DOHERTY AND ANOR V BANK OF NEW ZEALAND HC WN CIV-2009-485-1284

DOHERTY AND ANOR V BANK OF NEW ZEALAND HC WN CIV-2009-485-1284 13 July 2009IN THE HIGH COURT OF NEW ZEALAND WELLINGTON REGISTRY CIV-2009-485-1284IN THE MATTER OF the Property Law Act 2007 AND IN THE MATTER OF the Credit Contracts and Consumer Finance Act 2003 AND IN THE MATTER OF Mortgage Instrument No. 6670601.3 (Wellington Registry) BETWEEN PETER JOHN DOHERTY First Plaintiff AND HELEN MARY DOHERTY Second Plaintiff AND BANK OF NEW ZEALAND Defendant Telephone conference: 10 July 2009 Counsel: Peter Doherty in Person G J Toebes for the Defendant Judgment: 13 July 2009 In accordance with r 11.5 I direct the Registrar to endorse this judgment with the delivery time of 4:00pm on the 13 th day of July 2009.JUDGMENT OF JOSEPH WILLIAMS J[1] The first plaintiff owns a property at 7 Potaka Street, Marton. It is mortgaged to the Bank of New Zealand (the Bank). The Bank wishes to sell the land by auctionon Friday, 17 July. The Bank says that a Property Law Act Notice was served on the plaintiffs' New Zealand agent, Mr Robin Bruce Buxton, solicitor of Macalister Mazengarb Solicitors (the plaintiffs being resident in Australia). [2] The Bank alleges this notice was served at Mr Buxton's Wellington address on 12 June 2008. [3] The plaintiffs argue that notices for this property were not served. An affidavit has been filed by Mr Buxton. He deposes that no such notice was received at his offices. Mr Doherty deposes that no such notice was forwarded to him by Mr Buxton, and he has an affidavit from an Australian-based IT specialist who has looked at Mr Doherty's computer, extracted relevant emails from Mr Buxton to the first plaintiff and confirmed that no Property Law Act Notice in respect of the Marton property was forwarded with them. [4] There is therefore a genuine debate about whether the notice has been served. [5] Mr Toebes for the Bank concedes that there is an arguable case, but argues that the balance of convenience lies with allowing the auction to proceed on Friday. His arguments are: (a) the plaintiffs have no particular emotional attachment to the property and the Bank can pay damages if it is found to be at fault; (b) there is no way of knowing the worth of the plaintiffs' undertaking as to damages; (c) the Bank will be required to be pay twice for the auction because it has already incurred substantial costs and will have to incur them again. This may cost around $3,000. [6] In reply Mr Doherty argued that the property is in fact owned on behalf of his 19-year-old son and that together they renovated, or partially renovated it. He considers that putting the house to the market now will result in a substantial discount in the longer term value of the property to the detriment of his son, andthere is no need. He says that he has remedied all of the alleged arrears in respect of the property anyway. [7] I consider that the balance of convenience lies with preventing the sale at this stage. There is clearly a genuine debate about service of the notice and no way of knowing how that may ultimately be resolved, although it must be seen as significant that an officer of the court – Mr Buxton – deposes in firm terms that no notice was served. [8] The cost to the Bank of cancelling the auction is relatively modest and on the other hand the potential loss to Mr Doherty and his son (assuming their analysis of the market to be correct for present purposes) will over time potentially be very substantial indeed. [9] Notwithstanding Bevin v PSIS (1994) 2 NZ ConvC 191,821 it must be said that an additional matter in the balance is the fact that at least according to Mr Doherty the alleged breaches have in fact been remedied. [10] I am on balance prepared to grant the interim injunction sought on condition that the substantive issues in the proceeding are resolved quickly. I am advised that there are two days available in July 2009 for one-day fixtures each – one on 22 July and the other on 29 July. Two consecutive days are available week beginning 3 August 2009. [11] The respondent is restrained accordingly from selling the property at 7 Potaka Street, Marton until further order of this court. Leave is reserved to the respondent to further apply in the event that there is unjustifiable delay in having the substantive issues heard. "Joseph Williams J"Solicitors: Peter Doherty, Telephone: 006129 553 4991, Australia Buddle Findlay, Wellington