Clayton v Nothling - [2022] NZHC 387

IN THE HIGH COURT OF NEW ZEALAND ROTORUA REGISTRY

I TE KŌTI MATUA O AOTEAROA

TE ROTORUA-NUI-A-KAHUMATAMOMOE ROHE

CIV-2021-463-000099

[2022] NZHC 387

IN THE MATTER OF an application to sustain a caveat under the Land Transfer Act 2017

BETWEEN

MARK ARNOLD CLAYTON

Applicant

AND

LYNN ALTHEA NOTHLING

First Respondent

AND

ZAK EDWARD NOTHLING

Second Respondent

Hearing: 16 February 2022 (via VMR)

Appearances:

David Hayes for the Applicant

Geoff Jenkin for the First and Second Respondents

Judgment:

8 March 2022

JUDGMENT OF MOORE J

This judgment was delivered me on 8 March 2022 at 3:00 pm pursuant to Rule 11.5 of the High Court Rules.

Registrar / Deputy Registrar Date:

CLAYTON v NOTHLING & ANOR [2022] NZHC 387 [8 March 2022]

Introduction

[1] Mark Clayton applies under s 143 of the Land Transfer Act 2017 for an order that Caveat 12308581.1 (“the Caveat”) not lapse. The Caveat is lodged against a property on Gwendoline Street, Rotorua (“the Gwendoline Street property”). It is currently inhibiting his former de facto partner, Lynn Nothling, from settling a sale and purchase agreement on the property.

[2] Mr Clayton previously applied on a without notice basis for an interim order that the Caveat not lapse. He required the interim order to preserve the position until his substantive application was heard. On 22 December 2021, Associate Judge Sussock made an interim order that the Caveat not lapse until further order of the Court.1 This proceeding concerns Mr Clayton’s substantive application.

[3] The application is opposed by Ms Nothling and her son, Zak Nothling (together “the Nothlings”). They further apply for orders that:

(a)the interim order of Associate Judge Sussock be rescinded;

(b)the Caveat be removed;2 and

(c)Mr Clayton pay costs to the Nothlings.

Factual background

[4] Mark Clayton and Lynn Nothling began their de facto relationship in 2009. At the time Mr Clayton was reshaping New Zealand trust law through relationship property litigation with his former wife.3 He understandably wished to avoid that reoccurring. After settling the litigation with his former wife, and about seven years into their relationship, Mr Clayton and Ms Nothling entered into an agreement under

1      Clayton v Nothling HC Auckland CIV-2021-463-99, 22 December 2021 (Minute of Associate Judge Sussock).
2      This application is brought under s 142 of the Land Transfer Act 2017.
3      See for example Clayton v Clayton [2016] NZSC 30, [2016] 1 NZLR 590; Clayton v Clayton [2016] NZSC 29, [2016] 1 NZLR 551; Clayton v Clayton [2015] NZCA 30, [2015] 3 NZLR 293; and Clayton v Clayton [2013] NZHC 309, [2013] 3 NZLR 236.

s 21 of the Property (Relationships) Act 1976 (the “Contracting Out Agreement”). The Contracting Out Agreement is dated 20 December 2016.

[5] At some point between August 2019 and February 2020,4 Mr Clayton and Ms Nothling’s relationship ended. Ms Nothling continued to occupy the Gwendoline Street property for some time.

[6] At that time the Gwendoline Street property was owned by Mr Clayton, Ms Nothling and…

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 Nothling

Details

AGLC: Clayton v Nothling [2022] NZHC 387
Case: [2022] NZHC 387
Decision Date: 8 March 2022

CaseChat Overview and Summary

This case concerns an application to sustain a caveat under the Land Transfer Act 2017. Mark Clayton has lodged a caveat over a property on Gwendoline Street, Rotorua, which is owned by his former de facto partner, Lynn Nothling, and her son, Zak Nothling. The caveat has prevented Ms Nothling from settling a sale and purchase agreement on the property. The Nothlings opposed the application to sustain the caveat and applied for it to be removed, as well as for costs. The key legal issue was whether Mr Clayton had a reasonably arguable case for a caveatable interest in the Gwendoline Street property. The court found that Mr Clayton did not have a reasonably arguable case for a caveatable interest in the Gwendoline Street property. The court considered the evidence provided by both parties and the relevant legal principles. The court held that the onus was on Mr Clayton to show a reasonably arguable case for the interest claimed, and that if he could not establish such a case, the caveat must be removed or allowed to lapse. The court found that Mr Clayton's evidence was contradicted by the contemporaneous documentary record and the broader context of the Contracting Out Agreement. The court also held that even if Mr Clayton had established a caveatable interest, the court retains a residual discretion to remove the caveat, which must be exercised cautiously. The court granted the Nothlings' application to remove the caveat and ordered that the interim order made by Associate Judge Sussock be of no legal effect. The court also granted the Nothlings' application for costs on a 2B scale basis, and directed the parties to confer and reach agreement as to costs. If the parties were unable to reach agreement, leave was reserved to file memoranda.

Orders