Development Construction Company Limited v MacKenzie - [2021] NZHC 546

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

I TE KŌTI MATUA O AOTEAROA TĀMAKI MAKAURAU ROHE

CIV-2020-404-2210

[2021] NZHC 546

BETWEEN DEVELOPMENT CONSTRUCTION COMPANY LIMITED
Applicant

AND

DEAN MATTHEW MACKENZIE

Respondent

Hearing: 16 March 2021

Appearances:

Miles Beresford the Applicant Rajiv Rao for the Respondent

Judgment:

16 March 2021

ORAL JUDGMENT OF ASSOCIATE JUDGE R M BELL

Solicitors:
Natalie Tabb/Miles Beresford, Auckland, for the Applicant
Inder Lynch (Rajiv Rao), Papakura, Auckland, for the Respondent

Copy for:
Miles G Beresford, Auckland, for the Applicant

DEVELOPMENT CONSTRUCTION COMPANY LIMITED v MACKENZIE [2021] NZHC 546 [16 March 2021]

[1] Development Construction Ltd applies to sustain caveat 11752354.1 lodged against record of title NA54D/772 for the residential property at 22 Larsen Street, Ōtara, Auckland. Dean Mackenzie, the respondent, the registered proprietor, lives in Kazakhstan. The interest claimed in the caveat is:

The abovenamed caveator, Development Construction Ltd, claims a beneficial interest in the land contained in the above Certificate of Title NA54D/772 as a beneficiary under an implied Trust in respect of which the Registered Proprietor Dean Matthew MacKenzie is a Trustee.

The caveat was lodged on 19 May 2020. The main question is whether Development Construction Ltd has a caveatable interest.

General principles on caveat applications

[2] In Holt v Anchorage Management Ltd, McMullin J stated the purpose of a caveat against dealings under the Land Transfer Act 1952:1

Once lodged, a caveat is notice to all who search the title to the land against which it is registered and to the registered proprietor of the land (to whom notice of its receipt is given pursuant to s 142) that the caveator claims the estate or interest the subject of the caveat. It is both a warning to the persons mentioned that the caveator asserts rights against the land and a protection of those rights. (Section 143(1) uses the phrase "protected by the caveat"). Once the caveat is lodged the Registrar is prohibited from making any entry on the register which has the effect of charging or transferring or otherwise affecting the estate or interest protected by the caveat (s 141).

[3] Although the Holt case was decided under the Land Transfer Act 1952, that statement equally applies to caveats under the Land Transfer Act 2017. That Act applies in this case, as the caveat was lodged after the 2017 Act came into force.2

[4] In caveat applications under ss 142 and 143 of the Land Transfer Act 2017, the caveator generally has the onus of showing a reasonably arguable case for the interest claimed. That interest must come within s 138(1):

1 Holt v Anchorage Management Ltd [1987] 1 NZLR 108 (CA) at 113.
2 Land Transfer Act 2017 Commencement Order 2018, s 2.

138 Caveats against dealings with land

(1)A person may lodge a caveat against dealings with an estate or interest in land (a caveat against dealings) on the basis that the person—

(a)claims an estate or interest in the land, whether capable of registration…

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 Development Construction Company Limited v MacKenzie

Details

AGLC: Development Construction Company Limited v MacKenzie [2021] NZHC 546
Case: [2021] NZHC 546
Decision Date: 16 March 2021

CaseChat Overview and Summary

Development Construction Company Limited applied to sustain a caveat against the title of a residential property located at 22 Larsen Street, Ōtara, Auckland. The registered proprietor, Dean Matthew MacKenzie, who resides in Kazakhstan, opposed the application. The central issue was whether Development Construction Company Limited had a caveatable interest in the property. The High Court of New Zealand, Auckland Registry, presided over by Associate Judge R M Bell, examined the case. The primary legal issue was whether Development Construction Company Limited's reservation of title clause in its contract with Dean MacKenzie created a caveatable interest in the property. The court considered the general principles of caveats, including the requirement for the caveator to establish a reasonably arguable case for the claimed interest. The court concluded that a reservation of title clause without an express right to enter the property and remove materials did not create an interest in land. The court noted that New Zealand case law suggests that such clauses only confer a contractual right to enter and remove materials, rather than an interest in the land. Additionally, the court found that a charging order under the Construction Contracts Act did not support a caveatable interest. Ultimately, the court dismissed the application to sustain the caveat, ordering it to be removed and awarding costs to Dean MacKenzie. Associate Judge R M Bell acknowledged the late appearance of counsel for Development Construction Company Limited, who had been instructed at short notice due to the original counsel's illness.

Orders