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Lloyd's Maritime and Commercial Law Quarterly

UNJUST ENRICHMENT IN NEW ZEALAND

Peter Watts *

CASES

100. Keast v Crown Worldwide (NZ) Ltd [2021] NZHC 2143 (HC: Bell AJ)

Trespass to goods—conversion—destruction by mortgagee of land–liability of mortgagee’s bailee
This was strictly speaking a simple tort case about the appropriation of chattels. A mortgagee over land moved into possession upon default by the mortgagors under the mortgage. The mortgagee decided that the mortgagors’ household chattels and tools on the property needed to be removed to enhance the saleability of the land. The mortgagees contacted the mortgagors to ask for this to happen but they did nothing. The mortgagees then arranged for all the chattels to be removed from the property to storage with the first defendant (“the bailee”). When the mortgagors still did not collect their possessions, the mortgagees arranged for the chattels to be destroyed, by a third party not the bailee. The mortgagors then sued the mortgagee and the bailee for the alleged value of the chattels, and for damages for the destruction of sentimental items, including a wedding dress and family photographs. In these proceedings, the defendants sought summary judgment.
Decision: The bailee had a good defence. The mortgagee’s defence needed to go to trial.
Held: (1) The bailee was not liable, because the mortgagee, as an involuntary bailee itself, was entitled to remove the chattels and put them into storage with the bailee, and all that the bailee had done was redeliver them to the order of the mortgagee as bailor. These were not acts inconsistent with the plaintiffs’ rights as owners. (2) The mortgagee had no such defence. There is no general right in an involuntary bailee to destroy goods in its possession (Munro v Willmott [1949] 1 KB 295 and other standard authorities referred to). (3) Arguments that the mortgagors had abandoned the goods or consented to their destruction seemed unlikely to succeed, but such defences were a matter for trial.


Unjust enrichment in New Zealand

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