Strack v Grey - [2018] NZHC 1651

IN THE HIGH COURT OF NEW ZEALAND DUNEDIN REGISTRY

I TE KŌTI MATUA O AOTEAROA ŌTEPOTI ROHE

CIV-2015-012-162

[2018] NZHC 1651

UNDER the Contractual Remedies act 1979

IN THE MATTER

of an agreement for sale and purchase of real estate dated 24 February 2014 between Matthew Francis Strack, Tracey Leigh Strack and WMC Trustee Limited as vendors and David Harvey Grey as purchaser

BETWEEN

MATTHEW FRANCIS STRACK, TRACEY LEIGH STRACK AND WMC TRUSTEE LIMITED

Plaintiffs

AND

DAVID HARVEY GREY

Defendant

Hearing: (On the Papers)

Counsel:

D R Tobin and R M Reeve for Plaintiffs L A Andersen and R Reeve for Defendant

Judgment:

5 July 2018

JUDGMENT OF NICHOLAS DAVIDSON J (COSTS)

[1]Judgment was delivered on 31 May 2018.1 The disposition reads:

[132] The defendant is liable to the plaintiffs in breach of contract. No loss is proven. Judgment is entered for the plaintiffs for nominal damages of
$100.00.

1 Strack v Grey [2018] NZHC 1254.

STRACK & ORS v GREY [2018] NZHC [5 July 2018]

[133] Costs are reserved for memoranda to be filed within two weeks of delivery of this judgment.

[2] Both the plaintiffs and the defendant seek costs, and counsel agree that they should be categorised and banded according to Scale 2B.

The plaintiffs’ costs submission

[3] Mr Tobin for the plaintiffs correctly submit that the primary legal issue at trial was whether Mr Grey validly cancelled the Agreement for Sale and Purchase (“the agreement”), and says that judgment vindicated the plaintiffs’ contention that Mr Grey was in repudiatory breach when he purported to do so.

[4] Mr Tobin referred to the joint memorandum of experts and their agreement that Mr Vaughan Linwood’s letter to Mr Grey did not constitute a “full building report”. However, that much was obvious and the real question was whether it was a report as contemplated by the agreement. The judgment held it was not.

[5] The plaintiffs say Mr Grey took the position that it was for them to prove that he would have obtained finance and the agreement would have become unconditional. The alleged advice from Mr Grey’s bank manager, that it would have been unlikely that finance would have been approved, came “late in the piece”, not until some months after the initial disclosure and subsequent discovery.

[6] Mr Tobin submits that Mr Grey should not be entitled to benefit by a costs award given erroneous positions taken by him on critical issues determined at trial. He says that Mr Grey was given the chance to withdraw his purported cancellation of 26 February 2014 and obtain a building report of the kind the agreement contemplated, which may have lead him to continue with the contract, or to cancel on proper grounds. His lawyer, Ms Cummings, advised Mr Grey to do this, to obtain “an actual building report” which would have resolved the issue, but the judgment held that Mr Grey jumped the gun when he did not take that advice.

[7] Although the plaintiffs succeeded…

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 Strack v Grey

Details

AGLC: Strack v Grey [2018] NZHC 1651
Case: [2018] NZHC 1651
Decision Date: 5 July 2018

CaseChat Overview and Summary

In Strack v Grey, the High Court of New Zealand Dunedin Registry addressed a dispute concerning an agreement for the sale and purchase of real estate. The plaintiffs, Matthew Francis Strack, Tracey Leigh Strack, and WMC Trustee Limited, sued the defendant, David Harvey Grey, for breach of contract. The primary legal issue was whether Mr Grey validly cancelled the agreement. The plaintiffs argued that Mr Grey was in repudiatory breach when he purported to cancel the agreement, while Mr Grey contended that the cancellation was valid and that no loss was proven.

The court held that Mr Grey's purported cancellation was not valid, as the building report he relied on did not meet the agreement's requirements. The court also found that the likelihood of Mr Grey obtaining finance for the purchase was negligible, meaning the plaintiffs did not suffer any loss. Therefore, the court awarded the plaintiffs nominal damages of $100. The central debate in the case revolved around the allocation of costs, with both parties seeking costs under Scale 2B. The plaintiffs argued that Mr Grey should bear the costs due to his intransigence and erroneous positions, while Mr Grey claimed success due to the failure of the plaintiffs' damages claim and a Calderbank offer he made.

The court exercised its discretion to determine the costs allocation. It found that the plaintiffs were successful in establishing the breach of contract, but Mr Grey was successful in proving that no actual loss occurred. The court decided that the costs should lie where they fell, reflecting the mixed outcomes for both parties. Thus, neither party was awarded costs.

Orders