Lauder v Walmsley - [2023] NZHC 2710

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

I TE KŌTI MATUA O AOTEAROA TĀMAKI MAKAURAU ROHE

CIV-2022-404-002046

[2023] NZHC 2710

BETWEEN
ROBERT GLEN LAUDER, ERICA JANE LAUDER and RICHARD CAMERON

DREW as trustees of the TUSCANY TRUST

Plaintiff

AND

MICHAEL WALMSLEY and JESSICA WALMSLEY

Defendant

CIV-2023-404-000167

BETWEEN

MICHAEL ARTHUR WALMSLEY and JESSICA LAUREN WALMSLEY

First Plaintiffs

MICHAEL ARTHUR WALMSLEY, JESSICA LAUREN WALMSLEY and WYLIE MCDONALD TRUSTEE

(WALMSLEY) LIMITED as trustees of the Calliope Trust
Second Plaintiffs

AND

ROBERT GLEN LAUDER, ERICA JANE LAUDER and RICHARD CAMERON

DREW as trustees of the Tuscany Trust Defendants

Hearing: 27 June 2023

Appearances:

K P McDonald and M Pursey for the Plaintiffs P Cogswell and S J Tee for the Defendants

Judgment:

29 September 2023

JUDGMENT OF ASSOCIATE JUDGE GARDINER

LAUDER v WALMSLEY [2023] NZHC 2710 [29 September 2023]

This judgment was delivered by me on 29 September 2023 at 11.30 a.m. pursuant to Rule 11.5 of the High Court Rules.

Registrar/Deputy Registrar

Date.......................................

Solicitors:

Kevin McDonald & Associates, Auckland Morton Tee Ltd, Auckland

Introduction

[1] The trustees of Tuscany Trust (Tuscany Trustees) agreed to sell a residential property on Calliope Road to Michael and Jessica Walmsley (the Walmsleys). They also agreed to provide vendor finance of $450,000 until the Walmsleys sold their existing property. The Walmsleys have refused to repay the vendor finance because they claim the Tuscany Trustees carried out unconsented building work on Calliope Road in breach of their vendor warranty.

[2] The Tuscany Trustees apply for summary judgment for the $450,000 due and owing by the Walmsleys under the vendor loan, plus interest.

[3] The Walmsleys oppose summary judgment on the grounds that they have an arguable defence based on their claim for breach of vendor warranty which they maintain provides an equitable set-off. Alternatively, they asked the Court to exercise its residual discretion not to grant summary judgment.

[4] The Tuscany Trustees say that the Walmsleys do not have standing to bring a claim for breach of warranty because they nominated a trust to complete the Calliope Road purchase, and that trust owns the property so has sustained the loss (if any). Alternatively, the claim for repayment of the loan and cross-claim for breach of warranty are not sufficiently interdependent to qualify for equitable set-off.

[5]The issues are:

(a)Do the Walmsleys have standing to bring the cross-claim for breach of vendor warranty?

(b)If the Walmsleys do have standing, are the claim and cross-claim so interdependent that it would be unjust to allow summary judgment without bringing the cross-claim into account?

(c)If the answer is no to [5(b)], should the Court exercise its residual discretion to refuse summary judgment?

Background

[6] On 9 April 2022, the Tuscany Trustees and the Walmsleys entered into an agreement for the sale and purchase of a property on Calliope Road, Devonport. The agreement was the standard ADLS/REINZ Agreement for Sale and Purchase of Real Estate.1 The purchase price was $3,850,000. The settlement date was 20 May 2022. As the…

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 Lauder v Walmsley

Details

AGLC: Lauder v Walmsley [2023] NZHC 2710
Case: [2023] NZHC 2710
Decision Date: 29 September 2023

CaseChat Overview and Summary

In the High Court of New Zealand, Associate Judge Gardiner dealt with an application for summary judgment filed by the Tuscany Trustees against the Walmsleys. The Tuscany Trustees sought payment of a $450,000 vendor loan, plus interest, under a Term Loan Agreement. The Walmsleys opposed the application, asserting an arguable defence based on a claim for breach of vendor warranty in the agreement for sale and purchase. The court had to determine whether the Walmsleys had standing to bring the cross-claim for breach of warranty, whether the claim and cross-claim were interdependent, and whether the court should exercise its residual discretion to refuse summary judgment. The court found that the Walmsleys had standing to bring the cross-claim for breach of warranty, as they had not assigned their right to sue to the Calliope Trustees. However, the court held that the claim and cross-claim were not interdependent, as the breach of warranty did not impeach the Tuscany Trustees’ claim for repayment of the loan. The court declined to exercise its residual discretion to refuse summary judgment, and granted summary judgment in favour of the Tuscany Trustees for the $450,000 owed, plus interest. The Tuscany Trustees were also entitled to their costs.

Orders