Peegeecee Ltd v Parkview on Hagley Ltd - [2019] NZHC 258

IN THE HIGH COURT OF NEW ZEALAND CHRISTCHURCH REGISTRY

I TE KŌTI MATUA O AOTEAROA ŌTAUTAHI ROHE

CIV-2018-409-000676

[2019] NZHC 258

UNDER the Property Law Act 2007

IN THE MATTER

of an application for cancellation of lease

BETWEEN

PEEGEECEE LIMITED,

RJSN PROPERTIES LIMITED, SULLIVAN ENTERPRISES (2007) LIMITED,
AB HOLDINGS (2007) LIMITED, KESWICK ENTERPRISES LIMITED, L&M HOLDINGS (2008) LIMITED, RUSSELL MACKIE AND SUZANNE MACKIE (T/A HAGLEY PARKVIEW PARTNERSHIP),

TRAVELLERS INN LIMITED, JAYA INVESTMENTS LIMITED,

ANKUR INVESTMENTS LIMITED AND M & A LIMITED
Applicants

AND

PARKVIEW ON HAGLEY LIMITED

Respondent

Hearing: 4, 5 February 2019

Appearances:

P Sills for the Applicants

G K Riach and M Hughes for the Respondent

Judgment:

27 February 2019

JUDGMENT OF OSBORNE J

on Property Law Act applications

PEEGEECEE LIMITED, v PARKVIEW ON HAGLEY LIMITED [2019] NZHC 258 [27 February 2019]

Introduction

[1] There is a building where Riccarton Road meets Hagley Park in Christchurch. It is known as Parkview on Hagley. It contains units owned by the various applicants (and others) under the Unit Titles Act 2010. The owners, under a deed of lease entered into in 2007, lease their units to the respondent, Parkview on Hagley Ltd (Parkview), a company incorporated for the purpose of managing the units as hotel units.

[2] On 23 August 2018, the applicants (being most of the unit owners) issued a notice under s 246 Property Law Act 2007 (the PLA notice), giving notice of their intention to cancel the lease upon the expiry of 10 working days should identified (alleged) breaches not be remedied by Parkview.

[3] Parkview has remained in possession of the applicants’ units since the PLA notice was issued.

[4] In this proceeding, the applicants seek an order requiring Parkview to relinquish possession of their units. Parkview opposes the application. It makes a cross-application (should the Court find there to have been breaches justifying cancellation) for relief against cancellation under ss 253 and 256 Property Law Act. The applicants oppose the cross-application.

Outcome

[5] In this judgment, the Court determines that Parkview has committed breaches of the lease which justified cancellation. In particular, Parkview breached obligations to provide to the applicants audited accounts pursuant to cl 16.2 of the lease and to make available for inspection by the applicants, proper books of account and recordings relating to transactions conducted in the course of the hotel business pursuant to cls 16.3 to 16.4 of the lease.

[6] The Court determines that other breaches alleged by the applicants were either not breaches or did not justify cancellation of the lease.

[7] The Court then determines that it is appropriate to grant Parkview relief against cancellation on terms.

[8] Finally, the Court determines that there are costs and disbursements payable by Parkview to the applicants in relation to the proceeding.

Background

[9] Ultimately, the rights of the parties are to be determined pursuant to the terms of the lease as a matter of contract law, informed by the provisions of the Property Law Act.

[10] That said, there are…

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.

Keep reading for free

Create a free CaseChat account to read Peegeecee Ltd v Parkview on Hagley Ltd and more:

Read every judgment in full
Ask AI and get answers linked to paragraphs
See how each paragraph was cited in later cases
Download judgments as PDF or Word

Continue with Google

One click creates your free account or signs you in.

By continuing you agree to the Terms and Privacy Policy.

Details

Case: [2019] NZHC 258
Decision Date: 27 February 2019

CaseChat Overview and Summary

The applicants sought an order for possession of the leased units. The respondent opposed the application and made a cross-application for relief against cancellation of the lease. The applicants argued that the respondent breached the lease by failing to provide audited accounts, by failing to make available records for inspection, by not operating the hotel business in a profitable manner, and by not maintaining a fixtures, fittings and equipment reserve. The respondent argued that it had not breached the lease. The Court found that the respondent breached the lease by failing to provide audited accounts and by failing to make available records for inspection. The Court found that the respondent did not breach the lease by failing to operate the hotel business in a profitable manner or by failing to maintain a fixtures, fittings and equipment reserve. The Court found that the breaches were not serious enough to justify forfeiture of the lease and granted the respondent relief against cancellation on conditions. The Court ordered that the respondent must provide audited accounts, make available records for inspection, and make good any shortfall of payment identified through the auditing of financial statements. The Court reserved costs.

Orders