Mirador Holdings Limited v Vattikuti
[2024] NZHC 929
•17 May 2024
IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY
I TE KŌTI MATUA O AOTEAROA TĀMAKI MAKAURAU ROHE
CIV-2023-404-2039
[2024] NZHC 929
BETWEEN MIRADOR HOLDINGS LIMITED
Plaintiff
AND
NAGA PRADEEP VATTIKUTI
Defendant
Hearing: 18 April 2024 Appearances
D J Chisholm KC and J D Ryan for the Plaintiff Defendant is self-represented
Judgment:
17 May 2024
JUDGMENT OF ASSOCIATE JUDGE C B TAYLOR
[Application for summary judgment]
This judgment was delivered by me on 17 May 2024 at 3:00pm
pursuant to Rule 11.5 of the High Court Rules
…………………………. Registrar/Deputy Registrar
Solicitors:
Claymore Partners Limited (J D Ryan), Auckland, for the Plaintiff
Copy for:
David J Chisholm KC, Auckland, for the Plaintiff Pradeep Vatikutti, Auckland (Defendant)
MIRADOR HOLDINGS LIMITED v NAGA PRADEEP VATTIKUTI [2024] NZHC 929 [17 May 2024]
Introduction
[1] Mirador Holdings Limited (Mirador) seeks an order for specific performance by way of summary judgment against Mr Naga Pradeep Vattikuti (Mr Vattikuti).
Background
[2] Maritimus Limited (Maritimus) agreed to sell the property known as Unit 12 plus one carpark in the development known as “The Foundry” (the Property) pursuant to an agreement for sale and purchase dated 2 June 2020 (the Agreement). The purchase price of the Property was $295,000 (plus GST (if any)). The Agreement was later amended so that the purchase price was increased to $339,250 (plus GST (if any)).
[3] Mirador amalgamated with Maritimus on 8 November 2021 and, under s 225(d) and (e) of the Companies Act 1993, Mirador succeeded to all property of Maritimus and assumed all obligations of Maritimus to sell the Property under the Agreement.
[4] The terms of the Agreement included Mr Vattikuti paying a deposit of $29,500 (the Deposit) in instalments of:
(a)$5,000 on satisfaction or waiver of cl 22.5 (purchaser solicitor approval);
(b)$14,750 being 5 per cent of the purchase price payable two months following satisfaction of cl 22.5; and
(c)$9,750 being 5 per cent of the purchase price less than the amount paid under paragraph [4(a)] above payable four months following satisfaction of cl 22.5.
[5]Settlement of the Agreement was to occur on the later of:
(a)five working days after Mr Vattikuti or his lawyer was given a copy of the code compliance certificate for the Property;
(b)five working days after the date Mirador’s lawyer advised Mr Vattikuti’s lawyer that a search copy of the title to the Property was available; and
(c)five working days after the date Mirador provided Mr Vattikuti with a certificate from Mirador’s engineer that practical completion had been achieved.
[6]Under cls 32.1 and 32.3 of the Agreement:
(a)The Agreement was conditional on the following occurring on or before the last working day in December 2022:
(i)the issue of a new record of title for the Property;
(ii)a code compliance certificate issuing for the Property; and
(iii)practical completion of the Property being achieved.
(b)Mirador could extend the date for fulfilment of the above condition for a period not exceeding six months by giving notice in writing to Mr Vattikuti on or before the last working day in December 2022.
[7] Under cl 32.4 of the Agreement, Mr Vattikuti did not have the right, at any time prior to settlement, to advertise the Property as available for sale by any means whatsoever within New Zealand. This clause provided:
32.4 No Advertising
The purchaser must not, at any time prior to settlement, advertise the property as available for sale by any means whatsoever within New Zealand. The purchaser acknowledges that any such advertisement may jeopardise the sales
program of the vendor and as a result is likely to cause loss to the vendor. The vendor may, by notice in writing, consent to the purchaser advertising the property for sale in breach of this provision, however the vendor shall be under no obligation to act reasonably in determining whether its consent is available and such consent shall be given or withheld at the vendor’s sole discretion.
[8] Under cl 32.9 of the Agreement, Mirador and Mr Vattikuti acknowledged that the Agreement and the attachments to the Agreement contained the entire agreement between the parties, notwithstanding any negotiations or discussions prior to the execution of the Agreement, and notwithstanding anything contained in any brochure, report or other document. Mr Vattikuti acknowledged that he had not been induced to execute the Agreement by any representation, verbal or otherwise, made by or on behalf of Mirador or any agent of Mirador, which was not set out in the Agreement.
[9] Under cl 11.4 of the Agreement, if Mr Vattikuti did not comply with a settlement notice served under the Agreement, Mirador could without prejudice to its other rights or remedies available at law or in equity:
(a)sue Mr Vattikuti for specific performance; or
(b)cancel the Agreement; and
(i)retain the deposit; and
(ii)sue for damages.
[10] On 8 June 2020, Mr Vattikuti’s solicitor provided its approval of the Agreement in accordance with cl 22.5 and subsequently, Mr Vattikuti paid the Deposit.
[11] On 27 September 2021, Mirador and Mr Vattikuti agreed to the following amendments to the Agreement (the Amendment Agreement):
(a)the purchase price would be $339,250 (plus GST if any) increased from the original purchase price of $295,000 (plus GST if any);
(b)no further deposit would be payable; and
(c)it was specifically confirmed that Mirador agreed to Mr Vattikuti on- selling the Property prior to settlement if he chose to do so.
[12] On 11 May 2022 Mr Vattikuti’s lawyer requested Mirador’s consent to market the Property, which was refused.
[13] On 25 May 2023, Mirador’s lawyer provided the certificate of practical completion and code compliance certificate for the Property and informed Mr Vattikuti of the settlement date of 1 June 2023.
[14] Mr Vattikuti failed to settle the Agreement on 1 June 2023, and on that date Mr Vattikuti’s lawyers were served with a settlement notice requiring Mr Vattikuti to settle the Agreement on or before 21 June 2021. Mr Vattikuti failed to comply with the settlement notice by 21 June 2021.
Mirador’s application for summary judgment
[15] Mirador seeks orders granting summary judgment on its claim against Mr Vattikuti as pleaded in the statement of claim.1
[16]The grounds on which the orders are sought are:2
(a)Mr Vattikuti has no defence to the allegations contained in the statement of claim; and
(b)appearing in the statement of claim and the affidavit of Brandon Morley affirmed on 5 September 2023.
1 Notice of interlocutory application by plaintiff for summary judgment against defendant dated 6 September 2023 at [1].
2 At [2].
Mr Vattikuti’s opposition
[17] Mr Vattikuti opposes the application on the following grounds, as I have understood them:3
(a)Mirador breached and repudiated the Amendment Agreement by preventing him from reselling the Property prior to the settlement date due to Mirador not waiving the “no advertising” clause in the Agreement;
(b)Mirador made misrepresentations which induced him to sign the Amendment Agreement and also engaged in unconscionable conduct which was not disclosed to him and was relevant to his signing of the Amendment Agreement; and
(c)the amalgamation of Maritimus and Mirador is flawed and therefore Mirador has no legal standing to bring the claim.
Mr Vattikuti’s further filing
[18] On 1 May 2024, Mr Vattikuti sought to file further submissions and exhibits in support of his argument. He sought to file:
(a)a memorandum of three pages summarising the case;
(b)a transcript of his oral submissions at the hearing on 18 April 2024;
(c)a document entitled “Defendant’s preliminary response to the plaintiff’s submission titled “Mirador outline of submissions” [submitted to the Court by the plaintiff during the 18 April 2024 summary judgment hearing].”
3 Notice of opposition by Mr Vattikuti to application for summary judgment dated 7 February 2024 and subsequent documents filed by Mr Vattikuti, being his submissions dated 16 April 2024 and “New exhibits in support of the submissions of the defendant in opposition to the plaintiff’s application for summary judgment” dated the same date.
(d) a document entitled “Vattikuti Motion Bundle”. (together the Further Filing).
[19] Leave of the Court is required to file submissions after the hearing but before judgment, pursuant to r 11.8A of the High Court Rules 2016. The High Court Practice Note4 sets out that only in exceptional circumstances will leave be granted, for example where some new matter has arisen since the hearing which was not anticipated by counsel.
[20] Mr Vattikuti submits he was “ambushed” at the hearing, having not realised that the hearing was to argue the case and he was overwhelmed at the hearing and unable to properly present his case, hence he sought to make the Further Filing. Mr Vattikuti also makes the point in response to Mr Chisholm’s criticism that there is no sworn evidence filed by Mr Vattikuti before the Court, and that he did not realise he needed to have affidavits sworn and filed for the hearing. Mr Vattikuti outlines at some length in the Further Filing the expected contents of various affidavits he proposes would be sworn and filed if the matter were to go to trial or if the Court grants him an indulgence to file these after the hearing but before the judgment.
[21] Mr Chisholm opposes the Court granting leave to allow the Further Filing on the grounds:
(a)despite the fact he is self-represented, Mr Vattikuti is still obliged to comply with the same rules that all other litigants are obliged to comply with;
(b)Mr Vattikuti was not ambushed by a 72-page document – the document handed up to the Court at the hearing by Mr Chisholm was a three page summary of his oral submissions,
(c)the Further Filing is an attempt by Mr Vattikuti to file further unsworn evidence and make submissions after the hearing.
4 Practice Note 3 [1968] NZLR 608.
[22]I have considered the contents of the Further Filing and my views are:
(a)as Mr Vattikuti is self-represented, despite the fact (as I explain below) that the Further Filing does not meet the criteria for granting leave as set out in the Practice Note, I will allow the Further Filing to be admitted, despite Mr Chisholm’s opposition;
(b)however, the Further Filing does not in my view assist Mr Vattikuti. It reiterates, a number of times, the same arguments Mr Vattikuti has already put before the Court in the submissions filed before the hearing and his oral submission at the hearing. As will be apparent from further on in this judgment, in my view none of these arguments are reasonably arguable and do not justify the Court refusing summary judgment in favour of Mirador;
(c)the Further Filing does seek to introduce two new defences:
(i)specific performance should not be granted as damages are a sufficient remedy; and
(ii)Mirador has failed to mitigate its loss by not selling the Property during the previous nine months.
There is no evidence presented to support these defences, they are mere assertions by Mr Vattikuti and have not been included in his previous submissions, giving Mirador a change to respond to them. In these circumstances, I do not accept them as established or justifying refusal of summary judgment to Mirador;
(d)Mr Vattikuti makes much of the three affidavits he states could be sworn by Mr Burn, Mr Zhao and Mr Walenkamp) and the anticipated evidence of a list of subpoenaed witnesses. As none of this evidence has been sworn in the form of affidavit or is before the Court, it is all speculation on the part of Mr Vattikuti as to what the evidence will be.
However, giving Mr Vattikuti the benefit of the doubt that what he expects his witnesses to say is accurate (at least in respect of the three affidavits he proposes to have sworn), importantly even if the evidence supports the arguments he has advanced, in my view those arguments remain untenable.
[23] In conclusion, I am of the view that taking the Further Filing into account, it does not alter my judgment as set out below.
Legal principles
[24]Rule 12.2 of the High Court Rules 2016 (the Rules) provides, relevantly:
12.2 Judgment when there is no defence or when no cause of action can succeed
(1)The court may give judgment against a defendant if the plaintiff satisfies the court that the defendant has no defence to a cause of action in the statement of claim or to a particular part of any such cause of action.
[25] The relevant principles governing a summary judgment application are well established:5
The principles are well settled. The question on a summary judgment application is whether the defendant has no defence to the claim; that is, that there is no real question to be tried: Pemberton v Chappell [1987] 1 NZLR 1 at 3 (CA). The Court must be left without any real doubt or uncertainty. The onus is on the plaintiff, but where its evidence is sufficient to show there is no defence, the defendant will have to respond if the application is to be defeated: MacLean v Stewart (1997) 11 PRNZ 66 (CA). The Court will not normally resolve material conflicts of evidence or assess the credibility of deponents. But it need not accept uncritically evidence that is inherently lacking in credibility, as for example where the evidence is inconsistent with undisputed contemporary documents or other statements by the same deponent, or is inherently improbable: Eng Mee Yong v Letchumanan [1980] AC 331 at 341 (PC). In the end the Court’s assessment of the evidence is a matter of judgment. The Court may take a robust and realistic approach where the facts warrant it: Bilbie Dymock Corp Ltd v Patel (1987) 1 PRNZ 84 (CA).
5 Krukziener v Hanover Finance Ltd [2008] NZCA 187, [2010] NZAR 307 at [26].
[26]The wording of r 12.2 (“may give judgment”) indicates a residual discretion.
Having regard to the various authorities, the position appears to be as follows:6
(a)The discretion implied by the use of the word “may” is to be restrictively applied. In a great majority of cases, once the court is satisfied the defendant has no defence, there is no room for the exercise of discretion.
(b)The residual discretion may be invoked to avoid oppression or injustice to the defendant where:
(i)The proceeding involves the actions or possible liability of a third party which is not before the court;
(ii)The proceedings are such that the opportunity should be given to allow discovery or other interlocutory applications to be concluded;
(iii)The circumstances of the case disclose very unusual features, the presence of which leads the court to conclude that the entry of summary judgment would be oppressive or unjust; or
(iv)The combination of complex issues of fact and law justify the dismissal of the application for summary judgment, either as a matter of discretion or because the court cannot be satisfied that the defendant has no defence.
(c)Even where the court is not satisfied that a defence has been made out, in exceptional circumstances the application may be adjourned to allow for other processes to be followed.
Analysis
[27] The issue to be determined in this judgment is whether any of the grounds of opposition raised by Mr Vattikuti to Mirador’s application for summary judgment give rise to an arguable defence so that summary judgment should not be granted to Mirador. The grounds of opposition are:
(a)Mirador breached and repudiated the Amendment Agreement by preventing Mr Vattikuti from reselling the Property prior to the settlement date due to Mirador not waiving the “no advertising” clause in the Agreement;
6 Jessica Gorman and others (eds) McGechan on Procedure (online ed, Thomson Reuters) at [HR12.2.11].
(b)Mirador made misrepresentations which induced Mr Vattikuti to sign the Amendment Agreement and also engaged in unconscionable conduct which was not disclosed to him and was relevant to his signing of the Amendment Agreement; and
(c)the amalgamation of Maritimus and Mirador is flawed and therefore Mirador has no legal standing to bring the claim.
[28] Mr Vattikuti submits that the issues raised in the three grounds of objection involve complex and disputed facts and should not be dealt with in the context of a summary judgment but should be the subject of a trial.
[29]I deal with each of the grounds of opposition in turn.
Mirador’s breach and repudiation of the Amendment Agreement
[30] Mr Vattikuti argues that the Amendment Agreement gave him the right to sell the Property prior to settlement. He argues that notwithstanding cl 32.4 was not amended, any reasonable person would expect that if they specifically negotiated a special right to be able to sell the Property prior to settlement, the right to advertise or market the Property would be automatically included in the right to sell.
[31] Mr Vattikuti submits that as a result of Mirador refusing to allow him to resell the Property prior to settlement, Mirador has breached and repudiated the Amendment Agreement entitling Mr Vattikuti to cancel the Agreement based on ss 36 and 37 of the Contract and Commercial Law Act 2017.
[32] Mr Chisholm KC, for Mirador, submits that Mirador has not breached or repudiated the Amendment Agreement and in any event if there was any repudiation by Mirador, Mr Vattikuti affirmed the Amendment Agreement losing any right to cancel the Agreement.
[33]Mr Chisholm submits:
(a)Clause 32.4 of the Agreement does not impose any requirement on Mirador to act reasonably in determining whether it should give consent to any request to advertise the Property, and the clause expressly provides such consent could be given or withheld at Mirador’s sole discretion.
(b)The position under the clause aligns with the purpose of a “no advertising” clause, being to prevent the purchaser from advertising the Property in a way which competes with, and may jeopardise, the sales programme of the vendor.
(c)Part of the consideration for the Agreement is that the purchaser is prevented from marketing the sale of the Property.
[34] In relation to the allegation by Mr Vattikuti that Mirador has breached and repudiated the Amendment Agreement, Mr Chisholm submits:
(a)no amendment to cl 32.4 of the Agreement was ever agreed upon by the parties and Mr Vattikuti was acting with legal advice at all material times;
(b)Mr Vattikuti’s solicitor approved the Agreement in 2020 (and did not raise any issue with cl 32.4);
(c)Mr Vattikuti agreed to the amendments in 2021 (and did not raise any issue with cl 32.4);
(d)in 2022 Mr Vattikuti, only after signing both the Agreement and the Amendment Agreement raised an issue of obtaining consent under cl 32.4 to advertise the Property;
(e)once Mirador responded to the inquiry, Mr Vattikuti took the issue no further for over a year, until after service of the settlement notice and after commencements of these proceedings in 2023; and
(f)even if, which is denied, Mirador’s refusal to agree to advertising contrary to cl 32.4 was somehow a repudiation of the Agreement, Mr Vattikuti’s subsequent acquiescence or failure to take any steps to cancel the Agreement amounted to an affirmation. Any right he may have had to cancel was lost. As authority for this point, Mr Chisholm relies on Westpac Merchant Finance Ltd v Winstone Industries Ltd.7
[35] Mr Chisholm submits that Mr Vattikuti always possessed the right to sell the Property in accordance with the Agreement and the Amendment Agreement, but he never had the right, without Mirador waiving its rights under cl 32.4, to advertise the Property for sale and therefore Mirador had not breached the Agreement by refusing Mr Vattikuti the right to advertise the Property.
[36] Mr Chisholm submits that Mr Vattikuti’s argument that the clause in the Amendment Agreement acknowledging Mr Vattikuti’s right to resell the Property prior to settlement impliedly included the right to advertise the Property as that was a natural adjunct of Mirador agreeing to Mr Vattikuti’s right to resell the Property is untenable. He submits that this is demonstrated by the fact that when Mr Vattikuti’s solicitor contacted Mirador to seek consent to advertise the Property in 2022, he stated in the letter of 11 May 2022 that Mr Vattikuti was not aware of the “no-marketing” clause in the Agreement and if Mr Vattikuti was not even aware of the clause, the assertion he thought it was impliedly waived as part of the Agreement is not credible.
[37] Mr Chisholm submits that the terms of the Amendment Agreement were arrived at by Mirador accepting those conditions proposed by Mr Vattikuti’s solicitor and these conditions did not include any proposed amendment to cl 32.4. He submits that as Mr Vattikuti specifically sought waiver of certain clauses in the sale and purchase agreement it is not credible that if Mr Vattikuti had intended to require Mirador to waive cl 32.4, he would not have requested this in the amendments. Mr Chisholm submits that this issue is reinforced by the fact that Mr Vattikuti did not raise the potential breach or repudiation of the Amendment Agreement by Mirador until the issue of these proceedings in late 2023, and in particular it was not raised by
7 Westpac Merchant Finance Ltd v Winstone Industries Ltd [1993] 2 NZLR 247 (HC) at 255.
him or his solicitor when the issue of obtaining Mirador’s consent to advertise the Property in New Zealand arose in 2022.
Conclusion in relation to breach and repudiation of the Agreement
[38] I am of the view that Mr Vattikuti’s position that Mirador breached and repudiated the Amendment Agreement is not reasonably arguable and not a ground to refuse the grant of summary judgment to Mirador. The reasons for this are:
(a)I do not accept Mr Vattikuti’s proposition that the provision in the Amendment Agreement which specifically confirms his right to resell the Property prior to settlement impliedly waived the restriction on advertising the Property in New Zealand under cl 32.4. Mr Vattikuti was advised at all material times by his solicitor and the amendments to the Agreement which were incorporated in the Amendment Agreement were proposed by his solicitor. If the intention had been to require Mirador to waive cl 32.4, this would have been included in the suggested amendments. This conclusion is reinforced by the fact that when Mr Vattikuti’s solicitor sought consent to advertise the Property in May 2022, he expressed the view that Mr Vattikuti was unaware of the “no advertising” clause and consequently the assertion by Mr Vattikuti that he thought it had been impliedly waived is not credible.
(b)It follows from my views at paragraph [32(a)] immediately above, that there is no breach or repudiation of the Agreement by Mirador by refusing to allow Mr Vattikuti to advertise the Property for sale in New Zealand prior to settlement. Mirador was merely exercising its contractual rights and the wording of cl 32.4 makes it clear that Mirador could withhold its consent to advertising the Property in its sole discretion and was not required to act reasonably.
(c)In the event there was an arguable breach and repudiation of the Amendment Agreement by Mirador, then in my view Mr Vattikuti affirmed the contract by failing to take any action following the refusal
of consent to advertise the Property by Mirador in May 2022, with Mr Vattikuti’s delay continuing until after these proceedings were issued in 2023. Any right Mr Vattikuti may have had to cancel the Agreement due to the alleged breach and repudiation by Mirador was lost.
Misrepresentations and unconscionable conduct by Mirador
[39] Mr Vattikuti alleges that he was induced to enter into the Amendment Agreement by misrepresentations by Mirador and that Mirador failed to disclose the unconscionable conduct to its principal, Mr Farhad Moinfar (Mr Moinfar). Mr Vattikuti submits that he agreed to pay the higher price of $339,250 for the Property and forego certain cancellation rights because he believed the representations made by Mirador/Mr Moinfar in newsletters and updates of successful developments and that they were expert in commercial property development. He points to the communications received from Mirador or its agent, Barfoot and Thompson, as set out in Exhibits A to G in the bundle of documents.8
[40] Mr Vattikuti submits that leading up to the signing of the Amendment Agreement these communications caused him to place more reliance on the fact that the representations of Mirador were being made in good faith.
[41] Mr Vattikuti also submits that if he had known about what he describes as the “unconscionable conduct” of Mr Moinfar, he would not have entered into the Amendment Agreement. In this respect, Mr Vattikuti refers to the reported conduct of Mr Moinfar in relation to the West Village Capital Limited and Union Group developments, and relies on media reports relating to Mr Moinfar’s conduct.
[42] Mr Vattikuti relies on the provision of ss 7 and 8 of the Fair Trading Act 1986 (FTA) which deal with unconscionable conduct or bargain.
[43]In rebutting this allegation, Mr Chisholm submits:
8 Bundle of Documents, at 15 and 16; see also 137–153, 157, 158, and 176–212.
(a)Sections 7 and 8 of the FTA upon which Mr Vattikuti relies, did not come into force until 16 August 2022, whereas the conduct occurred in September 2021 and accordingly Mr Vattikuti cannot rely on these sections of the FTA.
(b)The fact that Mr Vattikuti was always legally represented makes any claim of unconscionable bargain untenable. He submits that Mr Vattikuti was under no significant disability or disadvantage.
(c)There are no identified misrepresentations relevant to the Agreement or the Amendment Agreement and the materials which Mr Vattikuti relies on are not deceptive and reflected the actual activity of Mirador at the time. He submits that in any event the emails are clearly marketing puffery.
(d)The articles referring to Mr Moinfar’s conduct in respect of West Village Capital Partners Limited and the Union Green Development are completely unrelated to Mr Vattikuti’s Agreement and are not relevant to this proceeding.
Conclusion in respect of misrepresentations/unconscionable conduct
[44] In my view, Mr Vattikuti’s contention that the misrepresentations by Mirador/Mr Moinfar and non-disclosure of what he describes as the unconscionable conduct of Mirador/Mr Moinfar induced him to enter into the Amendment Agreement, is not reasonably arguable and are not grounds to refuse summary judgment being granted in favour of Mirador. The reasons for this view are:
(a)The materials which Mr Vattikuti relies on as constituting the representations fall far short of specific misrepresentations which may have induced him to enter into the Amendment Agreement. They are either the updates as to the progress of the Foundry project and other projects in which Mr Moinfar is involved or clearly marketing puffery, and there are no specific misrepresentations which can be identified which are actionable.
(b)The alleged unconscionable conduct relating to Mirador/Mr Moinfar is unrelated to these proceedings and I do not accept Mr Vattikuti’s submission that had he known about these issues he would not have entered into the Amendment Agreement. This is not a tenable argument.
(c)Mr Vattikuti was legally advised throughout the process and if he considered he was induced to enter into the Amendment Agreement by misrepresentations, it would be expected that this issue would have been raised either when consent was sought to advertise the Property or at some earlier time before these proceedings were issued, but it was not.
Flawed amalgamation of Mirador/Maritimus
[45] Mr Vattikuti makes an assertion that the certificate of amalgamation of Mirador and Maritimus has not being validly issued and accordingly Mirador has no status to bring these proceedings. The criticisms that Mr Vattikuti levels at the amalgamation process appear to be:
(a)The resolutions included in the amalgamation process were not true and correct. He alleges that the cancellation of the shares in Maritimus would have meant that Maritimus ceased to exist and ceased trading as a separate entity, and this is not the case.
(b)He alleges that the representation that Maritimus had no secured creditors as at the date of the amalgamation resolution appears to be incorrect.
[46] In support of this contention that Maritimus continues to exist, he points to Maritimus appearing to still be a registered shareholder in another company associated with Mirador/Mr Moinfar, namely MP Limited, and therefore it appears to continue to be in existence and be continuing in business. He alleges that the statement in the amalgamation documents that Maritimus had no secured creditors as at 4 November
2021 is inconsistent with references to Maritimus/Mirador having bank financing in respect of the Foundry project.
[47] Mr Chisholm submits that the complete answer to these arguments is the effect of the amalgamation certificate under s 225 of the Companies Act 1993. This section makes it clear that on the issue of a certificate of amalgamation the consequences are as set out in s 225(a) to (h) and it is clear from subss (d) and (e) that Mirador had acceded to all rights and obligations of Maritimus in respect of the Agreement and the Amendment Agreement and therefore has legal standing to bring these proceedings.
Conclusion in respect of flawed amalgamation
[48] Mr Vattikuti’s argument that due to alleged defects in the Mirador/Maritimus amalgamation procedure resulting in Mirador having no legal standing to bring the proceedings is not tenable. It is clear from s 225 of the Companies Act that upon issue of the amalgamation certificate its effect is as set out in that section, including Mirador succeeding to all rights and obligations of Maritimus under the Agreement and the Amendment Agreement and by operation of law the amalgamation certificate is conclusive.
Result
[49] As a result of the conclusions I have reached at [38], [44] and [48] of this judgment, I am of the view that Mirador is entitled to summary judgment and the orders for specific performance as sought in Mirador’s application.
Orders
[50] I order the Mr Vattikuti shall specifically perform the Agreement and that he does all things necessary to perform his obligations under the Agreement including (but not limited to):
(a)instructing a solicitor to act for him on the purchase of the Property (the ‘purchaser’s solicitor”);
(b)instructing the purchaser’s solicitor to prepare the appropriate Client Authority and Instruction Form for an electronic transaction for the transfer of the Property from Mirador (and mortgage over the Property if required);
(c)providing, for the purposes of the Client Authority and Instruction Form, photographic identification and any other identification proof required by LINZ standards LINZ S20002;
(d)executing the Client Authority and Instruction Form for an electronic transaction for transfer of the Property from Mirador (and mortgage over the Property if required);
(e)instructing the purchaser’s solicitor to create in Landonline workspace an e-dealing for an electronic transaction for the transfer of the Property from Mirador (and mortgage over the Property if required) (“the e- dealing”) with the details of Mirador’s solicitor to be provided by Mirador;
(f)instructing the purchaser’s solicitor to sign, certify and pre-validate the e-dealing;
(g)instructing the purchaser’s solicitor to prepare and provide to Mirador’s solicitor a notice of change of ownership in respect of the transfer of the Property from Mirador;
(h)instructing the purchaser’s solicitor that, subject to the performance of the next succeeding order, upon receipt of the undertakings from Mirador’s solicitor for settlement of the transfer of the Property from Mirador in accordance with the PLS Guidelines shall pay to the trust account of Alexander Dorrington Limited (bank account No. 01-0102- 0271098-002) the sum which is calculated as follows:
Purchase price $339,250.00
Less deposit paid $29,500.00
Plus penalty interest at 15 per cent on the unpaid balance of purchase price (being $309,750.00) from 1 June 2023 until settlement of the purchase price in full;
Plus any other amounts due and owing as set out in the
settlement statement to be provided to the purchaser prior to settlement date, including rates, water levies and legal costs (as ordered below).
(i)By not later than 2pm on the date 10 working days from the date of this order, paying or causing to be paid to the trust account of the purchaser’s solicitor the sum of $309,750.00 plus interest (or any other amount as set out in the settlement statement) in cleared funds to enable the purchaser’s solicitor to carry out the above instruction.
[51] As the successful party, Mirador is entitled to costs on a 2B basis, together with disbursements.
…………………………….. Associate Judge Taylor
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