Cook v Romanes - [2018] NZHC 2650

IN THE HIGH COURT OF NEW ZEALAND ROTORUA REGISTRY

I TE KŌTI MATUA O AOTEAROA

TE ROTORUA-NUI-A-KAHUMATAMOMOE ROHE

CIV-2018-463-82

[2018] NZHC 2650

IN THE MATTER OF the Companies Act 1993

BETWEEN

RAYMOND NOEL COOK KIM JUDY LORRIGAN and MIOCHAEL JOHN ROMANES

as trustees of the M J ROMANES TRUST Plaintiffs

AND

DANIELLE NATAHSA ROMANES and JOANNE CYNTHIA ROMANES

as trustees of the J C ROMANES TRUST Defendants

Hearing: 26 September 2018

Appearances:

K Quinn for the Plaintiffs

J Hosking for the Defendants

Judgment:

12 October 2018

JUDGMENT OF ASSOCIATE JUDGE R M BELL

This judgment was delivered by me on 12 October 2018 at 12 noon
pursuant to Rule 11.5 of the High Court Rules.

…………………………………
Deputy Registrar

Solicitors:
Foley Hughes, Rotorua, for the Plaintiffs MJC Legal Ltd, Rotorua, for the Defendants

Copy for:
Kelly Quinn, Auckland Jo Hosking, Auckland

COOK v ROMANES and [2018] NZHC 2650 [12 October 2018]

[1] The trustees of the M J Romanes Trust apply for an order that their partnership with the trustees of the J C Romanes Trust be put into liquidation. In response, the J C Romanes trustees have applied for a stay of the proceeding.

[2] The proceeding arises out of the break-up of the marriage of Mrs Joanne Cynthia Romanes and Mr Michael John Romanes. Mr and Mrs Romanes married in 1986. They separated in July 2016. They have four adult children. The family home was on a “hobby” farm called Big Hill Farm. The owner of the farm is a partnership of mirror family trusts: the plaintiffs and the defendants. The trusts were each established by deeds on 30 April 1991. Mr Romanes is the settlor of the M J Romanes trust, but not a beneficiary. The final beneficiaries of each trust are the children. Mrs Romanes is one of the discretionary beneficiaries of the M J Romanes Trust. Mrs Romanes is the settlor of the J C Romanes Trust, but not a beneficiary. Mr Romanes is one of the discretionary beneficiaries. The two trusts carry on business in partnership, but there is no written partnership agreement. The partnership owns not only Big Hill Farm (said to have an estimated value of $4 million), but also properties on Kawau Island and in Lawrence, Otago. Before the partnership owned it, Big Hill Farm was an asset of Mr Romanes’ company, Mikro Holdings Limited.

[3] Part of the background to this case is a proceeding in the Family Court under the Property (Relationships) Act 1976 between Mr and Mrs Romanes. Mr Romanes relies on agreements under s 21 of the Property (Relationships) Act to say that much of his wealth is separate property. Mrs Romanes has applied to have the agreements set aside and to divide relationship property. She also claims under s 9A of the Property (Relationships) Act increases in Mr Romanes’ separate property attributable to the application of relationship property or her contributions to it.

[4] The Family Court has given a decision on an application for interim relief…

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 Cook v Romanes

Details

AGLC: Cook v Romanes [2018] NZHC 2650
Case: [2018] NZHC 2650
Decision Date: 12 October 2018

CaseChat Overview and Summary

The case of Cook v Romanes, heard by Associate Judge R M Bell, involves a dispute between the trustees of two family trusts, the M J Romanes Trust and the J C Romanes Trust, over the continuation of their partnership. The M J Romanes Trust trustees, acting on behalf of Michael John Romanes, applied for the partnership to be put into liquidation on the basis that it was just and equitable to do so due to the breakdown of trust and confidence between the trustees. The J C Romanes Trust trustees, representing Joanne Cynthia Romanes, sought a stay of the liquidation proceedings, arguing that the application was an abuse of process and that there were other remedies available.

The court had to determine whether the liquidation application was an abuse of process and whether there were alternative remedies that should be considered before proceeding with liquidation. The court noted that the proceeding was not an abuse of process as it was a legitimate means to seek a court order for the termination of the partnership. However, the court found that alternative remedies, such as dissolution under the Partnership Act or orders under section 182 of the Family Proceedings Act, should be explored before resorting to liquidation.

Given the potential for these alternative remedies to resolve the issues between the parties more efficiently and effectively, the court directed the parties to explore these options before taking further steps in the liquidation proceedings. The court adjourned the case to a telephone case management conference to review progress on alternative remedies and to decide whether further steps in the liquidation application were necessary. This decision highlights the importance of considering alternative remedies and the role of case management in ensuring that the most appropriate resolution is achieved.

Orders