CIT Holdings Ltd v Glover No 2 Ltd - [2014] NZHC 3114

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

CIV-2014-404-001643 [2014] NZHC 3114

UNDER the Land Transfer Act 1952

IN THE MATTER OF

an application to remove caveats numbered 9455113.1 and 9645842.1 pursuant to section 143 of the Land Transfer Act 1952

BETWEEN

CIT HOLDINGS LIMITED Applicant

AND

GLOVER NO 2 LIMITED Respondent

Hearing:
15 September 2014

Additional Memoranda (by leave): 24, 27 and 28 November
2014

Appearances:

G M Sandelin and K T Haemmerle for Applicant
R C Knight and T Chubb for Respondent

Judgment:

5 December 2014

JUDGMENT OF ASSOCIATE JUDGE OSBORNE
on application to remove caveats

CIT HOLDINGS LIMITED v GLOVER NO 2 LIMITED [2014] NZHC 3114 [5 December 2014]

Index of names used

BNZ Bank of New Zealand

CIT
CIT Holdings Ltd (the applicant),

registered proprietor of the caveated properties

Colliers Colliers International NZ Ltd (valuers)

Glover Trust
the Glover Trust, of which Glover Trust

Corporation Ltd is trustee

Glover No 2
the Glover No 2 Trust, established by Ms

Sparks, of which Glover No 2 Ltd is currently trustee

IRD Inland Revenue Department

Mr Olliver Gregory Martin Olliver

Mr Thomas Donald Bruce Thomas (solicitor)

Ms Sparks
Sarah Patricia Sparks (married name,

Olliver)

Waimarie JV
a joint venture agreement entered into on

March 2009

Waimarie Trust
the Waimarie Trust, of which Waimarie

Trust Ltd is currently trustee.

Introduction

[1] Ms Sparks and Mr Olliver had a marriage, soon to be (if not already) dissolved. Mr Olliver has come and gone through financial difficulties, reaching a nadir when in early 2009 he had to make a proposal under Part 5 of the Insolvency Act 2006.

[2] Ms Sparks and Mr Olliver have experience as property developers. Mr Olliver’s interests had, before 2009, acquired a number of adjoining properties at St Heliers, Auckland (the Waimarie properties) for development.

[3] This proceeding concerns caveats which Ms Sparks arranged for Glover No 2 to lodge against the titles to the Waimarie properties. Glover No 2 is a trust established by Ms Sparks.

[4] CIT Holdings Ltd (CIT) is the registered proprietor of the Waimarie properties and made this application for an order that the caveats be removed.

Amendment of the heading of this proceeding

[5] CIT commenced the proceeding by naming itself as plaintiff and Glover No 2 as defendant. As this is an originating application, and upon discussion with counsel, I made an oral order at the commencement of the hearing amending the description of the parties to be respectively “applicant” and “respondent” as now shown in the intituling to this judgment.

The Waimarie properties – a short history

The properties

[6] When Mr Olliver’s insolvency proposal was being pursued in 2009, Mr Olliver and Ms Sparks embarked upon arrangements to have Mr Olliver drop out of both legal and beneficial ownership of assets held by them or their interests.

The Waimarie Joint Venture

[7] Central to their arrangements was a joint venture agreement of March 2009 (the Waimarie JV) to which the Glover Trust and the Waimarie Trust…

Grounds of appeal

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

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

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

Consideration

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

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

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Details

Case: [2014] NZHC 3114
Decision Date: 5 December 2014

CaseChat Overview and Summary

CIT Holdings Ltd (CIT) applied to the High Court for an order removing caveats which Glover No 2 Ltd (Glover No 2) had lodged over properties which CIT held on trust for the benefit of Glover No 2. Glover No 2 opposed the application. CIT submitted that Glover No 2 had no interest in the properties sufficient to sustain the caveats, that there was no equity in the properties and that the Court should exercise a discretion to remove the caveats on account of Glover No 2's disqualifying conduct. The Court held that Glover No 2 had an arguable interest in the properties sufficient to sustain the caveats. While the Court retained a discretion to remove the caveats, it could not be completely satisfied that the legitimate interests of Glover No 2 would not be prejudiced. The Court dismissed CIT's application and ordered CIT to pay Glover No 2's costs.

Orders