Top One Real Estate Limited v Prema Developments Limited HC Auckland CIV-2009-404-6008
[2011] NZHC 1038
•16 September 2011
IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY
CIV-2009-404-6008
BETWEEN TOP ONE REAL ESTATE LIMITED Plaintiff
ANDPREMA DEVELOPMENTS LIMITED First Defendant
ANDARRANMORE DEVELOPMENTS LIMITED
Second Defendant
Hearing: 15 September 2011
Appearances: SRG Judd and N McDonald for plaintiff
No appearance for first defendant
M Fisher for second defendant
Judgment: 16 September 2011 at 4:00 PM
JUDGMENT OF LANG J
[on application by second defendant for review of Associate Judge’s decision
and for security for costs]
This judgment was delivered by me on 16 September 2011 at 4 pm, pursuant to Rule
11.5 of the High Court Rules.
Registrar/Deputy Registrar
Date……………
TOP ONE REAL ESTATE LTD V PREMA DEVELOPMENTS LTD HC AK CIV-2009-404-6008 16 September
2011
[1] In this proceeding the plaintiff, a real estate agency, seeks to recover commissions allegedly owing to it by the second defendant, Arranmore Developments Limited (“Arranmore”).
[2] On 4 November 2010 Associate Judge Christianson dismissed applications by Arranmore for orders granting it summary judgment against the plaintiff and/or striking out the proceeding on the basis that it contained no arguable cause of action.1 Arranmore applied for leave to appeal to the Court of Appeal against the refusal of the Associate Judge to enter summary judgment in its favour. The Court of Appeal dismissed Arranmore’s application on 21 March 2011.2 Arranmore now applies for review of the Associate Judge’s decision refusing to strike out the claim on the basis that it contains no arguable cause of action.
[3] In the event that the application for review is unsuccessful, Arranmore seeks an order that Top One be required to provide security for its costs.
The approach to be taken in an application for review
[4] The Associate Judge dismissed Arranmore’s strike out application in a reasoned decision that followed a defended hearing. On that basis, r 3.2(4) of the High Court Rules requires the review to proceed as a rehearing. It is therefore required to take the approach confirmed by the Supreme Court in Austin Nichols & Co Inc v Stichting Lodestar.3 This involves the Court making its own assessment as to whether the original decision is wrong.4
The approach to be taken in a strike out application
[5] The principles applicable in a strike out application were confirmed by the
Court of Appeal in the well-known case of Attorney-General v Prince and Gardner,
where it is said:5
1 Don Ha Real Estate Ltd v Prema Development Ltd HC Auckland CIV-2009-404-6008, 4 November
2010.
2 Arranmore Developments Ltd v Don Ha Real Estate Ltd [2011] NZCA 85.
3 Austin Nichols & Co Inc v Stichting Lodestar [2008] 2 NZLR 141 (SC).
4 Austin Nichols at [16]; Burmeister v O’Brien [2008] 3 NZLR 842 at [29].5 Attorney-General v Prince and Gardner [1998] 1 NZLR 262, 267
A striking-out application proceeds on the assumption that the facts pleaded in the statement of claim are true. That is so even although they are not or may not be admitted. It is well settled that before the Court may strike out proceedings the causes of action must be so clearly untenable that they cannot possibly succeed. (R Lucas & Son (Nelson Mail) Ltd v O’Brien [1978] 2 NZLR 289 at pp 294-295; Takaro Properties Ltd (in receivership) v Rowling [1978] 2 NZLR
314 at pp 316-317); the jurisdiction is one to be exercised sparingly, and only in a clear case where the Court is satisfied it has the requisite material (Gartside v Sheffield, Young & Ellis [1983] NZLR 37 at p
45; Electricity Corporation Ltd v Geotherm Energy Ltd [1992] 2
NZLR 641); but the fact that applications to strike out raise difficult questions of law, and require extensive argument does not exclude jurisdiction (Gartside v Sheffield, Young & Ellis).
[6] In determining a strike out application the Court must proceed on the basis that the allegations which are contained in the statement of claim are true. They are usually based on the pleadings alone. It is permissible, however, to refer to extrinsic or affidavit evidence where such evidence is undisputed and is not inconsistent with the pleadings.6
Factual background
[7] The original plaintiff in this proceeding was a company called Don Ha Real
Estate Limited (“Don Ha”). That company went into receivership on 17 March
2011. The present plaintiff, Top One Real Estate Limited (“Top One”), was incorporated on 24 March 2011. It subsequently purchased Don Ha’s real estate and property management business from the receivers. In doing so it acquired the right to continue the present litigation. This Court made an order on 16 June 2011 substituting Top One as the plaintiff. It now pursues the application for review.
[8] The facts as pleaded are largely agreed. They arise out of a subdivision project commenced by the first defendant, Prema Developments Limited (“Prema”), at Flatbush, East Tamaki in 2005. The principal funder of the development was
Castle Finance Limited, a company in the Hugh Green group of companies.
6 Attorney-General v McVeagh [1995] 1 NZLR 558, 566.
[9] On or about 27 November 2007 Prema entered into an agreement with Don Ha under which it appointed Don Ha to effect the sale of sections within the subdivision (“the agency agreement”). The agency agreement included the following terms:
(a) Don Ha was authorised to receive deposits from purchasers on
Prema’s behalf;
(b) Prema would pay a commission to Don Ha at the rate of 4% on the first $300,000 of the purchase price or other consideration achieved and 2.5% on any amount above $300,000 plus GST for each sale effected by Don Ha;
(c) Don Ha was entitled to retain from the deposits its fees and commission plus GST;
[10] Between 2007 and February 2008 Prema entered into 53 written agreements to sell sections within the subdivision. Although the agency agreement permitted Prema to sell sections privately, the majority of purchasers were introduced through Don Ha’s agency.
[11] Although the agency agreement provided for Don Ha to receive deposits from purchasers, that practice was varied by means of an oral agreement between Don Ha’s principal, Mr Ha, and a representative of Prema, Mr Amarsee. The oral agreement, entered into at or around the time the agency agreement was signed, was to the effect that purchasers would pay deposits to Prema’s solicitors rather than to Don Ha. Thereafter, purchasers paid their deposits in accordance with the oral agreement.
[12] By June 2008 Prema had encountered financial difficulties. At that point it entered into a written agreement under which it sold the entire subdivision to the second defendant, Arranmore, for the sum of $10,900,000 plus GST (“the subdivision sale agreement). Arranmore, too, is a company within the Hugh Green group. The sum that Arranmore paid enabled Prema to repay its indebtedness to Castle Finance in full.
[13] Under the subdivision sale agreement, Arranmore became the owner of the land on which the subdivision was being undertaken. It also became entitled to the
benefit of all agreements for sale and purchase that Prema had entered into with third parties in respect of sections within the subdivision (“subsale agreements”). When the subsale agreements became unconditional, Prema’s solicitors accounted to Arranmore for the deposits they had previously been holding as a stakeholder.
[14] Arranmore denies that it is liable to pay the commissions that Prema was required to pay to the plaintiff pursuant to the agency agreement. It contends that sole responsibility for paying the commissions remains with Prema. That fact is cold comfort to the plaintiff, because Prema is now in receivership and in liquidation. There is no prospect of the plaintiff obtaining payment of its commissions from that source.
The plaintiff ’s claims
[15] Top One advances its claims against Arranmore under five separate causes of action. They involve the following allegations:
(a) Under the subdivision sale agreement Prema assigned to Arranmore its obligation to pay any commission payable to Don Ha pursuant to the agency agreement;
(b)The subdivision sale agreement contained an implied term that Arranmore would pay commission to the plaintiff in terms of the agency agreement when the subsales became unconditional;
(c) Arranmore is contractually bound under the subsale agreements to pay commission to the plaintiff;
(d)The plaintiff is in any event entitled to be paid commission on a quantum meruit basis;
(e) Arranmore holds the commissions as constructive trustee for the plaintiff.
[16] As will be apparent, the first three causes of action are grounded in contract. The fourth and fifth causes of action seek equitable remedies.
The first cause of action - assignment
[17] Top One’s entitlement to be paid commission for introducing subsale purchasers arises from the agency agreement that Don Ha and Prema entered into on or about 27 November 2007. Under that agreement Don Ha was entitled to be paid commission when Prema entered into an unconditional contract to sell a section within the subdivision to a purchaser.
[18] Top One contends that the effect of the subdivision sale agreement was to assign from Prema to Arranmore Prema’s obligation to pay commission under the agency agreement. Arranmore relies for this submission on clause 21 of the subdivision sale agreement, which provides:
21.0The Vendor warrants that it has entered into agreements for sale and purchase with the parties more particularly described in Schedule One annexed hereto, for the sale of sections to be created and titles issued for the same at the price and on the terms and conditions specified in the said schedule (“the sub-sales”). In respect of the sub-sales:
21.1 The Vendor warrants that it has disclosed to the Purchaser all information within its knowledge material to the validity and enforceability of such sub-sales;
21.2 The Vendor agrees:
(a) to assign absolutely the benefit of the sub-sales to the Purchaser, such assignment to take effect on the possession date;
(b) to notify in writing each purchaser under each sub-sale of the assignment in terms of the notice in Schedule Two annexed hereto immediately after the possession date under this agreement and to furnish the Purchaser with a copy of each such notice;
(a) at the request of the Purchaser and at any time after the possession date forthwith to execute any such further deed, transfer, or other assurance as the Purchaser may require further to complete or formalise the assignment to the Purchaser of the sub-sales;
(d) to direct irrevocably Gibbs & Mills (David Gibbs), solicitors to hold all monies received from purchasers of
the sections pursuant to the sub-sales as stakeholder for the Purchaser herein as vendor under the said agreements and the various purchasers of the sections according to their respective rights and interests. The Purchaser herein acknowledges that interest payable on such deposit monies are lodged on interest bearing deposit through the trust account of the said solicitors and interest earned thereon shall belong to the purchasers of the various sections. The Vendor will further direct the said solicitors to forward to the Purchaser herein the originals of all such sub-sales, retaining copies thereof as may be required to enable the said solicitors to discharge their duty to the various parties as stakeholders in respect to such monies. The Purchaser herein covenants and undertakes with the Vendor to save harmless and indemnify the Vendor against all liabilities and obligations arising pursuant to the said sub-sales as a consequence of the Purchaser taking title to the said property subject to and with the benefit of the aforesaid agreements for sale and purchase. The Vendor further covenants and agrees that the Purchaser shall not be responsible nor have any liability for any legal fees incurred to the date of this agreement by the Vendor or subsequent to this agreement in respect of the sub-sales.
(Emphasis added)
[19] Counsel for the Top One submits, correctly, that the essential issue in relation to this cause of action is the proper interpretation to be given to the material terms of the subdivision sale agreement. He contends that the Court cannot properly interpret the agreement, or any of the contracts for that matter, without hearing viva voce evidence. It will require that evidence in order to appreciate the circumstances in which Prema and Arranmore entered into the subdivision sale agreement. This will include the facts known to the parties, their conduct and business practice. Only once those factors are known, counsel submits, can the Court properly interpret the contractual provisions that lie at the heart of the proceeding.
[20] I accept that oral evidence may sometimes be required in order to interpret a contractual provision. I consider, however, that the meaning of Clause 21.2 is clear and unambiguous. It provided for Prema to assign absolutely the benefit of the subsale agreements to Arranmore. It did not, expressly at least, purport to assign any obligations that Prema undertook under the agency agreement. Regardless of the circumstances that pertained at the time that the parties entered into the subdivision sale agreement, I do not consider that clause 21 can realistically be construed as
meaning that Prema expressly assigned its obligation under the agency agreement to
Arranmore.
[21] For that reason I respectfully reach a different conclusion to that of the Associate Judge in relation to the first cause of action. I do not consider that it raises an arguable cause of action, and must be struck out.
Second cause of action – breach of implied term
[22] Top One added this cause of action after the Court of Appeal dismissed Arranmore’s application for leave to appeal against the dismissal of its application for summary judgment. It alleges that it was an implied term of the subdivision sale agreement that Arranmore was to pay the real estate agent’s commission payable when each subsale became unconditional.
[23] Top One provides the following particulars in support of this pleading:
(a) Such a term is necessary to give business efficacy to the Subdivision Sale Contract and/or it represents the obvious, but unexpressed, intention of the parties to the Subdivision Sale Contract, objectively ascertained, and/or a reasonable person would have understood the document to mean that the second defendant would pay the commission.
(b) That the second defendant should be responsible for paying the commission is an obvious consequence of the second defendant assuming the position of vendor under the Subsales and becoming entitled to receive the entire price due under each Subsale including the deposits already paid.
(c) Any reasonable person knowing that the second defendant was receiving the full benefit of the Subsales, including the deposits and that the second defendant was assuming the position of vendor under the Subsales and knowing that Don Ha would not be entitled to its commission until the Subsales were unconditional would have understood that the second defendant would pay the commission.
[24] Counsel for Top One submitted that the subdivision sale agreement did not expressly provide for either Prema or Arranmore to assume responsibility for the payment of real estate agent’s commission. He contended that when the agreement is viewed in its entirety, however, it clearly provided for Arranmore to assume responsibility for that liability.
[25] Counsel referred me to the following passages from Attorney General of
Belize v Belize Telecom Ltd:7
17.The question of implication arises when the instrument does not expressly provide for what is to happen when some event occurs. The most usual inference in such a case is that nothing is to happen. If the parties had intended something to happen, the instrument would have said so. Otherwise, the express provisions of the instrument are to continue to operate undisturbed. If the event has caused loss to one or other of the parties, the loss lies where it falls.
…
21.It follows that in every case in which it is said that some provision ought to be implied in an instrument, the question for the court is whether such a provision would spell out in express words what the instrument, read against the relevant background, would reasonably be understood to mean. It will be noticed from Lord Pearson’s speech that this question can be reformulated in various ways which a court may find helpful in providing an answer – the implied term must “go without saying”, it must be “necessary to give business efficacy to the contract” and so on – but these are not in the Board’s opinion to be treated as different or additional tests. There is only one question: Is that what the instrument, read as a whole against the relevant background, would reasonably be understood to mean?
[26] Counsel for Arranmore contends that the meaning of clause 21 is plain. He submits that there is nothing missing from the agreement that needs to be inserted by implication. He points out that the agreement does not impose an obligation on Arranmore to pay commission in respect of the subsales. Moreover, the parties could easily have inserted an express term dealing with that issue if they wanted it to form part of their bargain. He therefore submits that the implication of a term is not necessary.
[27] I accept that the absence of any express reference to the payment of real estate agent’s commission could mean that the parties intended that obligation to remain with Prema and not pass to Arranmore following settlement. There are, however, two indicators to suggest that that might not have been their intention when they drafted the agreement. The first arises from the following sentence in clause
21.2(d):
7 Attorney General of Belize v Belize Telecom Ltd [2009] UKPC10 (PC).
… The Purchaser herein covenants and undertakes with the Vendor to save harmless and indemnify the Vendor against all liabilities and obligations arising pursuant to the said sub-sales as a consequence of the Purchaser taking title to the said property subject to and with the benefit of the aforesaid agreements for sale and purchase. …
[28] Construed narrowly, the clause only requires Arranmore to indemnify Prema in respect of liability arising out of the subsale contracts. The subsale contracts do not refer to the payment of commission. Liability to pay commission arises instead from the agency agreement. It can therefore be argued that Arranmore did not agree to indemnify Prema in respect of the payment of real estate agent’s commission.
[29] On a wider construction, however, it can be argued that the parties intended the clause to mean that Arranmore was to indemnify Prema in respect of all liability arising out of the subsale transactions, and not merely the subsale contracts. That interpretation is, in my view, available having regard to the fact clause 21 effectively made Arranmore responsible for the completion of the subdivision and the settlement of the subsale agreements.
[30] One of the obligations that arose out of the subsale transactions was the liability to pay commission to the real estate agent. Arranmore received the deposits in respect of those transactions when it knew, according to the statement of claim, that Prema was under an existing obligation to meet the payment of commission out of those deposits. It can therefore be argued that Arranmore agreed to indemnify Prema against liability for that obligation. It would only provide such an indemnity if it had agreed to assume responsibility for meeting it.
[31] Secondly, the last sentence in clause 21.2(d) is also of assistance. It provides:
… The Vendor further covenants and agrees that the Purchaser shall not be responsible nor have any liability for any legal fees incurred to the date of this agreement by the Vendor or subsequent to this agreement in respect of the subsales.
[32] I accept Top One’s argument that this sentence supports the interpretation for which it contends. The need to expressly provide for the vendor (Prema) to remain liable for legal fees suggests that the parties understood that remaining liabilities arising out of the subsales would henceforth be Arranmore’s responsibility.
[33] These factors persuade me that it is arguable that the subdivision sale agreement contained the implied term for which Top One contends. As a result, this cause of action must be permitted to proceed.
Third cause of action – commission payable under subsale agreements
[34] Under this cause of action Top One alleges that, construed properly, the individual subsale agreements contained a promise by the vendor (now Arranmore) to pay the commission due to the real estate agent who introduced the purchaser.
[35] The cause of action is based on the fact that the name of Don Ha as real estate agent was recorded on the cover page of each agreement. In addition, the agreement contained the following clause:
REAL ESTATE AGENT
If the name of a real estate agent duly authorised by the vendor appears on page 2 of the agreement then the vendor acknowledges that this sale was effected by the agent.
On the second page of each (or at least the majority) of the subsale agreements Don Ha’s name (or that of the individual salesperson who effected the sale) was recorded under the heading “Sale By”.
[36] Top One contends that, taken together, these words amounted to an enforceable promise by the vendor to pay the commission generated as a result of each agreement.
[37] I do not consider that this argument is tenable. The obligation to pay commission arose solely under the agency agreement. There was no promise to pay commission within any of the subsale agreements. The identification within those agreements of the agent who had effected the sale was clearly done in order to distinguish private sales from those effected through Don Ha’s agency. I do not consider that the words relied upon by Top One could possibly amount to a promise to pay commission. For that reason this cause of action must be struck out.
Fourth cause of action – quantum meruit
[38] Under this cause of action Top One alleges that Arranmore has knowingly received the benefit of the services that Don Ha provided in effecting the subsales, but now refuses to pay for those services. It will argue that, in the event that the Court finds that there was no contractual obligation on Arranmore to pay the commissions, nevertheless it was entitled to receive payment for its services on a quantum meruit basis. Allied to this is a submission that it would be unconscionable and/or Arranmore would be unjustly enriched if it was entitled to retain the deposits without accounting to Top One for the commissions payable in respect of the subsales.
[39] Counsel for Arranmore contends that this cause of action cannot succeed, because Don Ha had already completed the provision of its services prior to the point at which Arranmore purchased the benefit of the subsale agreements. Moreover, Top One has a contractual entitlement to be paid commission by Prema pursuant to the agency agreement. Arranmore argues that, where there is a contractual obligation on a party to pay for services rendered, it is not open to the provider of those services to seek payment from another party on a quantum meruit basis.
[40] That argument has superficial attraction, because Don Ha was clearly in a contractual relationship with Prema and its entitlement to be paid commission arose under that contract. Quantum meruit principles generally come into play in circumstances where services have been performed in the expectation that they will be paid for, but where for whatever reason no contractual relationship ever comes into existence. In the present case the existence of the agency agreement between Prema and Don Ha would appear to leave little room for Top One to be able to make an alternative claim against Arranmore based on quantum meruit principles.
[41] In response to Arranmore’s submissions on this point, counsel for Top One referred me to the following passage from Goff & Jones, The Law of Restitution (7th edition) Sweet & Maxwell, 2007, para 1-019:
But a defendant, who is not contractually bound, may have benefited from services rendered in circumstances in which the court holds him liable to pay
for them. Such will be the case if he freely accepts the services. In our view, he will be held to have benefited from the services rendered if he, as a reasonable man, should have known that the claimant who rendered the services expected to be paid for them, and yet he did not take a reasonable opportunity open to him to reject the proffered services. Moreover, in such a case, he cannot deny that he has been unjustly enriched.
It is said that the recognition of free acceptance, so defined, is in principle objectionable for it erodes the right of a person to determine his own choices; only if he has requested services can he be said to have “chosen” and gained a benefit.
[42] This is an area of the law that is clearly developing. On the facts as pleaded, Arranmore received the benefit of Don Ha’s services when it received the deposits after subsale agreements became unconditional. The statement of claim also avers that Arranmore knew when it received the deposits that Don Ha expected to be paid for its services. An argument based on quantum meruit is not entirely untenable given those factors. I therefore consider that it would be premature to strike this cause of action out on the basis that it is unarguable.
Fifth cause of action – constructive trust
[43] In its present form, the statement of claim does not articulate with any precision the circumstances allegedly giving rise to a claim in constructive trust. As I understand the position, Top One contends that this claim arises as a result of discussions between Mr Ha and Mr Amarsee. These led to Don Ha agreeing to vary the agency agreement to permit deposits received from subsale purchasers to be paid to Prema’s solicitors’ trust account rather than to Don Ha as the agency agreement required.
[44] Arranmore’s argument on this point is that Don Ha was entitled to be paid its commission from the deposits by virtue of a specific contractual right under the agency agreement. It also had a lien, or claim to set-off, in respect of monies in its possession. That arose once those monies became payable to Prema when subsale agreements became unconditional. The right to assert a lien or claim to set off depended upon Don Ha retaining possession of the deposits. The right disappeared as soon as Don Ha parted with possession of the deposits. In most, if not all, cases Don Ha was never in possession of the deposits because they were paid directly to
Prema’s solicitors. Arranmore submits that this is fatal to any claim based on constructive trust. It also points out that the affidavit evidence filed in relation to the application for summary judgment does not contain any material assisting Top One on this point.
[45] This claim will clearly need to be re-pleaded so as to specify the circumstances giving rise to the alleged constructive trust. If Top One relies on oral discussions between Mr Ha and Mr Amarsee, it will need to plead those discussions with particularity so that Arranmore understands the basis upon which the claim is being brought. For present purposes, however, I am not prepared to strike this cause of action out. A claim based on constructive trust could arguably arise if Mr Ha agreed that Don Ha would forego its contractual right to hold deposits on the basis of Mr Amarsee’s assurance that Don Ha would be paid its commission from deposits held by Prema’s solicitors. Whether or not such a claim has a basis in fact will depend on the evidence given at trial.
The application for security for costs
[46] Arranmore points out that Top One became the plaintiff in circumstances where Mr Ha’s previous company, Don Ha Real Estate Limited, was in obvious financial difficulty. He submits that this can give the Court no comfort that Top One will be in a position to meet Arranmore’s costs in the event that it fails at trial.
[47] Top One has recently filed what it describes as an “updating affidavit” by Mr Ha in opposition to the application. Mr Ha deposes that Top One commenced effective operation in June 2011, and has already earned commissions amounting to nearly $870,000. He says that Top One has engaged a large number of sales consultants, and that the company has approximately 220 listings. These have a combined value of more than $106 million. It has also obtained exclusive listings of several high value developments in the greater Auckland area. It submits that
Arranmore cannot meet the threshold8 of establishing that there is reason to believe
that Top One will not be able to meet Arranmore’s costs if it does not succeed at trial.
8 Under r 5.45(1)(b) of the High Court Rules.
[48] I do not accept this submission. The circumstances in which Top One acquired Don Ha’s business suggest that it depends on others for financial support. Although it paid the sum of $1.3 million for Don Ha’s business, that sum was apparently provided by Mr Ha’s friends and family. Its business premises are owned by Mr Ha personally. There is no evidence to suggest that Top One owns assets of any significance.
[49] Although I accept that Top One’s business has only been trading for a short period, nevertheless it would have been helpful for Mr Ha to provide the Court with details of the company’s overall financial position. In the absence of such evidence I proceed on the basis that there is a real prospect that Top One will not be able to meet Arranmore’s costs in the event that it fails at trial.
[50] The next issue is whether the Court should exercise its discretion to make an order requiring Top One to provide security for costs. Several factors are relevant in this context. First, although it is neither possible, nor desirable, to delve deeply into the merits in determining an application for security for costs, nevertheless my impression is that Top One’s chances of success are finely balanced. As will already be apparent, they depend upon the Court adopting the interpretation of the contracts for which it contends. This militates in favour of an order being made because there is, in my view, an appreciable risk that Top One may not succeed at trial.
[51] I do not regard Arranmore’s delay in applying for security as a disqualifying factor. The recent introduction of Top One as plaintiff obviously means that circumstances changed markedly at that point.
[52] I do not consider, either, that Arranmore is seeking security in an oppressive way or that it is seeking to prevent Top One from proceeding to trial. The tenor of Top One’s evidence suggests that it operates a highly successful business that generates substantial cash flow. It should therefore be able to provide security provided the amount is not too high and it is given time within which to do so.
[53] Counsel agree that Top One’s claim will not occupy more than five days. I
would be surprised if it went beyond four days, because its parameters are
reasonably straightforward. The balance of the trial will relate to Arranmore’s counter-claim, if it elects to file one. Costs in relation to a trial of four days duration on a category 2B basis amount to just over $22,000. I consider justice will be done if Top One is required to provide security to the satisfaction of the Registrar in the sum of $20,000 on or before 31 October 2011. I make an order accordingly.
Costs
[54] Both parties have succeeded to some extent. For that reason I direct that costs in relation to the two applications are to lie where they fall.
Directions
[55] Top One is to file and serve an amended statement of claim particularising its claim under the fifth cause of action within 14 days.
[56] Arranmore also needs to quickly decide whether it is going to pursue its counterclaim. I direct that it is to file and serve any amended statement of defence and counterclaim within 14 days after receiving Top One’s amended statement of claim.
Next event
[57] The proceeding is to be the subject of a telephone conference before Associate Judge Christiansen on 25 October 2011 at 4.10 pm. The purpose of that conference is to review compliance with the above directions and to give pre-trial directions designed to ensure that the current trial date of 20 February 2012 can be
maintained.
Lang J
Solicitors:
Daniel Overton Goulding, Onehunga
Oranga Law, Penrose
Counsel:
M Fisher, Erskine Chambers, Auckland
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