NEW WING DEVELOPMENT LIMITED V WAIN HC AK CIV 2010-404-8321

NEW WING DEVELOPMENT LIMITED V WAIN HC AK CIV 2010-404-8321 1 November 2011IN THE HIGH COURT OF NEW ZEALANDAUCKLAND REGISTRYCIV 2010-404-8321BETWEEN NEW WING DEVELOPMENT LIMITEDPlaintiffAND CLARE MARY WAINFirst DefendantAND PHILIP TREVOR LYONSSecond DefendantAND COLIN SLATER CONTRACTOR 2008LIMITEDThird DefendantAND IAN JESSE RICHARDSFourth DefendantAND MARCUS CHARLES PATERSONFifth DefendantAND MARK WILLIAM DE LISLESixth DefendantAND BRONWYN LESLIE SLATERSeventh DefendantAND COLIN LESLIE SLATEREighth DefendantHearing: 20 October 2011Counsel: JA Wickes for plaintiffEJ Hudson for third, seventh and eighth defendantsJL Millar for fourth, fifth and sixth defendantsJudgment: 1 November 2011 at 4:00 PMJUDGMENT OF ASSOCIATE JUDGE FAIRE[on application for summary judgment]Solicitors: Loo & Koo, PO Box 99 687, AucklandNielsen Law, PO Box 1108, Hamilton 3240Dix Koretz & Millar, PO Box 41, OtorohangaThe application[1] The plaintiff seeks summary judgment against the third defendant, the original tenant, and the fourth to eighth defendants, the original guarantors of an assigned lease, for rent, outgoings and interest.[2] Associate Judge Doogue entered judgment on an unopposed basis against the first defendant. His Honour recorded that no action was taken in respect of the second defendant, because that person was believed to be an undischarged bankrupt.The discovery application[3] As a preliminary matter, an application was made by the seventh defendant for particular discovery. Associate Judge Bell gave judgment on that application on 28 July 2011. Orders requiring the plaintiff to file and serve an affidavit of documents were made and a timetable for further affidavits on the summary judgment application was made. His Honour also directed that this fixture be allocated. Costs on the discovery application were reserved, to await the outcome of the summary judgment application.Background[4] By a deed of lease dated 18 October 2004, Chapel Road Holdings Ltd, as landlord, leased to the third defendant premises at 345 Chapel Road, Dannemora, Manukau City, Auckland.[5] The lease was for a term of 10 years, commencing on 6 August 2004. It contained one right of renewal for six years. The rent was $240,459, plus GST. That included a base rental and a capitalised works rental. The monthly rent was $20,038.25, plus GST. The first rent payment was due to be made on 1 September 2004. The tenant was obliged to pay all outgoings. The lease contains provisions for rent reviews operative as from 6 August 2005, 2008, 2010 and 2012. Provision iscontained for further reviews in the event that a renewal of the lease was sought and obtained. The lease document is the standard Auckland District Law Society 2002 Deed of Lease.[6] Schedule 3 to the lease contains the guarantee provisions. Under the guarantee, the guarantors guarantee payment of the rent and the performance of the covenants in the lease by the tenant. The Third Schedule expressly provides that an assignment of lease and any rent review shall not release the guarantor from liability.[7] On 17 December 2004 the plaintiff purchased the premises. On 27 June 2008 a deed of assignment of lease was executed. The parties to that document were the plaintiff as landlord, the third defendant as assignor, TLC Healthcare Ltd as assignee and the first and second defendants as guarantors.[8] Under the deed of assignment of lease, the third defendant assigned its estate in the premises to TLC Healthcare Ltd, and the first and second defendants guaranteed performance in accordance with the Third Schedule.[9] The deed of assignment of lease altered the term of the original lease to 16 years, necessitating an amendment to the printed form of the First Schedule of that document. The deed also introduced a new formula to the rent review position. The effect of this document in relation to the position of the third defendant, on the one hand, and in relation to the fourth to eighth defendants, on the other, needs to be looked at independently and will be considered later in this judgment.[10] TLC Healthcare Ltd failed to pay rent and outgoings commencing on 1 August 2008. That failure has continued to the present time.The court's approach to a plaintiff's summary judgment application[11] Rule 12.2 of the High Court Rules requires that a plaintiff satisfy the court that a defendant has no defence to a cause of action in the statement of claim or to a particular part of any such cause of action. The obligations imposed by the rule have been examined by a number of authorities.[12] The correct approach to an application for summary judgment by a plaintiff was recently summarised in Krukzeiner v Hanover Finance Ltd1 where the court said:The question on a summary judgment application is whether the defendant has no defence to the claim; that is, that there is no real question to be tried:Pemberton v Chappell [1987] 1 NZLR 1 at 3 (CA). The Court must be left without any real doubt or uncertainty. The onus is on the plaintiff, but where its evidence is sufficient to show there is no defence, the defendant will have to respond if the application is to be defeated: MacLean v Stewart (1997) 11 PRNZ 66 (CA). The Court will not normally resolve material conflicts of evidence or assess the credibility of deponents. But it need not accept uncritically evidence that is inherently lacking in credibility, as for example where the evidence is inconsistent with undisputed contemporary documents or other statements by the same deponent, or is inherently improbable: Eng Mee Yong v Letchumanan [1980] AC 331 at 341 (PC). In the end the Court‟sassessment of the evidence is a matter of judgment. The Court may take a robust and realistic approach where the facts warrant it: Bilbie Dymock Corp Ltd v Patel (1987) 1 PRNZ 84 (CA).[13] In Pemberton v Chappell2 the court also commented on the position where a defence is not evident on a plaintiff‟s pleading and said:If a defence is not evident on the plaintiff‟s pleading I am of opinion that if the defendant wishes to resist summary judgment he must file an affidavit raising an issue of fact or law and give reasonable particulars of the matters which he claims ought to be put in issue. In this way a fair and just balance will be struck between a plaintiff‟s right to have his case proceed to judgment without tendentious delay and a defendant‟s right to put forward a real defence.[14] That position was further reinforced in Australian Guarantee Corporation (New Zealand) Ltd v McBeth3 where the court said:Although the onus is upon the plaintiff there is upon the defendant a need to provide some evidential foundation for the defences which are raised. If not, the plaintiff‟s verification stands unchallenged and ought to be accepted unless it is patently wrong[15] Hypothetical possibilities in vague terms, unsupported by any positive assertion or corroborative documents will not frustrate the obligation on a plaintiff to discharge the onus of proof: SH Lock (NZ) Ltd v Oremland.41 Krukziener v Hanover Finance Ltd [2008] NZCA 187 (CA) at [26]; [2010] NZAR 307.2 Pemberton v Chappell [1987] 1 NZLR 1 (CA) at 3.3 Australian Guarantee Corporation (New Zealand) Ltd v McBeth [1992] 3 NZLR 54 at 59.4 SH Lock (NZ) Ltd v Oremland HC Auckland CP641/86, 19 August 1986.[16] In Tilialo v Contractors Bonding Ltd,5 the court raised a caution and said:The Courts must of course be alert to the possibility of injustice in cases in which some material facts to establish a defence are not capable of proof without interlocutory procedures such as discovery and interrogatories. That does not mean that defendants are to be allowed to speculate on possible defences which might emerge but for which no realistic evidential basis is put forward.[17] A court is not required to accept uncritically any or every disputed fact: Eng Mee Yong v Letchumanan.6 However, the court will not reject even dubious affidavit evidence, even if there is suspicion as to the good faith of the deponent, if there is an essential core of complaint that supports a defence. In essence, the inquiry iswhether or not the person‟s assertion passes the threshold of credibility: Pemberton v Chappell;7 Orrell v Midas Interior Design Group Ltd.8[18] In Tilialo v Contractors Bonding Ltd9 it was observed:Drawing the line between mere assertions of possible defences and material which sufficiently raises an arguable defence so that the defendant should not be denied the opportunity to employ interlocutory procedures and have a trial is a matter of judgment. Views may well differ.The plaintiff's case[19] The plaintiff‟s case is that the third defendant is liable for breaches of thelease dated 18 October 2004. The plaintiff sues for the rent due from 1 August 2008, plus outgoings and interest. It says that the third defendant‟s liability for the rent,outgoings and interest is unaffected by the deed of assignment. Ms Wickes submitted that the deed of assignment simply confirms the contractual obligation imposed on the third defendant to pay rent, outgoings and interest in respect of the default.[20] The plaintiff‟s case in respect of the guarantors is that the fourth to eighthdefendants remain liable pursuant to the original obligations that they undertook5 Tilialo v Contractors Bonding Ltd CA 50/93, 15 April 1994 (CA) at 6.6 Eng Mee Yong v Letchumanan [1980] AC 331.7 Pemberton v Chappell, above n 2.8 Orrell v Midas Interior Design Group Ltd (1991) 4 PRNZ 608 at 613.9 Tilialo v Contractors Bonding Ltd, above n 5, at 8.when they guaranteed the performance of the third defendant under the original lease. That position is not affected by the deed of assignment, because all that document did was introduce a variation to the original lease which did not have the effect of discharging the guarantees.The defendants' case[21] The third defendant‟s position is that the deed of assignment operated as asurrender of the original lease by operation of law. It effected, then, a re-grant. Mr Hudson submitted that the contractual obligation imposed on the third defendant to pay rent and outgoings, and the privity of estate that was formerly enjoyed by the third defendant as lessee, all came to an end with the execution of the deed of assignment. The result, he submitted, is that the third defendant is not liable for the breaches which all have occurred subsequent to the execution of the deed of assignment.The position in relation to the guarantors[22] Both Mr Hudson and Mr Millar, who represent different groups of guarantors, adopted the same position as that adopted by the third defendant. In short, their case is that the deed of assignment effected a surrender of the original lease. In the case of the guarantors, the deed of assignment amounted to a variation of the contract of guarantee. In the case of Mr Millar‟s clients, that is the fourth,fifth and sixth defendants, the deed was undertaken without their knowledge of the changes. Mr Millar submitted that the effect was to discharge their obligations pursuant to the guarantee. That position is in addition to the primary submission that the deed of assignment effected a surrender of the original lease and that, by itself, discharged the guarantors‟ obligations.[23] The position of the seventh and eighth defendants is a little different because they had knowledge of the content of the deed of assignment. Although the document, which I will set out in full shortly, was not executed by them as guarantors, their knowledge was acquired by virtue of the fact that they signed it as the directors of the third defendant. Nevertheless, Mr Hudson submitted that, first,they were discharged because the original lease had been surrendered; and secondly, in the alternative, like the fourth, fifth and sixth defendants, they were entitled to a discharge from the obligations as guarantors because there had been a substantial variation to the contract that they had originally agreed to guarantee.[24] The affidavit evidence filed on behalf of the seventh and eighth defendants is important as it sets out their involvement in the transaction that led to the execution of the deed of assignment. Their evidence, which was tendered in opposition, was not the subject of any specific reply by the plaintiff and must therefore be taken as unchallenged. In summary, the seventh defendant deposed:(a) The initial tenant was an investment company in which she and her husband and Mr Lyons, eighth and the second defendants respectively, had an interest;(b) In 2008 she and her husband wished to exit the venture. It was agreed that Mr Lyons would form a new company that would then take a transfer of the lease;(c) All negotiations concerning the assignment of the lease took place between the plaintiff and its officers and the second defendant;(d) The seventh and eighth defendants did not have any legal representation in relation to the preparation of the documentation that was designed to effect an assignment of the lease;(e) The seventh and eighth defendants were not asked, in their capacity as guarantors, to consent to any variation to the lease. The seventh defendant says that if she had understood that she was incurring further liability, she would not have consented; and(f) The eighth defendant has sworn a short affidavit confirming the evidence given by the seventh defendant.The deed of assignment[25] The deed of assignment is central to this dispute. It is a standard form document designed to deal with an assignment of a lease. It is not designed to deal with the situation where the assignment covers the extension of the term of the lease. I will set out shortly the operative parts of the deed of assignment that have a direct bearing on this dispute.[26] There is nothing in the papers before me to suggest that the parties to the deed of assignment turned their minds to the possibility that by the operation of law the extension of the term of the lease amounted to a surrender of the original lease and a re-grant to the new tenant.[27] As I have already recorded, the fourth, fifth and sixth defendants were not parties to the deed of assignment and therefore they cannot assist.[28] The seventh and eighth defendants say they took no part in the negotiations undertaken by the second defendant with the plaintiff relating to the assignment and, in particular, to the extension of the lease term.[29] No evidence is advanced on the plaintiff‟s behalf that has any directrelevance to the intention of the parties behind the deed of assignment and particularly the extension of the term. The plaintiff relies on the document itself.[30] The operative parts of the deed of assignment are as follows:DEED OF ASSIGNMENT OF LEASEFOURTH EDITION 2006DATE: 27 June 2008ASSIGNOR: COLIN SLATER CONTACTOR 2008 LIMITED at Hamilton (FORMERLY TLC BOTANY DOWNS LIMITED at Hamilton)ASSIGNEE: TLC HEALTHCARE LIMITED of HamiltonSHARHOLDER(S) and DIRECTOR(S):of AssignorGUARANTOR: Philip Trevor LYONS, Director of Hamilton and Clare MaryWANE WAIN, Manager of AucklandLANDLORD: NEW WING INVESTMENT LIMITED at Auckland1. THE ASSIGNOR assigns to the Assignee all the Assignor‟s estate andinterest in the Premises and the Lease as set out in the First Schedule.2. THE ASSIGNOR and the Assignee agree and acknowledge as set out in the Second Schedule.3. THE GUARANTOR guarantees as set out in the Third Schedule.4. THE ASSIGNOR and the Shareholder(s) and Director(s) (if any) agree as set out in the Fourth Schedule5. THE ASSIGNOR, the Assignee, the Landlord and the Guarantor all acknowledge that the Lease expires on the Expiry Date of Current Term set out in the First Schedule and the rent is the Annual Rent set out in the First Schedule.6. THE LANDLORD consents to the assignment but without prejudice tothe Landlord‟s rights powers and remedies under the Lease. If anyLease Variations are specified in the First Schedule the Landlord, the Assignor, the Assignee and the Guarantor agree that as from the Date of Assignment the Lease is varied as set out in the Lease Variations.7. THE LANDLORD acknowledges that as at the Date of Assignment the Landlord is not aware of any existing breach of the Lease by theAssignor and has no interest in any of the Assignor‟s Assets.WHENEVER words or phrases appear in this Deed and in the Second, Third and Fourth Schedules that also appear in the First Scheduled then those words or phrases shall also mean and include the details supplied after them in the First Schedule.IN this Deed:(a) The expressions "the Assignor", "the Assignee", "the Guarantor", "the Shareholder", "Director" and "the Landlord"include their respective executors administrators successors and permitted assigns.(b) The expression "Business Use" in the First Schedule meansthe permitted use of the Premises as at the Date of Assignment or as varied by any Lease Variation.(c) The expression "Assignor‟s Assets" shall mean all thechattels, fixtures and fittings in the Premises which are owned by the Assignor.(d) Where the context requires or admits, words importing the singular shall import the plural and vice versa.(e) Where any party comprises more than one person, such persons shall be deemed to have entered into the Deed both jointly and severally.FIRST SCHEDULEPREMISES: As described in the First Schedule of the Deed of Lease.CARPARKS: As described in the First Schedule of the Deed of Lease.DATE OF LEASE: 18 October 2004RIGHTS OF RENEWAL: One (1) of six (6) years.ANNUAL RENT: Premises: $267,827.50 plus GST per annumCarparks: $ - plus GST per annumTotal: $267,827.50 plus GST per annumEXPIRY DATE OF CURRENT TERM: 5 AUGUST 2014. Refer to additional clauseBUSINESS USE: Health Club and Wellness CentreDATE OF ASSIGNMENT: -RESTRAINT OF TRADE PERIOD: -RESTRAINT OF TRADE RADIUS: -LEASE VARIATIONS: Refer to Additional Clauses.SECOND SCHEDULE1. THE Assignee agrees with the Assignor to perform all the provisions in the Lease from the Date of Assignment.2. THE Assignee indemnifies the Assignor and any guarantor of the Assignor against all liability arising out of any default by the Assignee in the performance of the provisions in the Lease as from the Date of Assignment.3. THE Assignor warrants that all the provisions of the Lease have been performed up to the Date of Assignment.4. THE Assignee agrees with the Landlord that the Assignee will perform all the provisions of the Lease from the Date of Assignment.5. THE Assignor acknowledges to the Landlord that the covenants of the Assignee are not in substitution for and do not alter the liability of the Assignor under the Lease.THIRD SCHEDULE1. FROM the date of Assignment the Guarantor:1.1 Guarantees to the Assignor and the Landlord the performance bythe Assignee of all the tenant‟s obligations under the Lease: and1.2 Indemnifies the Assignor, any guarantor of the Assignor and the Landlord against any liability or losses suffered by the Landlord as a result of the Lease being lawfully disclaimed by an liquidator or receiver or arising through default by the Assignee in the performance of the provisions in the Lease.2. THE Guarantor agrees that neither an assignment of the Lease nor any rent review in accordance with the Lease nor any indulgence granting of time waiver or forebearance to sue or any other thing whereby the Guarantor would be released as a surety in any way releases the Guarantor from liability under the Lease.FOURTH SCHEDULETHE Assignor and the Shareholder(s) and Director(s) (if any) agree with the Assignee that the Assignor and the Shareholder(s) and Director(s) (if any)will not during the Assignor‟s Restraint of Trade Period either directly orindirectly carry on or be interested either alone or in partnership with or as manager, agent, director, shareholder or employee of any other person in any business similar to that carried on by the Assignee within the Restraint of Trade Radius from the Premises stated in the First Schedule.[31] I do not set out the additional clause referred to under the heading Expiry Date of Current Term. In summary, the additional clauses provided the following:(a) The term of the lease was extended for a further six years, to a total term of 16 years;(b) Further rights of renewal were provided for, leading to a final expiry date of 5 August 2026 (this should be compared with the original lease, which was for 10 years and with an expiry date of 5 August 2020);(c) The rent review provisions were deleted under the original lease and replaced. The change is significant as it introduces a new formula as the basis for establishing how the rent review is to be calculated.Analysis[32] The first issue that requires determination is the effect of the deed of assignment.[33] The original lease contains no provision for an extension of the term. There is provision in it for the renewal of the lease. The law in relation to the liability of the assignor where there has been a renewal after the assignment was settled by the Court of Appeal in Sina Holdings Ltd v Westpac Banking Corporation.10 The court held that where an assignee exercises a right of renewal provided for in the lease, the original lessee is not liable for the payment of rent or the performance of covenants under the renewed lease. This is because the renewal of the lease constitutes a new grant. Accordingly, the existence of a right of renewal in the lease does not assist theplaintiff‟s position in this case.[34] It is necessary to consider specifically what the effect of an agreement to extend a lease is. The position is summarised in Laws of New Zealand:11353. Variation of terms of leases where the terms of the relationship between the lessor and the lessee are altered by agreement it is necessary to decide whether the alteration amounts to the creation of a new lease upon the altered terms, and thus of necessity the surrender by operation of law of the previous lease, or whether the alteration merely continues the previous lease in a varied form.12 Certain agreed alterations necessarily involve the surrender of the previous lease and its replacement by a new lease. the duration of a lease can be extended only by the surrender of the existing lease and its replacement by a new lease for the longer term.13[35] The footnote in Laws of New Zealand records:10 Sina Holdings Ltd v Westpac Banking Corporation [1996] 1 NZLR 1.11 Laws of New Zealand Lessor and Lessee at [353].12 Robert Jones Investments Ltd v Instrument Supplies Ltd (1991) 1 NZ ConvC 190, 746; FriendsProvident Life Office v British Railways Board [1996] 1 All ER 336 (CA).13 Re Savile Settled Estates [1931] 2 Ch 210, [1931] All ER Rep 556.This is not the case where the original lease contains an option to extend. This point may not have been appreciated in some cases involving guarantees: Robert Jones Investments Ltd v Attorney-General (1994) 2 NZ ConvC 191,845; Westpac Banking Corporation v Sina Holdings Ltd (1994) 2 NZ ConvC 191,850; and Mayhew v Robert Jones Investments Ltd (1993) 2 NZ ConvC 191,719 (CA).[36] If what occurs is a surrender of the original lease, the result is that it stops the subsequent accrual of rent.14[37] In Adams v Touchtwo Ltd Hugh Williams J undertook a comprehensive review of the law in England, Australia and New Zealand.15[38] The plaintiff in Adams v Touchtwo Ltd was the owner of a commercial premise. In December 1999 it leased the premises to Touchtwo Ltd, the defendant, for 10 years. The lease contained no right of renewal. In 2006 Touchtwo Ltd assigned the lease to BFS Auckland Ltd. Its obligations were guaranteed by the fifth to seventh defendants. At the same time, the plaintiff and BFS Auckland Ltd entered into a deed varying the terms of the lease whereby the term was extended by six years. Touchtwo Ltd was not a party to the deed. BFS Auckland Ltd fell into arrears of rent. The plaintiff terminated the lease and claimed the arrears from Touchtwo Ltd and BFS Auckland Ltd and the guarantors.[39] The court found that the 2006 deeds of assignment and variation effected a surrender of the balance of the December 1999 lease by operation of law and effected the grant of a new lease to BFS Auckland Ltd from that date until 2006. The result was that the parties had replaced a lease that was still current with another for the balance of the existing term. As a result, Hugh Williams J declined theplaintiff‟s application for summary judgment.[40] Ms Wickes sought to distinguish the position in this case from that set out inAdams v Touchtwo Ltd. She drew attention to the fact that the extension of the term of the lease was contained in the deed of assignment itself. Unlike the position in14 Laws of New Zealand, above n 11; Moir v McPherson [1917] GLR 592; Wildeboer v Carter[2004] 3 NZLR 247.15 Adams v Touchtwo Ltd (2011) 11 NZCPR 577.Adams v Touchtwo Ltd, the third defendant is a party to the extension of the lease because it is a party to the deed of assignment that contains the extension of lease.[41] The decisions that were referred to by Hugh Williams J do not confine the principle that a surrender of the original lease occurs only in situations where the original lessee is ignorant of the assignment variation.16 Indeed, in Jenkin R Lewis & Sons Ltd v Kerman Russell LJ observed:17This „surrender by operation of law‟ takes effect whether or not the parties to the new lease intend it to take effect.And:It is not possible simply to convert the existing estate in the land into a different estate by adding more years to it, and even if the parties use words which indicate that this is what they wished to achieve the law will achieve the result at which they are aiming in the only way in which it can, namely by implying a fresh lease for the longer period and a surrender of the old lease.[42] The result is that the plaintiff cannot satisfy the onus of proving that there is no defence in this case. Each guarantor, that is the fourth to eighth defendants, guaranteed the obligations under the original lease. If it has been surrendered then, as I have previously stated, there is no subsequent accrual of rent beyond the date of surrender of the lease. It follows that there is no breach by the third defendant inrespect of which the guarantors‟ guarantee the third defendant‟s obligation and in relation to the original lease.[43] This finding by itself makes it unnecessary to consider the alternative ground relied by the guarantors, namely, that there has been a variation of the contract between the obligor and the obligee that has clearly prejudiced them and therefore discharges their obligations as guarantor.18 It also makes it unnecessary to considerwhether the seventh and eighth defendants‟ knowledge of the variation estopped16 Jenkin R Lewis & Sons Ltd v Kerman [1970] All ER 414 (CA); Friends Provident Life Office vBritish Railways Board, above n 12; City of London Corporation v Fell [1994] 1 AC 458 (HL).17 Ibid at 419.18 Holme v Brunskill (1878) 3 QBD 495 (CA); Overton Holdings Ltd v Owens Properties LtdCA 114/02, 24 October 2002.them from denying that their guarantee does not apply. Counsel referred in argument to Winstone Ltd v Bourne and Liguori v Richelieu Investments Ltd.19[44] It also means that s 241 of the Property Law Act 2007 does not apply. That, of course, was the conclusion reached by Hugh Williams J in Adams v Touchtwo Ltd.20 In short, s 241 of the Property Law Act 2007 does not impinge on the surrender and re-grant occasioned by the extension of the term.[45] The position of the third defendant does cause some difficulty because the third defendant is a party to the document that creates the re-grant. The deed of assignment defines the lease as that set out in its First Schedule. The First Schedule contains the terms of the re-grant. It is arguable, therefore, that the deed of assignment effected a re-grant to the third defendant, which was then assigned toTLC Healthcare Ltd. If this is the case, then the plaintiff‟s statement of claim would require amendment. Although amendments are possible in summary judgment applications it would not be appropriate after hearing the application, to look at what would effectively be a new cause of action against the third defendant.21 If the plaintiff wishes to pursue that line, it should do so is way of amended pleadings in preparation for this matter being disposed of in the ordinary way, by trial.Conclusions[46] I conclude that the plaintiff cannot satisfy the onus that the defendants have no defence. There is clearly an arguable basis for the proposition that the deed oflease that is the foundation for the plaintiff‟s claim against the third to eighthdefendants has, in fact, been surrendered by the deed of assignment. Accordingly, the application for summary judgment is declined.[47] In the discussions I had with counsel at the conclusion of the hearing I canvassed the possibility of a declinature of the application for summary judgment and what steps should be ordered in consequence. What I set out below is the position that I understood all agreed to. In addition, counsel agreed that costs should19 Winstone v Bourne [1978] 1 NZLR 94; Liguori v Richelieu Investments Ltd [2008] NZCCLR 35.20 Adams v Touchtwo Ltd above n 15 at [83].21 Cegami Investments Ltd v AMP Financial Corporation (NZ) Ltd [1990] 2 NZLR 308.be reserved. That, of course, follows the general position which applies in line withNZI Bank Ltd v Philpott.22 It also takes into consideration the fact that costs in relation to the discovery application have also been reserved and at the appropriate time will need to be brought into account.Orders[48] I order:(a) The application for summary judgment is dismissed;(b) An amended statement of claim shall be filed and served by 24 November 2011;(c) A statement of defence to the amended statement of claim shall be filed and served by 15 December 2011;(d) A telephone case management conference with counsel shall be held at 10:10am on 2 February 2012. The following matters will be addressed:(i) Whether further specific orders for discovery are required and, if so, what orders should be made;(ii) Disposal of any other interlocutory matter or, alternatively, allocation of a fixture for same;(iii) Quantum;(iv) The issues requiring resolution at trial;(v) Settlement and whether a mediation or a Judicial settlement conference should be ordered; and22 NZI Bank Ltd v Philpott [1990] 2 NZLR 403 (CA).(vi) Trial duration, the fixing of the trial date and the making of any special trial directions that are required. In respect of these matters, counsel should have available the number of witnesses to be called and the general scope of the evidence to be covered. In addition, counsel should be in a position to indicate whether any order should be made in relation to the experts pursuant to r 9.44.Because the issues requiring resolution at trial will be considered at the conference, memoranda shall be filed on a sequential basis so that the defendants have the opportunity to comment on the plaintiff‟ssummary of the trial issues. To achieve this, the plaintiff‟smemorandum dealing with the above matters shall be filed and served by 23 January 2012 and the defendants‟ memorandum dealing withthe above matters and, in particular, commenting upon, conceding or adding to the list of issues shall be filed and served by 27 January 2012.