ATNZ challenges IBC over supply to 2 Cheap

Autoterminal New Zealand Ltd (ATNZ) has been refused an interim injunction blocking IBC Japan Ltd (IBC) from supplying Japanese used imports to 2 Cheap Cars.

The Hamilton registry of the high court heard on November 1 that the relationship between the two companies had “broken down”.

The court was told ATNZ imported and distributed used cars from Japan into New Zealand, while IBC exported vehicles and supplied them to ATNZ. The arrangement was covered by a vehicle supply agreement (VSA) between them dated July 1, 2014, and supplementary agreements dated 2016 and 2017.

At time of the hearing, IBC had “just signed an agreement to supply cars to ATNZ’s competitor in New Zealand – 2 Cheap Cars”, states the court judgement.

ATNZ claimed this meant IBC had breached the VSA and supplementary agreements. ATNZ sought the injunction to preserve what it said was its position as a preferred recipient of vehicles from IBC.

Justice Woolford, in his judgement of November 19, dismissed the application and ordered costs were payable by ATNZ to IBC.

The judgement stated the two companies formed a partnership between Robert Stone and Hohua Hemi. “They own or ultimately control both companies and all aspects of the business partnership. They are engaged in litigation in several jurisdictions. At present, Stone controls ATNZ and Hemi controls IBC.”

The judge said he didn’t have to decide whether the supplementary agreements existed – there were arguments in court whether they did or didn’t – and no interim injunction would be granted to enforce them or the VSA. He ruled if they proved to exist and were breached, damages would be an adequate remedy.