Maan v Keys

[2017] NZHC 3126

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

I TE KŌTI MATUA O AOTEAROA TĀMAKI MAKAURAU ROHE

CIV-2017-404-2584 [2017] NZHC 3126

UNDER

Section 244 Property Law Act 2007

BETWEEN

VIKKRAM MAAN AND SONIA SINGH AS TRUSTEES OF THE MAANʼS FAMILY TRUST

Applicants

AND

NEIL EDWARD KEYS Respondent

Hearing:	14 December 2017
Appearances:	S S Khan and M G Orange for the Applicants No appearance for the Respondent
Judgment:	14 December 2017

ORAL JUDGMENT OF PALMER J

Solicitors:

Fortune Manning, Auckland

And to:

Respondent

MAAN AND SINGH v KEYS [2017] NZHC 3126 [14 December 2017]

Previous application

[1]      Mr Vikkram Maan and Ms Sonia Singh previously applied for orders for possession of their properties, cancellation of a lease agreement dated 10 March

2016 (the second lease agreement) and for payment of rental and other obligations by Mr Keys.

[2]      That application failed because, in a judgment dated 17 August 2017, I held the parties did not intend to create legal relations  in entering that second lease agreement.1     I noted Mr Keys appeared to be in default of his rental obligations under the first lease agreement but the applicants would have to issue a new notice and  application  to  get  an  order  for  possession  and  cancellation  of  that  lease agreement under s 251 of the Property Law Act 2007 (the Act). I stated in my judgment:

[19]      Mr Maan and Ms Singh will have to issue a new notice if they wish to pursue this matter further. I consider the arguments Mr Keys offered against having to pay the rent he owes under the first lease agreement are insubstantial. If Mr Keys has no better argument in relation to the first lease, he will need to remedy the non-payment of rent within the period specified in the second notice. He would be best to do so. Otherwise the Court is likely to grant the order of possession and cancel the first lease agreement. It is likely to be in the interests of both parties to settle this matter rather than returning to court. But they each have a right to do so.

Current application

[3]      Mr Maan and Ms Singh now make a similar application regarding the first lease agreement, dated 18 November 2015.  The facts of the dispute, and the relevant law, are set out in my previous judgment. The differences are:

(a)      The applicants served a notice of intention to cancel the lease under s 244 of the Act on 5 September 2017.  Mr Keys failed to remedy the breach and continues to occupy the property without making rental payments.  The applicants say, as a consequence, they are in default of

their mortgage repayments.

1      Maan v Keys [2017] NZHC 1967.

(b)The  application  dated  25  October  2017  concerns  the  first  lease agreement rather than the second.

(c)       The rental arrears that are the subject of the application are $20,400 (GST incl) as at today’s date.

Submissions

[4]      Mr Khan, for the applicants, submits Mr Keys is not entitled to withhold rent on the basis of a variety of personal grievances against the applicants.  He submits I rejected Mr Keys arguments for not paying rent in the previous proceeding and it was only on the basis the applicants had applied to cancel the wrong lease that the application failed.  He submits, with that deficiency now remedied, this application should be granted.

[5]      Mr Keys failed to file and serve written submissions by the due date or by the date to which I extended them of noon yesterday.  He was advised of the hearing and the deadline for submissions and the extension.  He told the Registry he had another commitment.  His notice of opposition suggested Mr Keys opposes the application, on the grounds Mr Maan gave him a verbal assurance he would have enough work to pay $400 rent per week and the property is leaking and not fire-rated so he is entitled not to pay rent.  But there is no evidence before me of such an assurance or of the state of the property.

[6]      Although we started 10 minutes late today, Mr Keys was not present at the beginning of the hearing.   Accordingly, under r 10.7 of the High Court Rules 2016, the plaintiff was required to prove the cause of action.   Ten minutes into the hearing I received a note from the Registry saying that Mr Keys was “stuck in traffic” and would like to seek an adjournment as he did not have enough time to put through submissions.  Mr Maan strongly opposed an adjournment.  I agreed.  Mr Keys had plenty of notice of the hearing.

[7]      Mr Keys then arrived.  He renewed his application for an adjournment.  He said he had been away since the last court appearance, had left his phone behind and had not received notice of the hearing date until Monday when he discovered his

submissions were due and he has not had time to address them. When I asked him to explain his submissions he said he was wanting to gather evidence about the water being cut off.

[8]      Mr Khan submitted the Court had provided notice of the hearing by email straight away at 12.14 pm on 30 November 2017  and on 1 December 2017 at

9.37 am Mr Khan forwarded the email again to Mr Keys, and copied Mr Keys into his submissions on 4 December 2017.  Mr Khan strongly opposed the application, citing Mr Keys’ previous delays and suggested this was a further delaying tactic.  He said his client would be prejudiced by further delay which would likely be at least two more months.   And he submitted there was no viable defence shown in the statement of defence.  Mr Keys submitted the defence was he had enabled Mr Maan to meet several extensions to allow him to buy his property in the first place and he questioned the history of various offsets against rent and various requests he has made of Mr Maan which he says have not been responded to, including regarding power, leaks and fire-rating of the building.   He feels he has been dealt an unjust blow by Mr Maan.  He complained about the mode of service of various documents.

Decision

[9]      I consider here is nothing new in Mr Keys’ opposition to the application compared to the last one.  I discern in it no reason recognised by law that entitled him not to pay rent.   None of the matters raised by Mr Keys justify him in withholding rent.  In fact if he is correct about his view of fire-rating, he may not be entitled to a lease at all.

[10]     Mr Keys does not have a viable defence even if he had more time to assemble it.  I previously warned Mr Keys he needed to pay the rent.  He has taken no steps to do so.  The various affidavits of service and the progress of the proceeding show that Mr Keys has had sufficient time to assemble a defence if he had one.

[11]     The  rent  has  been  in  arrears  since  18  September  2016  with  51  out  of

63 weekly payments being missed.   No payments at all have been made for the

39 weeks since 27 February 2017.  That more than satisfies the requirement under s 245 of the Act.  The applicants served on Mr Keys a notice of intention to cancel

the first lease and, at the expiry of the period specified in the notice, Mr Keys agrees the breach has not been remedied.  The applicants have the right to cancel the lease under s 244. They have applied to do so.  I grant the application.

Result

[12]     Under s 251 of the Act, I make the following orders:

(a)       The  lease  dated  18  November  2015  between  the  applicants  and

Mr Keys is cancelled.

(b)I make an order granting possession to the applicants of the property at Unit 8 and Unit 10, 529 Great South Road, Papatoetoe, Auckland (being all that parcel of land being Unit D, DP 138278 and all land comprised  in  the  certificate  of  title  NA82A/287  (South Auckland Registry).

(c)      I  order  Mr  Keys  to  pay  the  applicants  outstanding  $20,400  as reasonable compensation for the breach.

(d)      I order Mr Keys to pay the costs of this proceeding on a 2B basis.

………………………….

Palmer J