Kahala Holdings Ltd v C & F Fishing Ltd

[2006] NZSC 98

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IN THE SUPREME COURT OF NEW ZEALAND

SC 67/2006
[2006] NZSC 98

BETWEENKAHALA HOLDINGS LTD (FORMERLY NALDER & BIDDLE (NELSON) LTD)

Applicant

ANDC & F FISHING LTD

Respondent

Court:Elias CJ, McGrath and Anderson JJ

Counsel:G W Allan for Applicant

B O'Callahan and N Carter for Respondent

Judgment:21 November 2006 

JUDGMENT OF THE COURT

1The application for leave to appeal is dismissed.

2The application for leave to cross-appeal is dismissed.

3Kahala Holdings Ltd is to pay C & F Fishing Ltd costs in the sum of $2,500.00 plus disbursements to be fixed if necessary by the Registrar.

REASONS

[1]       Kahala Holdings Ltd, formerly named Nalder & Biddle (Nelson) Ltd, applies for leave to appeal against the judgment of the Court of Appeal in relation to a contract, undertaken by the applicant, for refitting a purse seiner tuna fishing vessel owned by the respondent.  In the High Court the applicant obtained judgment for its claim to be paid the balance of the contract price, less deductions in relation to certain claims for extras.  The respondent obtained judgment against the applicant on a counter-claim for damages for defective workmanship and delay in the course of the refit.  It failed on a separate claim for wrongful arrest.

[2]       On the counter-claim, the applicant had contended unsuccessfully that its liability for breach of contract was limited by its terms of trade.  The High Court Judge decided that the terms of trade, included in an original proposal by the applicant to do the works, had not formed part of the subsequent contract.  Nor had they been incorporated into the contract by notice or on any other basis.

[3]       Both parties appealed unsuccessfully to the Court of Appeal.

[4]       The grounds advanced by the applicant for its proposed appeal to this Court concern the decisions by the Courts below that the applicant’s terms of trade in relation to limitation of liability under warranty and exclusion of loss of profits were not incorporated into the contract.  Emphasis was placed on the fact that the terms of trade had been made available to the respondent prior to contract in circumstances in which the applicant could reasonably have believed they would have been read by the respondent.  It was also argued that sufficient written acceptance and acknowledgement of the terms of trade was given when job cards were signed on behalf of the respondent, most of which stated that the standard terms of trade and of limitation of liability were accepted by the respondent.

[5]       The applicant says that the Courts below fell into error in their approach to these questions, first by considering whether the document containing the terms of trade was an essential part of the contract and, only if that were established, then considering whether reasonable notice had been given to limiting conditions.  Alternatively it is said that the Court of Appeal and the High Court erred in approaching the question on the basis that the contract had to be found in either the proposal or the job cards rather than in a combination of these documents.  As well, the applicant says that the Courts were in error in deciding that the applicant’s terms of trade were unusual or onerous and therefore sufficient notice was required before they became binding on the respondent.

[6]       The questions in issue in the Courts below have largely been concerned with ascertaining what the parties should be taken to have intended in the unusual factual situation that led to the formation of the refit contract.  These facts have been the subject of concurrent findings against the applicant in both lower Courts.  We do not see that the decisions of those Courts bear in any way on the general principles of law applicable to incorporation of exclusion clauses.  Nor do we see that any point of law of general or public importance arises in the appeal.  Essentially the proposed appeal would relate to what the parties should be taken to have intended would be the terms of their bargain.

[7]       In those circumstances, it is not in the interests of justice for the appeal to be heard and the Court must dismiss the application for leave to appeal.  The respondent is entitled to costs.

[8]       The respondent’s application to cross-appeal concerns the question of wrongful arrest, in particular in relation to the consequential lodging of a caveat against release and abatement.  However, the respondent seeks leave to cross-appeal only if the applicant is given leave to appeal.  In those circumstances it is not necessary to consider its application to cross-appeal in any detail.  It is accordingly dismissed but in the circumstances without any order for costs against the respondent.

Solicitors:

Pitt and Moore, Nelson for Applicant
Carter and Partners, Auckland for Respondent