purchasers, and it would likely be impossible to conduct tests on the cattle at this stage. I am satisfied that this line of argument would have no reasonable prospect of success at trial.

Damages

[61]That leaves the question of damages.

[62]   Although Mr Mills is correct that the claim as currently formulated does not factor in any obligation on the part of John Young Farming to pay commission to its livestock agent, it does not seem likely to me that this changes the net loss suffered by John Young Farming. The commission Mr Mills refers to is said to be charged on a per weight basis. That being the case, the commission would equally decrease the amount recovered from the subsequent sales by the livestock agent to other purchasers, presuming the figures provided by Mr Young account for this matter consistently, as one would expect. I am therefore not prepared to reduce the starting figure from

$568,972.95 to $540,524.29 as Mr Mills suggests is appropriate.

[63]   Although I accept Mr Mills’ evidence that prices in excess of $2.70 per kilogram were being achieved in June 2018, Mr Mills takes no account of the fact that

John Young Farming faced a situation in which it was compelled to divest itself of this livestock as fast as possible in what must have come close to fire sale circumstances. It may well be that the prices achieved — between $2.35 and $2.50 per kilogram — owe something to that.

[64]   Mr Mills’ evidence relating to the amount of feed that John Young Farming should have had to provide is not especially helpful. The claim is for 7 kilograms per day. Mr Mills says that the cattle would be unlikely to need more than 6 kilograms per day. I see no analysis of allowances for wastage, and for the “gruesome weather conditions” Mr Young says persisted at the farm during May and July 2018. In the end I am prepared to accept Mr Young’s evidence as to how much additional baleage he actually required.

[65]   As to the claim for pasture damage, whilst Mr Mills expresses some scepticism in relation to this, given Mr Young’s unchallenged evidence of the weather conditions he (and the cattle) faced at the time, I accept his evidence as to additional damage caused by the cattle remaining on the property for longer than expected and the cost he incurred to rejuvenate the pasture. In this regard, I record that his evidence is supported by that of Mr March.

[66]   The conclusion I have reached is that Ngāi Tahu Farming has no tenable defence to this claim and on that basis I enter summary judgment in favour of the plaintiff for the full amount of its claim as I have calculated it to be — $211,073.40.

Interest

[67]   In its prayer for relief, John Young Farming claims “[i]nterest on the sum at the plaintiff’s overdraft rate of 8%”. At the conclusion of his submissions, Mr Wilkin reiterated that the plaintiff was seeking interest on that basis. I asked him whether that claim was pleaded and he referred me to the plaintiff’s prayer for relief. However, the claim is not pleaded in the body of the statement of claim and nor is there any evidence supporting any such claim. The principle is that interest is allowed pursuant to the Interest on Money Claims Act 2016 unless interest on some other basis is pleaded and established. It has not been here.

[68]   The plaintiff will have interest at the rate provided for in the Interest on Money Claims Act.

Costs

[69]   The plaintiff seeks “[t]he costs of and incidental to these proceedings on a solicitor/client basis”.

[70]   The basis for seeking indemnity costs is apparently that in the correspondence between the parties prior to the commencement of proceedings the plaintiff said through its solicitors that if it had to make a claim it would seek such costs.

[71]   I am not satisfied that the plaintiff is entitled to indemnity costs. The general principle is that costs follow the event. In other words, the successful party is entitled to a costs award according to scale and an intending plaintiff cannot alter that position simply by asserting that it will claim indemnity costs prior to commencing proceedings.

[72]   Furthermore, from the outset this claim has been for a little over $200,000, well within the jurisdiction of the District Court.

[73]   The plaintiff will have its costs in accordance with the District Court Rules 2014, together with such disbursements as may be allowed by the Registrar.11

Associate Judge Johnston

Solicitors:

AWS Legal, Invercargill for plaintiff

Chapman Tripp, Christchurch for defendant

11     High Court Rules 2016, r 14.13.