Swanson v Laundry Today or Naked Tomorrow Holding Co Limited

[2021] NZHC 2864

IN THE HIGH COURT OF NEW ZEALAND CHRISTCHURCH REGISTRY

I TE KŌTI MATUA O AOTEAROA ŌTAUTAHI ROHE

CIV-2021-409-278

[2021] NZHC 2864

BETWEEN

MURRAY ALEXANDER SWANSON

Plaintiff

AND

LAUNDRY TODAY OR NAKED TOMORROW HOLDING CO LIMITED

Defendant

Hearing:	14 October 2021
Appearances:	D J Anderson for Plaintiff J Moss for Defendant
Judgment:	27 October 2021

JUDGMENT OF ASSOCIATE JUDGE LESTER

SWANSON v LAUNDRY TODAY OR NAKED TOMORROW HOLDING CO LIMITED [2021] NZHC 2864

[27 October 2021]

[1]    The plaintiff, Mr Swanson, applies for summary judgment for advances he made  to  the  defendant  company,  Laundry  Today  or   Naked   Tomorrow Holding Co Limited (the company), pursuant to three agreements entered into between 7 October 2020 and 13 April 2021.

[2]    The defendant was incorporated in September 2018 to develop self-contained and automated laundry pods that would be located in tourist areas and allow travellers to easily launder their clothes.

[3]    Mr Aitken is the director of the defendant. Mr Swanson was also a director of the defendant from 12 October 2020 to 27 April 2021. The “laundry pods” were    Mr Aitken’s idea or he had at least seen similar self-contained and automated laundry pods while in Europe. Mr Aitken required funding to develop the laundry pods in New Zealand and the plaintiff was introduced as a potential investor.

Documentation of the advances

[4]    The advances were made pursuant to three written agreements. Each agreement is in the same form and called a “Capital Note Subscription Agreement”. Pursuant to the 7 October 2020 Capital Note Subscription Agreement (the First Agreement), the plaintiff advanced $250,000. Under the Capital Note Subscription Agreement dated 16 January 2021 (the Second Agreement) the plaintiff advanced

$150,000 (the first $50,000 sum advanced on 13 January 2021, and the balance on  20 January 2021). The plaintiff also made a final advance of $20,000 on 13 April 2021 which was not documented until 7 May 2021 (the Third Agreement).

[5]Paragraph [7] of each Agreement is in the same terms.

7.1The Conversion Date shall be the earlier of:

7.1.131st March 2021

7.1.2Five (5) working days following the installation of the Laundry Pods in 10 locations throughout New Zealand.

7.2At any time on or after the conversion Date, the Subscriber may by notice in writing to the Company (“Conversion Notice”) request that:

7.2.1The Capital Notes be converted to Shares with a value of

$10.00 per Share; or

7.2.2The Principal Amount  be  repaid  by  the  Company  and  the Capital Notes be cancelled.

7.3Within seven days after the date of the Conversion Notice, the Company must:

7.3.1If conversion has been elected convert the Capital Notes into ordinary Shares in the percentage detailed in Schedule One by applying such amount to subscribe for Shares at the Conversion Price and issue to the Subscriber those Shares; or

7.3.2If repayment has been elected, repay the Principal Amount to the Subscriber and immediately cancel the Capital Notes.

[6]    The Agreements go on to specify when notices (which are to be in writing) under the Agreements are deemed to have been validly given. The Agreements also contain an entire agreement clause, exclusion of liability under certain provisions of the Fair Trading Act 1986, a clause that the Agreement may only be amended in writing, and a no waiver clause. The Agreement was paid for by the defendant.

Demand is made and why it is reinstated

[7]    On 21 April 2021 the plaintiff called for repayment of the two original advances. When these proceedings were issued on 21 June 2021, the pleading relied on the proceeding as being a demand for payment of the third instalment. The notice of opposition does not take issue with demand for the third instalment being made in that way.

[8]The grounds of opposition to the application are as follows:

(a)the plaintiff has expressly or by his conduct elected under each Agreement to take shares in lieu of repayment; and/or

(b)the plaintiff, by his conduct, is estopped from demanding repayment in lieu of taking shares pursuant to each Agreements; and/or

(c)the plaintiff is in breach of his fiduciary obligations to the defendant as a director under s 131 of the Companies Act 1993 (the Act) such that it is unconscionable for him to demand repayment in lieu of taking shares.

[9]    During the hearing Mr Moss, counsel for the defendant, did not pursue the third ground as a separate defence.  Rather, he submitted the plaintiff’s obligations under  s 131 of the Act imposed a duty on him to have the defendant take steps to enable it to pay him out. As the plaintiff did not do so at the time the defendant says he was obliged to, Mr Moss argued the plaintiff signalled he intended to take shares instead of call for repayment.

Summary judgment principles

[10]   The principles applicable to an application for summary judgment by a plaintiff are well established and not in dispute. The approach taken to such an application by a plaintiff was set out by the Court of Appeal in Krukziener v Hanover Finance Ltd:1

(a)the question is whether the defendant has no defence to the claim; that is, that there is no real question to be tried;2

(b)the Court must be left with no real doubt or uncertainty;

(c)the onus is on the plaintiff, but where its evidence is sufficient to show there is no defence, the defendant will have to respond if the application is to be defeated;3

(d)the process is not appropriate where there are factual disputes;

(e)the Court, however, is not bound:4

… to accept uncritically as raising a dispute of fact which calls for further investigation, every statement on an affidavit, however equivocal, lacking in precision, inconsistent with undisputed contemporary documents or other statements by

1      Krukziener v Hanover Finance Ltd [2008] NZCA 187, [2010] NZAR 307 at [26].

2      Pemberton v Chappell [1987] 1 NZLR 1 (CA) at 3.

3      MacLean v Stewart (1997) 11 PRNZ 66 (CA).

4      Eng Mee Yong v Letchumanan [1980] AC 331 (PC) at 341.

the same deponent, or inherently improbable in itself it may be.

The facts in more detail

[11]   The defendant does not identify a specific time when it is said the plaintiff committed to become a shareholder. While the defendant increased its shareholding on 18 June 2020 which would allow it to issue the shares to the plaintiff, that was before the 7 October 2020 Agreement and indeed, before the plaintiff was introduced to the investment.

[12]   The defendant took no steps to issue the shares to the plaintiff on the basis that he had elected to take shares as opposed to requiring repayment. Further, at no time prior to the filing of the notice of opposition did the defendant or Mr Aitken assert that it was not open to the plaintiff to demand repayment because he had elected to take shares and was estopped from demanding repayment. Mr Moss submitted that did not occur because the defendant had not had legal advice. However, Mr Aitken’s silence (as the remaining director) and his promise of repayment referred to below demonstrate what the defendant actually understood at the time repayment was called for.

[13]   As to the possibility Mr Swanson committed to becoming a shareholder from the outset, such  is inconsistent with him entering into the Agreement  rather than     a straight share purchase on 7 October 2020. It is also inconsistent with an email exchange Mr Swanson had with the defendant company’s then director and its accountant, a Mr Bailey, the day before the first payment was made. In that email  Mr Swanson asked Mr Bailey what the advantage of the Agreement was as opposed to simply taking up the shares. Mr Bailey explained the advantages as follows:

Firstly it gives you the potential shareholder a period of up to 31/3/2021 to assess whether the company is able to meet the business plan and objectives set out.  If it does not you may, rather than convert to shares, withdraw your

$250k without requiring any assessment of the share value (at full face value).

Secondly you receive [an] interest return of 7% on the notes rather than being depend[ent]on dividends distribution. Naturally there will be no dividends over this initial period. You can of course if you wish go straight to an issue of shares instead if that is your preference.

[14]   With that advice the plaintiff made the advance under the First Agreement. Going “straight to an issue of shares” was not Mr Swanson’s preferred option. Following demand on 21 April 2021, repayment was due under cl 7.3 of the First Agreement on 28 April 2021. On 29 April 2021, Mr Swanson emailed Mr Aitken saying that seeing as he had not heard from Mr Aitken, he was assuming principal and interest would be paid that day.

[15]Mr Aitken replied on 30 April 2021 as follows:

Hi Murray

As we discussed at our meeting last Saturday, it would be unlikely that we would [be] able to repay the Capital Notes on the due date, and outlined the steps that we would need to take to be able to facilitate the payment.

That process is now under way.

[Mr Bailey] is going to calculate the interest owed and give you that figure. We are doing everything we can to get the repayment completed.

Thanks Murray. Kind regards Shane.

[16]   The above email is important as it answers the defendant’s criticism of how the plaintiff presented his case in his affidavit in support of the present application. The defendant criticises the plaintiff for not providing a full background to the matter in his first affidavit. However, given that the Agreement documents are clear, the absence of evidence of any contemporary dispute (indeed, a commitment was made to repay), or of any defences being raised prior to the notice of opposition, it is not clear to me what more Mr Swanson should have included in his affidavit.

The first defence – election

[17]   Mr Aitken’s evidence that he was led to believe Mr Swanson had elected to convert his Capital Notes to shares, is in the most general of terms. He does not say when and how Mr Swanson led him to believe that he would take that course. The proposition behind this and the estoppel defence is that the plaintiff’s involvement in the operation and management of the company was so extensive it amounted to him holding himself out as committing to become a shareholder.

[18]The defendant relies on the following matters.

[19]   On 12 October 2020, Mr Swanson consented to being appointed a director of the company. The defendant submits this is not a step that would ordinarily be taken by someone who would be calling up his money on 31 March the following year (under cl 7.1 of each Agreement). The defendant submits: “Rather this step is consistent with someone who has invested in the company and wishes to be directly controlling his investment and the growth of the company.”

[20]   Further submissions build on the proposition that Mr Swanson was an active director who was hands-on and involved in the detail of the company, including the approval of invoices and personally guaranteeing debts of the company. It is said: “These are not the actions of a third party creditor.”

[21]   Mr Moss submits that in January 2021, with the further $150,000 injected into the company by the plaintiff, that he was “clearly on board at this point and running the company alongside Mr Aitken”. These steps are said to be indicators of someone who was a shareholder investing in the company for the long term.

[22]   The final advance on 13 April 2021 is submitted to be conduct reflecting someone who was invested in the company long term as opposed to “to someone who has not made an election and is about the pull the trigger and seek repayment of the full amounts just two weeks later”.

[23]   I do not accept the doctrine of election applies in this case. It is clear from cl 7 of  each  of  the  Agreements  that  the  plaintiff’s  election  did  not  arise  until      31 March 2021. The law does not recognise anticipatory election. Authority for this proposition can be found in McDrury v Luporini, where Tipping J giving the judgment of the Court said:5

[44] There is compelling force in the view that, until the lessor has an unconditional right to forfeit, no choice is possible between that right and the alternative right of keeping the lease alive. Under the general law of contract the innocent contracting party does not have to choose

5      McDrury v Luporini [2001] 1 NZLR 652 (CA). See also Jansen v Whangamata Homes Ltd

[2006] 2 NZLR 300 (CA) 05 at [16].

whether to accept a repudiation of the contract by a contract breaker, and thereby to discharge the contract by cancellation, or whether to affirm and keep the contract alive, until there has been an unequivocal act of repudiation. Putting the matter in modern terminology, no choice is open or required unless and until the innocent party has an unconditional right to cancel. Of course earlier conduct inconsistent with cancellation may create an estoppel, but there can be no question of election until each of the two inconsistent alternatives has unconditionally accrued. There is no doctrine of anticipatory election. No unconditional right to forfeit accrues unless and until the required statutory notice has been given and has expired unfulfilled. Until then the lessee is entitled to restrain any purported forfeiture and re-entry. That there is no unconditional right to forfeit until then is also clear from the ability of the lessee to avoid forfeiture by compliance with the notice. At best, any earlier right vested in the lessor is contingent and defeasible. It would be contrary to the whole foundation of the doctrine of waiver by election to regard the lessor as having made    a binding election before the right to forfeit unconditionally accrues.

[24]   While his Honour’s statement of the loss was in the context of a landlord’s rights under a lease, the principles apply to election generally. Accordingly, the defendant’s reliance on election is misplaced as it relies on the plaintiff’s actions prior to the Conversion Date. No election in respect of the advance of 13 April 2021 is identified. Simply making the 13 April advance and subsequently signing the Third Agreement in relation to that advance cannot be an election – those steps point entirely the other way. However, as the passage from McDrury shows, estoppel may nonetheless be available.

The second defence – estoppel

[25]The elements of the claim of estoppel were summarised by Harrison J in

Nectar Ltd v SPHC Operations (NZ) Ltd as follows:6

(a)a clear and unambiguous representation or promise made by one party, encouraging an expectation on the part of the other;

(b)reliance on the representation by the party to whom it is made; and

(c)detriment suffered by the party relying on the representation as a result of its reliance.

6      Nectar Ltd v SPHC Operations (NZ) Ltd HC Auckland CL20/02, 7 May 2003 at [140]; applied in

Walton Mountain Ltd v Apple New Zealand Ltd (2003) 5 NZCPR 241 at [40].

[26]   Detriment in this context could be equated with an alteration of position that can include both the adoption of and the abstention from a particular course of action.7

[27]   The ultimate touchstone is whether it would be unconscionable or inequitable to allow the party making the representation to resile from its word and enforce its legal rights in a manner inconsistent with its representation.8

A clear and unambiguous misrepresentation?

[28]   Clause 7 of each Agreement sets out how the plaintiff would elect to take shares over repayment. Each Agreement could only be varied in writing. Those provisions are part of the context in which the defendant says the plaintiff is estopped from calling for repayment.9 To establish that the plaintiff created an expectation on the part of the defendant that he would take shares on the Conversion Date, the defendant relies on the same conduct said to have amounted to an election. Mr Moss submits: “In short, the plaintiff conducted himself at  all  times  up  until he  called  for repayment  on 21 April 2021 as someone who was a fully paid up shareholder in the company.” It is asserted the evidence demonstrates an arguable case that representations were made and relied on. I do not accept that submission.

[29] No express representation made by Mr Swanson is asserted save in the vaguest of terms. Mr Aitken in his affidavit says: “Mr Swanson said that he intended to take up the share option in the Subscription Agreement and thus the shares in the company were increased from 5,100 to 200,000.” No details of this claimed statement are made and the claimed timing cannot be correct given the increase in shares happened about three months before Mr Swanson met Mr Aitken as set out at [11] above. I consider this bare assertion is incapable of founding an estoppel.

[30]   Silence is inherently equivocal but the defendant says it is at least arguable that the plaintiff, by not taking steps to arrange finance to pay himself out when it is said

7      Nectar, above n 6, at [140].

8      Nectar, above n 6, at [141]; and Walton Mountain, above n 6, at [44].

9      Mr Anderson for the plaintiff relied on Air New Zealand Ltd v Newfoundworld Site 2 (Hotel) Ltd [2017] NZHC 1131 at [56] for the proposition that the Courts will be reluctant to grant equitable relief to commercial parties of equal bargaining strength dealing on an arm’s length basis. A representation that is not sufficiently clear to amount to a variation of contract will almost always be too uncertain to amount to an estoppel.

he had a duty to do so, led the defendant to believe he would not be calling up his advance on the Conversion Date. It is in this context that s 131 of the Act is relied on.

[31]   Section 131 provides  that  when  exercising  powers  or  performing  duties, a director must act in good faith and in what they believe to be the best interests of the company. The defendant submits that, when Mr Swanson was a director, he breached s 131 of the Act in that between January and April 2021 he took no steps to secure funding for the company. As it is the plaintiff’s case that he had not elected whether to convert his Capital Notes to shares, as far as he was concerned, the possibility remained that the company would be faced with a substantial liability to him come 31 March 2021 which the defendant says it had no ability to pay.

[32]   The defendant criticises the plaintiff for not actively trying to raise capital to meet the impending prospective liability that may have arisen on or after the Conversion Date. It is submitted the plaintiff, in his capacity as director, simply sat on his hands and allowed the Conversion Date to roll around and then, in his personal capacity, called up the debt.

[33]   The defendant says this was a breach of the plaintiff’s duties as director because he failed to turn his mind to what was in the best interests of the company and to consider the impact of his actions on creditors. It is submitted the plaintiff also breached s 131 because he failed to ensure the company retained access, or at least failed to actively seek access, to funds sufficient to meet the company’s maximum liability if it materialised.10

[34]   As mentioned above, other matters relied on by the defendant to found an estoppel are that the plaintiff became a director, that he was active in that role and “hands-on” and “was across all detail and involved in making all decisions.”

[35]   In my view, the question is whether the conduct relied on is only explicable or consistent with the plaintiff having decided to take shares, or whether the conduct at least communicated that decision to the defendant?

10     Arnerich v DHC Assets Ltd [2021] NZSC 121 at [10(d)], citing Madsen-Ries v Cooper [2020] NZSC 100, (2020) 29 NZTC 24-088.

[36] In my opinion, the plaintiff taking on the role of director and being active in that role is not a clear and unambiguous representation by him that he would opt for shares over repayment on the Conversion Date. Had that been the case, then the documentation of the second advance on 16 January 2021 and the third advance (money advanced 13 April 2021 but documented 7 May 2021) would have proceeded as straight share purchases. The timing of the signing of the Third Agreement for the third advance is telling. Even after all the matters relied on by the defendant said to show an election to take shares, the documentation of that final advance still proceeded as a capital note rather than a share purchase. That is doubly telling when coupled with Mr Aitken’s email of 30 April 2021 promising repayment, set out at [15] above.

[37]   Being a director, even an active one, cannot be said to only be consistent with the plaintiff representing he would opt for shares. Serving as a director allowed the plaintiff to complete due diligence on the company to assist him in deciding whether to opt for shares. The defendant did not see the plaintiff becoming a director as itself amounting to a commitment by him to opt for shares as, on 7 October 2020, Mr Bailey sent the plaintiff the First Agreement and in the same email noted that he would become a director and signatory on the bank account as soon as was practicable. I have already referred to Mr Swanson’s email at [13] asking about the advantages of the Capital Note Subscription Agreement over a share purchase and Mr Bailey’s reply. That reply shows accepting the  directorship  was  not  seen  as  inconsistent  with  Mr Swanson calling for payment at the end of the term – indeed, the ability to opt for repayment was held out as one of the advantages of entering into the Agreement. The directorship and the advantages of the Agreement were mentioned in the same breath.

[38]   In addition, on 21 October 2021, Mr Bailey emailed Mr Swanson a copy of the First Agreement asking: “Is that the documents [sic] you were requiring”, indicating that the plaintiff wanted a copy of that Agreement and not a share transfer. Why the plaintiff would change his preference for the capital note process to a commitment to take shares when there was no advantage to him in doing so before the Conversion Date, is unexplained.

[39]   Any argument that the 16 January 2021 advance carried with it a representation that the plaintiff was committed to take shares cannot survive the way in which the

company documented the transaction. The company did not understand Mr Swanson wanted to acquire shares because if it did, there would have been no point in using the Capital Note Subscription documentation.

[40]   The  defendant  refers  to  Mr Swanson  providing  a  personal  guarantee  to  a supplier on 11 October 2020. I accept Mr Swanson doing so shows a degree of commitment to the company but it does not amount to a representation by him that he had committed to taking shares when the Conversion Date arrived. Mr Swanson has the ability, as does any guarantor, to withdraw their guarantee. There was also nothing stopping Mr Swanson and the defendant varying the Agreement to bring forward the issue of shares if that is what had been agreed.11

[41]   That Mr Swanson took no steps to have the defendant raise finance so it could meet his call for repayment (should it be made), is not conclusive. Mr Swanson did not alert Mr Aitken that he may require repayment. However, the Agreements do not require such notice to be given.

[42]   The fact Mr Swanson did not arrange for alternative finance or give advance notice that he may want his money out does not amount to a representation that     Mr Swanson had irrevocably committed to taking shares on the Conversion Date.  Mr Swanson’s inaction on this front is equally consistent with him having made no decision as, come the Conversion Date, Mr Swanson could defer making his election. Mr Swanson’s inaction is just as equivocal as his silence. What the defendant lost when it was not given advance notice that repayment would be required, was the opportunity to arrange alternative finance – Mr Swanson’s inaction cannot be equated with a representation that he would elect to take shares as it is equally consistent with him having made no election.

[43]   References to what the defendant assumes the plaintiff’s mindset was, namely, that he was committed long term to the company, do not take matters further. Such assumptions are also difficult to reconcile with Mr Aitken saying they were doing everything they could do to complete repayment and his failure when demand was

11     Mr Swanson also personally guaranteed payment to the manufacturer of the laundry pods which was the reason for the April 2021 advance.

made to assert that option was no longer available to the plaintiff. The defendant tries to build an argument on Mr Swanson’s early email where he asked what the advantage of taking a capital note subscription would be as opposed to taking shares. The defendant says this indicated that the plaintiff was planning on taking shares. Thus, it is asserted that the First Agreement was a formality and it is said the same is true of the Third Agreement signed on 7 May 2021.

[44]   This is not an answer to the fact that the company’s accountant, when asked by the plaintiff, identified what are undeniably advantages in the capital note process. Having had the advantages explained, the plaintiff followed through on that option as it gave him all the advantages of being a shareholder should he wish to become one, but the ability to pull his funds out if he so wished.

[45]   Mr Aitken does not offer any explanation for why the capital note structure was used given the exchange between Mr Swanson and Mr Bailey. The submission that the documents were a formality is not supported by the evidence.

[46]   I see no significance in the plaintiff calling for repayment three weeks after 31 March 2021. Clause 7 of each Agreement gives him the right to make the election at any time on or after 31 March 2021. His delay in calling for repayment cannot found an estoppel, when each Agreement expressly permits the deferral of the election.

[47]   As to reliance and alteration of position, it is submitted the defendant was denied the opportunity to find other investors and order its affairs in a manner that would have ensured it was protected, had there been any expectation the plaintiff would call for repayment.

[48]   I deal with reliance and detriment together as they are related. The defendant’s reliance must also be reasonable in an ongoing sense. The defendant must take reasonable steps to mitigate its position:12

12 Andrew Butler (ed) Equity and Trusts in New Zealand (2nd ed, Thomson Reuters, Wellington, 2009), at [19.2.2(3)],  referring  to  Prudential  Building  and  Investment  Society  of  Canterbury v Hankins [1997] 1 NZLR 114 (HC) at [122]; and Burbery Mortgage Finance & Savings Ltd v Hindsbank Holdings Ltd [1989] 1 NZLR 356 (CA) at [361].

For example, where a party is unable to draw on finance from a particular source to which it believes it is entitled, an estoppel will not arise if it fails to take any steps to arrange alternative finance. Similarly, no estoppel will arise where the representor gives the other party sufficient time to resume his or her original position.

[49]   If a representation has been relied on but it is possible to “undo the detriment” then an estoppel will not arise.13

[50]   Of course, the defendant’s submission as to alteration of position assumes representations to found an estoppel were made. The high point on alteration of position/detriment argument is the defendant says it did not seek finance earlier in reliance on the plaintiff’s purported representations. However, the defendant has had enough time to seek finance. It was the defendant that specified that repayment would be made in seven days in each Agreement, nor did its agreement require advance notice that repayment may be required. The plaintiff could defer his election to “any time on or after” the Conversion Date, meaning the Agreement was always going to leave the defendant in an uncertain position as to if and when repayment would be required.

[51]   By the time of the hearing, almost six months had passed from the call for repayment, essentially the same period as the term of the original advance and significantly longer than the term of the second and third advances. The best case for the defendant in terms of notice that repayment would be required, is that the plaintiff would, at the time of each Agreement, have given advance notice that repayment would be required on the Conversion Date. Accordingly, any detriment in terms of loss of time to arrange payment has been overtaken by the time it has taken for this matter to come onto hearing.

[52]   Mr Aitken, in his affidavit, appears to accept that the money is repayable and says: “I am in the process  of  trying  to  find  a  new  business  partner  to  replace Mr Swanson.”

[53]   Mr Aitken says Mr Swanson’s actions have caused him significant loss, but it is the defendant that has to establish detriment, not Mr Aitken. The defence of estoppel fails.

13     Butler, above n 12 at [19.2.3].

Conclusion

[54]   For the reasons already given, the defendant has had at least as much time as it could possibly have had to arrange alternative finance if the plaintiff had given the earliest possible advance notice that he would elect repayment on the Conversion Date. There is no evidence that the defendant’s ability to find alternative investment/source of funds is any worse now than when the debt was called up.14 No willing investor was turned away because Mr Aitken believed the plaintiff was to take shares.

[55]   I am satisfied that the plaintiff is entitled to judgment for the principal sums advanced, being $420,000. No issue was taken by the defendant with the schedule attached to the plaintiff’s submissions calculating interest up to the hearing date.

[56]   Accordingly, there is judgment for the plaintiff in respect of each of the three advances totalling $420,000 together with interest to 11 October 2021, as set out in the   schedule   to   the   plaintiff’s    submissions    for    this    application    dated  27 September 2021.

Costs

[57]   The plaintiff is entitled to costs on a 2B basis plus disbursements as fixed by the Registrar.

Associate Judge Lester

Solicitors:

Mactodd Lawyers, Queenstown D J Stock, Christchurch

Copy to counsel:

J Moss , Barrister, Christchurch

C M Hanafin, Barrister, Christchurch

14  Butler, above n 12, at [19.2.3] states that: “an estoppel claim will be defeated if the representee   was given ‘a reasonable opportunity of resuming his [original] position’, at least so long as the party claiming the estoppel has not been permanently prejudiced by relying on the representation.” (footnotes omitted). No permanent prejudice has been claimed here.