Kamo Landscape & Quarry Supplies Limited v Whangarei District Court
[2021] NZHC 170
•16 February 2021
IN THE HIGH COURT OF NEW ZEALAND WHANGAREI REGISTRY
I TE KŌTI MATUA O AOTEAROA WHANGĀREI-TERENGA-PARĀOA ROHE
CIV-2020-488-83
[2021] NZHC 170
BETWEEN KAMO LANDSCAPE & QUARRY SUPPLIES LIMITED
PlaintiffAND
WHANGAREI DISTRICT COURT
First Respondent
ENVIRO 360 LIMITED
Second Respondent
Hearing: 2 February 2021 Counsel:
C Muston for Plaintiff
No appearance for First Respondent P Wilson for Second Respondent
Judgment:
16 February 2021
JUDGMENT OF WHATA J
This judgment was delivered by me on 16 February 2021 at 3.00 pm, pursuant to Rule 11.5 of the High Court Rules.
Registrar/Deputy Registrar Date: ………………………….
Solicitors: Crown Law, Wellington
Henderson Reeves Lawyers, Whangarei
KAMO LANDSCAPE & QUARRY SUPPLIES LIMITED v WHANGAREI DISTRICT COURT [2021] NZHC
170 [16 February 2021]
[1] Kamo Landscape & Quarry Supplies Limited (Kamo Landscape) applies for judicial review of the decision of Judge K B de Ridder1 declining an appeal against a decision of the Disputes Tribunal (the Tribunal) ordering Kamo Landscape to pay Enviro 360 Limited (Enviro 360) the sum of $10,221.07 by 9 July 2020.
[2] Kamo Landscape’s main claim appears to be that the Judge failed to consider an alleged procedural error made by the Ministry of Justice in scheduling the hearing of Enviro 360’s claim for enforcement of an earlier Tribunal order, in advance of other claims lodged by Kamo Landscape with the Tribunal, without any reference or link to those claims. Kamo Landscape submits therefore that it was deprived of a proper opportunity to advance these claims with the best evidence, for example, as to the price of topsoil.
Background
[3] In 2019, the parties entered into an agreement relating to the sale and purchase of topsoil, and the sale and purchase of a topsoil screening plant. Both parties filed proceedings in the Tribunal in 2019 in respect of this agreement. It is common ground that on 9 December 2019, the Tribunal ordered Enviro 360 to pay Kamo Landscape for 991 cubic metres of topsoil it had contracted to buy. That order also specified that the payments had to be made in a series of four scheduled payments, totalling
$22,793.00, on the following dates:
(a) $7,000.00 on 13 December 2019;
(b) $5,000.00 on 31 December 2019; (c) $5,000.00 on 31 January 2020; and
(d) With the balance of $5,793.00 on 28 February 2020.
[4] Enviro 360 admits to failure to make the second scheduled payment on 31 December 2019. However, Enviro 360 says it made the second scheduled payment
1 Kamo Landscape & Quarry Supplies Limited v Enviro 360 Limited [2020] NZDC 16921.
on 4 January 2020 and the other scheduled payments, so that it has paid $22,793.00 in full to Kamo Landscape in accordance with the 9 December 2019 Tribunal order.
[5] Kamo Landscape, however, claims it entered into a revised agreement with Enviro 360 on 10 January 2020 (the alleged New Agreement) under which Enviro 360 undertook to pay in full “by next week”. In breach of that alleged New Agreement, Kamo Landscape says Enviro 360 did not make payment in full and instead on 14 January at 7.49 am, Ben Matheson, director of Enviro 360, emailed John Robinson, director of Kamo Landscape, stating Enviro 360 had taken legal advice and would remove the topsoil at 8.00 am on 15 January 2020. Mr Robinson responded with a trespass notice against Enviro 360 (and Mr Matheson) entering Kamo Landscape’s yard. It also transpired that, without permission, Enviro 360 took quantities of topsoil, some of which was screened topsoil. Kamo Landscape then filed a new Tribunal claim for $5,500.00, plus GST, on 28 February 2020 in respect of the unauthorised taking of the topsoil. A hearing date was set down for 20 April 2020 but was deferred due to COVID-19. On 5 March 2020, Enviro 360 filed a request to enforce part of an agreed settlement with the Tribunal to enforce the original order.
[6] Kamo Landscape complains that, somehow, Enviro 360’s claim for enforcement got scheduled for a hearing prior to Kamo Landscape’s enforcement action could be carried out and their claim being heard. This is denied by Enviro 360. It says in the 3 June 2020 Tribunal hearing, Kamo Landscape specifically confirmed to the Tribunal Referee and to Enviro 360 that it was to proceed with the Tribunal hearing and to address both matters: Kamo Landscape’s 28 February 2020 claim and Enviro 360’s 5 March 2020 request for enforcement.
Disputes Tribunal decision
[7] The hearing took place on 3 June 2020 before Referee Nicholas Blake. He delivered his decision on 11 June 2020. In that decision, the Referee:
(a)described the background by referring to the Disputes Tribunal claim lodged by Kamo Landscape on 5 June 2019;
(b)referred to an order made by the Disputes Tribunal of 9 December 2019 and noted the basic terms of settlement: that Enviro 360 was to pay Kamo Landscape $22,793.00 in four instalments and, in return, Enviro 360 was permitted to remove 991 cubic metres of topsoil from a stockpile at Kamo Landscape’s yard; and
(c)referred to Enviro 360’s request to enforce on 5 March 2020.
[8] There is no mention in this part of the decision to Kamo Landscape’s application of 28 February 2020.
The Referee identified the following issues required to be answered:
(a)Did the agreed settlement require Kamo Landscape to take some action or provide some service that would benefit Enviro 360?
(b)If so, was that term of the agreement complied with?
(c)If it was not complied with, is it appropriate for the Disputes Tribunal to strike out that term and order the payment of money?
[10] In answer to the first question, the Referee found yes, the agreed settlement did require Kamo Landscape to take some action: the decision stated that Enviro 360 was to take 991 cubic metres of topsoil from Kamo Landscape’s premises by 28 February 2020, and specified rules for removal. In answer to the second question, the Referee also found that the agreement was not complied with. He was satisfied the evidence did not show him that Enviro 360 received 991 cubic metres of topsoil from Kamo Landscape.
[11] Turning to the third question of whether an order of money should be made, the Referee referred to Kamo Landscape’s argument that the agreement was null and void after Enviro 360 breached the agreement by failing to make payment that was due on 31 December 2019 and by failing to pay the full balance when it became due, immediately after the 31 December 2019 payment was missed. It was also noted that topsoil was removed without a Kamo Landscape employee being present. The Referee
recorded Mr Robinson’s argument that the breach was analogous to a breach of contract, meaning that the other party was not obliged to perform their side and that the losses lie where they fail.
[12] The Referee did not accept the settlement agreement was analogous to a contract, primarily because the remedies that flowed from breach were different. Even if Mr Robinson’s argument that an agreed settlement is like a contract were correct, the Referee said his conclusion about the consequences of breach is based on a misunderstanding of contract law. An agreed settlement is enforceable through the Collections Unit of the District Court, through the process in s 47 of the Disputes Tribunal Act 1988 (if the relevant term of agreement is for the provision of the service). In contrast, a breach of contract can give rise to a right of cancellation, but the Referee noted that even in the event of cancellation, courts and tribunals have broad powers, including the power to require parties to pay monies, take actions or transfer property.
[13] The Referee did note, however, that in quantifying the loss of benefit for Enviro 360, it is appropriate to take into account the benefit Enviro 360 have received and the loss Enviro 360 caused to Kamo Landscape by their own breach. In relation to the benefit already received, Mr Robinson submitted:
(a)Enviro 360 had taken more than the 321.039 cubic metres of topsoil that they claimed to have taken to date; and
(b)Enviro 360 had taken, in breach of agreement, a quantity of screened topsoil that has a higher value than the unscreened bulk topsoil they were supposed to take.
[14] The Referee then found against Enviro 360 in both respects, noting a concession by Mr Matheson that he had taken in excess of 100 cubic metres and that he had, without authority, taken topsoil from a screened pile.
[15] In addition, Kamo Landscape claimed it should be awarded compensation for losses it says it suffered when it had to re-book a shipping container because of Enviro 360’s belated payment of $5,000.00, with which it intended to pay for the container.
The Referee accepted this submission to the extent he acknowledged the principle that a late payment is less valuable than a payment on time, that this caused significant inconvenience and extra administration for Kamo Landscape, and the Tribunal’s quantification of loss should take some account of this principle.
[16]The Referee made the following findings:
22. … a.
The agreed settlement required Kamo Landscape to allow Enviro 360 to remove 991m3 of topsoil. This term of the agreement has not been met.
b.
The parties did not agree to vary the terms of the agreed settlement.
c.
Enviro 360 have suffered a loss of benefit. It is appropriate to strike out the terms relating to the provision of topsoil to Enviro 360, and replace them with· an order requiring payment to Enviro 360.
e.
The monetary order must take into account the benefits that Enviro 360 has received to date, and the losses that Kamo Landscape has suffered as result of Enviro 360’s breaches of the agreement.
f.
Enviro 360’s breaches did not render the agreement null and void, and did not vitiate the obligations that Kamo Landscape had under the agreement.
23
Enviro
360 sought a monetary order for $16,371.01, being the
difference between the value of the topsoil that they have received (321.039m3 at $20/m3) and the amount that they have paid to Kamo Landscape ($22,793.00).
24.From that figure I will deduct:
a.$1,150.00, being the extra 57.5m3 of topsoil removed on 28 January 2020 (the difference between 100m3 and 42.5m3), at the base rate of $20/m3;
b.$[3,000.00], being the additional value of the screened topsoil compared with the unscreened (based on a value of $50/m3 compared with $20/m3 multiplied by 100m3).
c.$2,000.00, being an assessment of damages incurred by Kamo Landscape as a result of Enviro 360’s breaches of the terms of the agreed settlement.
25.Kamo Landscape is to pay Enviro 360 $10,221.07.
District Court decision
[17] The key issue on appeal to the District Court was whether the Referee had acted unfairly by not specifically considering Kamo Landscape’s claim filed on 28 February 2020, in which it sought the sum of $5,500.00 on account of the amount of topsoil actually taken by Enviro 360; that Enviro 360 failed to pay one of the payments on the due date; and, that Enviro 360 took screened topsoil when the approved settlement only provided for unscreened topsoil. It was, however, clear to the Judge that Kamo Landscape’s 28 February 2020 application was before the Tribunal and considered by the Referee. The Judge noted that Enviro 360 had sought the sum of $16,371.07, being the difference between the price it had paid and the value of the topsoil it actually received. From that sum, the Judge noted the Tribunal clearly had taken into account the matters raised by Kamo Landscape in its application to the Tribunal on 28 February 2020: the actual amount of topsoil taken; the additional value of the screened topsoil; and damages for Enviro 360’s breach of the approved settlement. He thus concluded that contrary to Kamo Landscape’s claim, the Tribunal had all relevant information before it and all the concerns of the parties. There was no need to adjourn the hearing and there had been no procedural unfairness.
Issues
[18]The central issues on review are:
(a)Whether Kamo Landscape was deprived of a reasonable opportunity to be heard on its claims, including for that purpose by tabling evidence as to topsoil values bearing on the Tribunal’s orders; and
(b)Whether the Tribunal was wrong to dismiss Kamo Landscape’s claim based on the alleged New Agreement.
Assessment
[19] This is an application for judicial review. I am not concerned with the substantive merits of the underlying claim, nor am I concerned to review the merits of
the decision reached, either by the Tribunal or by the District Court.2 In order to succeed, Kamo Landscape must show that the District Court erred in law, failed to have regard to relevant considerations, took into account irrelevant consideration, acted unfairly or unreasonably. Furthermore, the policy of the Disputes Tribunal Act 1988 is clear. The Disputes Tribunal procedure is a fast track procedure, designed to avoid protracted litigation. As the Court of Appeal said in Graeme Martin Contracting Limited v Disputes Tribunal:3
[38] The purpose of the Disputes Tribunal Act is to provide for the prompt resolution of disputes involving modest sums. The Tribunal is required to determine disputes coming before it according to the substantial merits and justice of the case without being bound to give effect to strict legal rights or obligations, legal forms or technicalities. Orders of the Tribunal are final and binding on the parties in terms of s 23 of the Act, subject to the limited appeal rights conferred under s 50. The only available appeal right in this case is that the proceedings were conducted by the referee in a manner that was unfair to GMCL and prejudicially affected the result of the proceedings.
(citations omitted)
[20] I do not accept the District Court erred in any respect. I agree with the District Court Judge that the Referee carefully considered Kamo Landscape’s primary complaint referred to in its 28 February 2020 application – that is, the wrongful taking of topsoil. Relevantly, the Referee’s award appears to have resulted in a deduction from the Enviro 360 award that approximates to the value of the 28 February 2020 claim.
[21] Secondly, there was no procedural error or unfairness. Kamo Landscape was given ample opportunity to run its case in the Tribunal. As noted by Ms Wilson, counsel for Enviro 360, all of the material filed with Kamo Landscape’s 28 February 2020 application was attached to Enviro 360’s 5 March 2020 application, so the Referee had that information when he made his decision. In addition, and importantly, Mr Robinson did not seek to have the hearing adjourned so he could bring more or better evidence in support of his claim. To the contrary, the evidence before me was that Mr Robinson was content to proceed with the hearing on 3 June 2020.
2 Pring v Whanganui District Council (1999) 5 ELRNZ 464 (CA) at [7].
3 Graeme Martin Consulting Limited v Disputes Tribunal [2018] NZAR 1636 (CA).
Accordingly, he cannot now reasonably complain about a lost opportunity to bring further evidence in support of his claim.
[22] Lastly, even if Kamo Landscape is correct about the existence of a new agreement which meant that Enviro 360 could not enforce the agreed settlement, the result would have been the same, because Kamo Landscape would have been obliged to disgorge the monies subsequently paid by Enviro 360 pursuant to the agreed settlement. It could not possibly expect to keep those monies while not supplying the agreed topsoil to which those payments related. In the result, the award made by the Disputes Tribunal in respect of the same payments was inevitable.
[23]Accordingly, I see no basis for reviewing the District Court judgment.
Result
[24] The application for judicial review is dismissed. Enviro 360 seeks indemnity costs on the basis that the claim was baseless and an abuse of process. While the merits of the review were poor, I would not go so far as to say they were meritless. I am satisfied therefore Enviro 360 shall have their costs on a 2B basis.
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