Scott v Ellison - [2011] NZCA 302

IN THE COURT OF APPEAL OF NEW ZEALAND

CA660/2010
[2011] NZCA 302

BETWEEN RAEWYN MARIE SCOTT
Appellant

AND LINDY JANE ELLISON
Respondent

Hearing: 17 May 2011

Court: Ellen France, Gendall and Allan JJ

Counsel: G Brittain for Appellant
J S McHerron and G F Kelly for Respondent

Judgment: 4 July 2011 at 2.30 pm

JUDGMENT OF THE COURT

A The appeal against the refusal to grant summary judgment is dismissed.

BThe appellant must pay the respondent costs for a standard appeal on a band A basis and usual disbursements.

REASONS OF THE COURT
(Given by Ellen France J)

Introduction

In early 1988 Raewyn Scott, the appellant, and her then partner, Allan Irvine, purchased a residential property at 2 Maruia Place, Tauranga. They carried out building work on the property. The two converted a single storey house on poles, which had been relocated to the property, into a two storey home by enclosing and developing the ground floor area. This work was undertaken in the late 1980s/early 1990s. It appears that the requisite building permit for the building work was not obtained and neither was a code compliance certificate issued.
In August 1997, ownership of 2 Maruia Place was transferred by Ms Scott and Mr Irvine to Ms Scott as the sole owner. Ms Scott subsequently formed a trust. The trustees of this trust were Ms Scott and JSB Trustees Ltd. JSB Trustees is a professional trustee company operated by Ms Scott’s solicitor. On 29 March 2001 the property was transferred from Ms Scott to the two trustees.
Lindy Ellison, the respondent, agreed to buy the property in July 2004, with settlement occurring in mid-September 2004. Ms Ellison subsequently discovered defects in the construction of the lower storey and the absence of a permit for the work. Ms Ellison issued proceedings against Ms Scott to recover the cost of repairs, estimated at $170,604.32.
Ms Scott obtained summary judgment in the District Court but, on appeal, summary judgment was set aside.[1] Ms Scott now appeals from the refusal to grant summary judgment. The appeal turns on the meaning of the vendor’s warranty in the agreement for sale and purchase that works done by the vendor were permitted and code compliant.

The agreement for sale and purchase

[1]Ellison v Scott [2010] DCR 404; and Ellison v Scott HC Tauranga CIV-2009-470-1153, 19 August 2010.

The agreement for sale and purchase dated 26 July 2004 was in a standard form agreement.[2] The vendor was described as “RM Scott Family Trust (Raewyn Marie Scott & JSB Trustees Ltd as Trustees)”. The purchaser was Lindy Jane Ellison and/or nominee. Ms Scott and Ms Ellison signed the agreement as vendor and purchaser respectively. The purchase price was $441,000.
[2]REINZ/ADLS standard form agreement for sale and purchase of real estate (7^th ed (2), July 1999).
We need to refer to two of the general terms in the agreement. The first of these, cl 1.3(1) provides:
If there is more than one purchaser or vendor, the liability of…

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 Scott v Ellison

Details

AGLC: Scott v Ellison [2011] NZCA 302
Case: [2011] NZCA 302
Decision Date: 4 July 2011

CaseChat Overview and Summary

Raewyn Marie Scott (the appellant) appeals against the refusal of the High Court to grant summary judgment in her favour in proceedings brought by Lindy Jane Ellison (the respondent) to recover the cost of repairs to a residential property at 2 Maruia Place, Tauranga. Ms Ellison purchased the property from Ms Scott in September 2004. The appeal turns on the meaning of the vendor's warranty in the agreement for sale and purchase that works done by the vendor were permitted and code compliant. The Court of Appeal, in dismissing the appeal, held that the warranty applied to work done or permitted by either of the vendors, Ms Scott and JSB Trustees Ltd. Ms Scott, who permitted the works to be done, has remained a legal owner throughout and therefore cannot escape liability under the warranty. The Court also held that JSB Trustees Limited, as a trustee, is potentially liable for work for which it is not responsible, but that the proper response is for the trustees to limit their liability, rather than to read down the clause.

The Court of Appeal orders that the appeal against the refusal of summary judgment is dismissed. The respondent, having succeeded, is entitled to costs for a standard appeal on a band A basis and usual disbursements.

Orders