New Generation Homes Limited v Lal HC Auckland CIV 2010-404-345 - [2010] NZHC 551

IN THE HIGH COURT OF NEW ZEALAND

AUCKLAND REGISTRY

CIV-2010-404-345

BETWEEN NEW GENERATION HOMES LIMITED
Plaintiff

AND SATISH LAL
Defendant

Hearing: 27 April 2010

Appearances: P Moodley and K Morgan for Plaintiff M B Meyrick for Respondent

Judgment: 27 April 2010

JUDGMENT OF COOPER J

This judgment was delivered by Justice Cooper on
27 April 2010 at 3.30 p.m., pursuant to
r 11.5 of the High Court Rules

Registrar/Deputy Registrar Date:

Solicitors:

Brookfields, PO Box 76 004, Auckland

Berman and Burton, PO Box 11171, Ellerslie, Auckland

NEW GENERATION HOMES LIMITED V LAL HC AK CIV-2010-404-345 27 April 2010

[ 1 ] On 18 December 2009 the plaintiff commenced a proceeding seeking an

order for specific performance requiring the defendant to complete settlement of an agreement to purchase land situated at 123-125 Pah Road, Papatoetoe. By an application made on the same day, it sought summary judgment.

The defendant opposes the application for summary judgment, claiming that there was an agreement to cancel the agreement for sale and purchase on which the plaintiff relies.

Background facts

On 23 August 2007 the plaintiff and the defendant entered into an agreement for sale and purchase under which the plaintiff was the vendor and the defendant the purchaser of a property legally described as Lot 13 Deposited Plan 417695, contained and described in Certificate of Title 468308 (North Auckland Registry) (“the land”).
Under the agreement, the purchase price was stated to be $230,000, a deposit of $11,500 was payable by the defendant, the possession date was given as the date on which a certificate was to be issued under s 224(c) of the Resource Management Act and the settlement date was stipulated to be the fifth working day after the issuing of separate titles. The agreement was not made conditional on finance, or provision of a LIM report.
The defendant paid the deposit on 23 August 2007. The s 224(c) certificate was issued on 22 September 2009 and a copy of that was provided by the plaintiff’s solicitor to the defendant’s solicitor on 23 September. The Certificate of Title to the land was issued on 9 October 2009, and a copy of that was provided by the plaintiff’s solicitor to the defendant’s solicitor with a letter dated 9 October 2009. It followed from the terms of the agreement that settlement was required to be completed by 16 October 2009.
That did not occur. On 19 October, the plaintiff’s solicitor served a settlement notice on the defendant’s solicitors requiring the defendant to settle the

transaction within 12 working days from the date of service. The defendant did not comply with the settlement notice, and has not settled the transaction.

Those facts are not in dispute. The kernel of the defence, both to the substantive claim and to the summary judgment application, is an assertion by the defendant that prior to title becoming available he spoke with Mr Ha, the plaintiff’s principal, and it was mutually agreed that the agreement for sale and purchase would be…

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.

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Details

AGLC: New Generation Homes Limited v Lal HC Auckland CIV 2010-404-345 [2010] NZHC 551
Case: [2010] NZHC 551
Decision Date: 27 April 2010

CaseChat Overview and Summary

New Generation Homes Limited initiated legal proceedings against Satish Lal, seeking an order for specific performance requiring Lal to complete the settlement of an agreement to purchase land located at 123-125 Pah Road, Papatoetoe. The plaintiff also applied for summary judgment. Lal opposed the application for summary judgment, arguing that there was an agreement to cancel the sale and purchase agreement on which the plaintiff relied. The core dispute was whether there was a mutual agreement to cancel the contract before the title became available.

The court had to determine whether there was a mutual agreement to cancel the sale and purchase agreement and whether the summary judgment procedure was appropriate given the nature of the dispute. The court examined the evidence provided by Lal, which included his affidavit stating that he had discussions with Mr Ha, the principal of the plaintiff, agreeing that if Lal could not proceed with the purchase, the deposit would be refunded and the agreement cancelled. However, Lal's evidence was inconsistent with the terms of the executed agreement and lacked any written substantiation. The court found Lal's evidence inherently improbable and inconsistent with the documents.

The court held that Lal's evidence was not credible enough to warrant a substantive hearing and that the summary judgment procedure was appropriate in this case. The court concluded that there was no defence to the plaintiff’s claim for specific performance. Therefore, the application for summary judgment was granted, and the court ordered specific performance requiring Lal to complete settlement of the agreement to purchase the property.

The final order was that Lal must complete the settlement of the agreement to purchase the property as described, and the plaintiff was entitled to its costs calculated on a Category 2 Band B basis.

Orders