LEIGH AND ANOR V THE MACENNOVY TRUST LTD AND ORS HC AK CIV 2009-404-3631

LEIGH AND ANOR V THE MACENNOVY TRUST LTD AND ORS HC AK CIV 2009-404-3631

Clause 25.4 was fair and reasonable and therefore conclusive under s4(1) CRA so contractual claims based on pre-contractual representations were barred; however the vendor's and agent's statements were objectively misleading under s9 FTA, purchasers were actually misled and causation established, and the appropriate remedial exercise under s43 FTA was to vary the contracts retrospectively by reducing each purchase price by NZD 400,000 and order settlement and related directions (settlement date and suspension of interest).

Citation
openlaw-97996a10_ead0_489f_9896_045870df1d19.pdf
Parties
First Plaintiff: Margot Anne Leigh; First Plaintiff: Paul Richard Leigh; Second Plaintiff: Dinah Elizabeth Malyon; Second Plaintiff: Harbour Trustee Services No.2 Ltd as trustees of the Tauhara Trust; First Defendant: The MacEnnovy Trust Ltd; Second Defendant: Deposit Bond (NZ) Ltd; Third Defendant: Vero Insurance Ltd; Fourth Defendant: New Zealand Home Bonds Ltd; Fifth Defendant: Westpac New Zealand Ltd
Court
High Court
Jurisdiction
New Zealand
Judgment Date
31 March 2010
Procedural Posture
Civil Contract and Fair Trading Act / Judgment After Trial (final)
Outcome
Court varied the sale agreements under s43 FTA and awarded financial compensation by reducing each purchase price by NZD 400,000; orders for settlement and interest deferment made; contractual claims barred by entire agreement clause.
Legal Topics
Misrepresentation, Entire Agreement Clause, Causation, Remedy Under S43 FTA, Contractual Remedies Act S4(1)
Contract Law Consumer Protection Fair Trading Act Property Law Civil Remedies Misrepresentation Entire Agreement Clause Causation +2 more

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Parties

Margot Anne Leigh

First Plaintiff

Paul Richard Leigh

First Plaintiff

Dinah Elizabeth Malyon

Second Plaintiff

Harbour Trustee Services No.2 Ltd as trustees of the Tauhara Trust

Second Plaintiff

The MacEnnovy Trust Ltd

First Defendant

Deposit Bond (NZ) Ltd

Second Defendant

Vero Insurance Ltd

Third Defendant

New Zealand Home Bonds Ltd

Fourth Defendant

Westpac New Zealand Ltd

Fifth Defendant

Procedural Posture

Civil Contract and Fair Trading Act / Judgment After Trial (final)

Legal Issues

  1. 1 Whether entire agreement clause (clause 25.4) barred inquiry into alleged pre-contractual representations under s4(1) CRA
  2. 2 Whether vendor's and agent's statements as to apartment floor areas were misleading or deceptive in breach of s9 FTA
  3. 3 Whether purchasers were actually misled and causation established between representations and loss

Ratio Decidendi

Clause 25.4 was fair and reasonable and therefore conclusive under s4(1) CRA so contractual claims based on pre-contractual representations were barred; however the vendor's and agent's statements were objectively misleading under s9 FTA, purchasers were actually misled and causation established, and the appropriate remedial exercise under s43 FTA was to vary the contracts retrospectively by reducing each purchase price by NZD 400,000 and order settlement and related directions (settlement date and suspension of interest).

Court Disposition

Court varied the sale agreements under s43 FTA and awarded financial compensation by reducing each purchase price by NZD 400,000; orders for settlement and interest deferment made; contractual claims barred by entire agreement clause.

Orders

  • Vary each agreement for sale and purchase to reduce the purchase price by NZD 400000 effective from the respective contract date (4 May 2007 and 24/25 July 2007)
  • Each purchaser to settle their obligations under the varied contracts on 1 July 2010