McKenzie v Protective Canopies Ltd
[2017] NZHC 1623
•14 July 2017
IN THE HIGH COURT OF NEW ZEALAND TAURANGA REGISTRY
CIV-2015-470-71 [2017] NZHC 1623
BETWEEN GRAEME ROY MCKENZIE, KAREN
ISABEL MCKENZIE AND BRG TRUSTEES LTD AS TRUSTEES OF THE PEPATREE TRUST
Plaintiff
AND
PROTECTIVE CANOPIES LTD Defendant
Hearing: 22 May 2017
(Additional submissions: 30 June 2017)
Counsel:
D M Fraundorfer and J S Braithwaite for Plaintiff
No appearance by or on behalf of DefendantJudgment:
14 July 2017
JUDGMENT OF BREWER J
This judgment was delivered by me on 14 July 2017 at 12 noon pursuant to Rule 11.5 High Court Rules.
Registrar/Deputy Registrar
Solicitors:
Holland Beckett (Tauranga) for Plaintiff
MCKENZIE v PROTECTIVE CANOPIES LTD [2017] NZHC 1623 [14 July 2017]
Introduction
[1] The plaintiff (“Pepatree”) claims $718,2621 from the defendant (“PCL”).
[2] Pepatree grows kiwifruit. In 2013, PCL agreed to design and build three
canopies to protect Pepatree’s kiwifruit. The canopies were constructed but, in April
2014, they were damaged extensively by high winds. They were repaired with assistance from PCL. In October 2014, the canopies were again damaged extensively by high winds. This time Pepatree repaired about half of the canopies.
[3] Pepatree’s case is that it contracted with PCL in reliance on assurances from PCL that the canopies would withstand winds that they would likely encounter (in the 80 to 100 km/h range). It alleges that PCL’s design was flawed and that, as constructed, the canopies did not withstand winds of this strength.
[4] By joint memorandum of counsel, dated 9 May 2017, I was advised that PCL would not take part in the trial.2 I agreed to proceed on a formal proof basis. That means Pepatree has the onus of establishing, to my satisfaction, each cause of action relied on and to provide sufficient information to enable me to calculate and fix damages.3
Pepatree’s evidence
[5] The evidence for Pepatree is contained in the following affidavits:
(a) Affidavit of Graeme Roy McKenzie sworn 15 May 2017.
Mr McKenzie is a trustee of Pepatree. He deposes to the events preceding the agreement with PCL, the construction of the canopies, the two wind events which damaged them, and subsequent dealings
with PCL which led to the issuing of Pepatree’s claim.
1 In the amended statement of claim, the amount claimed is $623,332 but at trial I granted leave for this sum to be increased to $718,262 so as to include GST. The basis for the calculation is set out in a letter dated 18 May 2017 from chartered accountants, Gerry Rea Partners Limited, to Holland Beckett.
2 The trial was scheduled to commence on 22 May 2017, with five days allocated.
3 High Court Rules, r 15.9(4).
(b) Supplementary affidavit of Mr McKenzie sworn 28 June 2017.
Mr McKenzie provided further information as to the layout of the
shelterbelt that surrounds Pepatree’s kiwifruit orchard.
(c) Affidavit of Donald Richardson sworn 11 May 2017. Mr Richardson is a chartered professional engineer specialising in civil and structural engineering. Mr Richardson prepared a report on the canopies and provides his opinion on their structure and design with reference to the wind pressures present when they were damaged. In his opinion, the canopies could not withstand the wind pressures to which they were exposed, and crimped connection points along the tube frame member introduced an obvious weakness to the frame resulting in buckling failure.
(d)Affidavit of Yin Fai Li sworn 12 May 2017. Dr Li is a chartered professional engineer with experience in wind engineering. Dr Li was instructed to provide an estimate of the wind pressures on the canopies under their design conditions as well as the actual conditions experienced. His conclusions, relevantly, are that the peak gust wind speed on the two occasions the canopies were damaged was
100 km/h. The likely failure of the canopies was the wind pressure they experienced.
(e) Affidavit of John Maurice Leonard sworn 12 May 2017. Mr Leonard is a forensic accountant. In his report he calculates the sum which is now claimed by Pepatree.
Causes of action
[6] In its amended statement of claim dated 15 May 2017, Pepatree sets out four causes of action. These are:
(a) Breach of the Fair Trading Act 1986; (b) Breach of implied warranties;
(d) Negligence.
The agreement
[7] On the evidence, it is clear that the agreement between Pepatree and PCL was partly written and partly oral. For each canopy there was a written standard form contract entered into between the parties. They are identical save for the prices.4
The document is headed “Supply Schedule” and it has annexed to it the terms of trade.5 It relates to that part of the agreement between Pepatree and PCL which required PCL to supply the products for the construction of each canopy.
[8] The uncontested evidence of Mr McKenzie is that PCL made several visits to the kiwifruit orchard for the purpose of designing the canopies. PCL supplied the materials for each canopy and supervised their construction. PCL sourced most of the labour required for the construction of the canopies and, under PCL’s supervision, some employees of Pepatree lent a hand.
[9] Therefore, the oral part of the agreement between the two parties related to the design and construction of the canopies. The written part, in contrast, concerned the provision of the necessary materials. The exceptions are clauses 8.2 and 8.4 of the Supply Schedule and their effect will be discussed later in this Judgment.
[10] It is important that the position of the Supply Schedule in the overall agreement between the parties is appreciated because the Supply Schedule contains very significant exclusions of liability:
7. Warranties
7.1To the fullest extent permitted by law, PCL gives no representations, guarantees or warranties in relation to the Product. For the avoidance of doubt, PCL gives no guarantee, warranty or representation that the Product, following installation, will eliminate the risk of infection of any crop from the Psa-V disease.
4 As such, any reference to the written agreement refers to all three standard form contracts.
5 I will refer to the document as “the Supply Schedule”.
7.2The Customer acknowledges that it has relied on its own judgement in choosing to purchase the Products from PCL. PCL makes no warranty or representations to the state, quality or fitness of the Product for any particular purpose and no such warranty will be implied from the description of the Product in the Supply Schedule. All implied warranties and conditions as to state, quality or fitness of the Product for any purpose are expressly excluded.
7.3PCL will pass through to the Customer any warranty right it receives from any third party provider of Protective Canopy components not authored or manufactured by PCL (“Third Party Components”) and will reasonably cooperate with the Customer in enforcing such rights. PCL provides no warranties, express or implied, with regard to Third Party Components, and Provider will not be liable for any failure of any Third Party Component to function as expected or intended.
8. Liability
8.1To the extent that the liability of PCL under these Terms of Trade is not otherwise limited or excluded and to the fullest extent permitted by law, the total liability of PCL, whether in tort (including negligence), contract or otherwise, for any loss, damage or injury arising directly or indirectly from or in connection with the Product or this Agreement is limited to the Price actually paid by the Customer for the Product.
8.2Notwithstanding any other provision of these Terms of Trade, under no circumstances will PCL be liable for any loss of income or profits or any consequential, indirect or special loss or injury of any kind suffered by the Customer or any other person arising directly or indirectly under this Agreement, in connection with the Product itself or installation of the Product.
8.3The Customer and Guarantor (if any) indemnify PCL, its personnel, contractors and agents against any and all costs, losses, damages and expenses arising out of any third party claim in connection with the Product and/or this Agreement.
8.4The structural integrity of the Protective Canopy has been designed to take advantage of the existing shelter (including vegetation) at the Installation Address. The removal of, or alterations to, any individual components of the Protective Canopy may adversely affect the structural integrity of the Protective Canopy.
Issues
[11] Broadly speaking, there are two issues for me to decide:
(a) Does the evidence filed by Pepatree establish, on the pleaded causes of action, liability by PCL for the damage to the canopies and the consequential losses?
Are the exclusion clauses valid?
[12] The first issue turns principally upon the application of the exclusion clauses contained in the terms of trade in the Supply Schedule.6
[13] The law recognises the validity of exclusion clauses. As the Court of Appeal has confirmed, the approach to the interpretation of exclusion clauses should be the same as that applying to the interpretation of contracts generally.7
[14] That being said, the Court will ordinarily construe exclusion clauses strictly. To be effective, the clauses must be clearly and unambiguously expressed.8 If there is any doubt as to the meaning or scope of the clause, the contra proferentem rule requires the ambiguity to be resolved against the party who inserted it and who is now relying on it. But I reiterate that this “does not mean a strained interpretation is to be adopted. The overall objective is to ascertain the presumed mutual intention of the parties”.9
[15] The Court of Appeal has summarised this approach:10
[33] Given the premise that an exclusion clause will enable a party to escape liability for a breach of a contractual promise, it will be assumed that a party will not have intended to limit liability unless clear and unambiguous language is used. A Court will ordinarily look for clear language or necessary implication before concluding that the right to claim for damages is extinguished. Such an intention will not be lightly attributed. The ultimate objective is to ascertain what the parties intended their words to mean in the particular factual context in which the contract was made.
6 I note that the term ‘exclusion clause’ refers to many different types of clauses. The key feature
is that the clause either limits or negates the vendor’s liability for breach of the contract.
7 i-Health Ltd v iSoft NZ Ltd [2011] NZCA 575, [2012] 1 NZLR 379 at [43]. The Court cited
Investors Compensation Scheme Ltd v West Bromwich Building Society [1997] UKHL 28, [1998]
1 WLR 896 and Vector Gas Ltd v Bay of Plenty Energy Ltd [2010] NZSC 5, [2010] 2 NZLR 444 for the principles relating to the interpretation of contracts generally.
8 Dorchester Finance Ltd v Deloitte [2012] NZCA 226 at [33].
9 Lumley General Insurance (NZ) Ltd v Body Corporate No 205963 [2010] NZCA 316 at [27].
10 Dorchester Finance Ltd v Deloitte, above n 8. Citations omitted. See also Trustees Executors Ltd v QBE Insurance (International) Ltd [2010] NZCA 608.
Clauses 7.1 and 7.2
[16] Clauses 7.1 and 7.2 intend to completely preclude PCL from the types of liability specified within those clauses.
[17] Both clauses are stated to apply to ‘the Product’. Clause 1.9 defines ‘the Product’ as meaning “any materials or components which are used to construct a Protective Canopy and where such products are supplied to the Customer by PCL as described in the Supply Schedule”.
[18] There is no ambiguity. However, the clauses clearly do not apply to the pleaded causes of action. Pepatree does not plead that there were any defects in the materials supplied by PCL under the Supply Schedules. The pleaded liability of PCL comes from pre-contractual representations as to the ability of PCL to design and construct canopies which would withstand the wind conditions to be expected at Pepatree’s kiwifruit orchard. It is the design of the canopies which is said to be defective, not the materials supplied and constructed in accordance with the design.
[19] The words plainly do not intend to prevent liability arising from a separate contractual obligation to design and construct the canopies. There is no attempt to extend it to that situation, as is arguably the case in part 8.
[20] I regard these two clauses as having no application in this situation.
Clause 8.1
[21] Clause 8.1 is a limitation of liability clause. It is designed to limit PCL’s total liability to the price actually paid by Pepatree for the materials if any cause of action is made out. In contrast to clauses 7.1 and 7.2, this clause is stated to limit liability “for any loss, damage or injury arising directly or indirectly from or in connection with the Product or this Agreement …”
[22] The issue is whether clause 8.1 expressly captures the pleaded situation. Specifically, whether it is intended to apply to contractual obligations entered into between the parties to the Supply Schedule but not within the scope of the Supply
Schedule. The words “in connection with the Product” might, or might not, go to such intention.
[23] On the one hand, the pleaded loss arose directly ‘in connection with the Product’. The canopies were designed and constructed using the ‘Product’. There is a definite connection between the two. In that sense, general notions of caveat emptor, or ‘buyer beware’, arise. There was no inequality of bargaining power. Pepatree signed the agreement. It is taken to have intended to be bound by the terms.
[24] On the other hand, it is arguable that the parties did not intend clause 8.1 to extend to further contractual rights and obligations. Clear and unambiguous words would be required for that. Instead the parties intended for the Supply Schedule to govern the supply of the Product, namely the materials. Here, the parties negotiated contractual arrangements that went well beyond the terms of the Supply Schedule. If they had intended clause 8.1 to apply to all their contractual arrangements then they would be expected to have negotiated that. They did not.
[25] Furthermore, alongside the definition of ‘Product’, the price in the written agreement is stated to only be for the total cost of the products for construction. This total cost did not, therefore, include the price for design and construction. Clause 1.8 defines ‘price’ as meaning “the total price for the Products as described in the Supply Schedule inclusive of any applicable GST.” In a price estimate dated 22 February
2013, the estimated cost of materials was listed separately to the estimated construction cost.
[26] In the amended statement of claim, Pepatree pleaded that the agreement was for PCL to design, provide the materials and supervise construction of the canopies. It pleaded that the written terms were limited to the supply of materials and they did not incorporate any terms relating to design or construction.
[27] This is incorrect. Clause 8.4 relevantly reads:
8.4The structural integrity of the Protective Canopy has been designed to take advantage of the existing shelter (including vegetation) at the Installation Address …
[28] Despite the terms of trade in the Supply Schedule being expressly stated as forming “the Agreement between PCL and [Pepatree] for the supply of Product”, clause 8.4 is not concerned with the supply of the Product. It is instead a term relating to the design of the canopies.
[29] I asked for further submissions from Pepatree on the effect of the clause. Counsel for Pepatree submitted:
9.It is also unclear what the effect of cl 8.4 is. Clause 8.4 does not go on to limit or exclude the defendant’s liability in relation to the design or installation of the canopy. This is significant, as the courts have been clear that the contra proferentum (sic) rule, or the rule of strict construction, applies to the interpretation of exclusion clauses.
…
12.If the Court is minded to apply cls 8.2 or 8.4 on the basis that they extend to the design and installation of the Canopy, the plaintiff repeats the arguments made at [55] to [66] of counsel’s submissions dated 18 May 2017, to the effect that the exclusion clauses should not in any event be enforced.
[30] It is correct that clause 8.4 is not an exclusion clause. But it is evidence that the parties intended the Supply Schedule to extend to the design of the canopies.
[31] Counsel’s submissions dated 18 May 2017 do not assist on this point. Clause
8.2 is not an attempt to contract out of the Fair Trading Act or the Contractual Remedies Act. It is a general attempt to limit PCL’s liability if a cause of action, whether under those statutes or not, is made out.
[32] Counsel also referred to authorities where foreign courts have refused to give effect to an exclusion clause if it would “defeat the main objective of the contract” or “reduce the contract to a mere declaration of intent”.11 However, New Zealand
courts have instead focused on whether exclusion clauses are clear and
11 Two cases were referred to: Suisse Atlantique Société d’Armement Maritime SA v NV Rotterdamsche Kolen Centrale [1967] 1 AC 361 (HL) and Tercon Contractors Ltd v British Columbia (Transportation and Highways) [2010] 1 SCR 69, 2010 SCC 4.
unambiguous. Notions of fairness or reasonableness are not part of that inquiry. Regardless, clause 8.1 would not have either of the aforementioned effects. The materials were supplied in accordance with the Supply Schedule. It has just transpired that the design of the canopies was unsuitable for the local conditions.
[33] I suspect that clause 8.4 was added to the terms of trade in the Supply Schedule because it was not uncommon for PCL to design and install canopies instead of merely providing the materials. But that does not make it clear that the preceding limitation clauses were intended to apply to the design of the canopies. Clause 8.4 is advisory. The position is ambiguous. I will give effect to the policy underpinning the interpretation of exclusion clauses: they must be clear and unambiguous.
[34] PCL may not have felt the need to orally contract for an exclusion clause. It may have been under the impression that the standard terms and conditions would cover this type of situation. However, if that were to be the case, express language would be required. The language is ambiguous and, applying the contra proferentem rule, I conclude that clause 8.1 does not extend to the oral agreement that PCL design and construct the canopies.
Clause 8.2
[35] Pepatree submitted the following in respect of clause 8.2:
5.Accordingly, the plaintiff submits that cl 8.2 has no bearing on its claim other than on the issue of whether the loss of profits for the kiwifruit crop are claimable.
[36] I concur that the clause can only have application to Pepatree’s consequential loss, namely the loss of the value of the kiwifruit. But whether the clause applies is a different matter.
[37] Similar considerations apply to the interpretation of clause 8.2 as with clause
8.1. The difference is that the exclusion of liability also extends to the “installation of the Product”. Here, Pepatree claims as a component of damages the loss to its kiwifruit crop when the canopies failed.
[38] “Installation” can mean “the process of installing” or it can mean “once installed”. I am satisfied that if the parties had intended this clause to limit PCL’s liability in relation to the oral components of their agreement, then there would have been negotiation on that point. There was not. I, therefore, read the clause as limiting liability to the process of installing the canopy. There is no claim relating to that.
[39] I find that the exclusion clauses in the Supply Schedule do not exclude or limit PCL’s liability to Pepatree under the causes of action pleaded. I turn now to whether the causes of action are made out.
Fair Trading Act 1986
[40] Pepatree pleads first that PCL breached s 9 of the Fair Trading Act. Section 9 provides that no person shall, in trade, engage in conduct that is misleading or deceptive or is likely to mislead or deceive.
[41] It contends that PCL’s pre-contractual statements were false and misleading, being misrepresentations concerning the ability of the canopies to withstand the strong winds to which the canopies were likely to be exposed.12 Pepatree relies specifically on statements made by Mr Philip Reed, a director of PCL, that the canopies would withstand winds of up to 80 km/h. These statements were supplemented by a further representation, namely an engineering certificate advertised on PCL’s website, which stated that the canopies could withstand winds of up to 100 km/h.
[42] Mr Reed made these statements in trade by acting in his capacity as a director of Pepatree.13 But statements, which are said to have amounted to misleading or deceptive conduct, must have such qualities.
[43] The Supreme Court in Red Eagle Corp Ltd v Ellis held that the Court must inquire whether a reasonable person in the position of the claimant, having the
characteristics known to the defendant or of which the defendant ought to have been
12 Pepatree pleaded a number of separate misrepresentations but they all go to that overall point.
13 Fair Trading Act, s 2(1).
aware, would likely have been misled or deceived.14 Whether there was any intention to mislead or deceive is irrelevant.15
[44] PCL is in the business of designing and supplying protective canopies for kiwifruit orchards such as Pepatree’s. Mr Reed was advising on the capabilities of PCL’s specialised product. An engineering certificate published on PCL’s website reiterated and extended those capabilities. Mr Reed had knowledge of local conditions and was familiar with kiwifruit orchards. Mr McKenzie knew those things.
[45] A person is entitled to reasonably rely upon the expertise of a company making representations about one of its specialised products. Mr McKenzie made his concerns about local conditions known to Mr Reed. As Mr Reed was also a local orchardist and had experience with the local weather conditions, he was well qualified to address those concerns. In my view, there is no question that a reasonable person would likely have been misled or deceived. As indeed was Mr McKenzie.
[46] There was therefore a breach of s 9. But a breach of s 9 does not establish liability. As per s 43, there must be causation:16
[29] Then, with breach proved and moving to s 43, the court must look to see whether it is proved that the claimant has suffered loss or damage “by” the conduct of the defendant. The language of s 43 has been said to require a “common law practical or common-sense concept of causation”. The court must first ask itself whether the particular claimant was actually misled or deceived by the defendant's conduct. It does not follow from the fact that a reasonable person would have been misled or deceived (the capacity of the conduct) that the particular claimant was actually misled or deceived. If the court takes the view, usually by drawing an inference from the evidence as a whole, that the claimant was indeed misled or deceived, it needs then to ask whether the defendant's conduct in breach of s 9 was an operating cause of the claimant's loss or damage. Put another way, was the defendant's breach the effective cause or an effective cause? Richardson J in Goldsboro spoke of the need for, or, as he put it, the sufficiency of, a “clear nexus” between the conduct and the loss or damage. The impugned conduct, in breach of s 9, does not have to be the sole cause, but it must be an effective cause, not merely something which was, in the end, immaterial to the suffering of the loss or damage. The claimant may, for instance, have been materially
14 Red Eagle Corp Ltd v Ellis [2010] NZSC 20, [2010] 2 NZLR 492 at [28].
15 Commerce Commission v New Zealand Nutritionals (2004) Ltd [2016] NZHC 832 at [22].
16 Red Eagle Corp Ltd v Ellis, above n 14. Citations omitted.
influenced exclusively by some other matter, such as advice from a third party.
[47] It is pleaded that Pepatree would never have entered into the agreement if it were not for the misrepresentations. That is the evidence of Mr McKenzie. I accept that evidence. Pepatree had concerns about the ability of the canopies to withstand the strong local wind conditions. Mr McKenzie sought reassurance. Through Mr Reed, predominantly, PCL alleviated those concerns by giving a series of representations.
[48] The representations were incorrect. The evidence of Dr Li establishes that the peak gust wind speed on the two dates the canopies failed was 100 km/h. This was within the scope of the representations provided by PCL.
[49] Therefore, Pepatree was actually misled or deceived. It purchased the canopies in reliance on PCL’s representations. The canopies subsequently failed on two separate occasions. The misrepresentations were clearly an effective cause of Pepatree’s loss.
[50] This cause of action is made out.
Contractual Remedies Act 1979
[51] Pepatree also relies upon s 6 of the Contractual Remedies Act, which provides (relevantly):
(1) If a party to a contract has been induced to enter into it by a misrepresentation, whether innocent or fraudulent, made to him by or on behalf of another party to that contract –
(a) he shall be entitled to damages from that other party in the same manner and to the same extent as if the representation were a term of the contract that has been broken; and
(b) he shall not, in the case of a fraudulent misrepresentation, or of an innocent misrepresentation made negligently, be entitled to damages from that other party for deceit or negligence in respect of that misrepresentation.
[52] The essential elements of a cause of action under s 6 of the Contractual Remedies Act and s 9 of the Fair Trading Act are the same or similar.17 The High Court has previously summarised the position:18
[170] There must be a misstatement, whether a misrepresentation under the [Contractual Remedies Act] or misleading and deceptive conduct under the [Fair Trading Act]. The [Contractual Remedies Act] however also requires the plaintiffs to show that the defendant intended to induce the plaintiffs to enter into the contract on the basis of the misrepresentation.
[53] The Contractual Remedies Act does not define “misrepresentation”. The Court of Appeal has held that a misrepresentation is “a false or erroneous statement of fact”.19 The statements reasonably communicated to Pepatree that the canopies could withstand winds of up to 100 km/h. This was factually incorrect. The representations were false statements as to a present fact.20
[54] The Court of Appeal has also held that a misrepresentation is “one which would have induced a reasonable person to enter into the contract”.21 I have already found that the misrepresentations induced Pepatree, and would have induced a reasonable person, to enter into the contract. PCL also plainly intended the misrepresentations to induce Pepatree to enter into the contract.
[55] Therefore, s 6(1)(a) provides that the misrepresentations are redressable in damages as if they were terms of the contract.
Remaining causes of action
[56] The decisions I have reached on the causes of action under the Fair Trading Act and the Contractual Remedies Act capture what I consider to be the essence of this case. Put simply, PCL was consulted by Pepatree over whether it could design and build protective canopies which would be effective under local conditions. PCL,
which held itself out as having the skill and experience required, assured Pepatree
17 MacIntyre and Williamson Partnership v Fonterra Co-operative Group Ltd [2015] NZHC 3012 at [170].
18 MacIntyre and Williamson Partnership v Fonterra Co-operative Group Ltd, above n 17.
Citations omitted.
19 Savill v NZI Finance Ltd [1990] 3 NZLR 135 (CA) at 145.
20 Section 6 does not apply to statements as to a future state of affairs: Ware v Johnson [1984] 2
NZLR 518 (HC).
21 Savill v NZI Finance Ltd, above n 19, at 145.
that it could. In reliance on PCL’s representations, Pepatree contracted with PCL for the design and construction of the canopies. As it turned out, the reliance was misplaced. The canopies failed repeatedly. They were not capable of performing as PCL had said they would.
[57] There is no need for me to decide the applicability of the remaining causes of action, namely breach of implied warranties and negligence. Obviously, those causes of action would be determined by reference to the findings expressed in the preceding paragraph.
[58] On the first issue, I find that the evidence filed by Pepatree establishes, on the first and third causes of action pleaded, liability by PCL for the damage to the canopies and the consequential losses.
Damages
[59] Pepatree is entitled to damages for breach of s 6 of the Contractual Remedies Act. As there was also a breach of s 9 of the Fair Trading Act, it is entitled to the wide-ranging remedies specified in s 43(3).
[60] Pepatree seeks an award of $718,262 by way of damages. This figure has been independently assessed.
[61] Section 43(3)(f) of the Fair Trading Act permits the Court to make an order directing PCL to pay Pepatree the amount of loss or damage. But the Court has a discretion to award damages that are less than the full amount of the loss suffered.22
[62] In terms of s 6 of the Contractual Remedies Act, the measure of damages for a breach of contract is assessed as damages to put the injured party in the position it would have been if the representations had been true.23
[63] I am satisfied that the sum claimed is reasonable under either cause of action. It takes into account the benefit that Pepatree acquired from the use of the canopies
22 Goldsbro v Walker [1993] 1 NZLR 394 (CA).
23 Ellmers v Brown (1990) 1 NZ ConvC 190,568 (CA) at 190,578.
and the fact that a portion of the canopies remain in use. The sum compensates Pepatree for the damage to the canopies, the repair costs it incurred and the value of the kiwifruit lost when the canopies failed.
[64] On the second issue, I find the quantum of damages to be $718,262.
Decision
[65] As I have found in favour of Pepatree on the discussed causes of action, I
enter judgment in favour of Pepatree in the sum of $718,262.
[66] PCL is to pay interest to Pepatree pursuant to the Judicature Act 1908. Interest will accrue from the dates that losses occurred. If there is dispute between the parties then memoranda may be filed and I will rule separately in resolution of the dispute.
[67] I award costs to Pepatree on a 2B basis. These may be fixed by the Registrar.
Brewer J
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