Lawson v Gawith - [2017] NZHC 40

IN THE HIGH COURT OF NEW ZEALAND WELLINGTON REGISTRY

CIV-2016-435-3 [2017] NZHC 40

BETWEEN
KEVIN JAMES LAWSON AND

ROSEMARY LYNN LAWSON Applicant

AND

EDWARD BRIAN GAWITH First Respondent

AND

EDWARD BRIAN GAWITH, JOSEPHINE ANNE GAWITH AND PETER NEVILLE PUMPHREY Second Respondents

Hearing: 9 May 2016

Counsel:

G M Richards for Applicant
K B Johnston and P W Michalik for Respondents

Judgment:

27 January 2017

JUDGMENT OF CLARK J

Introduction

[1] Kevin and Rosemary Lawson are lessees of dairy farming land at Martinborough – Masterton Road, Gladstone in the Masterton area. The lease commenced on 1 June 2004 and was for a term of six years with two rights of renewal of six years each.

[2] Under the deed of lease the lessor is the Uwhiroa Trust, the trustees of whom are Edward Gawith, Josephine Gawith and Peter Pumphrey (the trustees).

[3] In response to the Lawsons notifying their intention to renew the lease for a six year term beginning on 1 June 2016 the trustees notified their refusal to renew.

LAWSON AND LAWSON v GAWITH [2017] NZHC 40 [27 January 2017]

[4] The Lawsons applied to the Court for an order renewing the lease of land (the relief application). The relief application is made in reliance on ss 261 – 264 of the Property Law Act 2007 (the Property Law Act).

[5] In reliance on an arbitration clause in the lease the trustees apply for an order dismissing or striking out the proceeding. Clause 12.3 of the lease is in the following terms:

12.3 Arbitration

(a) If any dispute or difference shall arise between the parties as to: (i) the meaning or application of any part of this Lease; or
(ii) any other matter in connection with or which may have an effect on this Lease

the dispute or difference (“the Issue”) shall be referred to the award of a single arbitrator to be agreed upon between the Lessor and the Lessee.

[6] The Lawsons did not attempt to commence arbitration.

[7] It is the trustees’ application which is the subject of this judgment.

The parties’ positions

[8] The application to the Court for orders dismissing the relief application is made on the basis of an arbitration clause in the lease. The trustees say the relief application should have been referred to arbitration in accordance with the lease. The Court has no jurisdiction to hear and determine the Lawsons’ application because the parties agreed under their lease to resolve such matters by arbitration. But, because the Lawsons did not commence an arbitration within the three month
period that the Property Law Act prescribes1 for such applications it is now too late

to refer the dispute to arbitration.

[9] The Lawsons’ primary argument is that the relief application is not able to be
submitted to arbitration. Such applications, it is said, are among a small group of matters that are not arbitrable. But, if the Court should find otherwise, the relief

1 Property Law Act 2007, s 262.

application should be…

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: [2017] NZHC 40
Decision Date: 27 January 2017

CaseChat Overview and Summary

In Lawson v Gawith, the High Court of New Zealand, Wellington Registry, dismissed an application by the lessees, Kevin and Rosemary Lawson, to renew their lease of dairy farming land. The lessors, the trustees of the Uwhiroa Trust, sought to dismiss the application on the basis of an arbitration clause in the lease. The lessees argued that the relief application was not able to be submitted to arbitration and, if it was, the application should be stayed in the Court and referred to arbitration. The Court found that the relief application was arbitrable and that the lessees were out of time to refer the relief application to arbitration. The Court concluded that it lacked jurisdiction to determine the tenants’ application for relief and dismissed the proceeding. The respondents were entitled to costs.

The Court held that the relief application was a dispute within the terms of the arbitration agreement and capable of determination by an arbitrator. The Court rejected the argument that the relief application was not arbitrable due to public policy reasons or the existence of interests in land. The Court also found that the trustees were not precluded from relying on the arbitration agreement by estoppel or waiver. The Court held that the time limit for commencement of arbitration had expired and there was no power to extend that time. The Court dismissed the proceeding on the basis of want of jurisdiction and found that the strike-out threshold was also satisfied.

Orders