A couple who sued the vendors of an Otahuhu cottage after they backed out of an unconditional sale are celebrating a legal victory but have spent nearly $150,000 on legal bills.
"It's obscene," Steve Piner told the Herald last night. "We possibly would have been able to come to an agreement much sooner had they not taken such an adversarial approach."
Vietnamese relatives Thi Kim Chu Nguyen and Vinh Hgoc Nguyen sold their Church St house by auction in December 2013 then tried to cancel the sale by text message days after the hammer fell.
But they have now been ordered to honour the sale and purchase contract and could face hundreds of thousands of dollars in penalties and costs.
Auckland academic Dr Marewa Glover and her husband Mr Piner sued the Nguyens for breach of contract.
During a High Court hearing in October, the couple asked the court to enforce their unconditional sale and purchase agreement and award hefty penalty payments for lost rental income and interest.
But the vendors claimed there was no written sale and purchase agreement and that they were misled by their Vietnamese estate agent.
The court heard that Dr Glover and Mr Piner's family-owned company SM & T Homes Ltd bought 42 Church St at auction as an investment nest egg with a $450,000 winning bid.
They paid a $44,000 deposit and said they shook hands with the vendors in Barfoot & Thompson's downtown auction rooms before heading off to arrange insurance.
But days later, Barfoot agent Ricky Yap, who handled the sale and rejected claims of any wrongdoing, received a text message in Vietnamese from the vendors which read: "Hi Ricky, I don't want to sell my house any more. Please cancel all contact."
A reserved court decision released yesterday by Justice Rebecca Edwards sided with the buyers and ordered the Nguyens to "perform the terms of the sale and purchase agreement".
Leave is reserved for Dr Glover and Mr Piner to seek ancillary orders relating to penalty interest, which amounted to more than $90,000 in their submissions. The couple will also seek legal costs of nearly $150,000 and lost rental income.
Justice Edwards said language difficulties were no barrier in the case and the Nguyens probably understood the legal effect of what they were signing. "In any respect, a lack of understanding cannot, on its own, release the Nguyens from the obligations contained in the documents which they signed."
Speaking through a Vietnamese translator, Ms Nguyen told the court she asked Mr Yap twice to cancel the auction because the offer price was too low and was shocked to learn her house had sold for $450,000.
However, Mr Yap disputed claims he was asked to call off the auction or that he had failed to explain the reserve price. Allegations he had colluded with the purchasers were "astonishing" and "not true".
Marewa Glover and Steve Piner purchase 42 Church St at auction with winning bid of $450,000.
Days later vendors send text message to Barfoot agent saying: "Hi Ricky, I don't want to sell my house any more. Please cancel all contact."
January 2014: Settlement date comes and goes. Repeated attempts by purchasers to reach vendors and enforce purchase agreement fail.
June 2014: Dr Glover and Mr Piner launch legal proceedings for breach of contract.
October 2015: Civil hearing in High Court at Auckland.
December 15, 2015: Court orders Nguyens to honour sale and purchase contract.