Lucas v Kroef - [2018] NZHC 2478

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

I TE KŌTI MATUA O AOTEAROA TĀMAKI MAKAURAU ROHE

CIV-2018-404-1905

[2018] NZHC 2478

BETWEEN COLIN JAMES LUCAS and SAMUEL MICHAEL WILLIAM BASSETT as
trustees of the Clement Family Trust Applicants

AND

LEON KROEF

Respondent

Hearing: 17 September 2018

Appearances:

S Robertson QC for the Applicants

M T Davies and K R Muirhead for the Respondent

Judgment:

21 September 2018

JUDGMENT OF ASSOCIATE JUDGE SMITH

This judgment was delivered by me on 21 September 2018 at 11.00am, pursuant to r 11.5 of the High Court Rules

Registrar/Deputy Registrar

Solicitors / Counsel:
Davenports Harbour Lawyers, Auckland S Robertson QC, Auckland
Meredith Connell, Auckland

LUCAS v KROEF [2018] NZHC 2478 [21 September 2018]

[1] The applicants (the trustees) are the registered proprietors of a property situated at Gillespie Road, Hunua (the property). On 23 August 2018 they signed an agreement for sale and purchase, under which they agreed to sell the property to the respondent (Mr Kroef). Mr Kroef has registered a caveat (caveat no. 11217606.1 – "the Caveat") on the title to the property, and the trustees now apply under s 143 of the Land Transfer Act 1952 (the Act) to have the Caveat removed.

Background

[2] The agreement for sale and purchase (the Agreement) was subject to three conditions, one of which was a finance condition (the finance condition) with a finance date "five days from acceptance of this offer".

[3] The Agreement provided at cl 10.8(4) and (5) that a condition would not be fulfilled until notice of fulfilment had been served by one party on the other party, and that if a condition had not been fulfilled by the date for fulfilment, either party could, at any time before the condition had been fulfilled or waived, avoid the Agreement by giving notice to the other.

[4] The trustees did not receive notice from Mr Kroef by 28 August 2018 that the finance condition had been fulfilled. On 29 August 2018 they gave notice purporting to cancel the Agreement. They immediately then gave notice under a "back-up agreement" they had entered into for the sale of the property, making the back-up agreement unconditional.

[5] Mr Kroef did not accept the trustees' cancellation. He instructed a new firm of solicitors, and on 30 August 2018 the new solicitors (Meredith Connell) wrote to the trustees' solicitors rejecting the trustees' purported cancellation of the Agreement and advising that all conditions in the Agreement were waived. Meredith Connell contended that the Agreement remained on foot, and was now unconditional in all respects.

[6] On the same day, Mr Kroef lodged the Caveat against the title to the property. The estate or interest claimed by Mr Kroef in the Caveat is "an interest pursuant to [the Agreement] in respect of the [property]".

Relevant provisions of the Agreement

[7]The Agreement contained the following relevant provisions:

1.2Time for Performance

…
(2)Any act done pursuant to this agreement by a party, including service of notices, after 5.00pm on a…

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 Lucas v Kroef

Details

AGLC: Lucas v Kroef [2018] NZHC 2478
Case: [2018] NZHC 2478
Decision Date: 21 September 2018

CaseChat Overview and Summary

In the High Court of New Zealand, the trustees of the Clement Family Trust applied to remove a caveat that the respondent, Mr Kroef, had lodged on the title of a property at Gillespie Road, Hunua. Mr Kroef had entered into an agreement for sale and purchase with the trustees, but he had failed to satisfy a finance condition by the agreed deadline, leading the trustees to cancel the agreement. Mr Kroef argued that the trustees were estopped from cancelling the agreement because they had represented that he had until 30 August 2018 to satisfy the finance condition, and he had reasonably relied on those representations. Alternatively, he argued that the agreement was not made until 24 August 2018, and so the deadline for fulfilling the finance condition was not until 29 August 2018. The court rejected both arguments. It held that the representations on which Mr Kroef relied were not clear and unequivocal, and even if they had been, it was not reasonable for him to have relied on them in the circumstances. It also held that the agreement was made when the trustees accepted Mr Kroef's offer on 23 August 2018, so the deadline for fulfilling the finance condition was 28 August 2018. As the trustees' cancellation notice was given before 5.00pm on 29 August 2018, it was valid. The court ordered the caveat to be removed from the title of the property.

Orders