Hitching its bandwagon to a low carbon economy and claiming an interest in exploiting solar energy, David Henry’s Kinleith Land & Infrastructure Ltd is in liquidation and on the hook for $2.4 million deposit unpaid on a failed property deal.
In August 2020, Kinleith Land signed up to buy Cavalier Bremworth’s commercial property in Auckland suburb Papatoetoe for $24 million. The High Court was told settlement date was extended while Kinleith Land continued negotiations with a US funder. The financing deal fell over. Bremworth cancelled the sale. It found another buyer, paying $24.9 million for the Papatoetoe site.
When sued for the unpaid deposit, Kinleith Land argued its liability to pay a deposit on the cancelled contract disappeared when Bremworth turned around and resold at a $900,000 ‘profit.’ The right to sue for a deposit remains when a contract is cancelled, Associate judge Gardiner ruled. Re-selling at an increased price was irrelevant; Bremworth had expended time and energy in finding another buyer.
Kinleith Land also argued negotiations over a later settlement date meant the requirement to pay a deposit was waived. Not so, Judge Gardiner ruled. Bremworth made it clear during negotiations that any new arrangement was without prejudice to its rights under the original August 2020 contract.
Bremworth is left as $2.4 million unsecured creditor in Kinleith Land’s liquidation. Liquidators first report shows no evidence of Kinleith Land having assets of any value.
Kinleith Land & Infrastructure Ltd v. Bremworth Ltd – High Court (19.08.21)
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