Clayton v Clayton - [2014] NZHC 135

IN THE HIGH COURT OF NEW ZEALAND ROTORUA REGISTRY

CIV2013-463-000428 [2014] NZHC 135

BETWEEN MELANIE ANN CLAYTON Judgment Creditor

ANDMARK ARNOLD CLAYTON Judgment Debtor

CIV 2011-485-000808

BETWEEN MARK ARNOLD CLAYTON First Appellant

MARK ARNOLD CLAYTON Second Appellant

BRYAN WILLIAM CHESHIRE and
MARK ARNOLD CLAYTON Third Appellants

ANDMELANIE ANN CLAYTON Respondent

Hearing: 12 February 2014

Appearances: J R Hosking for Melanie Ann Clayton
R P Harley for Mark Arnold Clayton

Judgment: 12 February 2014

ORAL JUDGMENT OF ASSOCIATE JUDGE CHRISTIANSEN

M A CLAYTON v M A CLAYTON [2014] NZHC 135 [12 February 2014]

[1] The proceeding in CIV 2013-463-428 concerns Mr Clayton’s application to

set aside the bankruptcy notice.

[2] The proceeding in CIV 2011-485-808 concerns Mr Clayton’s application for

a stay while his appeal to the Court of Appeal is determined.

Application to set aside bankruptcy notice

[3] The bankruptcy notice claimed payment of $42,602 as the amount unpaid on a costs judgment of the Rotorua High Court on 25 June 2013.

[4] Mr Clayton says that he has paid a sum of $30,000 by a pre marriage arrangement which he has set off against the amount due under the costs judgment.

[5] Mr Clayton says he paid the balance due of $12,602 on 13 August 2013. He claims the debt has been paid.

Application for stay

[6] On 22 February 2013 Rodney Hansen J issued his judgment on appeals by Mr Clayton and other entities of his against aspects of the decision of Judge Munro in the Family Court at Rotorua. Rodney Hansen J upheld Judge Munro’s decision to set aside a pre nuptial agreement and Her Honour’s conclusion that Mrs Clayton was entitled to a half share of the increase in value of Mr Clayton’s business assets, and as well Judge Munro’s findings in relation to certain trusts.

[7] Rodney Hansen J delivered his costs judgment on 25 June 2013 and fixed costs of $42,602 payable by Mr Clayton.

[8] Both Mr Clayton and Mrs Clayton have filed appeals to the Court of Appeal against aspects of the judgment of Rodney Hansen J.

[9] On 12 August 2013 Mr Clayton filed an application for orders: (a) As to satisfaction of the judgment as to costs.

(b) Granting stay of enforcement of judgment as to costs.

[10] The focus of the applications is that Mr Clayton claims that about four years ago he paid $30,000 pursuant to the terms of a pre nuptial agreement and therefore that he is entitled to set this amount off against what he was ordered by Rodney Hansen J to pay by way of costs. Judge Munroe and Hansen J both held that the pre nuptial agreement was invalid. For Mr Clayton it is claimed the sum of $30,000 is to be applied in part payment of the costs award. His position is that he has not appealed the judgment of Hansen J insofar as it held the pre nuptial agreement was invalid. It follows, says Mr Clayton that he accepts the pre nuptial…

Grounds of appeal

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

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

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

Consideration

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

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

Continue reading Clayton v Clayton

Details

AGLC: Clayton v Clayton [2014] NZHC 135
Case: [2014] NZHC 135
Decision Date: 12 February 2014

CaseChat Overview and Summary

The case before the High Court of New Zealand involved two applications, one by Mark Arnold Clayton to set aside a bankruptcy notice and the other for a stay of enforcement of a judgment while his appeal to the Court of Appeal was determined. The bankruptcy notice, issued by Melanie Ann Clayton, claimed payment of $42,602 as the unpaid amount on a costs judgment. Clayton argued that he had paid $30,000 by a pre-marriage arrangement, which he intended to be set off against the costs judgment. The court was required to determine whether Clayton had satisfied his obligations to pay the costs judgment and, if not, whether his obligations to pay those costs should be stayed pending disposal of the appeals to the Court of Appeal. The core issue was whether Clayton could offset a pre-marriage payment against the costs judgment.

The court considered that Clayton's payment of $30,000 was intended to satisfy his relationship property obligations under a pre-nuptial agreement, a view supported by the fact that two judges had set aside the pre-nuptial agreement. The court held that the payment was properly categorised as settling relationship property obligations. Clayton argued he was entitled to offset the $30,000 payment against the costs judgment. However, the court ruled that Clayton was not entitled to an order as to satisfaction of the judgment, as neither Mrs Clayton nor the Court accepted the judgment had been satisfied. The court also rejected Clayton's application for a stay of enforcement of the judgment, noting that there was nothing to suggest Mrs Clayton should be deprived of her opportunity to enforce a costs award. The court held that Clayton could not show he had a counterclaim at that time and therefore his application to set aside the bankruptcy notice had to fail.

The court dismissed both of Clayton's applications. It ordered Clayton to pay costs in the sum of $19,387, together with usual disbursements. The court gave Clayton until 4:00pm on Friday, 14 February 2014, to comply with the bankruptcy notice by paying $30,000 in cleared funds to Mrs Clayton's solicitors. Should Clayton fail to meet the payment, the court scheduled a one-day fixture in Rotorua on 12 March 2014 to hear an application for his adjudication as a bankrupt. The court also directed that any submissions for a hearing on 12 March 2014 be filed and served no later than 7 March 2014.

Orders