MQF Properties Limited v Mosli

[2019] NZHC 673

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

I TE KŌTI MATUA O AOTEAROA TĀMAKI MAKAURAU ROHE

CIV-2019-404-000135

[2019] NZHC 673

BETWEEN

MQF PROPERTIES LIMITED

Plaintiff

AND

ROSILAH MOSLI

Defendant

Hearing:

2 April 2019

Appearances:

D Liu for the Plaintiff

No appearance by or on behalf of Defendant

Minute:

3 April 2019

JUDGMENT OF WOOLFORD J

This judgment was delivered by me on Wednesday, 3 April 2019 at 10:00 am pursuant to r 11.5 of the High Court Rules.

Registrar/Deputy Registrar

Solicitors:           Yu Lawyers, Auckland Copy to:  Defendant

MQF PROPERTIES LIMITED v MOSLI [2019] NZHC 673 [3 April 2019]

[1]    MQF Properties Limited (MQF) applies for summary judgment against Rosilah Mosli in the sum of $600,000 plus interest, costs and disbursements. Ms Mosli resides in Singapore. She has been served with a copy of the proceedings, but has taken no steps.

Factual background

[2]    On 9 May 2018, MQF, as vendor, and Ms Mosli, as purchaser, entered into an unconditional agreement for sale and purchase of real estate in respect of a property owned by MQF at 75A Coatesville-Riverhead Highway, Coatesville, Auckland. The agreement was recorded in the ADLS/REINZ Ninth Edition 2012 (5) form and included the following terms:

(a)Purchase price: $6,000,000.

(b)Deposit: $600,000, payable by 18 May 2018.

(c)Interest rate for late settlement: 10 per cent per annum.

(d)Settlement date: 15 June 2018.

[3]    The agreement also included a provision that if the deposit was not paid on the due date for payment, MQF may at any time thereafter serve on Ms Mosli notice requiring payment. If Ms Mosli failed to pay the deposit on or before the third working day after service of the notice, time being of the essence, MQF was able to cancel the agreement by serving notice of cancellation on Ms Mosli.

[4]    The deposit fell due on 18 May 2018, but Ms Mosli did not pay it or any part of it. On 19 May 2018, MQF served written notice on Ms Mosli requiring payment of the deposit on or before the third working day after service of the notice. Ms Mosli also failed to comply with MQF’s deposit notice. MQF at all material times was ready, willing and able to perform its obligations under the agreement on the date that the deposit fell due.

[5]    On 25 May 2018, following expiry of the deposit notice, MQF served written notice on Ms Mosli cancelling the agreement on the ground of her failure to pay the deposit.

Plaintiff’s submissions

[6]    MQF submits that it is entitled to recover the deposit from Ms Mosli as an accrued debt under the agreement. In this regard, it relies on Pendergrast v Chapman1 and Brown v Langwoods Photo Stores Limited.2 In the Court of Appeal decision of Brown v Langwoods Photo Stores, the Court stated:

In Pendergrast v Chapman, Wylie J held that s 8(3)(a) [of the Contractual Remedies Act 1979] did not prevent enforcement of an accrued cause of action in debt. We agree, but would state the law more broadly. The provision does not abrogate any cause of action accrued unconditionally before cancellation, whether or not for debt. The present case is not concerned with any special point that may arise about deposits on the purchase of land; but we see no reason to doubt the decisions of Wylie J and Gallen J that such a deposit, if unconditionally due before cancellation but still unpaid, may be recovered by action after cancellation by the vendor based on default by the purchaser. That accords with the role of a deposit as an earnest that the purchaser will go ahead, and with the common law rule as now established by the weight of authority; see Damon Compania Naviera SA v Hapag-Lloyd International SA [1985] 1 All ER 475; Greig and Davis, The Law of Contract (1987) at pp 1277- 1278. Decisions to the contrary such as Johnson v Jones [1972] NZLR 313 cannot now be regarded as correct.

Result

[7]    I am satisfied that the deposit, which was unconditionally due before cancellation, may be recovered by action after cancellation by MQF based on default by Ms Mosli. Ms Mosli has no defence to the claim by MQF.

[8]    Although Ms Mosli resides outside New Zealand (namely Singapore), the Court may exercise jurisdiction in this case because the agreement was to be wholly performed in New Zealand3 and the breach occurred in New Zealand.4

1      Pendergrast v Chapman [1988] 2 NZLR 177.

2      Brown v Langwoods Photo Stores Ltd [1991] 1 NZLR 173.

3      High Court Rules 6.27(2)(b)(iii).

4      High Court Rules 6.27(2)(c).

[9]    The proceeding was served on Ms Mosli in Singapore on 15 February 2019, but she has filed no defence, appearance or opposition.

[10]Accordingly, there will be judgment against Ms Mosli for the sum of

$652,438.36, being the amount of the deposit of $600,000 plus interest at 10 per cent per annum from the due date for payment (18 May 2018) to the date of judgment    (2 April 2019), being 319 days.

[11]   Further, MQF is entitled to costs of $9,812 and disbursements of $2,449.89. The total amount owing by Ms Mosli to MQF is therefore $664,700.25.

Woolford J