MCCARTHY v CHRISTCHURCH CANTERBURY MARKETING LTD [2017] NZHC 1321

MCCARTHY v CHRISTCHURCH CANTERBURY MARKETING LTD [2017] NZHC 1321 [13 June 2017]IN THE HIGH COURT OF NEW ZEALANDCHRISTCHURCH REGISTRYCIV-2016-409-1188[2017] NZHC 1321BETWEEN ROBIN MAX MCCARTHY T/ACHRISTCHURCH TOURS GROUPAppellantAND CHRISTCHURCH CANTERBURYMARKETING LIMITED T/ACHRISTCHURCH CANTERBURYTOURISMRespondentHearing: 7 June 2017Appearances: Appellant in PersonA N Riches for the RespondentJudgment: 13 June 2017JUDGMENT OF MANDER J[1] The appellant, Robin McCarthy, has appealed the judgment of the District Court declining his claim against the respondent, Christchurch Canterbury Marketing Limited (CCM), for alleged losses arising from a breakdown in their business relationship. Mr McCarthy claimed CCM wrongfully terminated their contractual relationship. However, Judge Kellar found that CCM was entitled to do so, and that Mr McCarthy had not proved his loss. Mr McCarthy has appealed those findings.Background[2] CCM is an organisation which promotes tourism services in Christchurch and Canterbury. Tourist operators pay a subscription fee to CCM in return for their brochures being displayed at CCM's premises which operates as a visitor centre anddisplays Tourism New Zealand's official "I-Site" brand. For a commission, CCM also provides a booking service on behalf of subscribers. Prior to the Canterburyearthquakes of February 2011 it operated out of the Central Post Office Building in Cathedral Square. Tourist operators who take up its services are described as its"business partners" and the payment of the appropriate fee to display brochures atthe visitor centre as constituting a "membership".[3] Mr McCarthy has for a number of years worked in the local tourism industry, offering transport and touring services. He is a land transport operator licensed by the New Zealand Transport Agency, and has operated a number of tourist services inCanterbury. He first subscribed to CCM's services in 2003. Mr McCarthy displayed brochures advertising his tours at CCM's visitor centre, and also sold these tours andservices through the centre.[4] In 2010, disagreements developed between the parties regarding the qualityand accuracy of Mr McCarthy's brochures. As an example, one of Mr McCarthy'sbrochures represented a tour as having been endorsed by the Canterbury Horticultural Society. This was not correct, although Mr McCarthy maintained he inherited the brochure from the previous owner of the tour company which offered this tour and was unaware of the inaccuracy. CCM were unhappy about the state ofMr McCarthy's brochures. Many of them had parts crossed out with permanent marker and "discontinued" stamped on many of the tours, in addition to handwritten corrections.[5] The difficulties with the brochures appear to have been part of a series of disagreements between Mr McCarthy and staff at the I-Site premises, which developed into an ongoing dispute and ultimately culminated in CCM terminatingMr McCarthy's membership in December 2010. CCM refunded Mr McCarthy'smembership fee and settled outstanding bookings, although CCM continued to administer bookings for Mr McCarthy on a commission basis until 2015.[6] Mr McCarthy's claim before the District Court alleged a number of different grievances, however, as a result of case management and direction by the District Court and the filing by Mr McCarthy of an amended statement of claim, MrMcCarthy's action broadly distilled to one based upon breach of contract for whichhe sought compensation in the sum of $200,000.[7] At the commencement of the hearing before the District Court, Judge Kellar confirmed with Mr McCarthy that his claim was based on an allegation that his contract with CCM had been wrongfully terminated for which he was seeking compensation. Mr McCarthy maintained the termination of his membership had resulted in the loss of business and income, and had affected his reputation, and caused personal stress both to him and to his employees.[8] CCM denied any breach of contract and maintained that Mr McCarthy'smembership had been validly cancelled in accordance with the terms and conditions of the contract. Further, that if any losses had been suffered by Mr McCarthy they were not attributable to the actions of CCM, but rather reflected and were exclusively attributable to the serious decline in tourism in Christchurch in the wake of the February 2011 earthquakes.District Court decision[9] Judge Kellar found that when Mr McCarthy joined CCM he agreed to the standard terms and conditions of membership. Those terms included CCM reserving the right to terminate membership in the event of substandard, unlawful or unsafe operation of the product or service. Further, that failure by a member to act "in a professional and respectful manner" entitles CCM to suspend or terminatemembership.[10] The District Court found that CCM had legitimate concerns about Mr McCarthy's brochures being substandard, and that CCM had reasonably refusedto display the brochures, which contained little relevant or accurate information, until they had been properly updated. When Mr McCarthy refused to do so, CCM was entitled to cancel his membership. Based upon CCM's view of Mr McCarthy'sconduct towards CCM staff at the I-Site premises, Judge Kellar also found that CCM was entitled under the terms and conditions of the contract to terminate Mr McCarthy's membership.[11] Regardless of whether Mr McCarthy had established that CCM had wrongfully terminated the contract, Judge Kellar found that any loss Mr McCarthy had suffered was not as a result of any wrongful repudiation of the contract by CCM,but rather the effect of the Christchurch earthquakes of 2011. Most tourism operators in Christchurch had little to no income in 2011, with many going out of business.[12] In 2013, CCM invited Mr McCarthy to renew his membership to display his brochures at the new I-Site premises, but Mr McCarthy refused to agree to the terms and conditions or the membership fee, insisting that CCM should instead pay him compensation for lost income.Approach to appeal[13] This is a general appeal which proceeds by way of rehearing. The appellate Court is required to form its own view and exercise its own evaluative judgment involving issues of fact and degree without undue deference being paid to the Court at first instance.1 Should the appellate Court come to a different conclusion from that reached by the Judge, it must follow that the original decision was wrong and the appellate Court should intervene.[14] However, the appellant bears the onus of satisfying the appellate Court that it should differ from the decision of the lower Court. It is necessary for the appellant to identify the respects in which he or she says the judgment below is in error. The appellant must persuade this Court that it should differ from the Court below.2[15] On issues of credibility, an appellate Court should give appropriate weight to the conclusion of the Judge at first instance, and respect the advantages of that Court in seeing and hearing the witnesses.3Application to admit further evidence[16] Mr McCarthy made application to have admitted on the appeal a number of documents which he believed had not been produced before the District Court. That application was opposed. It was not clear why these documents, which appear to1 Austin, Nichols & Co Inc v Stichting Lodestar [2007] NZSC 103, [2008] 2 NZLR 141.2 Porter v Chief Executive, Ministry of Social Development [2013] NZHC 2666 at [30].3 WPH v ITP HC Auckland CIV-2009-404-462, 10 June 2009; Porter v Chief Executive, Ministry of Social Development, above n 2.have been available to Mr McCarthy at the time of the District Court hearing, wereneither disclosed to CCM, nor produced, if considered relevant to Mr McCarthy'scase.[17] However, Mr McCarthy is a litigant in person. At the hearing of this matter, I considered the best course to adopt in the interests of justice was to provisionally admit these further documents in order to gauge their materiality to Mr McCarthy'sargument. In the event, only a handful of documents were actually referred to in the course of Mr McCarthy's submissions. Their introduction and the purpose for which they were referred to by Mr McCarthy did not prejudice CCM.[18] It also became apparent that a number of the documents, in particular a copy of a trust deed, had in fact been before the District Court, and Mr McCarthy'sapplication was therefore, in some respects, redundant. The balance of the documents either related to Mr McCarthy's ongoing dispute with CCM and theChristchurch City Council after his membership was terminated, or to Mr McCarthy's more recent tours and activities.[19] Approaching the issue on the basis outlined, I admit documents 82-86, but exclude the rest. While some of the documents I have declined to admit are arguably relevant to the matter, they have little, if any, probative value.Issues on appeal[20] Mr McCarthy challenged a number of the District Court's findings regarding his contractual relationship with CCM, the circumstances leading up to the termination of his membership, and the cause of his loss. He also alleged Judge Kellar wrongly allowed and relied upon hearsay evidence from the sole witness called by CCM, Mr Martin Brice, the company's general manager of corporateservices.[21] Four issues arise from Mr McCarthy's submissions:(a) Was Mr McCarthy bound by the terms and conditions of the contract?(b) Was CCM entitled to terminate Mr McCarthy's membership?(c) Did the District Court Judge wrongly rely on hearsay evidence?(d) Did Mr McCarthy prove his losses?[22] Mr McCarthy also raised, in his written submissions, issues concerning the obligations of a trust which owns the shares in CCM, and collateral consequences to him resulting from the cancellation of his business relationship with CCM.Was Mr McCarthy bound by the terms and conditions of the contract?[23] When Mr McCarthy entered into a contractual relationship with CCM he signed what he referred to as a one page membership form upon which he filled out various details. These included contact telephone numbers, his address and the tours he was offering. His evidence was that the form stipulated the commission that would be payable to CCM. Mr McCarthy did not recall being handed any terms and conditions when he completed and signed this form.[24] A copy of the document Mr McCarthy signed is not available. After CCM evacuated their building in Cathedral Square when the February 2011 earthquake struck it was unable to access documentation. Limited access was achieved for the purpose of recovering computer servers, but staff were unable to recover much in the way of paper records. Most of the documentation within the building, which was subsequently occupied by squatters, has been destroyed or damaged. As a result, records that may be relevant to this matter from before the earthquake were not available.[25] Mr Brice was able to produce a copy of the terms and conditions which businesses that have subscribed to CCM's services since 2006, when he first joined the company, were subject. Mr Brice's evidence was that those terms and conditionswere in place at the time Mr McCarthy began using CCM's services. I was advisedthe document Mr Brice produced in the District Court is the same as the terms and conditions disclosed by Mr McCarthy in his initial discovery. Mr Brice, in his evidence, was confident that those were the terms in place in 2003 and would havebeen the same as those to which Mr McCarthy would have been subject at the time he contracted with CCM.[26] Mr McCarthy's position is that he was never provided with a copy of theterms and conditions. He disputes he was subject to those terms and conditions. Mr McCarthy accepted in cross-examination that, at the time he signed the one page"membership form", he was required to tick a box confirming that he accepted theterms and conditions of membership. However, Mr McCarthy maintained that he considered the terms and conditions which were referred to on the document he signed to only be those set out on the single page document, which included the amount of commission to be paid. He maintained these were the only terms and conditions which he had accepted.[27] One of the new documents which Mr McCarthy sought to be admitted on his appeal is an email of October 2010 from CCM requesting Mr McCarthy complete an attached form to display a brochure for one of his tours. Mr McCarthy informed me, and it was common ground as between the parties, that this was the type of form which he would have completed when first signing up with CCM in 2003. Mr McCarthy advised that he had signed "a couple of these" forms during the course of his relationship with CCM.[28] The one page document which is described as a membership application is divided into a number of parts. The form provides for the filling out of the applicantbusiness's name, its trading name, the period for which its brochure is sought to be displayed at the I-Site premises, contact particulars both for "operations" and "marketing", postal and physical addresses, bank details, and rates of commission.The final section provides, "I HAVE READ AND AGREED TO THE TERMS ANDCONDITIONS OF MEMBERSHIP". Next to those words is a box which isrequired to be ticked. On the following line provision is made for the signature of the person authorising the making of the application, and the date.[29] Mr McCarthy was asked about the terms and conditions by Judge Kellar. He referred the Judge to having sought a copy of the terms and conditions which had been referred to by Mr Brice in his letter, of 6 December 2010, cancelling thecontract. He confirmed the copy he was subsequently supplied was the same as thatwhich was attached to Mr Brice's affidavit. Judge Kellar directly asked MrMcCarthy whether that document contained the terms and conditions of his relationship with CCM, to which Mr McCarthy replied that it was, although he had never been provided with a copy of that document prior to his request in the wake ofMr Brice's December 2010 letter of cancellation.[30] Judge Kellar acknowledged Mr Brice's evidence regarding the set of terms and conditions that businesses seeking to utilise CCM's services were required to adhere to. The Judge noted the tick-box on the application form which confirmed that an applicant was willing to be subject to those terms and conditions, and MrMcCarthy's concession that when he joined CCM he would have filled out the one page form. Judge Kellar concluded that when Mr McCarthy joined CCM and completed the membership form he "confirmed" himself to be subject to the terms and conditions of membership. As a result, those terms and conditions formed the terms of the contract between Mr McCarthy and CCM.[31] The issue raised by Mr McCarthy on his appeal does not directly challengethe District Court's findings that he completed a membership form and ticked theappropriate box, acknowledging himself to be subject to terms and conditions of membership. His argument is that there were no terms and conditions attached to the form, and that he had assumed the details on the single page were the only terms and conditions.[32] I do not consider Mr McCarthy's view that the terms and conditions ofmembership were limited to the bare details contained in the form, all of which he was required to complete, is realistic. I do not consider Mr McCarthy would havebeen under any misapprehension that his "membership" would be subject to certainterms and conditions, as is readily apparent from the endorsement he was required to provide by ticking the box that he agreed to be bound by such terms. As a result, he agreed that his business relationship with CCM, which was contractual in nature, would be governed by those terms and conditions.[33] However, a separate issue arises as to whether Mr McCarthy's ignorance ofthe terms and conditions affects whether they are binding on him. In Ravensdown Fertiliser Cooperative Ltd v Eveleigh (Ravensdown), Ronald Young J considered whether parties to a contract were bound by a guarantee which was contained in the terms and conditions on the reverse of an extended credit application.4 The Court proceeded on the basis that the defendants were unaware of the content on the reverse of the application form. The defendants accepted they could not rely upon their own failure to read the terms and conditions on the reverse of the contract todefend the plaintiff's actions. The defendants could not escape liability by sayingthey had not read the reverse page.5[34] Because of the concession made by the parties in that case, the authoritative value of the case is diminished as that is essentially the contention that Mr McCarthy puts in issue in the present case. However, the Court relevantly observed that the front of the form made it clear that the defendants agreed to comply with the terms and conditions of the contract on the reverse of the form. The form specifically provided that the signatories agreed to comply with the terms and conditions, and signatures were required to acknowledge their agreement to comply with the terms and conditions on the reverse of the document.[35] In that case the terms and conditions were available to the defendants because they were set out on the reverse of the document. However, I do not consider that to be material. The front of the form made it clear to the defendants that there were terms and conditions of the contract, and by signing the document the defendants were acknowledging their agreement to comply with those terms and conditions.[36] The Court held that the guarantee had been expressly brought to the defendants' notice by referring them to the terms and conditions on the reverse of the document. The fact the defendants had chosen not to familiarise themselves with the content was not the plaintiff's responsibility. Accordingly, the Court held there wasno obligation on the plaintiff to more specifically draw the existence of the guarantee to the attention of the defendants. Unlike in Ravensdown, the terms and conditions,4 Ravensdown Fertiliser Cooperative Ltd v Eveleigh [2012] NZHC 660.5 At [25](b).at least on Mr McCarthy's evidence, were not available to him. That, however, does not change the legal effect of him ticking the box acknowledging that he had read and agreed the terms and conditions of membership.[37] I have not accepted as tenable Mr McCarthy's stance that the terms andconditions related only to the form itself, which, far from containing stipulated terms and conditions, was a form that he was required to complete. The reference to terms and conditions could only have been to those which would regulate his"membership", and therefore the contractual relationship between the parties. JudgeKellar accepted Mr Brice's evidence that the terms and conditions which heproduced to the Court were the same as those that were in place at the time Mr McCarthy commenced his contractual relationship with CCM in 2003 and remained applicable at the time of the breakdown in the business relationship. I was not referred to any other evidence on the hearing of the appeal which would lead me to question that finding or which suggested the District Court had erred in its conclusion in that regard.[38] If Mr McCarthy was not prepared to be bound by the terms and conditions, he should not have ticked the box endorsing that he had read and agreed them. As was the position in Ravensdown, Mr McCarthy cannot rely upon his failure to inquire or seek to read the applicable terms and conditions to assert he was not bound by their content.Was CCM entitled to cancel the contract?[39] Mr McCarthy disputed the ongoing difficulties with the standard of his brochures and that his conduct toward CCM staff at the visitor centre, which he denied, provided sufficient grounds for CCM to cancel their contractual relationship.[40] The District Court summarised CCM's position regarding their difficulties with Mr McCarthy in the period leading up to the termination of his "membership"in December 2010. CCM had concerns about the standard and accuracy of MrMcCarthy's brochures, which he continued to seek to have displayed despite some of his tours having been discontinued. The details of some services were crossed out on his brochures, with new prices being handwritten in vivid marker. A discontinuedtour of gardens in Christchurch had been stamped over to show the tour was discontinued, as had a discontinued tour of Christchurch heritage homes.[41] CCM considered that Mr McCarthy's brochures contained little relevant andaccurate information. As a result, Mr McCarthy was informed that he could not continue to display his brochures until they had been updated and replaced. The purpose of that requirement was to maintain professional standards and confidence in the Christchurch tourism industry. CCM considered that it had the right to ceasedisplaying Mr McCarthy's brochures in accordance with the terms and conditions ofthe contract.[42] The decision to discontinue displaying Mr McCarthy's brochures aggravated an already difficult relationship between the parties. Mr Brice gave evidence of difficulties that staff at the visitor centre had with Mr McCarthy. He would criticise and question decisions that they would make and question various policies. Mr McCarthy questioned CCM's policies regarding the standard of the brochuresand whether he was being treated in an even-handed way with other business partners. Mr Brice's evidence was that Mr McCarthy would frequently attend the I- Site premises, argue with staff, and, as he put it in his affidavit, "harass our managers".[43] Mr Brice personally recalled Mr McCarthy questioning the visitor centre manager on the policy that he was not allowed to display his brochure because of some belief, on Mr McCarthy's part, that CCM had a policy preventing competition between various clients. It is not necessary to go into detail about that particular dispute, however, it is apparent the poor relationship deteriorated further after the decision was made by CCM to cease displaying Mr McCarthy's brochures.[44] By late November/early December 2010, CCM made the decision it could no longer continue dealing with Mr McCarthy over the brochure issue. By letter dated 6 December 2010, Mr Brice wrote to Mr McCarthy informing him that CCM was ceasing his membership and the provision of services to him. The letter stated as follows:It has been reported that you are constantly harassing frontline staff in the visitor centre. This is not appropriate and you have been asked on several occasions to refer any issues to either Sandra Caldwell or myself.It has been decided that following a number of recent episodes where you have behaved in an aggressive and intimidating manner to our staff, that your membership will be terminated in accordance with section 7 of our terms and conditions.[45] Before the District Court, Mr McCarthy strongly took issue with CCM'scontentions regarding the state of his brochures, his alleged conduct toward visitor centre staff, and the approach he had taken to the disputed issues regarding hisbrochures. He contested CCM's right to terminate the contract.[46] However, Judge Kellar found that CCM was entitled to terminate Mr McCarthy's membership "given what CCM perceived to be the state ofMr McCarthy's brochures". The Judge further held that Mr McCarthy's conducttoward CCM staff was of such a nature that CCM was entitled to terminate his membership.[47] The relevant terms and conditions of the contract between Mr McCarthy and CCM are as follows:64.0 Advertising (brochure, web and marketing services)....d. We reserve the right to terminate your membership which will result in the brochure/s and/or website listings and other marketing support services ceasing immediately. Termination of membership will be in the event of substandard, unlawful or unsafe operation of the product or service (in our sole opinion), in receipt of consumer complaints which are not professionally resolved, or you are breaching any NZ laws or regulations.[Emphasis added]7.0 Code of conducta. CCT will always undertake to transact our business in a professional and respectful manner. Equally, we expect our business partners to do likewise. Should a business partner fail to meet this standard, we reserve the right to suspend membership while an investigation is6 Christchurch Canterbury Marketing Limited trades under the name Christchurch CanterburyTourism, hence the reference to "CCT" in the terms and conditions.undertaken. If the business partner has been found to have been in breach, CCT will terminate membership.8.0 Termination of business partner membershipa. If any of the above agreed terms and conditions are not met by you, we reserve the right to terminate your membership.[48] Mr McCarthy's position was that the termination was abrupt and unexpected.He maintained that CCM's staff had taken an inconsistent and contradictoryapproach to the issues relating to his brochures and how he could resolve the issues pertaining to them. In particular, he referred to providing to the I-Site manager, on 18 January 2011, a new brochure containing the amendments which had been earlierrequested, and that he had complied with CCM's requests to update the brochures hewished to display.[49] The difficulty for Mr McCarthy is that the issue for the District Court was whether CCM was entitled, in accordance with the terms and conditions to terminatehis membership. That turned on CCM's assessment of the state of his brochures in December 2010. In its opinion they were substandard, and that was sufficient to provide it with the right to terminate his membership. Similarly, the difficulties CCM considered it was experiencing in transacting business with Mr McCarthy, which it considered he was not undertaking in a professional and respectful manner, entitled CCM to investigate the situation and, if found to be in breach, terminate his membership. CCM expressly reserved to itself that right.[50] Mr Brice's evidence discloses ongoing communication and meetings withMr McCarthy regarding his conduct toward members of its staff. It appears that what had been a difficult relationship was considered by CCM to have deteriorated in the wake of the issues arising regarding the standard of Mr McCarthy's brochuresand could no longer be tolerated.[51] Mr McCarthy maintained the allegations of "harassment" were false. He disputed Mr Brice's assessment in his letter of 6 December 2010 that he had behavedin an aggressive and intimidating manner to staff. However, before the District Court, Mr McCarthy accepted that he was a private business entity who was dealing with another private business entity, namely CCM. It follows that CCM wasentitled, in accordance with the terms and conditions that governed the contractual relationship between the two parties, to come to its own assessment as to whether the way in which Mr McCarthy was interacting with it through its staff accorded with the professional and respectful standard of conduct expected of business partners.[52] Correspondence had been exchanged regarding CCM's concerns, and therehad been previous meetings regarding Mr McCarthy's relationship with CCM andhis interaction with I-Site staff, in addition to the more recent issues regarding the standards of the brochure. Mr Brice's letter of 6 December 2010 represented the culmination of this unsatisfactory engagement and was a decision made by CCM after a senior management meeting of the company, in response to Mr McCarthy'sperceived conduct.[53] Having reviewed the evidence, Judge Kellar's judgment, and the matters raised by Mr McCarthy, I am unable to discern any error in the approach taken by the District Court in holding that in the circumstances CCM was entitled, pursuant to the terms and conditions of the business relationship between Mr McCarthy and CCM, to cancel his membership.Hearsay[54] Mr McCarthy submitted that the introduction by Mr Brice in his evidence ofinadmissible hearsay "clouded" the District Court Judge's assessment of him and created a "negative perception" of his conduct toward CCM staff. Mr McCarthy made the point that CCM did not call any other witnesses, apart from Mr Brice, to give direct witness accounts of their interactions with him.[55] Judge Kellar was clearly alive to the issue of hearsay during the course of Mr Brice's evidence. I do not consider there to be any merit to this aspect of Mr McCarthy's appeal. The Judge intervened to prevent Mr Brice from tenderinghearsay. Mr McCarthy was unable to point to any part of Judge Kellar's judgmentwhere there had been erroneous reliance placed upon objectionable hearsay evidence, or that the Judge had taken an adverse view of Mr McCarthy as a result.[56] Prior to leaving this topic, it is to be noted that Mr Brice was entitled to give evidence of the inquiries he undertook, of his dealings with Mr McCarthy, meetings he attended with him and discussions he had about his membership, when giving evidence on behalf of CCM. Mr McCarthy obviously could not give direct evidence of interactions between CCM staff and Mr McCarthy which he had not himself witnessed, however, he was entitled to provide a narrative of the inquiries that he had undertaken and the basis upon which CCM had chosen to terminate Mr McCarthy'smembership.Proof of losses[57] Judge Kellar decided that, regardless of whether Mr McCarthy had demonstrated that CCM had wrongfully terminated the contract, he was required to establish a causal link between the alleged wrongful repudiation of that contract and the losses he claimed to have suffered as a result. The District Court concluded that Mr McCarthy had failed to prove on the balance of probabilities that any loss he suffered occurred as a consequence of CCM refusing to display his brochures and terminating his membership.[58] The matters which Mr McCarthy has raised on the appeal do not demonstrate any error on the part of the District Court Judge in the conclusion that he reached. Mr McCarthy drew my attention to the same figures which he had provided to Judge Kellar, which shows declining revenue in the period following termination of his membership. However, he has not addressed the Judge's finding that such losses were more likely the result of the devastating Christchurch earthquake of 2011 which decimated tourism in Christchurch only some two months after his membership was cancelled.[59] The uncontested evidence of CCM was that tourism in Christchurch was effectively non-existent, with little, if any, work available to those engaged in thetourism industry. Mr Brice's evidence was that all their business partners weresignificantly affected, with a number going out of business and everyone suffering a significant downturn in income, with many receiving little or no income for 2011. While CCM refused to display Mr McCarthy's brochures, it continued to sell histours on his behalf, as it had previously done, at least up to 2015. The slump in payments to him is consistent with the difficulties faced by many tourist operators following the February 2011 earthquakes, with much of the inner city being in the red zone, and many streets undriveable. It was a difficult city to live in, let alone holiday in.[60] Mr McCarthy himself accepted in evidence that tourist operators suffered significant loss post the earthquakes. In evidence, Mr McCarthy was invited by the Court to provide, in percentage terms, the impact of the earthquake on his tourism business in 2011 and 2012. When asked whether it had reduced by 25 per cent, 50 per cent, or more than that, Mr McCarthy replied "considerably more".Mr McCarthy advised there was nearly a collapse in the market, with many operators no longer operating, and that it was very difficult.[61] Judge Kellar's conclusion that Mr McCarthy suffered a significant loss of business as a result of the February 2011 earthquakes is undoubtedly correct. Mr McCarthy was therefore required within that context to prove what part of that serious loss, if any, was attributable to CCM refusing to display his brochures and terminating his membership. Given the circumstances in Christchurch in 2011 and thereafter, he was unable to do that, either before the District Court or on appeal before me. That is unsurprising having regard to the enormous impact on tourism in Christchurch in the immediate years following the 2011 earthquakes, and in particular on smaller tourist operators such as Mr McCarthy.Trust deed[62] One of the documents Mr McCarthy applied to have admitted on the hearing of his appeal was the trust deed of Destination Christchurch, Canterbury, New Zealand Trust (the Trust). This document was in fact admitted in the District Court as an exhibit to Mr Brice's affidavit. The Trust was established, it appears, as a joint initiative by the City Council and local tourist interests to promote Christchurch as a tourist destination, and to hold shares in CCM, or at least its corporate predecessor. Mr McCarthy pointed to some of the objects of the Trust which included: The expansion of employment by the creation of employment for the unemployed, the retention of employment for those persons whose employment is or may be in jeopardy and the creation and expansion of job opportunities for all persons in the visitor and related industries.And; To encourage promote and facilitate the establishment of carrying on, expansion and development of all kinds of businesses supporting the broader visitor and related industries.[63] Mr McCarthy submitted the action by CCM to cancel his membership was contrary to its obligations under the objects of the trust deed. That submission is not directly addressed by Judge Kellar in his judgment, and I am unsure whether it was presented to him in the course of the District Court hearing.[64] CCM was incorporated in November 1998. Its sole shareholder is the Trust. However, the company trades as a commercial entity, not as a registered charity. Mr McCarthy himself acknowledged before the District Court that it operates as a private business entity, just as he does, charging fees and taking commissions.[65] CCM, up until July 2016, held an income tax exemption under the IncomeTax Act 2007, on the basis the company had been established to "advertise, beautify, or develop a city or other district as to attract population, tourists, trade, or visitors".7That tax exemption, however, is not available for council controlled organisations. Because CCM was a privately operated company, owned by the trust, it was able to take advantage of that exemption. However, since July 2016, its ultimate shareholding company is now Canterbury Development Corporation Holdings Ltd, which is a company owned by the Christchurch City Council, and the exemption no longer applies.[66] CCM can no doubt be linked with the Christchurch City Council and the services it provides in furtherance of the promotion of tourism in Christchurch and the greater Canterbury area which the Council seeks to develop. However, the relationship between CCM and tourist operators remains a commercial one. The service offered by CCM, which is compatible with the identified objectives of the7 Income Tax Act 2007, s CW40.Trust, is provided in return for the payment of fees and/or commissions, and is subject to compliance with the terms and conditions which govern the contractual relationship between the company and tourism providers who seek to utilise those services. There is no inconsistency between the identified objects of the Trust and the requirement that tourist operators who utilise CCM's services abide by its termsand conditions.Other issues[67] Mr McCarthy, in his written submissions, sought to raise other issues, including that he has suffered reputational loss as a result of adverse reporting of the District Court decision, lost opportunities by being prevented from fully participating in the tourism marketplace, and stress and humiliation. He is critical of CCMrefusing to participate in "binding arbitration" to resolve this dispute before hecommenced this proceeding.[68] Such claims by Mr McCarthy are dependent upon him proving that CCM breached their contractual obligations and wrongfully terminated his membership. In the absence of him being able to prove that claim, these collateral issues of reputational and economic loss cannot be sustained.Conclusion[69] Leave is granted to Mr McCarthy to admit the further evidence which I have identified at [20].[70] I am not persuaded that Judge Kellar erred in dismissing Mr McCarthy'sclaim. His appeal is therefore dismissed.[71] In the ordinary way, costs follow the event. Mr McCarthy is ordered to payCCM's costs on a category 2B basis, with disbursements to be fixed by the registrar.Solicitors:Saunders & Co, ChristchurchCopy to:Mr McCarthy