Keller v Daisley - [2021] NZCA 351

IN THE COURT OF APPEAL OF NEW ZEALAND

I TE KŌTI PĪRA O AOTEAROA

CA271/2020
[2021] NZCA 351

BETWEEN	PAUL GERRARD KELLER AND KAREN ELIZABETH KELLER First Appellants ARK CONTRACTORS LIMITED Second Appellant
AND	MALCOLM JAMES DAISLEY Respondent

CA30/2021
BETWEEN	MALCOLM JAMES DAISLEY First Appellant HPL DISTRIBUTION LIMITED Second Appellant ACTION FENCING LIMITED Third Appellant
AND	ARK CONTRACTORS LIMITED First Respondent PAUL GERRARD KELLER Second Respondent

CA31/2021
BETWEEN	MALCOLM JAMES DAISLEY First Appellant HPL DISTRIBUTION LIMITED Second Appellant
AND	ARK CONTRACTORS LIMITED Respondent

Hearing:	29–30 June 2021
Court:	Cooper, Collins and Goddard JJ
Counsel:	J A Browne for Appellants in CA271/2020 and Respondents in CA30/2021 and CA31/2021 E L Smith for Respondents in CA271/2020 and Appellants in CA30/2021 and CA31/2021
Judgment:	29 July 2021 at 3.00 pm

JUDGMENT OF THE COURT

CA271/2020
AThe appeal in CA271/2020 is allowed.
BThe award of damages/equitable compensation to Mr Daisley is set aside.
CThe cross-appeal in CA271/2020 is dismissed.
DThe respondent must pay the appellants costs in respect of the appeal and cross-appeal, in each case for a standard appeal on a band A basis, with usual disbursements.
CA30/2021
EThe appeal in CA30/2021 is allowed in part. The damages awarded are increased by $577.50. The appeal is otherwise dismissed.
FThe appellants must pay the respondents 90 per cent of the costs for a standard appeal on a band A basis, with usual disbursements.
CA31/2021
GThe appeal in CA31/2021 is dismissed.
HThe appellants must pay the respondent costs for a standard appeal on a band A basis, with usual disbursements.

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Table of contents

Para no

Introduction

The main proceedings (CA271/2020)

The Depot proceedings (CA31/2021)

The chattel conversion proceedings (CA30/2021)

Background

The Daisleys face significant financial pressure

The Kellers come onto the scene

The Ark agreement

Claim that the Ark agreement was entered into under duress

The January 2010 agreement

Claim that the January 2010 agreement was entered into under duress

The lease of the Depot

The Daisleys leave the Depot

The removal of the office buildings

The Daisleys’ chattels left at the Depot

Subsequent events

Proceedings are issued

The main proceedings

The pleaded claims

The pleaded defences and counterclaims

High Court judgment in main proceedings

Appeal in relation to main proceedings

Issue 1: Was it open to the Judge to award compensation for failure to issue shares in Ark?

The issue

Discussion

Issue 2: Merits of claims for breach of contract/fiduciary duty

The issues

Discussion

Issue 3: Mr Daisley’s claim for interest

The Depot proceedings — office conversion claim

High Court judgment — office conversion claim

Issue 4: Conversion of office buildings

The issue

Discussion

The Depot proceedings — HPL Distribution’s liability for rent

High Court judgment — HPL Distribution’s liability for rent

Issue 5: HPL Distribution’s liability for rent

The issue

Discussion

The chattel conversion proceedings

High Court judgment — chattel conversion proceedings

Issue six: Chattel conversion issues

The forklift

Excavator parts

Fence panels

Steel beams

Hydraulic press and toolbox

Tractor and trailer

Summary

Costs

Result

REASONS OF THE COURT

(Given by…

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 Keller v Daisley

Details

AGLC: Keller v Daisley [2021] NZCA 351
Case: [2021] NZCA 351
Decision Date: 29 July 2021

CaseChat Overview and Summary

The appeal in CA271/2020 was allowed, the award of damages/equitable compensation to Mr Daisley was set aside, and the cross-appeal in CA271/2020 was dismissed. The Kellers were entitled to costs in respect of the appeal and cross-appeal. The appeal in CA30/2021 was allowed in part, the damages awarded were increased by $577.50, and the appeal was otherwise dismissed. The appellants were to pay the respondents 90 per cent of the costs for a standard appeal on a band A basis, with usual disbursements. The appeal in CA31/2021 was dismissed. The appellants were to pay the respondent costs for a standard appeal on a band A basis, with usual disbursements.

The Court found that the failure to issue shares in Ark was not pleaded in the main proceedings, and thus was not properly before the Court. The Judge's award of equitable compensation/damages for failure to issue shares was therefore set aside. The Court also found that the Kellers had breached a fiduciary duty owed to Mr Daisley by failing to issue shares in Ark, but that this was adequately pleaded. The Court found that the Kellers had breached a fiduciary duty owed to Mr Daisley by failing to issue shares in Ark, and awarded equitable compensation/damages of $541,721 against the Kellers and Ark. The Court rejected Mr Daisley's claim for interest on the equitable compensation/damages on the basis that interest had not been pleaded.

The Court found that the appeal in CA31/2021 was dismissed, and that the appellants were to pay the respondent costs for a standard appeal on a band A basis, with usual disbursements. The Court found that the appeal in CA30/2021 was allowed in part, and that the damages awarded were increased by $577.50. The Court found that the appeal was otherwise dismissed, and that the appellants were to pay the respondents 90 per cent of the costs for a standard appeal on a band A basis, with usual disbursements.

Orders