Cartwright v Joseph

[2020] NZHC 455

IN THE HIGH COURT OF NEW ZEALAND WHANGAREI REGISTRY

I TE KŌTI MATUA O AOTEAROA WHANGĀREI-TERENGA-PARĀOA ROHE

CIV-2017-488-000058

[2020] NZHC 455

IN THE MATTER

of the Family Protection Act 1955

AND

IN THE MATTER

of the estate John Boyd Harrison

BETWEEN

CATHERINE DAILE CARTWRIGHT and SARAH BEVERLY HARRISON

Plaintiffs

AND

NITA WAIRANGI JOSEPH, BARRIE AGAR, BRETT HOGAN and TREVOR

DRAFFIN as trustees and executors of the estate of John Boyd Harrison

Defendants

Hearing:

(On the papers)

Counsel:

A McDonald and C Rutledge for the Plaintiffs J Robertson for N Joseph

J Golightly for the Executors

Judgment:

10 March 2020

JUDGMENT OF MOORE J

[As to further orders]

This judgment was delivered by me on 10 March 2020 at 3:00 pm pursuant to Rule 11.5 of the High Court Rules.

Registrar/ Deputy Registrar Date:

CARTWRIGHT & ANOR v JOSEPH & ORS [2020] NZHC 455 [10 March 2020]

Introduction

[1]    John Boyd Harrison, known as Tim, died on 23 September 2016. Under his will, the whole of his estate was left to his partner of 38 years, Nita Joseph. On 11 September 2018, I found Tim had breached his moral duty to make adequate provision for his daughters, Catherine Cartwright (“Cathy”) and Sarah Harrison (“Sarah”).1 I indicated an award of about 10 per cent each would be sufficient to remedy the breach.2 In a second judgment on 6 November 2018, I determined the form of the award.3

[2]Cathy and Sarah now apply for further orders in respect of this award.

Background

[3]    The main asset of the estate is a large block of land comprising two sections, “609” and “610”. Nita operates a camping ground in the most valuable part of 609, referred to as “S11/1”. I considered it important that Nita could remain on that land and noted the executors should not be bound to the estate for too long. I took a provisional view that the best outcome would involve:4

(a)the subdivision of S11/1 from the remainder of 609; and

(b)the sale of the amalgamated title of 610 and the residue of 609.

[4]The parties filed further submissions about that proposed course of action.

[5]    On 6 November, the structure of the proposal was settled, and I made orders for the executors of the estate to arrange the subdivision and sale.5 To support the subdivision, I ordered that the executors may create an easement servient to 609 along the northern boundary of 610. The executors estimated that the amalgamation, subdivision and sale would cost $112,000.6 Cathy and Sarah sought an order that the estate bear that cost without further deduction from their share, but I ordered that they

1      Cartwright & Anor v Joseph & Ors [2018] NZHC 2383.

2 At [36].

3      Cartwright & Anor v Joseph & Ors [2018] NZHC 2867.

4 At [50].

5 At [18].

6 At [10].

pay 20 per cent of those costs upon receipt of invoices relating to the required advice and works. I confirmed to the parties in the later costs judgment that this was 20 per cent of the both subdivision/amalgamation costs and the sale costs of the amalgamated title.7

[6]    In my judgment of 6 November 2019, I reserved leave for the parties to approach the Court if the subdivision and/or sale were impeded for reasons outside the control of the executors, or if unforeseen costs arose.8 Cathy and Sarah now submit that the proposed subdivision is costlier and more complex than expected.

Issues with the subdivision

[7]    Since the beginning of 2019, the parties have been involved in ongoing discussions concerning access into S11/1. The current access runs partly over Department of Conservation land and 610. The executors are planning to request the Department of Conservation to exchange that right of way for an easement over 610, so that the existing access to S11/1 could be made into a legal roadway. The executors will need to obtain consent from the owners of neighbouring Māori land, the Department of Conservation and the Whangārei District Council.

[8]    Cathy and Sarah have not agreed with this proposal (or the two other options presented by the executors) because of the extra costs, delay and uncertainty involved. It is estimated this option would cost an additional $54,000 and take an additional one or two months. Cathy and Sarah worry that costs will increase after negotiations with the Council and the Department of Conservation. Cathy has provided the Court with an affidavit which includes emails between her and the executors, discussing the access problem. In one email, Cathy says:

“We understand there is a strong desire on the part of the executors to pursue this approach to maximise the value of the campground land by gaining access over DOC land, but that is for the benefit of Nita and in our view is against our interests. “

7      Cartwright v Joseph [2019] NZHC 1093 at [34].

8      At [18(f)].

[9]    Cathy and Sarah submit they are effectively obliged to accept the decisions of the executors and pay for work they have not consented to. They say the moral breach they have suffered has been aggravated by the time and stress involved in trying to resolve these issues. They therefore submit that the subdivision is not practicable, and the award should be satisfied in an alternative way.

Orders sought

[10]   Cathy and Sarah would prefer to be granted a 10 per cent interest each in the block of land comprised of 610 and 609, secured by a caveat over the titles to those sections. They consider that this will give the executors and Nita control as to how they dispose of the estate. They accept that this will result in a delay.

[11]Alternately, Cathy and Sarah propose that:

(a)the award is satisfied by granting them $380,000 each (representing 10 per cent of the lowest valuation of the estate provided by the executors);

(b)they execute loans to the executors of $380,000 each, repayable no later than two years from the date of the loan to be secured by way of mortgages over 609 and 610; and

(c)interest would accrue on the loan at 3.99 per cent per annum from the date of the original award.

[12]   Counsel for Nita has filed a brief memorandum in response, stating that the orders proposed by Cathy and Sarah would require Nita to sell the park. Counsel submits that Cathy and Sarah are trying to challenge the outcome of the 11 September and 6 November judgments, which should be done by way of appeal.

Analysis

[13]   The orders sought go against the substance of the original court orders. Cathy and Sarah’s suggestions for how the estate should be divided would bind the executors

to the estate for an unreasonable period of time and put pressure on Nita to sell. In the 6 November judgment, I stated that the exact amount Cathy and Sarah would be awarded was always contingent on practical considerations. The extra delays, costs and consent requirements that have arisen in this matter do not seem extraordinary for land transactions of this type. Furthermore, it does not appear that they can be practically avoided. Cathy and Sarah have not criticised the actual method by which the executors are trying to solve the access issues. Essentially, they are disputing the order that they bear 20 per cent of the costs of creating a vested road to S11/1.

[14]   The executors must be able to complete the subdivision and sale of the land in a cost-effective and timely way. Fixing the access irregularities may even benefit 610 and 609 and improve their sale price. The current orders are the only practical and mutually beneficial option. For these reasons, I do not think it is appropriate to further delay this matter by making the orders sought.

Costs

[15]   I heard the parties separately on 20 May 2019 on the question of costs after they were not able to agree as to costs between themselves.9 I ordered Cathy and Sarah’s costs on a 2B basis to be paid out of the estate.10 Cathy and Sarah say that the executors are now refusing to pay for the preparation of the common bundle, the attendance of second counsel and counsel’s accommodation disbursements. These costs were included in the schedule for costs submitted with the plaintiffs’ costs application. If the executors wished to dispute specific costs or disbursements, they should have done so at that time or appealed. An appeal against the costs order would have to have been made within 20 working days of the judgment being issued. They are now well out of time.

9      Cartwright v Joseph, above n 7.

10 At [31].

[16]   Cathy and Sarah are requesting that the executors are ordered to pay the full amount in costs, but such an order is not necessary. These costs exist as an enforceable debt against the estate under my judgment dated 20 May 2019.11

Moore J

Solicitors:

Ms McDonald, Auckland Ms Rutledge, Auckland Ms Robertson, Auckland

Marsden Woods Inskip Smith, Whangarei

11     Cartwright & Anor v Joseph & Ors [2019] NZHC 1093.