The Clubhouse (NZ) Limited v McApostrophes Holdings Limited

[2018] NZHC 3099

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

I TE KŌTI MATUA O AOTEAROA TĀMAKI MAKAURAU ROHE

CIV-2018-404-001914 [2018] NZHC 3099

BETWEEN  THE CLUBHOUSE (NZ) LIMITED

Plaintiff

ANDMCAPOSTROPHES HOLDINGS LIMITED

Defendant

Hearing:                   27 November 2018

Counsel:                   N A Farrands for the Plaintiff

No Appearance of, or for the Defendant

Judgment:                28 November 2018

JUDGMENT OF EDWARDS J

This judgment was delivered by Justice Edwards on 28 November 2018 at 1.00 pm, pursuant to

r 11.5 of the High Court Rules

Registrar/Deputy Registrar Date:

Solicitors:    Morrison Kent, Auckland

THE CLUBHOUSE (NZ) LTD v MCAPOSTROPHES HOLDINGS LTD [2018] NZHC 3099 [28 November 2018]

[1]    The plaintiff seeks summary judgment against the defendant for outstanding sums due under a Naming Rights Sponsorships Agreement dated 4 November 2016 (the sponsorship agreement). Judgment is sought for the sum of USD 267,085, interest in the sum of USD 5,997.40, legal costs and disbursements.

[2]    The defendant’s place of business is Seoul, South Korea. The proceedings were served on the  defendant  without  leave  under  r 27(2)(b)  and  (c)  of  the  High Court Rules 2016 on the basis that the contract was made or entered into in New Zealand, was to be wholly or in part performed in New Zealand, and by its terms is governed by New Zealand law. The proceedings were served on the defendant in South Korea by handing the documents to an employee of the defendant who accepted them on behalf of the defendant. Service was verified in an affidavit of service dated 23 November 2018.

[3]    There was no appearance by or on behalf of the defendant when the matter was called in the summary judgment list. Accordingly, the application proceeds unopposed.

Background

[4]    The plaintiff is an events management company which secured the hosting rights for the New Zealand Women’s Golf Open for the years 2017, 2018 and 2019. Those hosting rights include naming rights for those events.

[5]    Under the terms of the sponsorship agreement, the plaintiff granted the sponsorship rights to the defendant. In return, the defendant agreed to pay the sum of USD 1,322,500 for each event by way of instalments.

[6]    The sponsorship rights for the 2017 event were provided to the defendant and it was known as the McKayson New Zealand Women’s Open. McKayson is the brand of clothing and apparel manufactured by the defendant. Part of the total fee for the year was paid by the defendant, but by January 2018 there was an outstanding balance of USD 367,085 due and owing for the 2017 event.

[7]    In January 2018, the parties entered into an agreement whereby the plaintiff agreed to acquire goods from the defendant to a value of USD 100,000, which would be offset against the amount due from the defendant. That left a balance owing from the defendant to the plaintiff under the sponsorship agreement of USD 267,085.

[8]    There was subsequent correspondence between the parties whereby the plaintiff proposed that the outstanding balance be paid in three equal instalments of USD 89,028 on 30 January 2018, 28 February 2018 and 31 March 2018. The defendant failed to make any of those payments and the sum of USD 267,085 remains due and owing.

Decision

[9]    Having reviewed the statement of claim, application for summary judgment, the affidavit filed in support, and after hearing from Mr Farrands, counsel for the plaintiff, I am satisfied that there is no reasonably arguable defence to the application and summary judgment should be entered for the sum of USD 267,085.

[10]   The sponsorship agreement does not make provision for the payment of interest. Accordingly, interest falls to be dealt with under the Interest on Money Claims Act 2016 (Act). Section 17 of that Act provides the Court with a discretion as to the award of interest where the money judgment is expressed in a foreign currency. In this case counsel for the plaintiff has calculated interest in accordance with s 12 of the Act using the Internet site calculator referred to in s 13. I am satisfied that this is appropriate in the circumstances. As the contract is governed by New Zealand law, and was to be performed in New Zealand, there is no reason to exercise my discretion under s 17 to set a rate that is different to the one mandated by the Act.

[11]   In the circumstances, I am  satisfied  that  interest  from  31 March 2018  to 27 November 2018, being USD 5,997.40, is appropriate and judgment should be entered for that sum. Interest shall continue to accrue until payment of the judgment debt under the Act and shall be calculated in accordance with the Act.

[12]   Finally, costs and disbursements are sought on a schedule 2B basis. I am satisfied that those are reasonable.

Result

[13]   Accordingly, I enter summary judgment in favour of the plaintiff against the defendant for the following:

(a)the principal sum of USD 267,085;

(b)interest from 31 March 2018 to 27 November 2018, being the sum of USD 5,997.40;

(c)interest shall continue to accrue until payment of the judgment debt and shall be calculated in accordance with the Interest on Money Claims Act 2016; and

(d)costs and disbursements on a schedule 2B basis as set out in the schedule to counsel’s memorandum of 26 November 2018.

Edwards J