McCollum v Thompson - [2016] NZHC 28

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

CIV-2014-404-001958 [2016] NZHC 28

BETWEEN
ALLAN ROY MCCOLLUM, NANCY

MARGARET MCCOLLUM AND TERENCE NEIL WALKER Plaintiffs

AND

DAVID JOHN THOMPSON AND JOSEPHINE RUTH MACBETH Defendants

Hearing: 28-30 September and 6 November 2015

Appearances:

L Kemp for plaintiffs
W T Nabney for defendants

Judgment:

28 January 2016

JUDGMENT OF LANG J

This judgment was delivered by me on 28 January 2016 at 2 pm, pursuant to Rule 11.5 of the High Court Rules.

Registrar/Deputy Registrar

Date……………

ALLAN ROY MCCOLLUM v THOMPSON [2016] NZHC 28 [28 January 2016]

INDEX

Background [3]

The issues [10]

What sum do the defendants owe the plaintiffs in respect of the advance

made in July 2011?
[11]

Payment of $6200 to Mr Crossland [13]

Travel costs [15]

Service fee [17]

Solicitors’ costs [18]

Bankruptcy costs [19]

Credit in respect of income earned by the plaintiffs from milk production

derived from the herd before they purchased it from the receivers?
[20]

Result [24]

Did the GSA provide the plaintiffs with security over livestock other

than those described in the list attached to the GSA?
[25]

Did the defendants breach other obligations under the GSA and, if so,

what are the consequences of those breaches?
[50]

Failure to use herd management tags [51]

Failure to provide additional security [58]

Other alleged breaches [64]

Did the plaintiffs breach their duty to sell the livestock that they seized

under the GSA for the best price reasonably obtainable as at the time of the sale to the plaintiffs?
[66]

What loss did the defendants suffer as a result of the sale at undervalue? [80]

What is the status of the two year old heifers uplifted from the Onion

Road property?
[95]

What is the status of the livestock uplifted from the Otanga Valley Road

property?
[99]

What was the value of the two year old heifers uplifted from the Onion

Road property and the livestock uplifted from Otanga Valley Road?
[102]

The two year old heifers uplifted from the Onion Road property [103]

The livestock uplifted from Otanga Valley Road [108]

Consequential losses [112]

Summary [118]

Interest [119]

Leave reserved [121]

Costs [122]

[1] In this proceeding the plaintiffs seek to recover monies that they loaned to the defendants, Mr Thompson and Ms Macbeth, in July 2011. In order to provide the plaintiffs with security for the advance, the defendants executed in their favour a General Security Agreement (GSA). This gave the plaintiffs security over livestock owned by the defendants.

[2] The defendants do not contest the fact that they owe money to the plaintiffs, although there is some dispute regarding the issue of quantum. The principal issue in dispute is a counterclaim that the defendants advance against the plaintiffs. They contend that the plaintiffs seized their livestock and sold it at undervalue. In addition, they say that some of the livestock that the plaintiffs seized were not included within the security provided by the GSA. They say that the amount to which…

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 McCollum v Thompson

Details

AGLC: McCollum v Thompson [2016] NZHC 28
Case: [2016] NZHC 28
Decision Date: 28 January 2016

CaseChat Overview and Summary

This case involves a dispute between Allan Roy McCollum, Nancy Margaret McCollum, and Terence Neil Walker (the plaintiffs) and David John Thompson and Josephine Ruth Macbeth (the defendants). The plaintiffs seek to recover monies that they loaned to the defendants in July 2011, and the defendants have raised a counterclaim alleging that the plaintiffs seized their livestock and sold it at undervalue. The court must determine the amount owed by the defendants to the plaintiffs, the extent of the security provided by the General Security Agreement (GSA), and whether the plaintiffs breached their duty to sell the livestock for the best price reasonably obtainable.

The court found that the defendants owed the plaintiffs $285,056, together with interest. The court held that the GSA did not provide the plaintiffs with security over livestock other than those described in the list attached to the GSA, and that the plaintiffs were not entitled to uplift the livestock held at the Onion Road and Otanga Valley Road properties. The court also found that the receivers breached their duty under s 19 of the Receiverships Act 1993 to sell the herd to the plaintiffs for the best price obtainable at the time of the sale, resulting in the defendants suffering a loss of $54,250.

The court awarded the defendants damages for the conversion of the 47 two year old heifers uplifted from the Onion Road property and the livestock uplifted from Otanga Valley Road, as well as damages for consequential losses suffered as a result of the conversion. The court also reserved leave for the parties to file memoranda in the event that it had inadvertently omitted to deal with any of the issues raised by the pleadings.

The court ordered that the defendants are liable to pay the plaintiffs the sum of $26,606, together with interest on that sum. The parties were also ordered to endeavour to reach agreement regarding the issue of interest payable in respect of any of the sums awarded on the counterclaim. Costs were awarded to the defendants on a category B basis, together with disbursements as fixed by the Registrar.

Orders