Hanrahan v Hillock Hc Inv

JurisdictionNew Zealand
CourtHigh Court
JudgeOsborne
Judgment Date12 Mar 2012
Neutral Citation[2012] NZHC 404
Docket NumberCIV-2011-425-000507

[2012] NZHC 404

IN THE HIGH COURT OF NEW ZEALAND INVERCARGILL REGISTRY

CIV-2011-425-000507

BETWEEN
Vickie Hanrahan
Plaintiff
and
John Richard Hillock and Margaret Anne Hillock and Mcculloch Trustees Limited
Defendants
Appearances:

P M James for Plaintiff/Applicant

N H Soper for Defendants/Respondents

Summary judgment application seeking return of deposit — plaintiff agreed to purchase a lot in a subdivision — defendant warranted there would be no easements — clauses of agreement required defendant to make all reasonable efforts to a title free of all easements and to satisfy subdivision consent conditions — easement lodged by power company for underground cables — defendant failed to remove — whether consent required registration of easements — whether there was an inconsistency between clauses to provide free title and to comply with the conditions of the subdivision consent.

The issues were: whether requirement to register easements had been incorporated into the subdivision consent and whether there was an inconsistency between the clauses to provide a free title and to comply with the conditions of the subdivision consent.

Held: The subdivision consent had not stated that the powers lines had to be undergrounded across Hanrahan's lot or consequentially supported by an easement over the lot. A condition of the consent was that overhead power lines were to be replaced with underground cables in accordance with any requirements of Aurora Energy. That requirement had not of itself stipulated a route for the power lines, let alone a route which had to run over Hanrahan's lot. Hillock had not produced any evidence which indicated than an alternative route could not have been used, whereas Hanrahan had produced evidence that Aurora Energy had said that there was an alternative routing that would cost $20,000.

The survey plan had not been attached to the contract and had not formed part of it by reference. No information presented to the council about the electricity easements could be taken to have been incorporated into consent conditions by implication. The terms of the subdivision had not required Hillock to route the electricity lines or easement across Hanrahan's lot and it therefore been open to them to comply with the terms of the consent while giving effect to the warranty as to no easements over the property.

There was nothing to indicate that the parties had intended the combined effect of the clauses to be something other than what appeared on their combined plain meaning. There was no inconsistency between the clauses which would require a reading down of either of them. Further the failure of Hanrahan to enunciate concerns that led her to include a “no easements” provision (which were based on studies of links between high voltages and leukaemia) did not detract from the force of an otherwise clear provision. Equally any steps she may or may not have taken during due diligence, or after the contract, did not change the meaning of the contract at the time it was entered into. Hanrahan's post-contract conduct was entirely consistent with an understanding that she already had a contractual entitlement to having no easements on her title.

The Court was not concerned with the magnitude or triviality of a matter subject to requisition. The contractual provisions had extended the common law position in relation to requisitions so as to enable a purchaser to cancel in relation to title defects with the aspect of title being essential or its performance being substantial. The broad right of cancellation under the requisitions clause was not affected or limited by the provisions of s7 Contractual Remedies Act 1979 (cancellation). Under the warranty, the parties had impliedly agreed that the absence of easements was an essential term of the contract and that Hilllock's failure to provide a clear title either substantially reduced the benefit of the contract or substantially altered the burden of the contract.

Application for summary judgment granted. Hanrahan was entitled to the return of the deposit.

JUDGMENT OF ASSOCIATE JUDGE Osborne ON PLAINTIFF'S SUMMARY JUDGMENT APPLICATION

Introduction
1

At the heart of this case is the correct construction and application of a vendor's warranty that there would be no easements granted over the lot it was selling. Title was issued subject to an electricity easement. The purchaser cancelled the contract following a requisition procedure when the vendor could not clear easements off the title to the lot. The purchaser seeks by summary judgment the return of her deposit.

Summary judgment — the principles
2

The starting point for a plaintiff's summary judgment application is r 12.2(1) High Court Rules, which requires the plaintiff to satisfy the Court that the defendant has no defence to any cause of action in the statement of claim or to a particular part of that cause of action.

3

I summarise the general principles which I adopt in relation to this application:

  • (a) Commonsense, flexibility and a sense of justice are required ( Haines v Carter [2001] 2 NZLR 167, (CA) at 187).

  • (b) The onus is on the plaintiff seeking summary judgment to show that there is no arguable defence. The Court must be left without any real doubt or uncertainty on the matter.

  • (c) The Court will not hesitate to decide questions of law where appropriate.

  • (d) The Court will not attempt to resolve genuine conflicts of evidence or to assess the credibility of statements and affidavits.

  • (e) In determining whether there is a genuine and relevant conflict of facts, the Court is entitled to examine and reject spurious defences or plainly contrived factual conflicts. It is not required to accept uncritically every statement put before it, however equivocal, imprecise, inconsistent with undisputed contemporary documents or other statements, or inherently improbable.

  • (f) In assessing a defence the Court will look for appropriate particulars and a reasonable level of detailed substantiation.

  • (g) In weighing these matters, the Court will take a robust approach and enter judgment, even where there may be differences on certain factual matters, if the lack of a tenable defence is plain on the material before the Court.

  • (h) Where a last-minute, unsubstantiated defence is raised and an adjournment would be required, a robust approach may be required for the protection of the integrity of the summary judgment process.

  • (i) Once the Court is satisfied that there is no defence, the Court retains a discretion to refuse summary judgment but does so in the context of the general purpose of the High Court Rules which provide for the just, speedy and inexpensive determination of proceedings.

What the parties agree on
4

The parties entered an agreement for sale and purchase of the purchaser's lot adopting the REINZ/ADLS form of agreement, 8th ed. 2008(3). The agreement is dated 25 March 2011.

5

Ms Hanrahan agreed to purchase a lot in a proposed subdivision which the Hillocks were undertaking at Lake Hayes. The purchaser's lot (one of two in the proposed subdivision) was to be 0.95 ha (more or less). The subdivision was to be as per a proposed plan attached to and forming part of the contract (Appendix 1 to this judgment).

6

The Further Terms of Sale (typed in after the General Terms of Sale) included cl 17.4 as to easements. It provided:

17.4 The vendor warrants that there will be no easements granted over the lot and that no land covenants will be registered against the lot.

7

The Further Terms also created an obligation upon the Hillocks to complete the subdivision in these terms:

  • 17.2 The vendor will proceed forthwith, at their cost, to:–

    • (a) Complete all works required to subdivide the land;

    • (b) Comply with the conditions of the Subdivision Consent; (subject to clause 17.7);

    • (c) Prepare and submit a land transfer plan in accordance with the application plan to the Council for its approval.

Clause 17.7 (to which 17.2 was subject) contained additional agreements relating to the subdivision which are not relevant in this case.

8

The “Subdivision Consent” referred to in cl 17.2 arose through the decision of commissioners dated 13 May 2008.

9

The Consent contained provisions as to power supply and telecommunications. In particular condition 11c) and 11d) which read:

  • 11 Prior to certification pursuant to Section 224(c) of the Resource Management Act 1991, the consent holder shall complete the following:

    • a) …

    • b) …

    • c) The consent holder shall provide a suitable and usable power supply and telecommunications connection to the building platform on Lot 1. These connections shall be underground from any existing reticulation and in accordance with any requirements/standards of Aurora Energy/Delta and Telecom.

    • d) The overhead power lines shall be replaced with underground cables in accordance with any requirements/standards of Aurora Energy/Delta.

10

The Consent also provided in condition 13 that:

13. All easements shall be granted or reserved.

11

The Further Terms of Sale of the contract contained also a due diligence clause which provided:

  • 18 Purchaser's Conditions

  • 18.1 This agreement is condition [sic] on the purchaser satisfying themselves, following a due diligence inspection of the property and all information which the purchaser deems necessary, that the property is suitable for the purchaser's requirements.

  • 18.2 …

12

The real estate agent involved in the sale of the purchaser's lot, Kathleen Cruickshank, has given evidence that a plan was supplied to Ms Hanrahan with all the other information Ms Cruickshank held on the property. Ms Hanrahan has not denied receipt of the plan. The document Ms Cruickshank says she gave Ms Hanrahan is attached to this judgment as Appendix 2. (I have reproduced in black and white only, whereas the exhibit is in colour). It is...

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  • Hanrahan v Hillock HC Inv
    • New Zealand
    • High Court
    • 12 March 2012
    ...HIGH COURT OF NEW ZEALAND INVERCARGILL REGISTRY CIV-2011-425-000507 [2012] NZHC 404 Hearing: BETWEEN VICKIE HANRAHAN Plaintiff AND JOHN RICHARD HILLOCK AND MARGARET ANNE HILLOCK AND MCCULLOCH TRUSTEES LIMITED Defendants 10 February 2012 (Heard at Invercargill) Appearances: P M James for Pla......

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