LENDLEASE CAPITAL SERVICES PTY LIMITED v ARENA LIVING HOLDINGS LIMITED [2020] NZCA 471

LENDLEASE CAPITAL SERVICES PTY LIMITED v ARENA LIVING HOLDINGS LIMITED [2020] NZCA471 [5 October 2020]IN THE COURT OF APPEAL OF NEW ZEALANDI TE KŌTI PĪRA O AOTEAROACA358/2020[2020] NZCA 471BETWEEN LENDLEASE CAPITAL SERVICES PTYLIMITEDAppellantAND ARENA LIVING HOLDINGS LIMITEDRespondentCourt: Kós P and Clifford JCounsel: J F Anderson QC, M R Crotty and M Eastwick-Field forAppellantS J P Ladd and B J Ward for RespondentJudgment:(On the papers)5 October 2020 at 9 amJUDGMENT OF THE COURTA Leave to appeal is granted.B The approved questions on appeal are those stated at [5].____________________________________________________________________REASONS OF THE COURT(Given by Kós P)[1] The applicant, Lendlease Capital Services Pty Ltd, seeks leave to appeal adecision of the High Court declining its interlocutory application for orders strikingout the second cause of action, an allegation of breach of a maintenance warranty, inthe statement of claim of the respondent, Arena Living Holdings Ltd.1 Lendleasesought leave to appeal in the High Court which was declined.2[2] The underlying claim concerns a sale of shares in a company that ran fiveretirement villages in New Zealand, by Lendlease, to Arena. Three of the fiveretirement villages suffer from watertightness issues. Arena claims against Lendleasefor breach of warranties in the sale and purchase agreement.[3] Lendlease's application for strike out relates to the second cause of action,an allegation of breach of cl 14.1 of the agreement warranting that the buildings wereappropriately maintained. Clause 10.4 of the agreement relevantly provides that Arenamay only claim for a breach of warranty if it gave Lendlease written notice ofthe claim, setting out reasonable particulars, before a specified date. Lendlease'sstrike-out application alleges Arena did not give notice of breach of cl 14.1 in time.[4] This Court may grant leave under s 56(5) of the Senior Courts Act 2016. Leaveshould not be granted unless:3(a) the proposed appeal raises some question of law or fact capable of bonafide and serious argument in a case involving some interest, public orprivate, of sufficient importance to outweigh the cost and delay ofthe appeal; and(b) the proposed appeal has some reasonable prospect of success.[5] We are satisfied the following questions posed by Lendlease meet thosecriteria, namely whether the High Court erred in:(a) distinguishing between contractual notices requiring the person notifiedto do or refrain from doing something and contractual notices that1 Arena Living Holdings Ltd v Lendlease Capital Services Pty Ltd [2020] NZHC 587.2 Arena Living Holdings Ltd v Lendlease Capital Services Pty Ltd [2020] NZHC 1308.3 Moir v IHC New Zealand Inc [2018] NZCA 130, (2018) 24 PRNZ 45 at [6]; and Greendrake vDistrict Court of New Zealand [2020] NZCA 122 at [6].convey information, and finding that there is a heightened need forclarity and certainty in relation to the former but not the latter;(b) finding looseness in the references to breaches of other warranties inArena's notices was not fatal to their compliance with cl 10.4;(c) finding cl 10.4 permitted Arena to leave its way open to make claimsunder other warranties without expressly identifying those otherwarranties in the notices;(d) departing from English authority on the interpretation of noticeprovisions such as cl 10.4;(e) finding a vendor notified of a claim for watertightness defects wasthereby fairly notified of a claim under a maintenance warranty;(f) finding the cl 10.4 requirement to provide reasonable particulars ofthe grounds on which Arena's claims for breach of the maintenancewarranty is based was satisfied by reference to the watertightnesswarranty and/or watertightness defects and did not require Arena torefer to the maintenance warranty; and(g) finding, in the context of a leaky building claim, it would be undulyoppressive to require the purchaser to give greater specificity atthe notification stage by identifying the warranties under which itintended to claim.Result[6] Leave to appeal is granted.[7] The approved questions on appeal are those stated at [5].Solicitors:Russell McVeagh, Auckland for AppellantBell Gully, Auckland for Respondent