Barry v Carlisle

[2015] NZHC 1554

IN THE HIGH COURT OF NEW ZEALAND BLENHEIM REGISTRY

CIV 2014-406-19 [2015] NZHC 1554

BETWEEN

LYNDA ROSE BARRY

Plaintiff

AND

FRANCIS CARLISLE Defendant

Hearing:

Written submissions:

4-8 May 2015

8 June 2015

Counsel:

S J Zindel and J Gully for Plaintiff
M G Locke for Defendant

Judgment:

6 July 2015

JUDGMENT OF BROWN J

[1]      The plaintiff seeks specific performance of “a written agreement in the form of a deed”1  dated 17 October 2002 (the Agreement) concerning ownership of the property at 2355 Wairau Valley Road,  Blenheim  (MB 1A/190 Marlborough  Land Registry) which is registered in the name of the defendant.   An order is sought requiring the defendant to transfer to the plaintiff a half share in that property.

[2]      The defendant denies that the document is a deed for the reason that the parties did not intend it to be a deed.  If the document is not a deed, then he argues that the Agreement is void for want of consideration.

1      As pleaded in para 3 of the statement of claim.

BARRY v CARLISLE [2015] NZHC 1554 [6 July 2015]

[3]      He further contends that in 2000 he became seriously ill with heavy metal poisoning which resulted in his suffering a range of symptoms, including a reduction in intellectual and cognitive functioning, which symptoms were present at the time the  Agreement  was  signed.  He  contends  that  he  would  not  have  signed  the Agreement if:

(a)       he had received legal advice regarding the Agreement; (b)     he had not been unwell;

(c)       he had not been pressured and threatened by the plaintiff; and

(d)      he had appreciated what his legal rights and remedies were.

[4]      In consequence he pleads three affirmative defences: undue influence, duress and unconscionable bargain.

Evolution of the issues

[5]      It was apparent from the pleadings and the written openings that both parties were proceeding on the footing that if the Agreement was a deed, the plaintiff could enforce it despite an absence of consideration.2

[6]      Consequently on 1 May 2015 I issued a brief Minute drawing attention to the proposition that equity will not specifically enforce a contractual promise for which there is no consideration unless the promise is embodied in a deed which came into

operation on or after 1 January 2008.3

2      Terry Sissons “Specific Performance” in Andrew Butler (ed) Equity and Trusts in New Zealand

(2nd ed, Thomson Reuters, Wellington, 2009) at [24.2.4(1)].

3      Property Law Act 2007, s 18.

[7]      Apparently accepting that proposition, the plaintiff advised that she proposed to adduce evidence to show that consideration was provided to the defendant which was  materially  adequate  for  equity  to  enforce  his  promise  in  the  Agreement. However the defendant countered that a finding that the document was not a deed was likely to be determinative of the proceeding, invoking s 12 of the Property Law

Act 1952 which states:4

12.      Disclaimers

No disclaimer of any land shall be valid unless the same is made by deed or by matter of record.

[8]      Consequently it was common ground at the hearing that the case raised the following issues:

(a)       Is the Agreement to transfer a half share in the property a disclaimer of land?

(b)      Is the Agreement a deed?

(c)       Was there consideration for the Agreement to transfer to the plaintiff a half share in the property?

(d)      If  the  Agreement   is   enforceable,   did   the  defendant   enter   the

Agreement under duress?

(e)       If the Agreement is enforceable, was the defendant the subject of undue influence?

(f)       If the Agreement is enforceable, does it constitute an unconscionable bargain?

4      The equivalent provision in the Property Law Act 2007 is s 17. However it was common ground that the effect of s 367(4) of the 2007 Act was that s 12 of the 1952 Act continued to apply to the Agreement dated 17 October 2002.

Events prior to the Agreement

[9]      The evidence adduced over the five days of hearing was extensive. Although a substantial amount of it was  not directly relevant to the essential matters for determination, it is important to chronicle certain events that pre-dated the execution of the Agreement.   In material part the following record of events derives from a statement of facts signed by Mr Zindel for the plaintiff on 9 April 2015.  In several instances the chronology is elaborated upon by reference to items in the common bundle, the entirety of which, except for two affidavits, the parties agreed comprised evidence in the proceeding.

The early years of the parties’ relationship

[10]     The plaintiff and defendant first met at their place of work in West Auckland in 1988 and shortly thereafter they moved into a bedsit in Titirangi for a few weeks. They then shared a flat in Waitakere for three months before moving to a rental property in Whenuapai for approximately two years.

[11]   In 1991 the defendant signed an agreement to purchase a section of approximately three hectares in Smiths Road, Matakana which was registered in the defendant’s name on 22 April 1991.  It was his evidence that the purchase price was sourced from a settlement of $30,000 from his past marriage and that the plaintiff did not contribute any funds to the initial acquisition.  A few months later the defendant approached the Bank of New Zealand about a loan to build a house on the property. By this time, on the defendant’s evidence, the two were in the early stages of a relationship and he invited the plaintiff to be a joint borrower, his expectation being that if they stayed together they would one day jointly own the Matakana property. The parties were advanced a loan of $63,000 by the Bank of New Zealand, secured by a mortgage registered on 11 September 1991.

[12]     It was the defendant’s evidence that the two made an arrangement that the plaintiff would pay the mortgage payments and that the defendant would pay all the other outgoings, namely rates, power and groceries.  He said it was verbally agreed that ultimately they would own the Matakana property as tenants in common relative to their respective contributions but no written agreement was ever drawn up.  The

plaintiff agreed that in this period they were both working and contributing roughly equal amounts to the relationship and the exercise of building a home but she had no recollection of a discussion about ultimately owning the property.

[13]     The plaintiff made mortgage payments on the Matakana property mortgage for a period of almost a year whereupon the defendant assumed responsibility for the payments from about August 1992.  The parties’ recollections of the reason for that change differed markedly.  The defendant maintained that the plaintiff stated that she wanted to end their de facto relationship and that she wished to be removed from responsibility for the mortgage.  He said that at considerable cost and inconvenience he refinanced the mortgage to assume sole responsibility.  It was at that point, in his view,  that  their  de facto  relationship  ended  and  they  reverted  to  their  former relationship as friends and flatmates with the plaintiff having her own room in the newly-built house.

[14]     The plaintiff claimed that their de facto relationship did not cease and she did not know anything about a refinancing.  If there was a decision to refinance, it was the defendant’s alone. The position reached in cross-examination was:

Q.        Now Ms Barry if you were together as a couple, which you say you were, surely a mortgage is a joint obligation, why on earth would one party have to take it all over on himself?

A.        Well just like I said in the beginning, because Frank was working in a not very secure job initially in Walkworth (sic), I did the – and I was getting the regular salary each fortnight I think or was it each month, I can’t remember at this stage, I’d have to look in my bank statements but I took the mortgage on fully to start with and then it was more sensible for Frank to do so because I’d got in a bit of financial difficulty or was heading that way, Frank decided to take it over fully.

[15]     Although the parties disagreed as to the nature of their relationship from September 1992,  it  was  common  ground  that  the  plaintiff  did  move  out  of  the Matakana property for a period.   It was her recollection that it was for period of some eight months while the defendant recalled it being between 14 and 16 months.

[16]     Towards the end of 1996 the defendant travelled to the South Island with his son for a holiday.  It was his evidence that the plaintiff decided to “tag along”, saying that she intended to visit friends in the South Island.   The plaintiff’s response in cross-examination was:

A.        Well we went down there to look for – the reason for going down there was to look for a property because we always seemed to have three horses with no grazing of our own, no adequate grazing of our in winter time, so we were looking for a bigger block in a drier part of the country because we’d been a very wet south facing block with three horses and no grazes.  So our entire purpose for going to the South Island was looking for somewhere like that, better.  The other reason for looking for a place was somewhere where I could work from home with my equestrian business.

[17]     By the end of the trip the defendant was so impressed by the South Island that he decided to sell the Matakana property and move south.  The Matakana property was put on the market and it sold in July 1997 with settlement in January 1998.  The proceeds  of  sale,  after  repayment  of  the  Bank  of  New Zealand  mortgage,  were deposited into his bank account.

The purchase of the Wairau Valley property

[18]     In  September 1997  the  plaintiff  and  the  defendant  travelled  to  Blenheim where they inspected properties.  Again their perception of that trip was markedly different.  The defendant said that he drove his MR2 sports car down and that the plaintiff   “tagged   along”   as   she   did   not   have   anything   else   to   do.      In cross-examination the plaintiff agreed with the proposition put to her that in her perception the trip was a joint quest to look at property together.

[19]     An agreement to purchase the property at 2355 Wairau Valley Road by both the   plaintiff   and   the   defendant   as   purchasers   was   signed   on   or   about

5 September 1997 although the evidence did not disclose whether both the plaintiff and the defendant signed the Agreement.   The purchase price was $128,000 plus GST of $16,000.  Settlement occurred on or about 21 September 1997.  The property was registered in the name of the defendant alone.

[20]     The parties also held divergent views concerning the circumstances relating to the acquisition of the Wairau Valley property.  In his brief the defendant said:

58.While I was looking at properties around Blenheim Lynda tagged along with me, having nothing else to do in Blenheim.   When we were being shown the property I ultimately bought, my current property which is a small farm about 25km out of Blenheim, Lynda expressed an interest in jointly owning the property with me.  She herself did not have any money to contribute at that stage, but told me that she could get the money from her father.

59.I remember Lynda and I spoke about owning the property as tenants in common in the same way we had discussed in relation to the Matakana property, based on our financial contributions (it was expected equal contributions) to the purchase of the property.

60.I agreed in principle to this occurring, provided that Lynda came up with her share of the money.  The agreement for sale and purchase dated 5 September 1997 … had both our names on it as purchasers for that reason.

[21]     The plaintiff ’s recollection of events was explained in cross-examination in this way:

A.        We both entirely dismissed the first two we saw and then we, we were really keen on the Wairau Valley Road one.   We were there quite a while with Paul Rutherford and then we went back –

Q.       Right, this is where you may, you and Mr Carlisle may start to agree.

He says, “Lynda expressed an interest in jointly owning the property with me”.  Is that correct? This is the Wairau Valley property?

A.       It was intended to be our block, yeah.

Q.        Mr Carlisle  will  say,  “She  herself  did  not  have  any  money  to contribute at that stage, but told me she could get the money from her father”.

A.       I didn’t say that.  I wouldn’t ask my father for money for that.

Q.        He says, “I remember Lynda and I spoke about owning the property as tenants in common, in the same way we had discussed in relation to the Matakana property.   Based on our financial contributions it was expected equal contributions to the purchase of the property”. Agree?

A.       No.

Q.       You’ll need to answer verbally.

A.        No sorry, no we didn’t discuss anything like that.  It was just a given that  it  was  going  to  be  our  property  regardless  of  how  it  was achieved.

Q.        Mr Carlisle will say, “I agreed in principle to the securing, providing that Lynda came up with her share of the money.  The agreement for sale and purchase dated 5 September 1997 had both our names on it as purchasers for that reason”. You disagree with that don’t you?

A.       Yeah.

At a later point in the cross-examination she said that there was no discussion about her contributing any cash for the purchase.

[22]     The defendant’s explanation for his being the sole registered proprietor was as follows:

66.The property was put in my sole name because Lynda could not come up with the cash.   It was clearly understood that the plan to jointly own the property was at an end.

67.After Lynda failed to come up with the money to buy the property there  was  no  further  discussion  about  her  coming  down.     I understood that she had just given up on the idea.  I had no idea of her intentions.   There was certainly no discussion about joint ownership of the property until later after she turned up again early the next year, 1998.

[23]     In  an  affidavit  sworn  on  7 August 2013  in  proceedings  in  the  Blenheim Family Court, the plaintiff stated that she and the defendant together found the Wairau Valley property for sale and agreed to purchase it “but for some reason the title was transferred only to the [defendant’s] name”.  However at various times she has offered two inconsistent reasons why she was not also registered on the title of the property.

[24]     One  explanation  was  to  do  with  GST  registration,  as  explained  in  the

plaintiff’s affidavit dated 6 April 2001 in Family Court proceedings.5

4.When we shifted to Marlborough in 1997 it was our intention to purchase a Wairau Valley property as tenants in common.  However there were issues of GST which I did not wish to become involved in and the property was purchased in the [defendant’s] name only.

5      At [37] below.

[25]     However in her brief of evidence she advanced the different reason that she was unavailable to sign the required documentation:

18.We  intended  to  be  tenants  in  common  in  equal  shares  of  this property.   However, it was only registered in the name of Frank. When it came time to sign the papers for the house, I was back at the Campbell  Beach  cottage  and  did  not  have  access  to  any  fax machines or computers.  Therefore we agreed to register in Frank’s name.   Frank assured me this would not affect my share of the property.   The 17 October 2002 agreement … refers to GST as an issue, as well.

[26]     Counsel  for  the  defendant,  Mr Locke,  sought  to  clarify  the  issue  in cross-examination of the plaintiff:

Q.        So your recollection is that you said that you can’t be available without driving some distance to an office with a fax machine and Frank could just go ahead and do what he needed to do to transfer the property into his name?

A.       Mmm. Yes.

Q.        It seems to me to conflict somewhat with your later explanation for Mr Carlisle transferring the property into his sole name, which was that you had, well I think it’s implicit, that you and Mr Carlisle had consulted regarding whose name the property would go into –

A.       I missed that little bit in the middle, sorry, what was that?

Q.        Well, remember that beginning I think in  mid-1998 there’s been reference to the property being in Mr Carlisle’s name because you didn’t want to be involved in the GST aspects of the transaction?

A.        Mmm, that came up on, closer to the time that the house was being built.  I, I wasn’t completely understanding what the GST thing was but, um, some point during the beginning of that year Frank was talking about being GST registered and something to do with the building  of  the  house  of  the  acre  that  the  house  was  on,  or something, being different to the GST on the rest of the acreage.

…

Q.        No, let’s be very precise about this.  You’ve said in your evidence and in a number of documents created through this period that the property went into Mr Carlisle’s name because you didn’t want to be involved in GST so in a sense you said to Frank, “Put it in your name because I don’t want to be involved in that.  It’s too messy”.

A.        But I didn’t say that at the time.   I didn’t say that when I was at Campbell’s Beach on the phone.  When Frank and I were working out those documents it was Frank’s input that put that in because Frank realised at the time that I didn’t understand GST and he would

have put that in as an explanation why my name didn’t go on the title when in fact the real explanation that, you know, previously, prior to Christmas, the reason my name didn’t go on the title is because I wasn’t able to have my signature sent down.

[27]     Although there was an evidential dispute concerning the mechanics of the move to Marlborough once settlement had occurred, it was common ground that in early 1998 both parties took up residence at the Wairau Valley property, initially living in a caravan and horse truck on the site.  In due course a loan of $22,000 was obtained from the Bank of New Zealand to fund the building of a house and the defendant granted a mortgage over the property to secure that loan on 18 May 1998.

Disharmony in the relationship

[28]     During their tenure of the Wairau Valley Road property for the period of approximately five years up to the date of execution of the Agreement there was a series of incidents which resulted in either attendance by the police or the initiation of a court process.  The first of these in evidence is a report of a domestic dispute on

25 January 1998 where the plaintiff was identified as a suspect and the defendant the victim.

[29]     The second is an incident at the property in early August 2000 which resulted in the plaintiff going initially to hospital and subsequently to the Women’s Refuge. On 10 August 2000 the plaintiff obtained a without notice protection order against the defendant.

[30]      In her affidavit in support of the application for the protection order she stated that she was very reliant on the defendant and she always hoped that things would improve.  She annexed a handwritten note, which he had left for her after the incident which prompted her application, which read:

I will leave a cheque for your father please post it use one of my stamps Im leaving although I dont know were to I didnt mean to harm you or make you angry but it seems my very presents upsets you so its best if I leave.  Dude hasn’t been feed so he’ll be hungry.  Im sitting here expecting a police car to pull up but anyway what ever happens I will always love you even if its not returned I dont want to see us distroy each other so the choice is one of us must go.  I feel its my turn if thay dont arrest me for asulting you Ill got to work and continue to pay the morgage.  I really cant think of anymore to say apart from sorry but then you have heard that a million times I have tryed

hard to make you proud of me (and love me) but some things arent ment to be. (sic)

[31]     The plaintiff’s wish to return to reside at the Wairau Valley property was reflected in the terms of a letter written by her lawyer, Marianne Startup, to the defendant dated 11 August 2000:

We act for Lynda in the matter of her application for a Protection Order which was granted on Thursday 10 August 2000.   You may be aware that Lynda  has  been  staying  at  the Women’s  Refuge  until  the  matter  of  the Protection Order could be appropriately dealt with.  Lynda chose to make an application for a Protection Order as a means of helping both of you in your relationship and not as a means of punishment.  Lynda wishes to return to the home and is hopeful that with the Protection Order in place you will both attend courses to assist with problem aspects of your relationship, with the added protection of the Court order which will give Lynda some degree of piece (sic) of mind.

You will note that Lynda has not approached the Police about the incidents which have occurred as she does not choose to have the problems dealt with by the Police if at all possible.

We  suggest  that  you  see  a  Solicitor  in  relation  to  the  Protection  Order matters.  It is hoped that with the benefit of the Protection Order both Lynda and you may move on to dealing with those negative aspects of your relationship.

[32]     The police were called to a further incident on 2 September 2000 in response to a complaint by the plaintiff.  Her request to have the defendant leave the property presented the police with something of a conundrum given that the house was in the defendant’s  name.     The  protection  order  obtained  in  August  became  a  final protection order in November 2000.

[33]     On 30 March 2001 the defendant served a trespass notice on the plaintiff warning  her  to  stay  off  the  property.    On  the  same  day  he  filed  an  on notice application in the District Court at Blenheim for an occupation order entitling him to occupy the house on the property.  In his affidavit in support he explained that the plaintiff had been living with him, albeit not in a sexual relationship, since the protection order had been granted, that he had told the plaintiff to leave his home but she refused and instead had told him to leave the property.

[34]     On 2 April 2001 he filed an application to discharge the protection order.  In an affidavit in support he contended that the protection order was preventing him living on his own property and that it was assisting the plaintiff to have control over what he did.  However on the same day he signed a handwritten document which stated:

this letter alows Lynda Barry to remain on my property at my discresion

(sic).

[35]     Two days later he signed another handwritten document which read:

I Francis Carlisle Boilermaker of wairau valley road do swear that on the removal of the protection order and the removal of the Caveat over my property   I   shall   enter   into   a   tennets   in   Common   agreement   with Lynda Rose Barry this I am doing through my own choice. (sic)

[36]     On 6 April 2001 the defendant’s solicitors, Wain & Naysmith, then wrote to

Ms Startup as follows:

Further to your facsimile of today, our client instructs that he is prepared to enter into a property arrangement with your client however, before he is prepared to sign a Property Agreement he wishes to have the Protection Order that your client applied for against him on the 9th August and which was granted on the 10th August 2001 discharged.

Secondly our client wishes to have the matter of the Occupation Order, which I understand your client is defending, dealt with before he enters into any type of property arrangement.

Please let us have your client’s comments.

[37]     On  9 April 2001  the  plaintiff  filed  a  defence  to  the  application  for  an occupation order.   In her affidavit in support dated 6 April 2001 she recorded her understanding from her discussions with the defendant that he did not in fact wish her to leave the property but simply did not wish to have the powerlessness of the plaintiff having a protection order.  She stated that the defendant had advised that if she was to remove the protection order and the caveat he would enter into a property agreement with her.

[38]     In  a  Minute  of  11 April 2011  Judge P  R  Grace  in  the  Family  Court  at Blenheim directed that both applications were to be heard together on 6 June 2001. However on 1 June 2001 Wain & Naysmith sent a letter to the Registrar advising that the defendant would not be pursuing his application for discharge of the protection order and for the occupation order.

The defendant’s ill-health

[39]     The  defendant  is  an  engineer  who  had  spent  some  30 years  engaged  in electric arc welding with significant stainless steel welding, often in confined spaces with no respiratory protection or effective ventilation.   Over a period of time he began to experience mood swings, headaches and insomnia.

[40]     The  plaintiff  introduced  the  defendant  to  her  general  practitioner  on

22 August 2000  who  referred  him  to  an  occupational  medical  specialist.     In November 2000 the defendant was diagnosed with “phase 1” manganese toxicity.  A neuropsychological report following an assessment on 17 March 2001 stated:

Mr. Carlisle  is  showing  symptoms  of  both  the  first  and  third  stage manganese neurotoxicity.  First stage symptoms, which are expected to last approximately  13 months  after  exposure  has  ceased,  are  psychiatric-like symptoms of fatigue,         anorexia, insomnia, and manganese induced aggression dubbed “manganese mania”.  Third or final stage neurotoxicity symptoms may include frontal lobe dysfunction, cognitive deterioration and emotional liability, which Mr. Carlisle has.

He ceased metallic exposure only some six months ago so first stage symptoms  of  manganese  neurotoxicity  may  be  expected  to  remain  for another seven months or so.  Thus there should be improvement with time with regard to fatigue, anorexia, insomnia and verbally aggressive behaviour. The third stage symptoms of frontal lobe dysfunction cognitive deterioration may persist and a neuropsychological reassessment in six to nine months is recommended to monitor this.

In terms of return to work his present level of cognitive functioning is at a borderline level which means that if there were no other difficulties he could be expected in some seven months time to return to the workforce doing simple manual work.  Whether he was able to do this would be dependent on his level of fatigue and his emotional state.

[41]     A  further   neuropsychological   report   dated   15 July 2002   following   an assessment  on  6 June 2002  indicated  that  he  had  deteriorated  since  his  first assessment. The conclusions included:

The third, or final stage neurotoxicity symptoms may include frontal lobe dysfunction, cognitive deterioration and emotional liability, and these were present when Mr. Carlisle has (sic) assessed a year ago.  They have since got worse.  While this may be contributed in part to the continuing presence of manganese which he reports is still in his body, a major contribution is likely to be the psychological difficulties he has in coping with physical conditions and his life circumstances.  His emotional and behavioural functioning needs to stabilise before a reliable measure of his cognitive functioning can be made.  In his present state he is not fit to return to work.

[42]     The defendant was treated in Christchurch with chelation therapy for a week in 24–28 June 2002 (comprising two days as an inpatient with cardiac monitoring and three days in the day staff unit) and for a further week in 4–8 August 2003.

January to August 2002

[43]     Early  in  2001  the  defendant  commenced  a  romantic  relationship  with Bronwyn Wadsworth.  The evidence of Ms Wadsworth and the defendant indicated that the plaintiff had monitored Ms Wadsworth’s home during the night and shone a torch through the window of her home.  On 8 February 2002 Ms Wadsworth served on the plaintiff a notice of warning under s 4 of the Trespass Act 1980 in respect of her property in Blenheim.

[44]     It appears that at this time the defendant also proposed serving a trespass notice on the plaintiff.   A police case summary report records that at 3.30 pm on

10 February 2002 police were directed to the property to serve a trespass notice on the plaintiff.  However because there was a protection order in place it could not be established who the lawful occupier was and hence the notice was not served.  It was recorded that the parties were advised to speak with their lawyers and that the plaintiff elected to stay at a friend’s address.

[45]     At about this time the plaintiff obtained legal advice from Ms Startup.  She was closely cross-examined about the following entry in her diary for Thursday,

28 February 2002:

re L/A

good evidence of intentions but separate legal advice needed to be “binding” agreement.

[46]     The plaintiff explained that that entry was a reference to an early draft of the Agreement dated 17 October 2002, pointing out that it could not be a reference to the two  documents  dated  9 May 20026   because  the  defendant  had  not  at  that  stage sought the occupation order which necessitated the creation of those  two documents.

[47]     A further  police  case  summary  report  referred  to  a  domestic  dispute  on

8 April 2002 and stated:

LYNDA BARRY COMPLAINS SHE HAS BEEN ASSAULTED BY HER FLATEMATE FRANCIS CARLISLE WHO HAD VERBALLY ABUSED HER AND PUSHED HER ONTO A BED.

THIS IS AN ONGOING SITUATION * CARLISLE WARNED FOR BREACH OF PROTECTION ORDER * INSUFFICIENT EVIDENCE TO CHARGE HIM WITH ASSAULT IN RELATION TO THE INCIDENT

[48]     On 11 April 2002 the police wrote to the defendant with reference to this incident as follows:

On Tuesday the 9th day of April 2002, Blenheim Police received a complaint from Lynda Rose BARRY, alleging that you had assaulted her and breached a current Protection Order against you at your address the previous night.

Investigations have been undertaken into this matter and while it has been concluded that Police will not proceed with a (sic) charging you it is still of great concern to us that a complaint in relation to your behaviour has been reported.

Your admission of entering Ms BARRY’s room on the night in question could be regarded as a breach of those conditions, as Ms BARRY clearly did not want any contact with you at that time.

Therefore you are officially warned for breaching your Protection Order.

6      At [52]–[53] below.

[49]     After the incident on 9 April 2002 the plaintiff left the property to reside in Blenheim and did not return for several months.   On 14 April 2002 the defendant served a further trespass notice on the plaintiff.   On the following day he filed without notice applications in the District Court at Blenheim for an occupation order in respect of the property and for a protection order against the plaintiff.

[50]     However those applications did not proceed.   The reason was explained in letter dated 6 June 2002 from Dew & Company on behalf of the defendant to the Registrar of the Family Court:

1.We act for Frank Carlisle.  On 15 April 2002 we filed an Application for Protection Order and Occupation Order without Notice on behalf of our client.  The Application was put on Notice.  However, shortly after the filing of the application our client advised us that he did not wish to proceed with it.  We therefore requested that the documents not be served on Ms Barry. We understand that service has not taken place.

2.Our client remains of the view that he does not wish to proceed with his applications.  Ms Barry has now left the property and the parties appear to have come to their own arrangements for resolving issues regarding property.

3.We understand from Mr Carlisle that he no longer feels he is in need of  the  protection  order  given  that  the  parties  no  longer  reside together.  We would therefore be grateful if the applications could be withdrawn.  Should you have any queries, please do not hesitate to contact the writer.

[51]     The  plaintiff’s  diary  revealed  that  on  29 April 2002  the  plaintiff  became aware that those proceedings would not be progressed.  A diary entry a few days earlier on 24 April 2002 outlined the terms of a proposed lease for the property.  It stated:

ASigned Lease right to

-     grazing horse

-     Lease terms (2 yrs)

-     area
-     activities

-     times

-     commencement date

-     to carry out business

-     $10 week??
-     maintain area

-     use of caravan/shed/longdrop

[52]     On 9 May 2002, the defendant signed two typed documents, both of which were witnessed by the Deputy Registrar at the District Court at Blenheim.  The first read:

TO WHOM IT MAY CONCERN

I wish to state that Lynda Rose Barry is free to bring onto the property, at

2355 Wairau  Valley  Road,  whoever  she  wishes  to  accompany  her,  for whatever reason, without interference from myself.

[53]     The second, which was also signed by the plaintiff, reflected a number of the lease terms noted in the 24 April 2002 diary entry:

TO WHOM IT MAY CONCERN

Lynda Rose Barry is allowed full access to the property at 2355 Wairau Valley Road without any form of legal impediments.  She has full access to all equipment necessary for her business, sheds, roundyard, hitching rails, fencing, water and grazing for four horses.

This is subject to Lynda maintaining the property in a proper manner, and the payment of $10 per week for power to the shed ($3.22), and use of landline phone call-minder ($6.78).

The contract commences 9 May 2002 and it ceases 9 May 2003.

The fact that these two documents were signed at the Blenheim courthouse was noted  in  the  plaintiff’s  diary  for  9 May 2002.    However  the  defendant  had  no recollection of signing either document.

[54]     The   defendant   had   carpal   tunnel   release   surgery   in   Blenheim   on

30 May 2002.  Then, accompanied by Ms Wadsworth, he travelled to Christchurch in late June for the first round of chelation therapy.7    Further tests were scheduled in Blenheim in early July.

[55]     The plaintiff’s mother passed away on 23 July 2002 and the plaintiff travelled from Blenheim to Matamata to stay with her father for about a month.  She dated her return to Blenheim by reference to a diary entry for 22 August 2002 which recorded the details of an InterIsland ferry booking.  There was a conflict in the evidence as to

whether the plaintiff then returned to the Wairau Valley property immediately.

7      At [42] above.

The nature of the relationship

[56]     A substantial amount of evidence was focused on the precise nature of the parties’ relationship.  On the plaintiff’s part this was a consequence of the fact that she understood that the quality of their relationship might be relevant to the interpretation and enforcement of the 17 October 2002 document.  Her brief, which comprised 273 paragraphs, canvassed their relationship in detail from 1998 to 2014. Unsurprisingly perhaps the defendant responded in kind, his brief comprising 389 paragraphs.  In order that the evidence could be completed within the allocated week a substantial amount of the briefs were taken as read.

[57]     While the parties both acknowledge a sexual relationship, their recollection of the duration of that relationship was markedly different.  The plaintiff maintained that such a relationship began almost immediately at the Titirangi bedsit8  and in an affidavit dated 7 August 2013 in proceedings in the Blenheim Family Court she stated that she was in a de facto relationship with the defendant “on and off” for approximately 23 years before finally separating on 18 November 2011.

[58]     The defendant was adamant that the relationship did not develop in that way until they took up residence at Matakana in 1991.  Furthermore he maintained that the duration of their sexual relationship was for some 18 months concluding about the time that the plaintiff decided to cease making contributions to the Matakana property mortgage.9

[59]     While the plaintiff considered that the sexual relationship continued for a much longer period, at times her evidence on this point was somewhat vague as illustrated by her responses to my questions:

Q.        … [the defendant] says, “throughout the five years we’ve lived at Wairau Valley we’ve not had a sexual relationship nor for the previous three years prior to my move”.  Now I’d just like to have a crystal clear answer on that one.

A.       Okay so this is 2002, April.

8      At [10] above.

9      At [13] above.

Q.        So you’ve been in Wairau Valley for five years roughly and you’re saying – he’s saying, “All the time we’ve been at Wairau Valley and three years prior to that at Matakana, we haven’t had a sexual relationship”, yes or no?

A.        So ’98, ’99, 2000 and 2001, so we’d been there four years and a bit and this is when I had left because of his – the reason I – can I just respond by saying the reason I left on this occasion, this is why he’s

– yeah the reason I had left on this occasion was because was in a relationship with Bronwyn Wadsworth and the reason he assaulted

me before I left that night was because he, as the police said, he basically wanted his cake and eat it too.  He didn’t want me to be just a flatmate.

Q.       Well coming back to my question. A.      It’s a roundabout way.

Q.       Quiet please. A.  Sorry.

Q.        We’ll break it into pieces.  What’s your statement to the proposition that in the period of time from your arrival at Wairau Valley in 1998 to the date of this affidavit in 15 April 2002 that you had not, the two of you had not had a sexual relationship, it must be a yes or no to that?

A.        Well our reason for going there was a new start, so we were trying to get a relationship back together again.  So we did make attempts but lots of things happened along the way.  We arrived with two 13 year old boys that had been thrown out of home because that caused their mother a nervous breakdown.  They were a lot better behaved with us fortunately.  I got quite ill in 1999 and then Frank got extremely ill.

At that point in her answer the plaintiff became upset and a short adjournment was taken.

[60]     On the issue of the duration of their sexual relationship I prefer the evidence of the defendant which I consider is not only consistent with his conduct in the period prior to the execution of the Agreement but also supported by a number of statements made by or attributed to the plaintiff.   That is demonstrated in the following paras [61]–[64].

[61]     So far as the defendant is concerned, the first neuropsychological report10 contained several references to the plaintiff as the defendant’s “wife”.  On receipt of that report the defendant telephoned Dr Black to advise him that he and the plaintiff were not married.  Dr Black provided a suitably amended copy of the report under cover of a letter dated 10 April 2001 recording the fact of the defendant’s call and tendering his apologies to the defendant and the plaintiff for any awkwardness the references may have caused.

[62]     A few months  later in  a Referral  for  Psychological  Services  form  dated

3 August 2001 completed by the case manager, under the heading “Cultural or other personal considerations” it was stated:

Lives with 16 yr old son and female flatmate.  (Flatmate has been friend for

10 years but he denies “partner” relationship).

[63]     An early description by the plaintiff of the relationship was in para 1 of her affidavit  of  9 August 200011   in  support  of  her  without  notice  application  for  a protection order which stated:

1.        THAT I have been in a domestic relationship with the Respondent.

Our relationship started in about 1990 and we tended to flat together although over the course of our flatting we had sexual relationships on and off.   Wherever we have lived over that 10 year period we have generally had our own individual rooms.

The plaintiff made clear that the reference to  “sexual relationships on  and off”

related to the defendant.

[64]     Another example is a further neuropsychological report dated 8 October 2004 in relation to an interview attended by both the plaintiff and the defendant.   That report notes that the plaintiff described herself as the defendant’s “former partner and now friend”.  It also stated:

[The defendant’s] relationship with Lynda has become distant and estranged

and she described their ongoing relationship now as one of friendship.

10     At [40] above.

11     At [30] above.

The Agreement of 17 October 2002

[65]     Reference  has  been  made  to  the  defendant’s  evidence  that  he  had  been willing to acquire the property as tenants in common with the plaintiff in the proportions of their respective financial contributions to the purchase price, that it was  in  contemplation  of  such  an  arrangement  that  the  agreement  for  sale  and purchase included them both as purchasers, but that the plaintiff was not able to find

the funds to participate.12

[66]     The different reasons which the plaintiff gave for the absence of her name on the title have also been traversed.13   When pressed on the point, the reason which she ultimately adopted in her evidence at the hearing was her unavailability to sign a document which was necessary to complete the purchase transaction.  The evidence did not establish the nature of the document which she claimed that it was necessary for her to sign as a transferee of the property.  The following passages in the course

of Mr Locke’s cross-examination addressed the issue:

Q.       Ms Barry, do you know what document it would have been that you

weren’t in a position to sign and Mr Carlisle was?

A.        Again, not having had to do this before, I just assumed it was the finalising of the purchase of the property and for his name to go on the title.  I don’t know whether any money changed hands or what.  I wasn’t there to know exactly what was going to go, was going to happen. All I know is that he was ringing to ask me whether I was in a position to sign anything, if he could send me something, and I just said, I can’t, not in a hurry anyway, I’d have to go for quite a drive. This was later in the afternoon when he rang me I think but I trusted him to look after my interests that’s all.

…

THE COURT:

Q.       Do you recall getting a telephone call from Mr Carlisle do you?

…

A.       …, definitely I do and I wasn’t expecting it.  It was –

Q.       And where were you? A. Um –

12     At [20] and [22] above.

13     At [24]–[26] above.

Q.       Campbell’s Beach?

A.       Yeah,  we’d  moved  out  of  the  Matakana  house  and  we  were  at

Campbell’s Beach.

Q.       And where did you understand Mr Carlisle was ringing from? A.   A lawyer’s office in Blenheim.

Q.       In Blenheim? A.  Mmm.

Q.       And the issue was, was there somewhere that he could send you a document for your signature?

A.       For finalising the purchase of the property.

[67]     The reporting letter addressed to both the defendant and the plaintiff from their solicitors dated 26 November 1997 concerning the completion of the purchase enclosed a copy of the certificate of title.  The letter specifically noted the fact of the transfer of the property into the defendant’s name only.  There was no reference to any circumstances relating to or reasons for the non-inclusion of the plaintiff’s name on the title.   There was no documentation enclosed or referred to recording any interest of the plaintiff in the property.  The solicitor involved was not called as a witness in the case.

[68]     It was during the first half of 1998 that the plaintiff first took steps to secure recognition of her having an interest in the property.   She prepared a handwritten form of agreement dated 17 May 1998 which recognised her “individual financial interest” in the property as $70,000 and, by reference to the sum said to have been raised by mortgage, calculated that “a ⅜ share of property and dwelling is held in

trust” for her by the defendant.14   She claimed that the defendant had assisted her in

drafting that document and that the mortgage figure of $42,000 had been inserted by the defendant.

[69]    The defendant denied assisting in the preparation of the document.   He explained that he was outraged by the plaintiff’s proposal and refused to sign the proposed agreement.  He made the point in the course of his evidence that it was not

apparent how the figure of $70,000 bore any obvious relationship to the $128,000

14 This was the document referred to in para 6 of the letter of 5 February 2014 at [80] below.

purchase price or the GST inclusive figure of $144,000.  He also pointed out that the amount of the mortgage was $22,000, not the figure of $42,000 which appeared in the document.

[70]     In the period prior to the execution of the 17 October 2002 Agreement there were  two  other  documents  which  indicated  a  preparedness  on  the  part  of  the defendant to enter into a co-ownership agreement with the plaintiff.  The first was the handwritten document of 4 April 2001.15   The second was the Wain & Naysmith letter of  6 April 2001.16     The defendant’s  explanation  of the  circumstances  then

pertaining was as follows:

168.During another big fight with Lynda about her wanting a share in the property on 4 April 2001, to get some peace I drew up a handwritten note and signed it that day … .  At this time I was incredibly sick with manganese poisoning and just couldn’t deal with the endless harassment by Lynda about the property and the threats of breaching me under the protection order and just wrote and signed it to shut her up and avoid the Police being called on me again.

169.This was only four days prior to the incident on 8 April 2001 when Lynda called the Police, and I went to stay at our neighbours, the Joneses, for a few days.  I was staying there when the Police came to speak to me on 10 April 2001. The threat by Lynda was very real.

170.I really had no intention at that time of going through with a transfer of any part of the property to Lynda.  I just wanted her out of my life once and for all.  In fact I was already taking steps to have Lynda removed from the property.  I told Lynda that day that I had been to see my lawyer to take action to have her removed from the property earlier that day. That was what had started the fight.

171.My applications were filed with the Family Court that day for an occupation order and to discharge the protection order …

172.The  4 April 2001  note  reflected  the  discussion  we  had  that  day, namely that Lynda would withdraw the caveat and protection order, although I was already taking steps to deal with the protection order. It wasn’t until 6 June 2001 … , after Lynda had made it clear that she would be defending the applications, that I withdrew my applications, after I realised I was just too sick to cope with the process.

15     At [35] above.

16     At [36] above.

[71]     The defendant further said:

174.Even if I had been serious about transferring part of my property to Lynda  the  fact  that  I  didn’t  mention  in  the  4 April 2001  note anything about Lynda paying me any money doesn’t mean that I did not require this to occur.   I had told Lynda EVERY time that she raised the subject that she would need to pay money and that her share in the property would be relative to the money she paid, and that any further discussion until then was pointless.  From my point of view it was so obvious that it didn’t need recording.

He deposed that he had absolutely no reason for or interest in gifting the plaintiff half of his property in October 2002 or at any other time.

[72]     According to the plaintiff a draft of the 17 October 2002 document came into existence no later than February 2002, in particular prior to the entry in her diary for

28 February 2002.17     She  said  that  that  diary  entry  was  recording  the  fact  that

separate legal advice was required in order for an agreement to be binding.

[73]     There  is  no  dispute  that  the  document  below  was  executed  by  both  the plaintiff and the defendant on 17 October 2002 in the presence of a Deputy Registrar

at the Blenheim courthouse:

17     At [45] above.

[74]     The  structure  and  content  of  the Agreement  are  discussed  below  in  the context of the issue whether the document was a deed.  However two points can be conveniently noted at this stage.  First, the reason recorded for the plaintiff’s name not being noted on the title is her alleged preference not to be registered for GST. The second point is the reference in the final sentence to the fact that separate legal advice had been received.

[75]     The contrast between the parties’ evidence concerning the execution of the Agreement was dramatic.   The plaintiff claimed that on the previous day the defendant had produced the document and said that they should proceed to sign it. In response to a question from me on the issue how a diary entry in February 2002 could be referring to a document subsequently created she said:

A.        Because they came into being in the future because they were signed in the future but they were worked on over previous months and I know that when I moved back into the property near the end of August I had way too much else to do and get organised and I didn’t even think of this property agreement or have anything to do with the property agreement and it wasn’t until Frank suggested that we sign it tomorrow when he spoke to me on 16 October about it that we pulled it out of its file, wherever it was, and did something with it.

She recalled attending at the courthouse to sign the document following which she said that the two of them had lunch together at Paysannes Restaurant in central Blenheim.

[76]     The  defendant  simply  had  no  recollection  of  signing  the  document  or lunching  afterwards.    It  so  happened  that  at  10.25 am  on  17 October 2002  the defendant had been served at his home with a notice of revocation of his driver licence which had been  cancelled on account  of the results of an Occupational Therapy Driving Assessment he had undertaken.   The defendant recalled the circumstances  of  the  service  of  that  notice  although,  until  it  was  drawn  to  his attention  at  the  hearing,  he  had  not  appreciated  that  it  occurred  on  the  day in question.

Enforcement of the Agreement

[77]     The plaintiff explained that in early 2014, after the death of a friend, she was removing  a  photograph  from  a  binder  and  in  the  process  happened  across  the

Agreement which she had forgotten about.  She explained in cross-examination:

Q.	Where was it, what building or whatever were you in when you found this in this folder?
A.	I was in my caravan.
Q.	Your caravan and was it your folder?
A.	Yes and it was in a box. The folder was in a box with my 2002 diary and my 2005 diary that I wasn’t even aware I still had and my horse help book work, my accounts and my receipt books and –
Q.	Do I get the impression you’d forgotten about this document?
A.	Totally, entire forgotten about it and that include the years that Monica was riding with me too.  There’s no way I talked about it with Monica.
[78]	The	reference    to    Monica    was    to    a    witness    for    the    defendant,

Monica Goossens-Gomez, who gave evidence that in a number of conversations the plaintiff had referred to having a written document which stated that the plaintiff and the defendant were equal partners in the property.   The plaintiff denied that such conversations had occurred.

[79]     The plaintiff delivered the document to her solicitor, Patricia Wardill, who sent to Mr Locke a letter dated 3 February 2014 stating:

I have been handed a certain document by my client which I now attach by way of disclosure.  I believe the document to be a sufficient memorandum in writing to be relied upon with certainty.

Given that my client has, pursuant to the terms of this agreement, a one half share in the property, she now calls upon your client to sign all necessary documents to enable registration of a transfer of the property.

To this end please provide by return the necessary documents to enable this firm on behalf of my client to register a transfer as is her right pursuant to the terms of this agreement dated in year 2002.  My client would of course agree to transfer her interest to your client for payment of a sum equivalent to a one half share of the market value of the property and it is likely that this would resolve the current claims in the Family Court.

As this interest is a different interest than that claimed under the prior caveat registered in year 2000 and the interest is one capable of being perfected by registration I have lodged a caveat to protect this interest in the property.

[80]     Mr Locke’s response of 5 February 2014 included the following statements:

In any event my client instructs me:

1.That  he  has  no  recollection  of  signing  the  document  you  have disclosed.    He  reserves  his  rights  regarding  its  authenticity  and having it forensically examined.

2.That  my  client  does  not  acknowledge  any  agreement  (oral  or written) regarding the property with your client other than the 1997 agreement for sale and purchase and the oral agreement regarding the Agreement referred to in paragraphs 45, 46, and 50 of my client’s narrative affidavit (whereby your client was to take a half interest in the property if she contributed half of the purchase price and which agreement lapsed at the point she could not do so).

3.That my client was extremely unwell in 2001 and 2002, to the point that he would have been likely not to have appreciated the effects and implications of the document or his legal rights, if indeed he did sign it.   My client has no recollection of having taken separate or indeed any legal advice regarding such a document.

4.My client has already deposed to the abusive nature of your client’s relationship with him.  If my client signed the document he is of the view that this was very likely under duress from your client, in particular around the caveat and protection order.

5.That  your  client  has  not  provided  any  consideration  for  the acquisition of one half of the property.  It is noted that the purported agreement does not specify any consideration, and any agreement would be void for lack of consideration.

6.Notwithstanding that, it would  appear that Ms Barry periodically endeavoured to have Mr Carlisle acknowledge an interest in her part in the property.   Further examples are the enclosed copies of a document   entitled   ‘Agreement   between   Francis   Carlisle   and Lynda Rose Barry’ dated  17 May 1998  (which  my  client  did  not sign)  and  a  document  signed  by  Mr Carlisle  dated  4 April 2001. Copies of these documents are enclosed.  It seems the latter was an exhibit to your client’s affidavit dated 1 May 2001, the former has been discovered more recently in a suitcase by my client.

7.My client regards any such documents as void due to lack of consideration, lack of certainty, and due to being vitiated by duress and lack of capacity, and recalls that your client periodically stated that she would contribute one half of the value of the property, which of course has not occurred.

[81]     On the issue of consideration, Ms Wardill responded in this way:

As  to  your  requirement  for  there  to  be  consideration  in  order  for  the document to be enforceable I disagree.  Clearly the document is a deed and entry into the deed is sufficient. That document creates a caveatable interest.

[82]     The further caveat registered against the title referred to in Ms Wardill’s first

letter recorded the relevant interest in the land as:

Beneficial interest in ½ share (as tenant in common) arising from an Agreement to Transfer dated 17 October 2002 between Francis Carlisle as Transferor and register proprietor and the Caveator as Transferee.

The statement of claim was filed on 8 April 2014.

Closing submissions – additional issues

[83]     Because of the time absorbed in the hearing of the evidence, the parties agreed  to  provide  written  closing  submissions  by  a  simultaneous  exchange  on

2 June 2015.  By subsequent agreement that date was extended to 8 June 2015.

[84]     The defendant’s submissions addressed a number of issues additional to those agreed at the hearing.18   First it was said that, although formal delivery of a deed was not required under the Property Law Act 1952, the common law as to delivery as an escrow continues to apply.  Hence, if the Agreement was found to be a deed, it was the defendant’s contention that it was delivered to the plaintiff strictly on the basis that it did not become a deed unless and until she paid to the defendant a sum of

money commensurate  with  the extent  of the interest  in  the property which  she sought.

[85]     This  point  was  not  raised  in  the  statement  of  defence.     Nor  was  it

foreshadowed in the defendant’s opening submissions.   I do not consider that it is

open to the defendant to advance this argument for the first time in closing.

18     At [8] above.

[86]     Secondly, the closing submissions raised for the first time  a point about limitation:

135.     It is submitted that for the purposes of limitation the document dated

17 October 2002   is   a   instrument   under   hand   (though   not   an instrument within the meaning of the Land Transfer Act 1952 or the

Property Law Act 1952) and that the limitation period commenced

on the date of its execution, 17 October 2002, and that it expired on or about 18 October 2008, and that the present proceeding is out of time by in excess of seven years.

[87]     Curiously however the defendant’s concluding summary of his case stated:

(d)      The agreement is not time-barred by the Limitation Act 1950 due to the   fact   that   the   cause   of   action   accrued   no   earlier   than

3 February 2014 when Ms Barry made demand for Mr Carlisle to

transfer her share in the property to her and Mr Carlisle refused to do so.

[88]     While I would not have entertained an unpleaded limitation defence, in fact the correct analysis in my view is as stated in the summary.  No limitation defence would arise on the facts of this case.

[89]     Finally I note that in anticipation of further arguments the defendant’s closing submissions also touched on the issues whether the document was indicative of a gift and whether the three pleaded affirmative defences might be defeated by an affirmation of the Agreement on the part of the defendant.  Neither of those points were raised by the plaintiff and it is not necessary for me to consider them.

Issue one:  Is the Agreement to transfer a half share in the property a disclaimer of land?

[90]     Although it was the defendant who had put this issue into contention, his written submissions simply stated that he accepted that the Agreement was not a disclaimer of land within the meaning of s 12 of the Property Law Act 1952.  That was plainly an appropriate concession.  A “disclaimer” is a refusal to accept or a renunciation of an interest in an estate.  As stated in Garrow’s Law of Real Property

in New Zealand:19

19     E C Adams Garrow’s Law of Real Property in New Zealand (4th ed, Butterworths, 1954) at 180.

A person disclaims an estate or gift or office when he refuses to accept it. Disclaimer is simply the refusal to accept and this refusal may according to circumstances be evidenced by conduct or by writing.  In the case of land no disclaimer is valid unless it is made by deed or by matter of record.

[91]     As the defendant’s promise in the Agreement is not a disclaimer it follows that s 12 is not applicable and there is no requirement that the Agreement should have taken the form of a deed.

Issue two:  Is the Agreement a deed?

[92]     A document must satisfy two requirements in order to constitute a deed: the formalities prescribed by s 4 of the Property Law Act 1952 must be present; and the instrument must have been intended to take effect as a deed.   No issue arises concerning the first requirement but the defendant disputes that the second requirement is met.

[93]     The leading New Zealand authority is Morley v Spencer when Richardson J

explained the principles in this way:20

… At common law it was always essential to the creation of a deed that the parties intended it to have that effect.  While physical delivery was no longer required delivery occurred when there were “acts or words sufficient to show that it is intended by the party to be executed as his deed presently binding on him” (Xenos v Wickham (1866) LR 2 HL 296, 312 and 322; Dean and Westham Holdings Pty Ltd v Lloyd [1990] 3 WAR 235). Thus in Boyd v Cooper  (1915) 34 NZLR 807, 810 Stout CJ, after observing it was not decisive that the document was called a memorandum of agreement, immediately posed the question: “What was the intention of the parties?”

Following an illuminating historical review Young J in Manton v Parabolic Pty Ltd (1985) 2 NSWLR 361, 369 concluded that the history of solemn deeds and the authorities to which he had referred made it plain that the essential element of a deed is that it be the most solemn act that a person can perform with respect to a particular piece of property or other right. Where numerous formalities are prescribed – Coke on Littleton 35(b) specified ten requirements for a deed – the performance of all of those acts is powerful evidence of a solemn intention to be immediately bound by deed.   The position is obviously different where the formal requirements are reduced to two, namely signing and attestation as under s 4.  That is reinforced by the common conveyancing practice of having the simplest contract witnessed by persons who add their address and occupation.   As Young J observed at p 368  the  limited  formalities  prescribed  in  New Zealand  mean  that  the Judges in this country have to focus more intently on the substantial requirement.

20     Morley v Spencer [1994] 1 NZLR 27 (CA) at 30.

In ascertaining the intent of the parties as in determining the true character of a transaction in other respects the instrument must be considered as a whole in its factual matrix and having regard to the object.   Extrinsic evidence concerning the words or acts of the parties as well as examination of the words contained in the document itself may assist in discerning the intent of the parties (Xenos v Wickham p 312; Comptroller of Stamps v Associated Broadcasting Services Ltd [1990] VR 335, 347). While the nomenclature used may not be decisive, whether the document is intended to have present effect as a deed can only be determined by careful consideration of its content and language and of the objects of the parties as reflected in the instrument and considered in its factual setting.

[94]     McKay J discussed a number of other authorities and in particular approved the principles stated in Dean and Westham Holdings Pty Ltd v Lloyd:21

…The  principles  adopted  and  applied  in  that  case  are  accurately summarised in the following portion of the headnote at p 235:

…

(3)       An instrument which is not distinctly stated to be a deed but which otherwise implies through  its tenor and the  words used therein, that it is intended to be a deed, is an instrument purporting to be a deed.

(4)       The  intention  of  a  party  when  executing  a  document remained of primary importance.    Intention could be discerned from extrinsic evidence such as the words or acts of the parties or from an examination of the words contained in the document itself.

…

(5)       The object of a document was also relevant in determining whether it was a deed.

...Paragraph (3), (4) and (5) in my view correctly express what is also the relevant law in New Zealand.

[95]     The defendant had no recollection of signing the document22 or indeed of any of the circumstances concerning its preparation.  In fact it was apparent from their evidence  that  neither party was  even  aware of  the concept  of a  deed  until  the exchange  of  correspondence  in  February 2014,23   which  prompted  Mr Locke  to observe that there was an air of artificiality in the Court being asked to discern the

parties’ intentions.  He went on to submit that the document did not have any of the

21     Dean and Westham Holdings Pty Ltd v Lloyd [1990] 3 WAR 235 (WASC).

22     At [76] above.

23     At [79]–[81].

usual nomenclature of a deed prepared by lawyers and suggested that it was likely to have been prepared by the plaintiff, possibly with some assistance from others.

[96]     While I agree that it is apparent that the document was not prepared by a solicitor, nevertheless it has a decidedly formal structure and tone. After the heading in capital letters, the legal description of the property is set out on four separate lines (also in capital letters) although the details of the “estate” are missing.

[97]     There follow three paragraphs which are in the nature of recitals recording: (a)        the fact of the Agreement for sale and purchase in 1997;

(b)      the plaintiff’s reason for not having her name on the title;

(c)      that the plaintiff has a half share in the property and an entitlement to run her business there and to live in the house “as an equal tenant in common”.

[98]     There is then what might be viewed as an operative clause in which the plaintiff’s  “legal  right”  as  a  half  owner  in  the  property is  confirmed,  again  by reference to the legal description of the property in capital letters.  That is followed by what is in effect a machinery clause recording the defendant’s obligation to take steps necessary to effect a transfer to the plaintiff of a half-share in the event that the plaintiff so requests.   The final paragraph contains an acknowledgement that both parties had received separate legal advice before signing the document.

[99]     The word “deed” is not contained in the document.  As Mr Locke notes it is described  as  an  “agreement”  both  in  the  heading  and  in  the  final  paragraph concerning legal advice.  The sentence which I have likened to an operative clause refers to “this letter”.

[100]   The format of the lower part of the document providing for signature and attestation is also quite formal.  Although the parties’ signatures were witnessed by the same person, the document makes provision for a witness in relation to each signature and also makes provision for the entry of a date in respect of all four

signatures (which serves to emphasise that the document was not prepared by a lawyer).

[101]   The document was signed in the presence of the Deputy Registrar of the Blenheim District Court. The fact that the parties attended together at the courthouse to sign the document adds to the air of formality of the document.

[102]   Mr Locke drew attention to the phraseology which a legal  drafter would employ and submitted that the manner in which the Agreement was drafted is a strong indication that neither party intended the document to be a deed.

[103]   While clearly not the product of a solicitor, I consider that the document is crafted in such a manner as a lay person might compose if endeavouring to create a document similar to one professionally prepared.  In my view the structure and the tone of the document, the manner of the description of the property, the subject matter and the mode of its execution collectively point to a document which was not only intended to have legal effect but also was viewed as a formal and solemn arrangement.

[104]   Viewed objectively, I consider that the Agreement dated 17 October 2002 was intended to be a deed notwithstanding that neither party was then familiar with the concept of a deed.

[105]   In addition to his argument on the issue of intent, Mr Locke also presented a detailed submission addressing whether the Agreement was deemed to have the effect of a deed by virtue of s 157 of the Land Transfer Act 1952 and by reference to the judgment of Turner J in Fama v Ryder.24    However in view of my conclusion

above it is unnecessary for me to rule on Mr Locke’s further argument.

24     Fama v Ryder [1954] NZLR 523 (SC).

Issue three:   Was  there consideration  for the Agreement  to transfer to the plaintiff a half share of the property?

[106]   It was common ground that, whether or not the 17 October 2002 document was a deed, in order for specific performance to lie it was necessary that there be consideration for the defendant’s promise.   It was also common ground that the document did not record the fact of any consideration.

[107]   However  I accept  Mr Zindel’s  submission  in  reliance  on  Pao  On  v  Lau Yiu Long  that  extrinsic  evidence  is  admissible  to  prove  consideration  where  no consideration is expressed in the instrument, provided that such consideration advanced is not inconsistent with the terms of the written instrument.25

[108]   With reference to the plaintiff’s broad contention that consideration can be said to have passed over the 14 years preceding the execution of the Agreement, it is well established that what is described as “past” consideration will not be sufficient. The law is stated in Law of Contract in New Zealand in this way:26

If the defendant makes a promise, subsequent to and independent of the transaction, it must be regarded as a mere expression of gratitude for past favours or as a designated gift, and no contract will arise.  It is irrelevant that he or she may have been induced to give the new promise because of the previous bargain.  The fact is that it is not part of any bargain: the act of the plaintiff was not done in response to such a promise.   In such a case the promise is declared, in traditional language, to be made upon past consideration; or, more accurately, to be made without consideration at all…

[109]   It was Mr Locke’s submission that any contributions which the plaintiff had made in respect of the Matakana property were made over 10 years prior to the Agreement and as such could have no causal nexus with the defendant’s entry into the Agreement.   If such contributions amounted to consideration, then it was past

consideration.

25     Pao On v Lau Yiu Long [1980] AC 614 (PC).

26     John  Burrows,  Jeremy  Finn  and  Stephen  Todd  Law  of  Contract  in  New Zealand  (4th   ed, LexisNexis, Wellington, 2012) at [4.2.1(b)].

[110]   Such contributions as there were during the occupation of the Wairau Valley property were described as not significant.   Mr Locke contended that the plaintiff paid nothing towards the expenses of the property or the household and performed no significant domestic or farming services beyond looking after herself and her own horse.  Indeed she derived the benefit of both a residence and a site for her horse and horse riding business which more than offset any contribution she may have made.

[111] An unexplained payment of $1,589.23 from the plaintiff’s father to the defendant on 14 February 2005 was said to be perplexing in that neither party could recall the reason for the payment.   In Mr Locke’s submission that payment was de minimis  and  in  any  event  moved  from  the  plaintiff’s  father  rather  than  the plaintiff herself.

[112]   However, as Mr Zindel properly submits, there may be circumstances where a promisee’s conduct prior to the giving of a promise by the promisor to confer some benefit can be consideration for the promise.  In Pao On Lord Scarman explained the law in this way:27

The Board agrees with [the submission of counsel for the plaintiffs] that the consideration expressly stated in the written guarantee is sufficient in law to support the defendants’ promise of indemnity. An act done before the giving of a promise to make a payment or to confer some other benefit can sometimes be consideration for the promise.  The act must have been done at the promisors’ request, the parties must have understood that the act was to be remunerated either by a payment or the conferment of some other benefit, and payment, or the conferment of a benefit, must have been legally enforceable had it been promised in advance.  All three features are present in this case.  The promise given to Fu Chip under the main agreement not to sell the shares for a year was at the first defendant’s request.  The parties understood at the time of the main agreement that the restriction on selling must be compensated for by the benefit of a guarantee against a drop in price: and such a guarantee would be legally enforceable.   The agreed cancellation  of  the  subsidiary  agreement  left,  as  the  parties  knew,  the plaintiffs unprotected in a respect in which at the time of the main agreement all were agreed they should be protected. (emphasis added)

27     Pao On v Lau Yiu Long, above n 25, at 629–630.

[113]   On this critical issue I set out the plaintiff’s relevant submission verbatim:

227.     Whether or not the document … is a deed, it appears that the Court will need to find consideration to enforce the evident promise by the defendant to transfer a half interest in the property to the plaintiff.   The consideration has been gone into in some detail during the course of the evidence.  Apart from the plaintiff’s father’s contribution to the mortgage, sometime after the event, in 2005, about which there may not have been any ongoing    expectation    when    the    document    was    entered    into    on

17 October 2002, there could well have been other financial contributions

expected from the plaintiff’s camp, including after her parents passed away and she received an inheritance.  Most of the contributions by the plaintiff are in the form of less measureable things like paying for groceries; the provision of the car which she purchased with the money which her father gave her following her mother’s death; the provision of transport for the defendant, particularly when he was unable to drive but needed to be driven to various appointments, or for errands in town to see specialists or ACC; paying  for  diesel  for  the  car  or  generator;  with  care  of  the  defendant’s children at various times and with household companionship, performance of chores and all the various incidents which go towards the domestic relationship.   The defendant and his witnesses downplayed the plaintiff’s performance of chores but … the defendant admitted in paragraph 6 of his affidavit of 3 April 2001, that: “She did not pay me any money but she did things around the house and helped with various household chores”.

…

228.    It is sufficient, it is submitted, if the plaintiff provides material consideration (including matters of general expenditure or of a non-financial kind) over the course of years preceding the 17 October 2002 instrument and that would include prospective consideration following the execution of that document.   If there has been more than minimal consideration then  the Agreement should be ordered to be performed, with the vitiating factors such as undue influence and unconscionability submitted not to be open on the evidence.  Common law does not look at the adequacy of consideration at all but in equity if the consideration is materially inadequate the discretionary remedy of specific performance may be withheld: …

[114]   The plaintiff concluded her submission with the proposition that it would be in keeping with the 23 years that the relationship had potentially lasted and the “wide-ranging consideration which the plaintiff provided” for the plaintiff now to receive “her half share” of the property.   That proposition echoed the grounds contained in the plaintiff’s abandoned notice of claim to the Wairau Valley property under s 42 of the Property (Relationships) Act 1976 dated 31 July 2013 in which she stated:

2.I have been in a de facto relationship with FRANCIS CARLISLE and the relationship lasted for approximately 23 years on & off with periods of separation during the relationship.

3.Under the Property (Relationships) Act 1976, I claim an interest in that  estate  or  interest  by virtue  of  my de facto relationship  with FRANCIS CARLISLE.

[115]   I  agree  with  Mr Locke  that  the  nature  of  the  acts  said  to  comprise consideration were not particularly significant and certainly not of a measure which might be expected as the quid pro quo for the transfer of a half interest in land of the order of the Wairau Valley property.  In so concluding I am mindful of the fact that consideration which is sufficient in law may be materially inadequate in the eyes of equity and that the consideration relied upon in this case can fairly be viewed as

“unbalanced” in equitable terms.28

[116]  However on the evidence presented, in my view the hurdles which the plaintiff’s claim must inevitably fail to surmount are the first and second features identified by Lord Scarman.  There is no evidence that the activities relied upon as amounting to consideration were undertaken at the defendant’s request.   Nor was there evidence that the performance of such acts was to be remunerated by a transfer of a half share of the property to the plaintiff.  A mere expectation on the part of the plaintiff in the absence of those two features does not provide a basis for a claim to enforce a promise which is unsupported by consideration.

[117]   Indeed on the plaintiff’s own evidence it is very questionable whether she held any expectation as to a transfer of a share in the property in return for her performance of services or her making contributions subsequent to the purchase of the Wairau Valley property.   The tenor of her evidence appeared to be that her entitlement to a half share was already extant at the date of purchase. That is the thrust of the Agreement itself, containing as it does the GST-based explanation for the absence of her name from the title and the confirmation of her “legal right” as a half-owner  of  the  property.    I  consider  that  the  wording  of  the Agreement  is inconsistent with the contention that consideration for the promise in the Agreement

flowed from acts done subsequent to the purchase at the request of the defendant.

28     Attorney-General for England and Wales v R [2002] 2 NZLR 91 (CA) at [100] and [103].

[118]   Consequently   I   uphold   the   defendant’s   objection   that   there   is   no

consideration for the promise in the Agreement.

[119]   Given my conclusion on this issue, strictly speaking it may be unnecessary to make a finding on the conflict in the parties’ evidence concerning the circumstances of the acquisition of the Wairau Valley property.  In the event that it could assume significance, however, I record my clear preference for the evidence of the defendant as related at [20] and [22] above.  While there was the opportunity available for the plaintiff to participate in the purchase, in fact because of a lack of funds she did not do so and the defendant became the sole owner.

[120]   I reject the plaintiff ’s contradictory reasons for the absence of her name on the title.   The reason which she ultimately advanced was at odds with the reason recorded in the Agreement itself.29   Furthermore, if the reason for the omission of her

name on the title was as she deposed in evidence at the hearing,30 then I would have

expected that the solicitor’s correspondence would have made mention of that fact. It is also reasonable to assume that she would have called the solicitor to give evidence.

[121]   In  view  of  my  conclusion  on  the  third  issue,  I  will  address  reasonably succinctly  the  remaining  issues  comprising  the  defendant’s  three  affirmative defences.

Issue four:   If the Agreement was enforceable, did the defendant enter the

Agreement under duress?

[122]   In Pharmacy Care Systems Ltd v Attorney-General Hammond J summarised the elements of duress in New Zealand in seven points:31

First, there must be a threat or pressure.   Secondly, that threat or pressure must be improper.  Thirdly, the victim’s will must have been overborne by the improper pressure so that his or her free will and judgment have been displaced.  Fourthly, the threat or pressure must actually induce the victim’s manifestation of assent.  Fifthly, the threat or pressure must be sufficiently grave to justify the assent by the victim, in the sense that it left the victim no

29     At [74] above.

30     At [66] above.

31     Pharmacy Care Systems Ltd v Attorney-General (2004) 2 NZCCLR 187 at [98].

reasonable alternative.   Sixthly, duress renders the resulting agreement voidable at the instance of the victim.   This may be addressed either by raising duress as a defence to an action, or affirmatively, by applying timeously to a court for avoidance of the Agreement.  Seventhly, the victim may be precluded from avoiding the Agreement by affirmation.

[123]  The close relationship between the elements of illegitimate pressure and coercion is apparent from A-G for England and Wales v R where Tipping J observed that whether the pressure amounted to such compulsion of the will as to constitute duress in law depended on an assessment of two often linked matters, the first being whether the pressure was regarded in law as legitimate and the second whether the

pressure brought about an absence of practical choice.32    Cautioning against taking

too compartmentalised an approach towards duress, he said:

Illegitimate pressure may amount to duress even if there is a practical choice, but the absence of practical choice may suggest the pressure is illegitimate. Illegitimacy of pressure can sometimes arise from conduct which is lawful in itself, albeit it will of course be easier to demonstrate illegitimacy of pressure if it derives from conduct which is unlawful in itself. The starting point must be  that  the  law  recognises  people  generally  act  under  some  degree  of pressure in making decisions affecting their commercial and other interests. In all duress cases the Court must consider whether the pressure under which the plaintiff was acting should be regarded as legitimate or illegitimate and, in that respect, the nature of any alternatives reasonably open to the plaintiff will be of major importance.

[124]   The defendant has the onus of establishing this and his other affirmative defences.  He places substantial reliance on his state of health at the time.  However the point is somewhat two-edged because one effect of his illness was that his memory was impaired.   Indeed, as noted earlier, he has no recollection of even signing the Agreement.33

[125]   The evidence established that the plaintiff left the Wairau Valley property on

9 April 2002 in, to say the least, strained circumstances34 and she did not return until at the earliest late August 2002.35   It appears that the defendant was content for her to

return, apparently having some sympathy for her situation.

32     Attorney-General for England and Wales v R, n 28 above at [62].

33     At [76] above.

34 At [49].

35 At [55].

[126]   However the evidence, such as it is, relating to the period from when the plaintiff returned to the property until 17 October 2002 does not suggest to me that during that period the defendant was subjected to such a degree of pressure as to sustain  a  finding  that  he  signed  the  Agreement  under  such  compulsion  as  to constitute duress.

Issue five:   If the Agreement is enforceable was the defendant the subject of undue influence?

[127]   The   doctrine   of   undue   influence   was   explained   by   Richardson J   in

Contractors Bonding Ltd v Snee as follows:36

[U]ndue  influence  consists  in  the  gaining of  an  unfair  advantage  by an unconscientious use of power by a stronger party against a weaker in the form of some unfair and improper conduct, some coercion from outside, some  overreaching,  some  form  of  cheating,  and  generally,  though  not always,  some  personal  advantage  obtained  by  the  stronger  party.    It  is directed at conduct within a relationship which justifies the conclusion that the disposition or agreement was not the result of a free exercise of the disponer’s will.   The doctrine is founded on the principle that equity will protect  the  party  who  is  subject  to  the  influence  of  another  from victimisation.

[128]   However in National Commercial Bank (Jamaica) Ltd v Hew Lord Millett maintained that, however great the influence which one person might be able to wield over another, equity will not intervene unless that influence has been abused.37

Equity does not save people from the consequences of their own folly; it acts to save them from being victimised by other people.

[129]   For essentially the same reasons as stated in the context of the duress claim, notwithstanding the fact and nature of defendant’s illness, I am not satisfied that at the relevant time the plaintiff exercised such a degree of influence over the defendant

that in signing the Agreement he did not exercise free will.

36     Contractors Bonding Ltd v Snee [1992] 2 NZLR 157 at 165.

37     National Commercial Bank (Jamaica) Ltd v Hew [2003] UKPC 51.

Issue six:   If the Agreement is enforceable, does the Agreement constitute an unconscionable bargain?

[130]   In  Gustav  and  Co  Ltd  v  Macfield  Ltd  the  Court  of Appeal  set  out  the following principles, said to be non-exhaustive, summarising the law of unconscionable bargain:38

1Equity  will  intervene  to  relieve  a  party  from  the  rigours  of  the common law in respect of an unconscionable bargain.

2This equitable jurisdiction is not intended to relieve parties from “hard” bargains or to save the foolish from their foolishness.  Rather, the jurisdiction operates to protect those who enter into bargains when they are under a significant disability or disadvantage from exploitation.

3A qualifying disability or disadvantage does not arise simply from a inequality of bargaining power.   Rather, it is a condition or characteristic  which  significantly  diminishes  a  party’s  ability  to assess his or her best interests.  Likely characteristics of this kind are ignorance,  lack  of  education,  illness,  age,  mental  or  physical infirmity, stress or anxiety, but other characteristics may qualify depending on the circumstances of the case.

4If one party is under a qualifying disability or disadvantage (the weaker party), the focus shifts to the conduct of the other party (the stronger party).  The essential question is whether in the particular circumstances it is unconscionable to permit the stronger party to take the benefit of the bargain.

5Before a finding of unconscionability will be made, the stronger party must know of the weaker party’s disability or disadvantage and must “take advantage of” that disability or disadvantage.

6The requisite knowledge may be that of the principal or an agent, and may be actual or constructive.   Factors associated with the substance of a transaction (for example, a marked imbalance in consideration) or the way in which a transaction was concluded (for example, the failure of one party to receive independent advice in relation to a significant transaction) may lead to a finding that the stronger party had constructive knowledge.   So, in the particular circumstances the stronger party may be put on inquiry, and in the absence of such inquiry may be treated as if he or she knew of the disability or disadvantage.

7        “Taking advantage of” (or victimisation) in this context encompasses

both the active extraction and the passive acceptance of a benefit.

8If these conditions are met, the burden falls on the stronger party to show that the transaction was a fair and reasonable one and should therefore be upheld.

38     Gustav and Co Ltd v Macfield Ltd [2007] NZCA 205 at [30].

[131]   Undue influence and the doctrine of unconscionable bargain are said to have much in common to the point that undue influence can be seen as a species of unconscionable conduct.39   However on this issue I find in favour of the defendant.

[132]   It is plain in my view that the plaintiff was fully cognisant of the defendant’s poor state of health.  Affidavits which she filed in Family Court proceedings in 2001 clearly evidence that knowledge.  The circumstances of this case are such that the burden falls on the plaintiff to show that the transaction was fair and reasonable and should be upheld.

[133]   This transaction, which would involve the defendant assigning to the plaintiff a half share in the Wairau Valley property, was in no measure fair and reasonable. The plaintiff had made no financial contribution to the purchase price of the land or to the cost of construction of the house.   Indeed, far from contributing, she had derived   significant   benefits,   both   residentially  and   in   the  operation   of  her horse-riding business.

[134]   To permit a transfer of a half share in the property to the plaintiff in the circumstances of this case would be to endorse an unconscionable bargain.   The defendant’s third affirmative defence succeeds.  Relief would have been granted to the defendant had the third issue been resolved in favour of the plaintiff and the Agreement had been held to be enforceable.

Summary of findings

[135]   On the second issue I hold that the Agreement dated 17 October 2002 was a deed because viewed objectively the parties intended it to be a deed.  However on the third issue I find that there was no consideration for the defendant’s promise in

the Agreement and consequently no order for specific performance may lie.

39     Burrows, Finn and Todd, above n 26, at [12.4.1].

[136]   If,  contrary  to  my  view,  there  was  consideration  and  the Agreement  is enforceable, then I would uphold the defendant’s affirmative defence of unconscionable bargain.  However the other affirmative defences, duress and undue influence, do not succeed.

Costs

[137]   The defendant is prima facie entitled to costs and reasonable disbursements as fixed by the Registrar.  If the parties cannot agree on costs, then the defendant is to file a memorandum by 27 July 2015 and the plaintiff is to file a response by

17 August 2015.

Brown J

Solicitors: Zindels, Nelson

M G Locke, Barrister, Nelson