Routhan v PGG Wrightson Real Estate Ltd

IN THE HIGH COURT OF NEW ZEALAND CHRISTCHURCH REGISTRY

I TE KŌTI MATUA O AOTEAROA ŌTAUTAHI ROHE

CIV-2018-409-000077

[2021] NZHC 3585

BETWEEN

PHILIP WILLIAM ROUTHAN AND JULIE VERONICA ROUTHAN AS TRUSTEES OF THE KANIERE FAMILY TRUST

Plaintiffs

AND

PGG WRIGHTSON REAL ESTATE LIMITED

Defendant

Hearing:	3 - 13 August and 1 September 2021
Appearances:	D R Kalderimis and O T H Neas for Plaintiffs M E Parker and J Eckford for Defendant
Judgment:	21 December 2021

JUDGMENT OF DUNNINGHAM J

This judgment was delivered by me on 21 December 2021 at 3 pm, pursuant to r 11.5 of the High Court Rules

Registrar/Deputy Registrar Date:

ROUTHAN v PGG WRIGHTSON REAL ESTATE LIMITED [2021] NZHC 3585 [21 December 2021]

Contents

Introduction.......................................................................................................... [1]

The pleadings....................................................................................................... [5]

Factual background............................................................................................. [9]

Limitation defences........................................................................................... [62]

The defendant’s submissions  [63]

The plaintiffs’ submissions  [66]

Discussion  [68]

The claims in negligence.................................................................................... [78]

Did PGG owe a duty of care to the Trust?...................................................... [80]

The plaintiffs’ submissions  [80]

The defendant’s submissions  [87]

Discussion  [101]

Does the disclaimer negate a duty?................................................................ [111]

The defendant’s submissions  [111]

The plaintiffs’ submissions  [113]

Discussion  [115]

Was the duty breached?.................................................................................. [116]

The claim in deceit........................................................................................... [118]

The plaintiffs’ submissions  [118]

The defendant’s submissions  [124]

Discussion  [128]

The Fair Trading Act claim............................................................................. [131]

The plaintiffs’ submissions  [131]

The defendant’s submissions  [135]

Discussion  [139]

Causation and loss........................................................................................... [142]

The plaintiffs’ submissions  [142]

The defendant’s submissions  [153]

Discussion  [170]

Contributory negligence.................................................................................. [198]

The defendant’s submission  [198]

The plaintiffs’ submissions  [204]

Discussion  [219]

Result................................................................................................................ [230]

Interest.............................................................................................................. [231]

Costs.................................................................................................................. [232]

Introduction

[1]    In 2010 Philip and Julie Routhan were looking to buy a dairy farm in the Kokatahi/Kowhitirangi Valley on the West Coast. In due course, and after an offer to purchase another property was rejected, they decided to buy a farm owned by Cooks Stud Farms Ltd through their family trust, The Kaniere Family Trust (the Trust). While the farm’s infrastructure was run down, it was close to the 73 hectare run-off block the Trust already owned, and was said to produce an impressive 103,000 kg of milk solids (kgMS) per season from 260 cows off the 105 hectares.  Indeed, both   Mr Routhan, and Mr Cook, the vendor, referred to the farm as having “rockstar” qualities.

[2]    However, the Routhans say those production figures were not correct. The average was in fact around 98,000 kgMS per season, and was sharply declining. When the purchase settled in December 2010, the farm was on track to  produce  just 85,000 kgMS for the 2010/2011 season.

[3]    In their first few years of farming the Routhans struggled to see why they were not producing milk solids at the level which was represented to them by the real estate agency, PGG Wrightson Real Estate Ltd (PGG). They spent money re-seeding the property to get better pasture, they brought in supplementary feed, and, in due course, they cancelled the lease of cows from the vendor thinking the quality of that herd was the reason 103,000 kgMS remained unattainable. However, they could not sustain…