Kuoch v Ganda - [2022] NZHC 452

IN THE HIGH COURT OF NEW ZEALAND c REGISTRY

I TE KŌTI MATUA O AOTEAROA TĀMAKI MAKAURAU ROHE

CIV-2021-404-2178

[2022] NZHC 452

UNDER Section 261 of the Property Law Act 2007 and Part 19 of the High Court Rules 2016

IN THE MATTER OF

A lease of premises at 27 Chartwell Avenue, Glenfield, Auckland

BETWEEN

JOHNLEE HUA MINH KUOCH

Applicant

AND

MAHESH GANDA, MANI GANDA and

RAMAN DIYAR GANDA as trustees of the Morar Family Trust

Respondent

Hearing: 1 March 2022

Appearances:

B Rooney for the Applicant

L Ponniah for the Respondent

Judgment:

14 March 2022

JUDGMENT OF POWELL J

This judgment was delivered by me on 14 March 2022 at 3.30 pm pursuant to R 11.5 of the High Court Rules

Registrar/Deputy Registrar Date:

Solicitors/Counsel:
Fortune Manning, P O Box 4139, Auckland
(B Rooney, Vulcan Building Chambers, Auckland)

Thomas and Co, New Lynn, Auckland
(L Ponniah, P O Box 55022, Eastridge, Auckland)

KUOCH v GANDA [2022] NZHC 452 [14 March 2022]

[1] The applicant, Johnlee Kuoch, has applied for an order pursuant to s 261(1)(a)(i) of the Property Law Act 2007 to renew the lease of the premises where his laundromat business is located (“the lease”). The application is necessary because Mr Kuoch failed to give the appropriate notice to renew the lease prior to its expiry on 8 January 2020.

[2] The application is opposed by the respondents, as trustees of the Morar Family Trust, which owns the premises in which Mr Kuoch’s business is located (“the trustees”). While the trustees do not dispute that Mr Kuoch inadvertently failed to renew the lease, they say that Mr Kuoch’s application should be dismissed because he had two alternative opportunities available to avoid the alleged prejudice faced by the refusal to renew the lease, which he deliberately chose not to take. They argue he could either have maintained the periodic tenancy that resulted after he failed to renew the lease or, in any event, the trustees had been prepared to grant him a new lease.

[3] More broadly the trustees argue that to grant Mr Kuoch’s application would prejudice the trustees because the lease does not appropriately deal with liability for infrastructure growth charges (“IGC”) levied by Watercare against the trustees for water use at the leased premises and three other premises also owned by the trustees on the same site. The trustees consider Mr Kuoch has primary responsibility for these charges due to the nature of his laundromat business and associated water usage.

[4] Mr Ponniah, on behalf of the trustees, went so far as to submit that in the event that relief was granted on the application, it should be done so to require Mr Kuoch to enter into a new lease with the trustees, or to amend the existing lease to confirm his liability with regard to the IGC.

Factual background

[5] Mr Kuoch took assignment of the leased premises on 8 November 2018, which, as noted, is one of four owned by the trustees in Chartwell…

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 Kuoch v Ganda

Details

AGLC: Kuoch v Ganda [2022] NZHC 452
Case: [2022] NZHC 452
Decision Date: 14 March 2022

CaseChat Overview and Summary

The High Court of New Zealand, Auckland Registry, considered the case of Kuoch v Ganda, where Johnlee Kuoch applied for the renewal of a lease for his laundromat business located at 27 Chartwell Avenue, Glenfield. The lease had expired on 8 January 2020, and the application was necessary as Mr Kuoch had failed to give the appropriate notice to renew the lease prior to its expiry. The respondents, as trustees of the Morar Family Trust which owns the premises, opposed the application. They argued that Mr Kuoch should not be granted relief as he had alternative opportunities to avoid the alleged prejudice, and that to grant the application would prejudice them due to the lease not appropriately dealing with liability for infrastructure growth charges (IGC) levied by Watercare for water use.

The court considered the legal issues surrounding the application of section 261 of the Property Law Act 2007 and the court's broad discretion to grant relief under section 264. The court must consider all relevant circumstances and balance the rights of the lessor and lessee. The underlying rationale for the court's discretion is to avoid injustice, protecting the lessee from a lessor taking commercial advantage of their inadvertent mistake, where doing so would disproportionately impact the lessee.

In this case, it was clear that Mr Kuoch simply overlooked the requirement to renew the lease and failed to do so through pure inadvertence. There was no evidence that Mr Kuoch was other than a good tenant, and the prejudice that would be faced by him if the lease was not ultimately renewed was self-evident, as he would be forced to close or move his business. The court found that there was no evidence of any prejudice to the trustees if the application was granted and the lease renewed. The opposition to the application was seen as an opportunistic attempt by the trustees to take advantage of Mr Kuoch's inadvertent failure to renew the lease in time to strengthen their own position with regard to obtaining a contribution for the IGC incurred.

The court concluded that the present application should be granted, and directed Mahesh Ganda, Mani Ganda, and Raman Diyar Ganda to renew the lease in favor of Johnlee Kuoch until 7 January 2024 and for such other renewal periods under the lease as may be notified. Mr Kuoch was entitled to costs on the application, and indemnity costs were sought. If agreement could not be reached within one month of the judgment, memoranda not exceeding five pages were to be filed by both parties, and the court would then determine costs on the papers.

Orders