Dynasty Capital could not use a ‘sunset clause’ to back out of its Kaiapoi fixed price house build when it deliberately stopped work attempting to force purchaser Andrea Titterton into paying an extra $45,000.
Ms Titterton signed up in 2020 for a new house to be constructed in Rahme Crescent, Kaiapoi; one of adjoining house builds sold off the plans as fixed price land and building packages. The High Court was told developer Dynasty Capital Ltd subsequently sought increased payments from three purchasers; one agreed to paying an extra $40,000; a second withdrew and the deposit was refunded; Ms Titterton questioned why she had to pay an extra $45,000. Her request for details of cost increases justifying extra payment in a fixed price contract were ignored. Work stopped on the build for Ms Titterton, whilst the other two jobs were completed on time.
In March 2022, Dynasty cancelled Ms Titterton’s contract. It pointed to a ‘sunset clause’ in the building contract allowing cancellation if a code compliance certificate was not obtained by end of February 2022.
In the High Court, Associate judge Lester ruled Dynasty had no grounds for cancellation. The build contract required Dynasty to complete the build with reasonable diligence. There was evidence Dynasty told contractors on Ms Titterton’s build to stop work while variation costs were reviewed. Dynasty said it stopped work because Ms Titterton asked in a telephone conversation that work stop while cost variations were sorted out. Judge Lester ruled the effect of the conversation was that Ms Titterton was neither agreeing to the variation nor cancelling her contract. She simply wished to take legal advice. Her lawyer subsequently wrote to Dynasty Capital seeking to enforce the contract.
Companies Office records name Na Zhang of Halswell as sole director of Dynasty Capital and Auckland-based Stephen MacEachen as sole shareholder.
Titterton v. Dynasty Capital Ltd – High Court (27.05.22)
22.094