Ordered to pay $429,000 damages after defaulting on an Auckland residential property deal; Jay Bath signed up in September 2021 agreeing to buy for $1.16 million with settlement not due for eight months, then failed to complete, short of cash in a falling property market.
After he defaulted, the property in Pallant Street, Manurewa, was resold at a price thirty per cent less than Mr Bath had agreed to pay. He claimed Whakaruru Family Trust as vendors should instead have accepted his request to re-jig the deal at a lower price. This claim was dismissed by Associate judge Sussock. Mr Bath had defaulted on the first deal. There was every chance he would default again on a revised deal, she ruled.
The High Court was told Mr Bath had come back with a revised offer to instead pay $900,000, later upped to one million dollars, after he failed to settle in May 2022. These revised offers required a further delayed settlement: six months.
Mr Bath, in turn, declined the Trust’s suggestion of a six month settlement extension at the original $1.16 million price together with an immediate payment of $88,000: payment on account ($58,000) plus contribution towards the Trust’s holding costs ($30,000). He didn’t have the cash, he said.
After cancelling Mr Bath’s contract, Whakaruru Trust put Pallant Street back on the market. It was passed in at auction, later selling for $781,500.
Mr Bath was ordered to pay damages for breach of contract: loss on resale less the deposit retained ($320,500); penalty interest at 18 per cent ($72,800); and costs of resale ($36,000).
Whakaruru Family Trust v. Bath – High Court (11.09.23)
23.194