Lynch v FCL Cl Limited - [2024] NZHC 1437

IN THE HIGH COURT OF NEW ZEALAND INVERCARGILL REGISTRY

I TE KŌTI MATUA O AOTEAROA WAIHŌPAI ROHE

CIV-2023-425-108

[2024] NZHC 1437

UNDER the Land Transfer Act 2017

IN THE MATTER

of an application for an order under s 143 of the Land Transfer Act 2017 that a caveat not lapse

BETWEEN

MONIQUE HUNE LYNCH and LUKE ALEXANDER SANSOM

Applicants

AND

FCL CL LIMITED as trustee of the FCL CL TRUST

Respondent

... contd over

Hearing: 21 May 2024

Counsel:

D G Chesterman for Applicants S A Grant for Respondent

Judgment:

31 May 2024

JUDGMENT OF ASSOCIATE JUDGE PAULSEN

This judgment was delivered by me on 31 May 2024 at 3.30 pm pursuant to Rule 11.5 of the High Court Rules.

Registrar/Deputy Registrar Date:

LYNCH v FCL CL LIMITED [2024] NZHC 1437 [31 May 2024]

CIV-2023-425-114

UNDER

the Land Transfer Act 2017

IN THE MATTER

of an application for an order under s 143 of the Land Transfer Act 2017 that a caveat not lapse

BETWEEN

MARTA YATES

Applicant

AND

FCL CL LIMITED as trustee of the FCL CL TRUST

Respondent

[2] The applicants (the purchasers) entered into agreements to acquire residential units in a complex being constructed by the respondent (FCL) in Queenstown.1 FCL exhausted its funding facility, which it says was due to delays and cost increases resulting from the COVID-19 pandemic. FCL purported to cancel its agreements with the purchasers, relying on a force majeure clause. The purchasers lodged caveats over the head title of the development to protect their interests under the agreements. FCL regarded this as a further basis upon which to cancel the agreements and again purported to do so. It then applied to the Registrar-General of Land to lapse the caveats and the purchasers applied to this Court for an order under s 143 of the Land Transfer Act 2017 that the caveats not lapse.

[3] In a judgment of 9 April 2024, I granted the purchasers’ applications.2 The orders were conditional upon the purchasers commencing proceedings to sustain the interests claimed in their caveats within 10 working days, which they have done. As the purchasers were the successful parties, I awarded them 2B scale costs plus reasonable disbursements as fixed by the Registrar.

[4] FCL applies to recall the judgment so that the costs order can be reconsidered. FCL has also filed an appeal from the judgment on other aspects of the decision.

[5] The grounds upon which FCL relies to have the judgment recalled are as follows:

(a)I did not address an argument that the agreements expressly provided that costs relating to lodging a caveat in contravention of a no-caveat clause would be borne by the purchasers;

(b)costs ought not to have been awarded against FCL, or alternatively should have been reduced, because:

1 I will refer to the applicants in the substantive proceeding (but the respondents to this application) as “the purchasers” and the respondent in the substantive proceeding (and applicant to this application) as “FCL”.
2 Lynch v FCL CL…

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.

Keep reading for free

Create a free CaseChat account to read Lynch v FCL Cl Limited and more:

Read every judgment in full
Ask AI and get answers linked to paragraphs
See how each paragraph was cited in later cases
Download judgments as PDF or Word

Continue with Google

One click creates your free account or signs you in.

By continuing you agree to the Terms and Privacy Policy.

Details

Case: [2024] NZHC 1437
Decision Date: 31 May 2024

CaseChat Overview and Summary

The High Court of New Zealand in Invercargill heard an application by FCL CL Limited against Monique Hune Lynch and Luke Alexander Sansom, seeking to recall a judgment under s 143 of the Land Transfer Act 2017 that a caveat not lapse. The case involved agreements for the purchase of residential units by the applicants, who lodged caveats when FCL attempted to cancel the agreements citing a force majeure clause due to the COVID-19 pandemic. FCL argued that the judgment should be recalled on several grounds, including an alleged failure to address an argument about costs related to the caveats, and sought to reduce or reserve the costs awarded to the applicants.

The court considered the grounds for recall, noting that the recall jurisdiction is rarely exercised and only in special circumstances, such as where a judge overlooks a material factor. The court found that FCL's argument about the no-caveat clause was not adequately raised in the original proceedings, and even if considered, it would have been rejected. The court also noted that FCL could have raised the costs issue on appeal, which it had initiated. Furthermore, the court rejected FCL's arguments for reducing or reserving costs, finding that the applicants were entitled to costs on a 2B scale plus reasonable disbursements, as fixed by the Registrar.

The court declined the application for recall and upheld the previous costs order in favour of the applicants. The decision highlights the limited circumstances under which a judgment may be recalled and the importance of raising all relevant arguments at the appropriate stage of proceedings.

Orders