Maydonoz NZ Ltd v Poppelwell - [2012] NZHC 1026

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

CIV-2011-404-8144 [2012] NZHC 1026

BETWEEN MAYDANOZ NZ LTD Plaintiff

ANDIAN RONALD POPPELWELL AND DOROTHY POPPELWELL TRADING AS THE POPPELWELL PARTNERSHIP Defendants

Hearing: 21 March 2012

Counsel: D L Schnauer for Plaintiff
S H N Chan for Defendants

Judgment: 17 May 2012

JUDGMENT OF BREWER J

This judgment was delivered by me on 17 May 2012 at 2:00 pm pursuant to Rule 11.5 High Court Rules.

Registrar/Deputy Registrar

SOLICITORS
Schnauer & Co (Auckland) for Plaintiff
McVeagh Fleming (Auckland) for Defendants

MAYDANOZ NZ LTD V POPPELWELL TRADING AS THE POPPELWELL PARTNERSHIP HC AK CIV-
2011-404-8144 [17 May 2012]

Introduction

[1] The plaintiff operates a Turkish food takeaway business from premises in Oneroa, Waiheke Island. The defendants own those premises. In June 2010 the defendants leased the premises to the plaintiff. The business relationship between the plaintiff and the defendants has not been good. Mr Ramadan, one of the plaintiff’s principals, seems, from my observation of him, to be a fiery and intractable person. Mr Poppelwell, the power behind the landlord, does not strike me as a man who is unused to getting his own way.

[2] Up until November 2011, perhaps the major cause of dispute between the plaintiff and the defendants was the plaintiff’s refusal to pay operating expenses at a rate higher than the estimated amount contained in the initial Agreement to Lease. A new source of friction at that time was a changed requirement by the defendants’ insurers as to the type of fire extinguisher to be kept at the premises. The plaintiff took the view that it was for the defendants to pay the cost of purchasing and installing the newly required fire extinguisher. The defendants, after correspondence, arranged for an installer to visit the premises to supply and install the new fire extinguisher. Mr Ramadan refused to allow that to happen once he ascertained that the plaintiff would be required to pay for it.

[3] This seems to have been the ultimate casus belli for the defendants. On or about 21 November 2011, the defendants issued a default notice under s 246 of the Property Law Act 2007. It related to the absence of the required fire extinguisher. It told the plaintiff that if it did not provide the fire extinguisher within 10 working days of the date of the notice the defendants would terminate the lease and re-enter the premises.

[4] A few days later, on 25 November 2011, the defendants served a further default notice on the plaintiff. This related to unpaid operating expenses. The sum demanded was $2,805.41. Again, the notice said that failure to pay this amount would result in termination of the lease and the defendants re-taking possession of the premises.

[5] The plaintiff’s response to both notices was to instruct The North Shore Law Practice to represent it. The North Shore Law Practice wrote a letter to the defendants dated 5 December 2011. It sought information and negotiation. Mr Poppelwell for 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.

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Details

Case: [2012] NZHC 1026
Decision Date: 17 May 2012

CaseChat Overview and Summary

Maydonoz NZ Ltd brought an action against Ian Ronald Poppelwell and Dorothy Poppelwell, trading as The Poppelwell Partnership, for relief against forfeiture of a lease on the basis that the defendants had wrongfully terminated the lease and ejected the plaintiff from the premises. The plaintiff sought an order for relief against forfeiture pursuant to section 253 of the Property Law Act 2007. The defendants opposed the application. The court was required to determine whether the default notices were valid, and if so, whether relief against forfeiture should be granted. The court found that the first default notice was invalid, as the defendants had the responsibility to supply and install the new fire extinguisher. The second default notice was valid, as the defendants were entitled to charge varying amounts so long as they were reasonable. The court granted the plaintiff relief against forfeiture, subject to certain conditions, including the payment of outstanding expenses and the installation of the fire extinguisher. The court reserved leave to the defendants to apply for further orders if the conditions were not met.

Orders