Kumar v Many Limited - [2024] NZHC 1164

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

I TE KŌTI MATUA O AOTEAROA TĀMAKI MAKAURAU ROHE

CIV-2023-412-13

[2024] NZHC 1164

BETWEEN
ROSHNI KUMAR

Plaintiff

AND

MANY LIMITED

Defendant

Hearing: 15 February 2024

Appearances:

PF Dalkie and S Bhanabhai for the Plaintiff MB Wigley for the Defendant

Judgment:

16 May 2024

JUDGMENT OF ASSOCIATE JUDGE SUSSOCK

This judgment was delivered by me on 16 May 2024 at 12.30 pm pursuant to r 11.5 of the High Court Rules

Registrar/Deputy Registrar

Solicitors:
Dyer Whitechurch, Auckland
Wigley and Company, Wellington

KUMAR v MANY LIMITED [2024] NZHC 1164 [16 May 2024]

Introduction

[1]The plaintiff, Roshni Kumar, applies for summary judgment of her claim for

$337,021.20 allegedly owing pursuant to an agreement with the defendant, Many Ltd.

[2] The agreement was for Ms Kumar to sell 38 shares in FM105.3 Ltd and to assign a loan advance in the name of her late husband to Many Ltd (Agreement).

[3] Many Ltd paid the deposit and the first instalment of the purchase price1 but not the second instalment of $337,021.20. In April 2022, the 38 shares were registered in the name of Many Ltd. Despite demand being made, the balance of the purchase price remains unpaid.

[4] The correspondence on behalf of Many Ltd at the time and its written submissions focus on whether Many Ltd and its director and shareholder, Mr Khan, were aware of alleged accounting issues with FM105.3 Ltd when entering into the Agreement. At the hearing however Many Ltd relied more heavily on alleged breaches of warranties in the Agreement.

[5] In Chief Executive of the Department of Corrections v Fujitsu New Zealand Ltd (Fujitsu), Cooke J held that liability under a warranty is strict, with the claimant not having to prove reliance or loss.2 Breach is established simply by proving the statement is false. In that case, the knowledge or otherwise of Many Ltd or Mr Khan, would not be relevant to whether there was a breach of warranty or not.

[6] Many Ltd says it has a reasonably arguable defence to the summary judgment application on this basis relying on the warranties and indemnity in the Agreement.

[7] Ms Kumar submits in response that Fujitsu is distinguishable and the Agreement contained a right to cancel if Many Ltd’s name had not been entered in the company’s share register as the holder of the 38 shares by 28 January 2022. When share registration did not occur by that date but Many Ltd decided to continue with

1 Referred to in the Agreement at the “Purchase Consideration”.
2 Chief Executive of the Department of Corrections v Fujitsu New Zealand Ltd [2023] NZHC 3598 at [123] approved in Dixon v Takapuna Residence Development Ltd [2024] NZCA 129 at [21], n 18.

the Agreement in full knowledge of the alleged accounting issues with FM105.3 Ltd, Ms Kumar says Many Ltd waived its rights under the warranties.

[8]The issues for determination are therefore:

(a)Is it reasonably arguable that Ms Kumar breached…

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.

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Details

Case: [2024] NZHC 1164
Decision Date: 16 May 2024

CaseChat Overview and Summary

Roshni Kumar applied for summary judgment against Many Ltd for the balance of the purchase price of $337,021.20 owed under an agreement to sell shares and a loan advance in FM105.3 Ltd. Many Ltd opposed the application and raised defences and a counterclaim. The court considered the principles of summary judgment and whether there was a real question to be tried. Many Ltd argued there was a reasonably arguable defence based on a breach of warranty in the agreement and that the doctrine of election did not prevent them from relying on any breach of warranty. The court found that there was a reasonably arguable defence based on a possible breach of the warranty in cl 6.2(f) of the agreement. The court also found that the doctrine of election did not clearly prevent Many Ltd from relying on any breach of warranty. Therefore, the application for summary judgment was declined and costs were reserved.

Orders