MQF PROPERTIES LIMITED v MOSLI [2019] NZHC 673

MQF PROPERTIES LIMITED v MOSLI [2019] NZHC 673 [3 April 2019]IN THE HIGH COURT OF NEW ZEALANDAUCKLAND REGISTRYI TE KŌTI MATUA O AOTEAROATĀMAKI MAKAURAU ROHECIV-2019-404-000135[2019] NZHC 673BETWEEN MQF PROPERTIES LIMITEDPlaintiffAND ROSILAH MOSLIDefendantHearing: 2 April 2019Appearances: D Liu for the PlaintiffNo appearance by or on behalf of DefendantMinute: 3 April 2019JUDGMENT OF WOOLFORD JThis judgment was delivered by me on Wednesday, 3 April 2019 at 10:00 ampursuant to r 11.5 of the High Court Rules.Registrar/Deputy RegistrarSolicitors: Yu Lawyers, AucklandCopy to: Defendant[1] MQF Properties Limited (MQF) applies for summary judgment againstRosilah Mosli in the sum of $600,000 plus interest, costs and disbursements. Ms Mosliresides in Singapore. She has been served with a copy of the proceedings, but hastaken no steps.Factual background[2] On 9 May 2018, MQF, as vendor, and Ms Mosli, as purchaser, entered into anunconditional agreement for sale and purchase of real estate in respect of a propertyowned by MQF at 75A Coatesville-Riverhead Highway, Coatesville, Auckland. Theagreement was recorded in the ADLS/REINZ Ninth Edition 2012 (5) form andincluded the following terms:(a) Purchase price: $6,000,000.(b) Deposit: $600,000, payable by 18 May 2018.(c) Interest rate for late settlement: 10 per cent per annum.(d) Settlement date: 15 June 2018.[3] The agreement also included a provision that if the deposit was not paid on thedue date for payment, MQF may at any time thereafter serve on Ms Mosli noticerequiring payment. If Ms Mosli failed to pay the deposit on or before the third workingday after service of the notice, time being of the essence, MQF was able to cancel theagreement by serving notice of cancellation on Ms Mosli.[4] The deposit fell due on 18 May 2018, but Ms Mosli did not pay it or any partof it. On 19 May 2018, MQF served written notice on Ms Mosli requiring paymentof the deposit on or before the third working day after service of the notice. Ms Moslialso failed to comply with MQF's deposit notice. MQF at all material times was ready,willing and able to perform its obligations under the agreement on the date that thedeposit fell due.[5] On 25 May 2018, following expiry of the deposit notice, MQF served writtennotice on Ms Mosli cancelling the agreement on the ground of her failure to pay thedeposit.Plaintiff's submissions[6] MQF submits that it is entitled to recover the deposit from Ms Mosli as anaccrued debt under the agreement. In this regard, it relies on Pendergrast v Chapman1and Brown v Langwoods Photo Stores Limited.2 In the Court of Appeal decision ofBrown v Langwoods Photo Stores, the Court stated:In Pendergrast v Chapman, Wylie J held that s 8(3)(a) [of the ContractualRemedies Act 1979] did not prevent enforcement of an accrued cause of actionin debt. We agree, but would state the law more broadly. The provision doesnot abrogate any cause of action accrued unconditionally before cancellation,whether or not for debt. The present case is not concerned with any specialpoint that may arise about deposits on the purchase of land; but we see noreason to doubt the decisions of Wylie J and Gallen J that such a deposit, ifunconditionally due before cancellation but still unpaid, may be recovered byaction after cancellation by the vendor based on default by the purchaser. Thataccords with the role of a deposit as an earnest that the purchaser will goahead, and with the common law rule as now established by the weight ofauthority; see Damon Compania Naviera SA v Hapag-Lloyd International SA[1985] 1 All ER 475; Greig and Davis, The Law of Contract (1987) at pp 1277-1278. Decisions to the contrary such as Johnson v Jones [1972] NZLR 313cannot now be regarded as correct.Result[7] I am satisfied that the deposit, which was unconditionally due beforecancellation, may be recovered by action after cancellation by MQF based on defaultby Ms Mosli. Ms Mosli has no defence to the claim by MQF.[8] Although Ms Mosli resides outside New Zealand (namely Singapore), theCourt may exercise jurisdiction in this case because the agreement was to be whollyperformed in New Zealand3 and the breach occurred in New Zealand.41 Pendergrast v Chapman [1988] 2 NZLR 177.2 Brown v Langwoods Photo Stores Ltd [1991] 1 NZLR 173.3 High Court Rules 6.27(2)(b)(iii).4 High Court Rules 6.27(2)(c).[9] The proceeding was served on Ms Mosli in Singapore on 15 February 2019,but she has filed no defence, appearance or opposition.[10] Accordingly, there will be judgment against Ms Mosli for the sum of$652,438.36, being the amount of the deposit of $600,000 plus interest at 10 per centper annum from the due date for payment (18 May 2018) to the date of judgment(2 April 2019), being 319 days.[11] Further, MQF is entitled to costs of $9,812 and disbursements of $2,449.89.The total amount owing by Ms Mosli to MQF is therefore $664,700.25._________________________Woolford J