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V V Investments Ltd v Kahlua Ltd [2018] NZDC 17840

Published 20 June 2019

Summary judgment application — breach of lease — rent arrears. The plaintiff sought summary judgment for rent and outgoings, contractual interest and costs under the Deed of Lease of their property. The first defendant leased the premises at $30,000 per annum, while the second defendant was one of two guarantors on the lease. The defendants had difficulty setting up and operating a cafe in the premises and failed to pay any rent to the plaintiff, leading the defendants to sell the business and leave the premises. The defendants raised three defences in opposition to summary judgment: that they invested a considerable amount into the property's kitchen which off-set the amount owing; that the plaintiff waived the rent arrears due to the defendant's renovations; and that the other guarantor was not joined in the action. The Judge found that the plaintiff was under no obligation under the lease to accept renovations as compensation and that there was no contemporaneous documentation to support the suggestion the plaintiff would waive rent for renovations. Just because the defendant had invested a large sum of money in the property did not in itself off-set the amounts claimed under the lease. Finally, the Judge found that if the second defendant wished for the second guarantor to also contribute, he would need to pursue that himself, as it was not an obligation on the plaintiff. For those reasons, the Judge granted summary judgment for the outstanding sum of $35,600.01 for rent arrears, legal costs of $1,108.55, and interest on the accrued rent before and after the judgment at 14 percent. Judgment Date: 4 September 2018.

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