Pounamu Properties Ltd v Brons

[2012] NZHC 590

IN THE HIGH COURT OF NEW ZEALAND TAURANGA REGISTRY

CIV-2008-470-000617 [2012] NZHC 590

BETWEEN  POUNAMU PROPERTIES LIMITED Plaintiff

ANDMARCUS LEIGH BRONS First Defendant

ANDGEORGINGA JANE CRAWFORD Second Defendant

Hearing:         2, 5-6, 9-10 and 12 August 2010 (Rotorua) and

23-27 and 30 May, 2-3 and 8-9 June 2011 (Auckland) (Heard at Rotorua and Auckland)

Counsel:         N W Ingram QC and J L Clark for the Plaintiff

M J Sharp and E H Wiessing for the Defendants

Judgment:      30 March 2012

JUDGMENT OF DUFFY J

This judgment was delivered by Justice Duffy on 30 March 2012 at 11.30 am, pursuant to

r 11.5 of the High Court Rules

Registrar/Deputy Registrar
Date:

Counsel:     N W Ingram QC P O Box 6569 Wellesley Street Auckland 1141 for the Plaintiff

Solicitors:   Edwards  Clark  Dickie  P  O  Box  105629  (DX  CP24032)  Auckland  City

Auckland 1143 for the Plaintiff

Holland  Beckett  Private  Bag  12011  Tauranga  Mail  Centre  (DX  HP40014) Tauranga 3143 for the Defendants

POUNAMU PROPERTIES LTD v BRONS and ANOR HC TAU CIV-2008-470-000617 [30 March 2012]

[1]      The plaintiff, Pounamu, brings claims in equity and under the common law against the first defendant, Mr Brons, as well as a claim in equity against the second defendant, Ms Crawford.

[2]      The equitable claims against Mr Brons raise the following issues:

(i)Whether  the  relationship  between  Pounamu  and  Mr  Brons gave rise to fiduciary obligations that Mr Brons owed to Pounamu, either as a manager or a de facto director of Pounamu;

(ii)      The nature and scope of any such obligations;

(iii)     Whether in his dealings with Pounamu’s property, Mr Brons

breached those obligations; and

(iv)If  he  has,  the  nature  of  the  relief  that  should  be  awarded against Mr Brons.

[3]      Pounamu’s claim against Ms Crawford alleges that she knowingly received property from Pounamu that was transferred to her by Mr Brons in breach of his fiduciary obligations to Pounamu.   The success of this claim hinges, in part, on Pounamu being able to prove its claim against Mr Brons and on Pounamu being able to  prove that  Ms  Crawford  had  the  necessary degree of knowledge that  equity requires to found this claim.

[4]      Pounamu’s common law claims against Mr Brons are based in tort and allege that in his dealings with Pounamu’s property and otherwise managing its business affairs in regard to payment of tax, he acted negligently.

[5]      Mr  Brons  contends  that  his  relationship  with   Pounamu  is   governed exclusively by the law of contract and tort, so that there is no room for the intervention of equity.  If he is correct, the main plank of Pounamu’s equitable claims against Mr Brons and Ms Crawford will fail.  Regarding the common law, Mr Brons

also relies on the Limitation Act 1950 and argues that the alleged conduct giving rise to these claims occurred outside the six year time limit in s 4.

[6]      Ms Crawford contends that she purchased property off Pounamu for value and without notice of any breach of fiduciary duty on the part of Mr…