Bacon v Bacon - [2022] NZHC 3441

ORDER PROHIBITING PUBLICATION OF NAMES OR IDENTIFYING PARTICULARS OF THE PARTIES.

IN THE HIGH COURT OF NEW ZEALAND WELLINGTON REGISTRY

I TE KŌTI MATUA O AOTEAROA TE WHANGANUI-A-TARA ROHE

CIV-2021-485-118

[2022] NZHC 3441

BETWEEN
ANNE BACON

Applicant

AND

STEVEN BACON

Respondent

Hearing: 8, 11, 15-17 November 2021; 8 December 2021

Counsel:

P F Dalkie for the Applicant

M L Greenhough and C M McCracken for the Respondent

Judgment:

15 December 2022

JUDGMENT OF GWYN J

(Costs)

Solicitors:
DLA Piper, Wellington
McDonald Law Limited, Auckland

BACON v BACON [2022] NZHC 3441 [15 December 2022]

[1] The substantive hearing of this matter occurred on 8, 11 and 15-17 November 2021 and 8 December 2021. I issued judgment on 31 August 2022.1

[2] I invited submissions from the parties on costs and have received the respondent’s submissions dated 14 September 2022, submissions for the applicant, dated 28 September 2022 and a further memorandum in reply on behalf of the respondent dated 30 September 2022.

Background

[3] The applicant and the respondent were married in 1992 and separated in December 2014. Four related proceedings arising out of their separation were set down for hearing together in this Court.

[4] As recorded in the judgment, the issues in three of the proceedings were resolved by way of consent orders dated 8 December 2012, leaving for resolution by the Court part of the applicant’s application under the Property (Relationships) Act 1976 (PRA), in CIV-2021-485-118. The PRA proceeding originated in the Family Court, commencing on 21 December 2017, and on 25 February 2021 was transferred by consent to this Court.

[5] Following resolution of the three related proceedings, the specific issue that remained to be determined concerned whether advances, totalling $3.6 million, made between 2002 and 2010 by the respondent’s family trust (the Trust) constituted a relationship debt.

[6] The respondent’s case was that the advances from the Trust were loans, repayable on demand, and that the sum of $3.6 million was a relationship debt within the terms of the PRA. The applicant submitted that the advances were not loans, as there was no expectation of repayment. The applicant denied that there was a genuine debt and, alternatively, that any debt was not a relationship debt.

1 Bacon v Bacon [2022] NZHC 2202 (the judgment).

Judgment

[7] In the judgment, I first concluded that the nature of the Trust and the relationship of the parties did not, as a general principle, preclude some or all of the advances being properly characterised as loans.2

[8] Accordingly, the judgment then went on to scrutinise each of the six categories of advances to determine whether they amounted to relationship debts. The judgment concluded that four categories, amounting to $2,128,628.96 in total, did constitute relationship debts.

Submissions

For the respondent

[9] The respondent seeks costs on a scale 2B basis, together with reasonable disbursements, in a total sum of $83,426 plus disbursements of $50.

[10] Counsel for the respondent submits that it is appropriate that the costs award from the…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

Continue reading Bacon v Bacon

Details

AGLC: Bacon v Bacon [2022] NZHC 3441
Case: [2022] NZHC 3441
Decision Date: 15 December 2022

CaseChat Overview and Summary

In the High Court of New Zealand, the case of Bacon v Bacon involved a dispute between Anne Bacon and Steven Bacon, who were married and subsequently separated. The central issue in the case was whether advances totaling $3.6 million made between 2002 and 2010 by Steven Bacon's family trust constituted a relationship debt under the Property (Relationships) Act 1976. Steven argued that the advances were loans, while Anne contended that they were not loans and therefore not relationship debts.

The court had to determine whether the advances were properly characterized as loans and if they constituted relationship debts. After a detailed examination of the evidence and submissions, the court concluded that four categories of the advances, amounting to $2,128,628.96, did constitute relationship debts. This finding meant that Anne had to repay half of this amount to Steven.

Regarding costs, Steven sought costs on a scale 2B basis, arguing that the proceeding's transfer to the High Court justified the higher scale. He also sought additional costs for second counsel and an extra step in preparing the costs submissions due to the applicant's failure to consider the costs issue timely. Anne, on the other hand, argued for a reduction in costs, stating that Steven was only partially successful and that his legal team's approach involved an inappropriate attack on her credibility.

The court ruled that while Steven was the successful party, some reduction in costs was appropriate due to the unsuccessful aspects of his claim, which did not significantly increase the applicant's costs. The court decided on a 15% reduction from the amount sought by Steven. Additionally, the court deducted a duplicate entry and did not award extra costs for the additional step in preparing the costs submissions.

The final order directed Anne to pay Steven the costs and disbursements as set out in the schedule, with the specified deductions.

Orders