R v Hessell - [2010] NZCA 450

JUDGMENT REISSUED PURSUANT TO RECALL JUDGMENT DELIVERED ON 15 FEBRUARY 2011

IN THE COURT OF APPEAL OF NEW ZEALAND

CA239/2009
CA807/2009
[2010] NZCA 450

BETWEEN CONCRETE STRUCTURES (NZ) LIMITED
Appellant

AND NZ WINDFARMS LIMITED
Respondent

Hearing: 21 June 2010

Court: William Young P, Heath and Allan JJ

Counsel: D J Goddard QC and W Lawson for Appellant
R G Smedley and L M Taylor for Respondent

Judgment: 4 October 2010

Reissued

Judgment: 15 February 2011

JUDGMENT OF THE COURT

AThe appeal in the relation to the Rotorua proceedings is dismissed as moot but the appellant is nonetheless entitled to costs in this Court for a standard appeal on a band B basis together with usual disbursements.
BThe appeal in relation to the Christchurch proceedings is dismissed for want of jurisdiction but on the application for review, the decision of Associate Judge Osborne is set aside. The award of costs made in the High Court is reversed and the appellant is awarded costs in this Court for a standard appeal on a band B basis together with the usual disbursements.
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REASONS OF THE COURT

(Given by William Young P)

Introduction

These two appeals arise from a single dispute between the respondent, NZ Windfarms Ltd and the appellant, Concrete Structures (NZ) Ltd. They were parties to a contract under which Concrete Structures was to construct, for NZ Windfarms, wind turbines on sites in the Manawatu. This agreement was in the standard form NZS 3910:2003. Engineering services associated with the construction project were provided by Connell Wagner, and Mr Murray Fletcher of that firm was the engineer to the contract.
At the completion of the construction, Mr Fletcher issued a final payment schedule which recorded that Concrete Structures was required to pay to NZ Windfarms $109,522.78. The effect was to require Concrete Structures to repay money to NZ Windfarms which it had already received. Concrete Structures challenged this schedule. On 25 January 2008 it purported to refer the dispute to arbitration. This purported reference was premature under the contractual dispute resolution process. That process resumed but did not result in a settlement. Concrete Structures then, on 15 February 2008, invited Mr Fletcher to issue a formal decision under cl 13.2.4 of the contract. This the engineer did on 6 March 2008. This decision was, in terms of the contract, final unless arbitration proceedings were initiated by Concrete Structures.
Under cl 13.4 of the contract, a party wishing to initiate arbitration is required to give notice to that effect and such notice is required to be:
… in writing and should be given by the Principal or the Contractor to the other of them ... .

In this case, the time limit was one month. So Mr Fletcher’s decision would become final unless an appropriate notice was given by 6 April 2008.

As to service, cl 15.1.2 provides:
Any document which is to be served upon the Principal, the Contractor or the Engineer under the contract shall be sufficiently served if it is…

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.

Continue reading R v Hessell

Details

AGLC: R v Hessell [2010] NZCA 450
Case: [2010] NZCA 450
Decision Date: 4 October 2010

CaseChat Overview and Summary

In the Court of Appeal of New Zealand, Concrete Structures (NZ) Ltd appealed against decisions made in the High Court in relation to a contractual dispute with NZ Windfarms Ltd. The primary issue was whether a letter sent by Concrete Structures to the engineer was an effective notice to refer the dispute to arbitration. The Court of Appeal found that the letter was equivocal but reasonably interpretable as a notice requiring arbitration. The Court of Appeal also examined whether the letter was received by NZ Windfarms and whether it constituted notice to them, concluding that it was arguable that it did, provided it was received. The appeal concerning the Rotorua proceedings was dismissed as moot, but the appellant was awarded costs. The appeal regarding the Christchurch proceedings was dismissed for lack of jurisdiction, but the decision of the Associate Judge was set aside on review, and the appellant was awarded costs.

The Court of Appeal addressed the interpretation of the letter sent by Concrete Structures to the engineer. The Court found the letter to be equivocal but held that a reasonable recipient would interpret it as a notice requiring arbitration, considering the contractual context and the urgency to respond before the engineer's decision became final. The Court also determined that the Associate Judge should have considered it arguable that the letter was forwarded to NZ Windfarms, and thus it constituted notice to them if received. The Court concluded that the case could be resolved on the basis of the existing evidence without needing to admit further evidence regarding the forwarding of the letter. The Court of Appeal then examined the implications of these findings for the Rotorua and Christchurch proceedings, ultimately dismissing the appeals as moot or for lack of jurisdiction but awarding costs to the appellant.

Orders