Verboeket v Seaview Road Limited

[2012] NZHC 182

IN THE HIGH COURT OF NEW ZEALAND WELLINGTON REGISTRY

CIV-2010-032-000190 [2012] NZHC 182

BETWEEN  PETER CHARLES ROBERT VERBOEKET

Plaintiff

ANDSEAVIEW ROAD LIMITED Defendant

Counsel:         PSJ Withnall for Plaintiff

S M Dwight and K M McMullen for Defendant

Judgment:      17 February 2012

In accordance with r 11.5 I direct the Registrar to endorse this judgment with a delivery time of 3pm on the 17th day of February 2012.

SUPPLEMENTARY JUDGMENT AS TO INTEREST AND COSTS

[1]      In my judgment delivered on 15 December 2011, at [76], I gave judgment for the defendant on the plaintiff’s claim, and judgment for the defendant on its counterclaim in the sum of $467,925.32.   Counsel for the defendant has filed a memorandum noting that in its statement of counterclaim the defendant had claimed interest and that my judgment did not address that claim.  Counsel for the plaintiff has filed a memorandum in reply, to which counsel for the defendant has responded.

[2]      Judgment has not been sealed, so that the power to recall the judgment, under r 11.9 of the High Court Rules, is available.  I treat the plaintiff’s memorandum as an application for recall.

[3]      I regret that I did overlook the claim for interest in giving judgment.   I

consider that my failure to address the question of interest does provide a proper

VERBOEKET V SEAVIEW ROAD LIMITED HC WN CIV-2010-032-000190 [17 February 2012]

basis for the exercise of my discretion to recall the judgment.   That course was adopted, in similar circumstances, in Brake v Boote.[1]

[1] Brake v Boote (1991) 4 PRNZ 86.

[4]      The sum which I awarded as damages was the amount set out in paragraph 40 of the statement of defence and counterclaim, with an adjustment of $5,000 to reflect the evidence at trial as to the value of the property at the date of settlement.  The prayer for relief sought judgment for that amount, and interest on that amount “from

1 February 2010 to the date of judgment at the contractual rate of 14 per cent per

annum or such other rate as the Court deems just”.

[5]      The claim to a contractual rate of 14 per cent per annum is based upon cl 9.4 of the Agreement for Sale and Purchase.  The relevant parts of that clause are set out in [73] of my judgment. The basis for the claim is cl 9.4(3)(a).

[6] The vendor’s options following cancellation are set out in cl 9.4(1)(b). Here, the vendor elected to sue the purchaser for damages, under cl 9.4(1)(b)(ii). I addressed that issue briefly in [74]. Clause 9.4(3) describes the damages which may be claimed. There are, broadly, two elements which may be included in the damages claim:

(a)       All damages claimable at common law or in equity;  and

(b)      Any loss incurred in a resale contracted within one year.

[7]      That latter element was not available to the vendor in this case, because the resale, which I described in [70], was not contracted within one year.

[8]      The final sentence in cl 9.4(3), which includes the three lettered paragraphs, applies only to the second element of damages, namely the loss on resale.  That is clear from the wording of the clause.   The reference to “the amount of the loss” (rather than “the amount of the damages”), and the reference to “such resale” in cl 9.4(3)(a) and (c) makes that clear.  Accordingly, I do not consider that cl 9.4(3)(a)

has the effect of applying the interest rate for late settlement, when the vendor’s

claim is for damages claimable at common law or in equity under the first element in cl 9.4(3).

[9]      For these reasons, I do not consider that the contract provides for payment of interest on the damages awarded.  The claim to interest falls to be considered under s 87 of the Judicature Act 1908.  That provides that the Court may award interest at a rate not  exceeding the  prescribed  rate, for the whole or any part of the period between when the cause of action arose and the date of judgment.  Here, the cause of action  arose  on  the  cancellation  of  the  contract,  at  which  point  the  remedy  in cl 9.4(1)(b)  became  available  to  the  vendor.     The  contract  was  cancelled  on

23 February 2010.

[10]     All of the losses claimed were incurred by that date.  In the circumstances, I consider that the appropriate course is to order that the defendant is entitled to interest at the prescribed rate on the sum awarded, from 23 February 2010 to the date of judgment.

[11]     For these reasons, there will be an order recalling [76] of my judgment dated

15 December 2011. The recalled paragraph is replaced with the following.

[76]     There will be judgment for the defendant on the plaintiff’s claim. There will also be judgment for the defendant on its counterclaim in the sum of $467,925.32.  I award interest to the defendant on that sum, pursuant to s 87   of   the   Judicature   Act   1908,   at   the   prescribed   rate,   from

23 February 2010 to the date of judgment.

[12]     Both  counsel  have  in  their  memoranda  also  addressed  issues  of  costs. Counsel have accepted my preliminary view that costs on a 2B basis are appropriate. I direct that the defendant is entitled to costs, which I fix on a 2B basis, together with

disbursements, to be fixed by the registrar if required.

Solicitors:           C V Law Ltd, Wellington for Plaintiff

Cavell Leith Pringle & Boyle, Christchurch for Defendant

“A D MacKenzie J”