Sidney v Ngatapa Ltd

• Jurisdiction: New Zealand
• Court: Court of Appeal
• Judge: Cooke J
• Judgment Date: 20 November 2025
• Neutral Citation: [2025] NZCA 609
• Year: 2025
• Docket Number: CA678/2025

Between

Michael David Sidey

Appellant

and

Ngatapa Limited

Respondent

[2025] NZCA 609

Court:

Cooke, Walker and Cull JJ

CA678/2025

IN THE COURT OF APPEAL OF NEW ZEALAND

I TE KŌTI PĪRA O AOTEAROA

Contract, Property — against dismissal of application to sustain a caveat — sale and purchase agreement — affirmation — cancellation

The issue was whether the caveat should be sustained.

The Court held S had no reasonably arguable case of an interest in the land. The HC had not erred by not recognising that a caveatable interest could arise if there was an arguable case to sustain the caveat. A caveat could be sustained if the applicant put forward a reasonably arguable case of an interest in the land. Here there were no further inquiries relevant to assess whether there was such an interest in the land. The relevant events were clear and enabled the Court to draw a conclusion on whether a caveatable interest existed as a result. Either there was an enforceable agreement to sell the land arising from the exchanges between the parties, or there was not.

The case had not turned on the principles of affirmation. An affirmation must be clear and unequivocal. The parties were proceeding to negotiate varied terms of an agreement for sale and purchase of the land, it was clear from the communications that neither party was confirming that the Agreement was binding upon them. What followed was a negotiation on varied terms. Ngatapa was not affirming the Agreement by engaging in those negotiations. Those negotiations proceeded on the basis that the Agreement had not been made binding, and at no stage had Ngtapa expressly or implicitly say it would not exercise its right to cancel as a consequence. The email exchanges between the parties, in the context of their earlier, and unconfirmed, conditional contract, had not amounted to a binding agreement in varied terms. The critical negotiations were conducted between solicitors in which the requirements for forming an agreement in amended terms were clearly set out. Those requirements were not satisfied prior to the respondent advising it was no longer prepared to agree to them.

There was no binding agreement until there was a binding agreement. The original Agreement was validly avoided by Ngatapa.

The appeal was dismissed.

Counsel:

R B Butler and T P Refoy-Butler for Appellant

B M Russell for Respondent

• A The appeal is dismissed.

• B The appellant must pay the respondent costs for a standard appeal on a band A basis together with usual disbursements.

JUDGMENT OF THE COURT

REASONS OF THE COURT

(Given by Cooke J)

1 Mr Michael Sidey seeks to appeal from a decision of the High Court dismissing his application to sustain a caveat. 1 The caveat had been lodged in relation to an agreement for sale and purchase dated 8 July 2025 for the sale of a rural property in Christchurch for $7.75 million. Associate Judge Lester held that the contract had been

validly cancelled by the respondent after Mr Sidey had not confirmed the contract as unconditional under its terms. He rejected Mr Sidey's argument that the respondent had affirmed the contract after Mr Sidey had not confirmed the contract as unconditional within the time required. 2

The relevant facts

2 There are no material factual disputes.

3 The agreement for sale and purchase dated 8 July 2025 (the Agreement) was on standard ADLS/REINZ terms. The relevant land involved 198.2447 hectares of rural land at Coutts Island Road in Christchurch. The Agreement was subject to a number of special terms, including a due diligence clause in the following terms: 3

35 DUE DILIGENCE

• 35.1 This Agreement is conditional upon the Purchaser being entirely satisfied that the property is suitable to them at the agreed price and for their intended uses following the Purchaser undertaking a due and diligent investigation of the property which may include (without limitation).

  • a) Architectural and engineering analysis in respect of the buildings.

  • b) The property's compliance with the Resource Management Act 1991 and the Building Act 2004 including future compliance given the Purchaser's proposed uses of the property.

  • c) A valuation report by a registered valuer appointed by the Purchaser.

  • d) A review of the Certificate of Title, Easements and EQC Claims.

  • e) The obtaining of a satisfactory Land Information Memorandum from the local territorial authority.

  • f) An assessment of the overall financial suitability of the Purchaser's proposed investment in the property.

  • g) Securing finance upon terms and conditions satisfactory to themselves.

• 35.2 The parties acknowledge that the satisfaction of clause 35.1 shall be at the sole discretion of the Purchaser and that if the condition is not fulfilled due to the Purchaser not being satisfied with any aspect of the property the Purchaser shall not be obliged to state any reason for the Purchaser's lack of satisfaction.

• 35.3 The time for satisfaction of the conditions in clause 35.1 shall be confirmed with fifteen (15) working days from the date of this agreement.

• 35.4 The parties acknowledge that clause 35.1 is inserted for the sole benefit of the Purchaser and may at any time prior to the Agreement being voided be waived by the Purchaser giving written notice of waiver to the Vendor.

• 35.5 The parties acknowledge that the Purchaser may elect to employ independent consultants at the Purchaser's cost to prepare a report on the property and that the Vendor will at all reasonable time and upon reasonable notice provide or cause to be provided access to any necessary part of the property to enable the consultants to undertake the report.

4 The standard terms included a clause relating to conditions of this kind in the following terms:

9.10 Operation of conditions

If this agreement is expressed to be subject either to the above or to any other condition(s), then in relation to each such condition the following shall apply unless otherwise expressly provided:

• (1) The condition shall be a condition subsequent.

• (2) The party or parties for whose benefit the condition has been included shall do all things which may reasonably be necessary to enable the condition to be fulfilled by the date for fulfilment.

• (3) Time for fulfilment of any condition and any extended time for fulfilment to a fixed date shall be of the essence.

• (4) The condition shall be deemed to be not fulfilled until notice of fulfilment has been served by one party on the other party.

• (5) If the condition is not fulfilled by the date for fulfilment, either party may at any time before the condition is fulfilled or waived avoid this agreement by giving notice to the other. Upon avoidance of this agreement, the purchaser shall be entitled to the immediate return of the deposit and any other moneys paid by the purchaser under this agreement and neither party shall have any right or claim against the other arising from this agreement or its termination.

• (6) At any time before this agreement is avoided, the purchaser may waive any finance condition and either party may waive any other condition which is for the sole benefit of that party. Any waiver shall be by notice.

The Agreement also provided that all notices were required to be given in writing.

5 Mr Sidey did not give confirmation by the date specified in cl 35.3. But the parties expressly agreed to an extension of that time on two occasions, first extending the time to 30 July 2025, and the second extending time to 5.00 pm on 4 August 2025.

6 Mr Sidey did not give confirmation by the extended date and time on 4 August 2025, however discussions continued between the parties beyond that date. Those discussions focused on three matters. First, Mr Sidey wanted to check the position regarding previous EQC claims associated with the farmhouse located on the site. Secondly, Mr Sidey wanted to ensure that the full suite of water allocation rights associated with the farm property would be transferred on settlement. Lastly, Mr Sidey wanted to commence grazing on the property before the proposed settlement on 13 October.

7 Progress was made on the outstanding items with proposals to vary the terms of the Agreement. For example, the parties agreed on varied terms in relation to the water rights so that those rights would be confirmed after varied terms were agreed. By email dated Wednesday 6 August from Ms Lucy Robinson of the vendor's solicitors (Anthony Harper) to Ms Olivia Macgregor of Mr Sidey's solicitors (Tavendale & Partners), Ms Robinson summarised the negotiations and the areas of potential agreement. Her email ended:

These terms are still subject to the vendor's final approval. The intention is that once further terms are agreed, due diligence is then confirmed and the agreement is unconditional, with your client's option to cancel if the water consent is not transferred with the full allocation.

8 On the morning of Thursday 7 August, the respondent's real estate agent then sent an email to Mr Sidey further summarising the negotiations, which included outlining the details that were to be agreed that day. For example, his email said:

1. [Mr Sidey] to go unconditional on all matters except transfer of...