Raine & Horne New Zealand Pty Limited v Normans Road Real Estate Limited

[2025] NZHC 3254

IN THE HIGH COURT OF NEW ZEALAND CHRISTCHURCH REGISTRY

I TE KŌTI MATUA O AOTEAROA ŌTAUTAHI ROHE

CIV-2024-409-326 [2025] NZHC 3254

BETWEENRAINE & HORNE NEW ZEALAND PTY LIMITED

Plaintiff

ANDNORMANS ROAD REAL ESTATE LIMITED

First Defendant

KRISTINA JANICE BRIGGS
Second Defendant

TINA & CO REAL ESTATE LIMITED
Third Defendant

MATTHEW SALTHOUSE

Fourth Defendant

Hearing:                   22 October 2025

Appearances:           S A Grant and A M Elcoat for Plaintiff

C Mo for Defendants

Judgment:                30 October 2025

JUDGMENT OF ASSOCIATE JUDGE PAULSEN

This judgment was delivered by me on 30 October 2025 at 2.30 pm pursuant to Rule 11.5 of the High Court Rules.

Registrar/Deputy Registrar Date:

RAINE & HORNE NEW ZEALAND PTY LIMITED v NORMANS ROAD REAL ESTATE LIMITED [2025] NZHC 3254 [30 October 2025]

[1]                 Raine & Horne New Zealand Pty Ltd (Raine) took an assignment of franchise agreements between Mike Pero Real Estate Ltd (Mike Pero) and 73 business owners trading throughout New Zealand under the Mike Pero brand, including Normans Road Real Estate Ltd (Normans Road).

[2]                 Normans Road resisted Raine’s demand that it adopt the Raine brand (in substitution for the Mike Pero brand) and purported to cancel its franchise agreement. Its director (Ms Briggs) has continued in business as a real estate agent, operating through the third defendant.

[3]                 Raine commenced this proceeding alleging breach of contract by Normans Road and Ms Briggs as covenantor under the franchise agreement, as well as additional claims against the third and fourth defendants.

[4]                 Broadly, the principal issues that arise in the substantive proceeding are whether:

(a)Mike Pero could assign the franchise agreement;

(b)Raine was entitled to require Normans Road to rebrand under cl 23.9 of the franchise agreement, which gave the franchisor power to make changes to or substitute intellectual property for use in the business;

(c)Normans Road validly cancelled the franchise agreement; and

(d)If not, what is Raine’s loss.

[5]                 Raine initially sought injunctions against the defendants. The applications were  opposed  and  were  successful  only  in  part.  In  her  reserved  decision  of  19 September 2024, Dunningham J sets out in some detail the background to the claim, the issues arising and an analysis of the relevant law.1

1      Raine & Horne New Zealand Pty Ltd v Normans Road Real Estate Ltd [2024] NZHC 2706.

This application

[6]                 The application before me concerns discovery of documents. The discovery process has misfired, and some further background is required.

[7]                 The parties filed separate memoranda for a first case management conference. They indicated they considered tailored discovery was appropriate. However, there was no agreement as to the categories of documents the plaintiff would disclose and nor does it appear counsel had given consideration to the methods and strategies for locating documents or the application of the listing and exchange protocols.2

[8]                 Counsel expected a first case management conference would be convened with a Judge, with an opportunity provided to discuss the terms of a tailored discovery order. However, Associate Judge Lester made directions on the papers. As far as discovery of documents is concerned, the Associate Judge noted that counsel appeared to agree on tailored discovery but did not make any formal directions in respect to it. It appears counsel were aware the Associate Judge misunderstood the situation, but this was not immediately drawn to the Court’s attention.

[9]                 On 18 August 2025, Raine filed an  affidavit  of  documents  sworn  by  Keryn Thompson, a manager of the plaintiff. She purported to make the affidavit pursuant to a discovery order made by Associate Judge Lester on 19 June 2025, but then noted that the Associate Judge had not understood that the defendants’ discovery requests were disputed.

[10]            Raine’s affidavit of documents did not disclose documents in the categories that it considered disputed, and pt 1 of the schedule to the affidavit lists just two open documents. In explanation for this, Ms Grant advises that she understood it was agreed between counsel that documents previously disclosed (in initial disclosure or put in evidence in relation  to the injunction application) did not need to be listed.  Ms Mo denies there was any such agreement.

2      High Court Rules 2016, sch 9.

[11]            What is more, Raine’s affidavit does not comply with the High Court Rules 2016. It does not adequately describe what steps were taken to locate documents, nor does it comply with the listing and exchange protocols. There are two entries under pts 2 and 3 of the affidavit, described simply as “various”, for which blanket claims are made of privilege and confidentiality. The grounds upon which privilege is claimed are not stated,3 nor are any restrictions proposed to protect the claimed confidentiality.4 There is therefore no way that the defendants can assess or challenge the claims to privilege or confidentiality.

[12]            Unsurprisingly, the defendants did not consider that Raine’s discovery was adequate. On 18 August 2025, the defendants’ counsel filed a memorandum requesting a telephone conference. The defendants had not filed their own affidavit of documents, and said it was unfair that they be expected to do so when Raine had not made genuine attempts to reach agreement with them as to the terms of the tailored discovery order and had disclosed only two documents.

[13]            Raine’s counsel filed a memorandum on 25 August 2025 rejecting the criticisms of its discovery but noting that the parties were both faced with a situation they did not expect, which is that directions were made without a first case management conference taking place

[14]            I issued a minute on 27 August 2025, which required counsel to confer and if they could not resolve their differences by 4 September 2025 they were to seek a telephone conference. Counsel did not reach agreement, and a telephone conference was held before Associate Judge Lester on 2 October 2025 who directed that the defendants file an application for particular discovery which was to be set down to be heard before me on 22 October 2025.

[15]            The defendants filed their application for particular discovery, seeking discovery in the categories attached to their original memorandum for first case management conference. The plaintiff opposes that application.

3      High Court Rules, sch 9, pt 1, r 8.16(3).

4      High Court Rules, sch 9, pt 1, r 8.15(2)(f).

[16]            The plaintiff’s opposition has been supported by affidavits, including from the plaintiff’s solicitor on the record, Mr Germann, to which the defendants object. Despite counsel’s submissions to the contrary, Mr Germann’s affidavit is contentious and as the solicitor on the record for Raine he should not have made an affidavit in the proceeding.5 Given the approach I intend to take with this application I do not need to refer to this further.

My assessment

[17]            In my assessment, the position is that no discovery order has been made in the proceeding as it appears Associate Judge Lester considered no order was necessary when the parties had agreed matters between themselves. Even if that is not the case and Associate Judge Lester had intended to make a discovery order, he did so under a misunderstanding and the order should be varied. At the present time no party has provided adequate discovery in accordance with the High Court Rules and it is appropriate to consider the matter afresh.

[18]            I advised counsel at the beginning of the hearing that I was considering making an order for standard discovery. Ms Mo advised that would be acceptable to the defendants but suggested it would be helpful for some guidance to be given as to Raine’s obligation to disclose documents in the disputed categories.

[19]            For Raine, Ms Grant accepted that it would be required to provide further discovery but submitted it would be better if I ruled on the disputed categories and made a tailored discovery order. She stated that if a standard discovery order was made there may be disputes about compliance, resulting in further applications to the Court.

[20]            There is some force in Ms Grant’s submission, but on reflection I do not intend to deal with the matter in the way she proposed and will make a standard discovery order for several reasons.

5      Lawyers and Conveyancers Act (Lawyers: Conduct and Client Care) Rules 2008, r 13.5.

[21]            First, I do not accept counsel’s view that this is a case that necessarily lends itself to tailored discovery. It is a proceeding of only average factual and legal complexity in the High Court and the cost of the parties providing standard discovery would not be disproportionate to the amounts and importance of the issues at stake.

[22]            Second, the fact that the Court makes a tailored discovery order does not insulate the parties from further disputes in relation to the adequacy of the discovery provided. It is very apparent to me that these parties have not cooperated in the manner that the High Court Rules require of them and such disputes may well occur.6

[23]            Third, when parties are proposing tailored discovery they must endeavour to reach agreement as to the terms of the discovery order to be made, not just in respect to the categories of documents but also as to the methods and strategies for locating documents.7 Here, that has not occurred and I am not in a position to make such directions on what is before me. As a result, any tailored discovery order I make would require the parties to either reach agreement about such matters or return to the Court for a ruling. I have no expectation that they will reach agreement. The making of a tailored discovery order would therefore only lead to further delays in circumstances where that may put the trial dates in jeopardy. I will, however, make some general comments about matters that were subject to argument in the hope they provide guidance.

[24]            The plaintiff objected to providing discovery of documents in the defendants’ categories 1 and 2 on grounds which included that the documents were not relevant to the interpretation of the franchise agreement and/or that they are highly confidential and commercially sensitive. While I accept that in some respects the defendants’ proposed categories are expressed too broadly, I also consider Raine’s approach misunderstands the concept of relevance in this context.

[25]            The relevance of documents is at the heart of discovery and is broader than the test for admissibility under the Evidence Act 2006, which is what Raine’s submissions

6      High Court Rules, r 8.2.

7      High Court Rules, sch 9, pt 1, r 3.

seem directed to. Documents will be relevant if they are directly connected, related or pertinent to any matter at hand.8

[26]            In my view, the contractual documents relating to the purchase of the business and assignment of the franchise agreements are clearly relevant, as are documents concerning or related to Raine’s intention to rebrand, and communications that Raine may have had with Mike Pero, Liberty Group and other franchisees (both before and after acquiring the business) in respect to those intentions. The fact Raine considers documents to be highly confidential, commercially sensitive and/or privileged is not a reason for failing to disclose them.

[27]            The defendants are entitled to any documents that concern or are connected to any losses that Raine claims to have suffered, howsoever described. Ms Grant made submissions that suggested some of the heads of damage may not be relied upon at trial. She also said the only amounts claimed relate directly to the loss of the Normans Road franchise. If that is the case, Raine should make that clear in its pleadings. It may then be difficult to see how the defendants’ demand for discovery in relation to commissions earned by other franchisees, or the value of franchise territories throughout New Zealand, or the terms of franchise agreements subsequently entered into by Raine with other franchisees could be justified.

Result

[28]            I direct that the parties are each to provide standard discovery by filing affidavits of documents complying with rr 8. 15 and 8.16 of the High Court Rules by

3.30 pm on 5 December 2025.

[29]The parties shall provide inspection of documents in accordance with r 8.27 by

3.30 pm on 12 December 2025.

[30]            In relation to costs, my preliminary view is that there should either be no order as to costs or that they should be reserved. If any party wishes to be heard in relation to that, they may do so by memorandum filed within 14 days of the date of this

8      Attorney-General v Institution of Professional Engineers New Zealand Ltd Inc [2018] NZHC 74, [2018] NZAR 275 at [28].

judgment with seven days for any reply. If no application is made, costs shall be reserved.

O G Paulsen Associate Judge

Solicitors:

Stewart Germann Law Office, Auckland Saunders & Co, Christchurch