Wereszczynski v Zhang - [2016] NZHC 1397

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

CIV-2015-404-3039 [2016] NZHC 1397

BETWEEN
ANDREW ZGYMUNT

WERESZCZYNSKI AND CHRISTINE ANNE WERESZCZYNSKI

Plaintiffs

AND

JUNXING ZHANG Defendant

Hearing: 25 May 2016

Appearances:

Mr L Herzog for Plaintiffs
Mr E J Werry for Defendant

Judgment:

24 June 2016

JUDGMENT OF ASSOCIATE JUDGE J P DOOGUE

This judgment was delivered by me on
24.06.16 at 4 pm, pursuant to
Rule 11.5 of the High Court Rules.

Registrar/Deputy Registrar

Date……………

WERESZCZYNSKI v JUNXING ZHANG [2016] NZHC 1397 [24 June 2016]

[1] The plaintiffs, Mr and Mrs Wereszczynski, have filed an application for summary judgment. The substantive proceedings allege that the defendant, Mr Zhang, is the guarantor of certain lease payments that were required from a company, General Sports Ltd (“the company”), of which the defendant was a director and shareholder. The company entered into a deed of lease on 22 June 2011 which leased to it a cafe and driving range facility in west Auckland for a period of five years commencing on 1 June 2011. The business did not prosper. Apparently, the cafe had already been out of operation for some time before the company took over the facility.

[2] In order to assist the company to establish itself, the plaintiffs agreed to accept a reduced rent for the initial period of the lease. Specifically, special condition 57 of the deed of lease provided:

57. The parties specifically record that the previous Tenant Shine Golf Limited had an arrangement with the Landlord for a reduced rental for the Cafe and Driving Range, due to the premises not being in operation for several months prior to them taking over the Lease…. Accordingly, the Landlord and Tenant have agreed a rental reduction from commencement of the lease for June, July, August, September and October, …22 weeks less one day to $830 plus GST per week, to help establish the cafe and undertake refurbishment and redecoration of the premises.

[3] The standard rate, from which the above represented a deduction, was to be

$5330 per month plus GST or $1230 plus GST per week.

[4] It is accepted that the defendant did not bring the rent payments back up to the standard rate after the period of reduced rental came to an end on 1 November
2011.

[5] The matters which are in dispute in the summary judgment application have been refined and reduced in scope as a result of a conference which Toogood J conducted on 28 April 2016. Later that day, the Judge issued a minute in which he noted that the defendant claimed he was entitled to continue paying rent at the lower figure because, he said, the plaintiffs had agreed that the reduced rental should continue to apply “until the business got better”.

[6] Mr Werry appeared for the defendant and sensibly agreed that, subject to disputes about liability, the total unpaid rental under the deed of lease came to
$95,657.14 together with GST of $14,348.57 and interest totalling $37,997.10 for…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

Continue reading Wereszczynski v Zhang

Details

AGLC: Wereszczynski v Zhang [2016] NZHC 1397
Case: [2016] NZHC 1397
Decision Date: 24 June 2016

CaseChat Overview and Summary

In the case of Wereszczynski v Zhang, the plaintiffs, Mr. and Mrs. Wereszczynski, filed an application for summary judgment against the defendant, Mr. Zhang, for outstanding lease payments and other costs related to a lease agreement for a cafe and driving range facility. The defendant claimed that he was entitled to pay a reduced rental amount beyond the agreed-upon period due to an alleged agreement between the parties. The court found that the defendant's evidence concerning the receipt of an email detailing rental arrears was not credible. Furthermore, the court found that the defendant had not presented a reasonably arguable defence for the alleged reduced rental agreement, as it was vague and lacked particulars. As a result, the plaintiffs were granted summary judgment for the total amount of $148,002.81, including rental arrears, default interest, and GST. The plaintiffs were also entitled to costs under the lease agreement's cost-charging provision. The defendant's claim for an equitable set-off due to the plaintiffs' failure to maintain an electronic golf simulator in working condition was not considered substantial enough to halt the plaintiffs' claim.

Orders