LA Nailcare Limited v 60 Cuba Street Limited

[2018] NZHC 1961

IN THE HIGH COURT OF NEW ZEALAND WELLINGTON REGISTRY

I TE KŌTI MATUA O AOTEAROA TE WHANGANUI-A-TARA ROHE

CIV-2018-485-540

[2018] NZHC 1961

BETWEEN	LA Nailcare Limited Plaintiff
AND	60 Cuba Street Limited Defendant

Teleconference:

27 July 2018

Counsel:

B Marten for Plaintiff

T Grimwood for Defendant

Judgment:

2 August 2018

Reissued:

31 August 2018

JUDGMENT OF CLARK J

(Interim Injunction Application)

[1]                   On the afternoon of Friday 27 July 2018 the plaintiff filed an on-notice application for an interim injunction. The plaintiff operates a nail salon at 54 Cuba Street, Wellington. The premises have  been  leased  by  the  plaintiff  for  the  past 12 years. The expiry date of the lease is 31 December 2024.

[2]                   At approximately 8.50 am on Friday 27 July the owners of LA Nailcare Ltd, Lan Anh Do Nguyen and her husband, arrived with a staff member to open the salon for the day. They were unable to enter because a wooden wall had been erected covering the entrances. Mrs Nguyen also received an email with a notice cancelling the lease.

[3]                   By her application for an interim injunction the plaintiff sought access to its leased premises until the substantial dispute between the parties could be determined by arbitration. The injunction also was to restrain the defendant from retaking

LA Nailcare Ltd v 60 Cuba Street Ltd [2018] NZHC 1961 [2 August 2018]

possession of the premises pursuant to the notice of cancellation of lease and to allow the plaintiff to resume normal access to its premises to allow it to open for business on Saturday 28 July 2018.

[4]                   I was minded to grant orders holding the position until the application could be argued the following week. But Mr Rupert Curry, the Director of 60 Cuba Street Ltd, the defendant, attended the conference with his counsel Mr Grimwood. Mr Curry advised the premises had been stripped of all wiring, plumbing, lights and the walls between the tenancies. He said the site is a construction site. Mr Marten, counsel for the plaintiff, learned for the first time during the course of the telephone conference that in fact the premises had been stripped.

[5]                   Understandably, Mr Marten expressed an interest in seeing photographic evidence on the following Monday but I was prepared to accept Mr Curry’s confirmation to the Court that his statement was entirely accurate.

[6]                   Under the lease, if the landlord required the building or the premises or any part of the building or premises for redevelopment purposes, the landlord could require vacant possession and terminate the lease by written notice specifying a date of termination not less than six months after the date of service. Under the lease, “redevelopment purposes” means a determination by the landlord to “carry out any substantial material, additions, renovations or alterations to the building or premises”.

[7]                   A notice of termination of the lease for redevelopment purposes was served on the plaintiff on 24 January 2018. The plaintiff does not dispute service on that date. The plaintiff disputes that the work is for redevelopment and contends it is for seismic strengthening. Mr Grimwood agreed the work was for seismic strengthening but also for redevelopment purposes in terms of the lease.

[8]                   The bald fact is, however, that an injunction, or any kind of interim relief, is futile. The premises are stripped. Practically, the plaintiff is unable to resume its business. Mr Grimwood is no doubt correct in submitting that if the plaintiff is to pursue any remedy it is more likely to be for damages than seeking to retake possession.

[9]                   I was sympathetic to Mr Marten’s position. Mr Marten contacted the defendant’s solicitor, around noon on 27 July 2018. He advised the solicitor that an application for an injunction was to be filed in the afternoon. The solicitor did not inform Mr Marten that the premises had been stripped during the morning. Had he been informed Mr Marten would not have continued to finalise and file the originating application for relief, the memorandum seeking an urgent conference, undertakings, an affidavit and a draft order. It is regrettable that the plaintiff was put to this pointless effort.

[10]               I discussed with Mr Marten whether the plaintiff might wish to withdraw the application on the basis of the information that emerged during the telephone conference. Ultimately, Mr Marten agreed with my suggested approach. It seemed to me preferable to issue a judgment recording the course of events because of the potential costs implications. Had counsel for the plaintiff been advised the premises had been rendered a “construction site” when he put the defendant on notice of the imminent application for injunctive relief the plaintiff could have avoided incurring the costs of the application. On the basis of the information available to me at the time of the telephone conference I consider the plaintiff is entitled to indemnity costs on the application which I award.

Karen Clark J

Solicitors:

Izard Weston, Wellington for Plaintiff

Castle Law, Waikehe Island for Defendant