Norris Ward McKinnon v Kaye - [2015] NZHC 1025

IN THE HIGH COURT OF NEW ZEALAND HAMILTON REGISTRY

CIV-2009-019-1473 [2015] NZHC 1025

BETWEEN
NORRIS WARD MCKINNON

Plaintiff/Counterclaim Defendant

AND

ANTHONY PRATT KAYE AND MORVA KAYE

Defendants/Counterclaim Plaintiffs

Hearing: 28 April to 1 May and 11 - 13 November 2014

Appearances:

Counterclaim Plaintiffs/Defendants in person
R J Latton and C A Robertson for Plaintiff/Counterclaim
Defendant

Judgment:

14 May 2015

JUDGMENT OF M PETERS J

This judgment was delivered by Justice M Peters on 14 May 2015 at 4.45 pm pursuant to r 11.5 of the High Court Rules

Registrar/Deputy Registrar
Date: ...................................

Solicitors: Kennedys, Auckland

Copy for: Counterclaim Plaintiffs / Defendants

NORRIS WARD MCKINNON v KAYE [2015] NZHC 1025 [14 May 2015]

Introduction

[1] The Counterclaim Plaintiffs (“Mr and Mrs Kaye”) bring these proceedings against the Counterclaim Defendants, Norris Ward McKinnon (“Norris Ward”), for breach of contract, alternatively in negligence for breach of duty of care. Although Norris Ward commenced this proceeding, in November 2012 they advised that they would not pursue their claim and so this judgment is concerned only with Mr and Mrs Kaye’s counterclaim.

[2] Norris Ward acted for Mr and Mrs Kaye or their company, Room Outside

Limited (“ROL”), in two matters.

[3] The first concerned settlement of agreements relating to Mr and Mrs Kaye’s and ROL’s purchase of a “Palmers” garden centre in Cambridge (“business”) and associated land. Mr Barris of Norris Ward had the day to day conduct of this aspect of Mr and Mrs Kaye’s instructions, which were given between mid-August 2006 and March 2007.

[4] The second matter was litigation that Mr and Mrs Kaye and ROL commenced against their previous solicitors, Tanner Fitzgerald Getty (“TFG”), in March 2008. Mr John Bolton acted on these instructions from May 2007 until August 2008, and Mr Samuel Hood thereafter. The proceedings against TFG were settled at mediation in March 2009.

[5] Norris Ward terminated their retainer with Mr and Mrs Kaye in February

2009.

[6] The business was unsuccessful. In April 2009, on the application of Palmers Franchise Systems Limited (“Palmers”), the Court ordered that ROL should be wound up. Following this, lots 1 and 3 (referred to below) and two residential properties that Mr and Mrs Kaye owned were sold at mortgagee sale.

[7] Mr and Mrs Kaye’s case is that Norris Ward breached their duty to exercise reasonable skill and care in carrying out Mr and Mrs Kaye’s instructions. There is no dispute that Norris Ward owed this duty. The issues for determination are

whether Norris Ward breached their obligation and, if so, whether their breach

caused loss. Mr and Mrs Kaye’s case is that they sustained losses of approximately

$2,500,000.1

[8] For the reasons set out below, I am not persuaded that Mr Barris breached his obligation to the Kayes and the claim as it concerns him fails. I am, however, satisfied that Norris Ward were in breach between, say, June 2007 and February 2008 in respect of advice that they gave or failed to give regarding the litigation. The Kayes…

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

Case: [2015] NZHC 1025
Decision Date: 14 May 2015

CaseChat Overview and Summary

The counterclaim plaintiffs, Mr and Mrs Kaye, brought proceedings against the counterclaim defendants, Norris Ward McKinnon, for breach of contract, alternatively in negligence for breach of duty of care. Norris Ward had acted for Mr and Mrs Kaye in relation to the purchase of a business and associated land, and in litigation against their previous solicitors. The Kayes alleged that Norris Ward breached their duty to exercise reasonable skill and care in carrying out the Kayes' instructions. The Kayes claimed they sustained losses of approximately $2,500,000. The court found that Norris Ward did not breach their obligation in relation to the purchase of the business, and that the Kayes did not establish that this breach caused loss. The court did find that Norris Ward were in breach between, say, June 2007 and February 2008 in respect of advice that they gave or failed to give regarding the litigation. The Kayes, however, had not established that this breach caused loss and so the claim as it concerned the litigation failed on that ground. The counterclaim was dismissed.

Orders