Westgate Town Centre Limited (In Liquidation) v Westgate Properties Limited - [2025] NZCA 474

Appeal — local government — contract — interpretation — implied terms

Appeal dismissed.

The New Zealand Retail Property Group (NZRPG) worked with Waitakere City Council (and later Auckland Council and Auckland Transport, to develop a new Westgate Town Centre (the Town Centre), to be located across what would be Fred Taylor Drive from the original Westgate Shopping Centre (Original Westgate). Numerous contracts and other documents were concluded or otherwise shared between the parties involved. NZRPG considered that Auckland Council and Auckland Transport took a different approach in the development to the original vision. They sued Auckland Council and Auckland Transport for breach of contract on several grounds. The High Court held that none of the contractual breaches alleged were made out. NZRPG appeals.

Issue 1: was Fred Taylor Drive required to be widened to integrate Original Westgate with the Town Centre?
Held: no. The parties agreed from the outset their shared vision did not create binding contractual obligations, absent more specific agreements.   Neither the Infrastructure Funding Agreement {IFA) or Cost Sharing Agreement 1 (CSA 1) imposed an obligation to consult with NZRPG over the design and construction of the widening of Fred Taylor Drive. The quality standards in the Demarcation Schedule to CSA 1 did not create contractual obligations: respectively, they comprised a standard that was not objectively identifiable or specific so as to be relied on; a general set of guidelines; and a statement of general vision. A reasonable person having all the background knowledge reasonably available to the parties in the situation they were in at the time of the contract would not have considered there was a contractually binding specification of quality standards; and would have expected such standards to be explicitly specified.

Issue 2: was there an implied term to construct Northside Drive East?
Held: no. Because the contractual obligation regarding Fred Taylor Drive has been rejected, the related argument regarding Northside Drive East also fails. The IFA was clear there was no such agreement, consistent with CSA 1 and the Demarcation Schedule. The cases NZRPG rely on can be distinguished.

Issue 3: was Maki Street South required to be upgraded with Maki Street North or within a reasonable time?
Held: no. There was no agreement about what the upgrade of Maki Street South would involve in CSA 1. Works Development Agreement 3 (WDA 3) was explicit about that and there being no agreement as to timing. Without a contractual obligation specifying the work to be done, no time obligation can be implied. The case law about implying a term to act within a reasonable time is not activated because the nature and extent of the upgrade had to be agreed first. If some timing requirement could be implied before May 2017, it was not breached given the timeline of designs and the associated costings.

Issue 4: did the bus interchange have to be constructed in Zone 2?
Held: no. The text of WDA 3 indicates there were areas of agreement and non-agreement. There was no contractual obligation about the bus interchange's location: Auckland Transport was not a party to WDA 3; the more natural reading of the relevant clause is that agreement on location (and grant of the easement) were "subject to final agreement"; WDA 3 as a whole, and its context, suggest the location was not being contractually committed to; and none of the parties could implement the understanding of the location without further agreements with Auckland Transport. Even if there were some contractual obligation, NZRPG has not demonstrated the Judge was wrong that there was no breach of contract.