Sunnyside 2019 Limited v Li - [2025] NZHC 214

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

I TE KŌTI MATUA O AOTEAROA TĀMAKI MAKAURAU ROHE

CIV-2024-404-1776 [2025] NZHC 214

BETWEEN
SUNNYSIDE 2019 LIMITED

Plaintiff

AND

SHENG LI

Defendant

Hearing: 13 February 2025

Counsel:

S Tee for the Plaintiff

J Phillips for the Defendant

Date of Judgment:

19 February 2025

JUDGMENT OF ASSOCIATE JUDGE BRITTAIN

This judgment was delivered by me on 19 February 2025 at 2 pm.
Pursuant to Rule 11.5 of the High Court Rules.

…………………..
Registrar/Deputy Registrar

Solicitors:
Morton Tee Limited, Auckland Tompkins Wake, Auckland

SUNNYSIDE 2019 LTD v LI [2025] NZHC 214 [19 February 2025]

Introduction

[1] The plaintiff, Sunnyside 2019 Ltd (Sunnyside), subdivided a rural property in Coatesville into four lots. By a contract dated 12 July 2022 (the contract), Sunnyside sold one of the proposed lots to the defendant, Sheng Li (Mr Li), before titles had issued.

[2] The lot was described in the contract as lot 4 with reference to a provisional plan of subdivision attached to the contract and by reference to its area (the property). There has never been any misunderstanding between Sunnyside and Mr Li regarding the land that was the subject matter of the contract.

[3] When the subdivision plan was deposited with Land Information New Zealand, and titles issued, the property was designated as lot 3 on the deposited plan. The surveyors had altered the numbering of the lots. The property (now lot 3) otherwise remained the same.

[4] The neighbouring property in the subdivision was lot 3 on the provisional plan attached to the contract. That neighbouring property was designated as lot 4 on the deposited plan.

[5] In the lead-up to the settlement date, Sunnyside’s solicitors mistakenly assumed that the record of title for the neighbouring property, lot 4 on the deposited plan, was the relevant title for the property. It was not. The relevant record of title for the property was for lot 3 on the deposited plan.

[6] Sunnyside’s solicitors issued a settlement statement which referred to “Lot 4”. That was a correct reference to the description of the property in the contract, but an incorrect reference to the lot on the deposited plan.

[7] Mr Li did not settle. Sunnyside’s solicitors issued a settlement notice which incorrectly referred to the record of title for the neighbouring property, lot 4, on the deposited plan. Mr Li did not respond to the settlement notice. Sunnyside cancelled the contract and re-sold the property.

[8] In these proceedings, Sunnyside seeks summary judgment for the loss on the re-sale and related losses. Mr Li applies for summary judgment for the return of his deposit, claiming that it was futile for him to tender the settlement sum and Sunnyside repudiated the contract.

[9] The dispute between the parties arises from the mistake by Sunnyside’s solicitors in identifying the relevant record of title for the property. This raises two issues:

(a)Was Sunnyside ready, willing and able to settle the contract on the settlement date and when Sunnyside purported…

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.

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Details

Case: [2025] NZHC 214
Decision Date: 19 February 2025

CaseChat Overview and Summary

Sunnyside 2019 Ltd, the plaintiff, initiated proceedings against Sheng Li, the defendant, after a failed land sale. Sunnyside sold a rural property in Coatesville to Mr Li before titles were issued. The property was identified as lot 4 on a provisional plan attached to the contract. However, when titles were issued, the property was designated as lot 3. This discrepancy led to confusion during the settlement process, culminating in Mr Li's refusal to settle. The court was tasked with determining whether Sunnyside was ready, willing, and able to settle and whether Mr Li had valid grounds to object to the title. Sunnyside sought summary judgment for losses incurred from the re-sale of the property and related costs. Mr Li, on the other hand, applied for summary judgment to recover his deposit, arguing that tendering the settlement sum would have been futile due to the title error and that Sunnyside repudiated the contract.

The court examined whether Sunnyside was ready, willing, and able to settle on the designated settlement date and when the contract was cancelled. Despite the mistake in the settlement statement and notice, the court found that Sunnyside was prepared to convey the correct property and that the settlement notice was valid. The court concluded that Mr Li's refusal to settle was based on financial constraints rather than any issue with the property description. Additionally, the court found that Mr Li did not make a valid objection to the title as he failed to notify Sunnyside of any objections within the stipulated timeframe. As a result, Sunnyside was entitled to forfeit the deposit and recover losses from the re-sale. The court granted Sunnyside's application for summary judgment and declined Mr Li's application. Judgment was entered in favour of Sunnyside for the sum of $452,247 plus interest from 24 April 2024 until payment in full.

Orders