McFarlane v Dickson Marine (Refits) Limited - [2013] NZHC 647

IN THE HIGH COURT OF NEW ZEALAND NELSON REGISTRY

CIV-2012-442-375 [2013] NZHC 647

UNDER District Courts Act 1947

IN THE MATTER OF an appeal against a decision of the District
Court at Nelson

BETWEEN ANDREW ANGUS MCFARLANE Appellant

ANDDICKSON MARINE (REFITS) LIMITED Respondent

Hearing: 19 February 2013

Counsel: P A Cowey for Appellant
J M Fitchett for Respondent

Judgment: 27 March 2013

JUDGMENT OF MILLER J

Introduction

[1] Dickson Marine repaired a large launch, the Akarua, at the request of Mr McFarlane. This appeal from the District Court concerns a sum of $24,746.29 that Dickson won from Mr McFarlane for the work.1

[2] The District Court established that this was a time and materials contract with an agreed hourly labour rate. But Dickson had given estimates, and it had promised to tell Mr McFarlane weekly what stage the work had reached and how much time
had been expended. It did not honour the promise, and it ultimately invoiced

1 Unless otherwise specified, all figures used in this judgment include materials and GST, which was charged at 12.5 per cent until 1 October 2010.

MCFARLANE v DICKSON MARINE (REFITS) LIMITED HC NEL CIV-2012-442-375 [27 March 2013]

Mr McFarlane for about twice the estimates. The question on appeal is this: did the District Court err when it denied Mr McFarlane relief for Dickson’s admitted breach of that promise?

[3] The Dickson estimates that are in dispute - a small portion of the work is not contested - totalled $26,650.38. After work began in February 2010 Dickson initially kept Mr McFarlane informed of progress and cost, but it ceased to do so at the end of April. About mid-May it rendered invoices totalling $29,105.05 for work to 30 April. Mr McFarlane paid $28,309.67. In mid-June 2010 he went to Dickson’s yard to collect the vessel, and found invoices for a further $25,751.07, which he had not anticipated and refused to pay.

[4] It is common ground that the appeal must be allowed in small part, for Dickson conceded in the District Court that it had claimed too much but that concession was not reflected in the judgment. Mr McFarlane’s case goes much further than that, however: he says that he has paid more than the reasonable cost of the work. To prove that, he called expert evidence, a challenge to the admissibility of which has been renewed on appeal.

The narrative

[5] The Akarua is a 20m launch, built in 2002. Through one of his companies Mr McFarlane bought the vessel in 2005. Between 2006 and 2008 he had extensive repair and maintenance work done, some of it by men who gave expert evidence at the hearing. That work cost more than $400,000.

[6] In 2010 Mr McFarlane decided to prepare the vessel for sale. He approached Dickson about necessary repair and maintenance work, explaining why he wanted it done.

[7] Before the vessel was delivered to the yard one of Dickson’s operations managers, Barry Hart, travelled to Queen Charlotte Sound to inspect…

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 McFarlane v Dickson Marine (Refits) Limited

Details

AGLC: McFarlane v Dickson Marine (Refits) Limited [2013] NZHC 647
Case: [2013] NZHC 647
Decision Date: 27 March 2013

CaseChat Overview and Summary

The case of McFarlane v Dickson Marine (Refits) Limited concerns a legal dispute between Mr McFarlane, the appellant, and Dickson Marine (Refits) Limited, the respondent, regarding the repair of a large launch named Akarua. The central issue in the case is whether the District Court erred in denying Mr McFarlane relief for Dickson’s breach of its promise to keep him informed of the progress and costs of the work. The District Court had ruled in favour of Dickson Marine, awarding it $24,746.29 for the work done. The High Court of New Zealand, Nelson Registry, was tasked with reviewing this decision.

The High Court found that the promise made by Dickson Marine to keep Mr McFarlane informed weekly of the progress and cost of the work was a term of the contract. This promise was made before the formation of the contract and induced Mr McFarlane to enter into it. The court also determined that Mr McFarlane's failure to file a counterclaim was not a barrier to him relying on Dickson’s breach of its obligation. The court held that Mr McFarlane had lost the opportunity to control the scope and methodology of the work due to Dickson's failure to keep him informed, which could have led to more efficient work or a narrower scope of work at a fixed price. The court further concluded that the Consumer Guarantees Act 1993 did not add to Mr McFarlane's rights in this case.

The High Court allowed the appeal in part, set aside the District Court judgment, and awarded Dickson Marine $9,093.52. The court ordered that Mr McFarlane would have costs in the High Court on a 2B basis, with counsel to seek agreement on costs. The District Court decision as to costs remained unaffected.

Orders