Watts v Leary

[2016] NZHC 1623

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

CIV-2013-090-142 [2016] NZHC 1623

BETWEEN

MICHAEL JOHN WATTS

Plaintiff

AND

DAVID VIVIAN LEARY First Defendant

AND

SHIRLEY JEAN LEARY Second Defendant

AND

RICE CRAIG Third Defendant

On the papers
Counsel:	JB Murray for the Plaintiff T Thoms for the First Defendant H Twomey for the Third Defendant
Judgment:	19 July 2016

JUDGMENT OF TOOGOOD J

This judgment was delivered by me on 19 July 2016 at 10:00 am

Pursuant to Rule 11.5 High Court Rules

Registrar/Deputy Registrar

Watts v Leary [2016] NZHC 1623 [19 July 2016]

[1]      The plaintiff, Mr Watts, is a United Kingdom citizen residing in England.  He alleges that on 22 April 2009 he loaned the sum of £60,000 to the first and second defendants (Mr Leary and Ms Leary), most of which has not been repaid as required.

[2]      Mr Watts says that the loan was to be used by the Learys in the purchase of a business, FRL Holdings Limited (FRL), of which Ms Leary was the sole director and shareholder.  Mr Watts claims the loan was to be repaid after three years or earlier if the business was sold and compound interest was payable at the rate of five percent per  annum.    Solicitors  acting  for  the  Learys  treated  the  payment  as  a  gift  but Mr Watts rejects that proposition.

[3]      The  funds  received  by  the  Learys  were  used  as  an  advance  to  FRL to purchase the business known as Rosedale Liquor, in or about June 2009.  The Learys sold the business about one year later.   Mr Watts alleges that, on 24 April 2012, Ms Leary paid the sum of $10,831.19 to him but neither of the first or second defendants made any other payment to him despite demands for the balance of the loan having been made.

[4]      Pursuant  to  a  Minute  of  Sargisson  AJ  dated  28 May 2015,  the  second defendant was re-served with the pleadings on 16 May 2016.1

[5]      The plaintiff has recalculated the amount of judgment sought to be sealed, claiming interest at five percent compounding annually from the date of the loan on

27 April 2009  to  30 June 2016.    He  seeks  costs  and  disbursements  in  both  the

District Court (from which the proceeding was transferred) and this Court.

[6]      The notice of proceeding notified the second defendant that she must file a statement of defence to the plaintiff’s claim within 25 working days’ after the date on which she was served with the notice.  The second defendant was informed that if she did not do so, the plaintiff may at once proceed to judgment on the plaintiff’s

claim, and judgment may be given in her absence.

1      According to an affidavit of service to that effect filed on 27 May 2016.

[7]      The second defendant has not filed a statement of defence and the time notified her for doing so has expired. The plaintiff is entitled to judgment.

[8]      Counsel  for  the  plaintiff  has  set  out  the  details  of  the  claim  for  the outstanding balance, compounding interest, costs and disbursements as follows:

Balance
Loan received 27 April 2009	155,224.33
Interest at 5%, compounding (annually)
1 July 2010 to 30 June 2011	7,761.22	162,985.55
1 July 2011 to 24 April 2012 (8,149.28 pa – 22.33 per day – 298 days)	6,654.34	169,639.89
LESS: repayment 10,831.19	158,808.70
25 April 2012 to 24 April 2013	7,940.43	166,749.13
25 April 2013 to 24 April 2014	8,377.46	175,086.59
25 April 2014 to 24 April 2015	8,754.33	183,840.92
25 April 2016 to 24 April 2016	9,192.04	193,032.96
25 April 2016 to 30 June 2016 (9651.65 pa – 26.44 per day – 66 days	1,745.04	$194,778.00

District Court Costs [2B $1,550 per day (2009 Rules apply as all steps prior to 1 July 2014)
Item	Description	Time allocation
1	Notice of claim	1.5
3	Information capsule	2.0
9.10	Application for order for substituted service on second defendant	0.4
3.9
Total	$6,045.00

High Court Costs [2B $1,990 per day (2009 Rules apply as all steps prior to 1 July 2014)
Item	Description	Time allocation
9	New statement of claim (equivalent of amended pleading)	0.6
10	Preparation first case management conference	0.4
13	Appearance first case management conference 31 July 2014	0.3
14	Issues conference 29 October 2014	0.5
20	List of documents	2.5
28	Obtaining judgment without appearance	0.3
29	Sealing judgment	0.2
4.8
Total	$9,552.00

Disbursements sought
District Court filing fee	169.20
Attempted service on second defendant	50.00
Application for substituted service	223.50
High Court filing fee on statement of claim	110.00
Service fee on second defendant	97.75
Sealing judgment	50.00
Total	$700.45

[9]      To summarise:

Principal and interest to 30 June 2016	194,778.00
District Court Costs	6,045.00
High Court Costs	9,552.00
Disbursements	700.45
TOTAL	$211,075.45

[10]     Accordingly, I give judgment for the plaintiff (including interest) in the sum of $194,778.00.  The second defendant shall pay costs in this Court and the District Court of $15,597.00 and disbursements of $700.45.   The total amount the second defendant is required to pay is $211,075.45.

……………………………..

Toogood J