Fuchs v Heeg

[2016] NZHC 1315

IN THE HIGH COURT OF NEW ZEALAND NELSON REGISTRY

CIV 2011-042-000373 [2016] NZHC 1315

BETWEEN

KURT FUCHS

Plaintiff

AND

CHRISTIAN OTTO ALFRED HEEG Defendant

Hearing:	14 June 2016
Counsel:	D M Lester and P C Maciaszek for Plaintiff Defendant in Person
Judgment:	16 June 2016

JUDGMENT OF SIMON FRANCE J

Introduction

[1]      Mr Fuchs is the de facto partner of the defendant’s mother. The couple live in Germany, and the defendant in Nelson.  In 2010 Mr Fuchs made four payments to Mr Heeg totalling 40,000 euro.  Mr Fuchs says they were short term loans that have not been repaid.  Mr Heeg says they were payments made on behalf of his mother and there is no obligation to repay.

[2]      It is convenient first to set out the framework within which Mr Heeg says the payments should be viewed.  The general context is his relationship with his mother since his father died in 1988.  He says that over the years there has been a tradition of assisting each other in times of need.

[3]      There are then two specific threads – his father’s will, and the plans of his

mother and him to emigrate from Germany to New Zealand.

[4]      In the will, his father’s estate was left to his mother.   The time passed in

which Mr Heeg could make any legal claim.  However Mr Heeg says his mother had

FUCHS v HEEG [2016] NZHC 1315 [16 June 2016]

moral obligations to provide him with his share, and further that she recognised and accepted these obligations.  It was in this context that some payments were made.  I pause here to observe this is a context the mother does not accept.   There are separate proceedings awaiting hearing in which she is suing Mr Heeg for unpaid loans.   Whatever the situation in this regard, Mr Heeg is on record as saying he accepts that by 2007 all obligations had been met.

[5]      The second thread is that the Heegs had plans to come to New Zealand to live.  They visited in 2000 and found a property in Nelson.  It was purchased around the end of 2000 and was placed in their joint names.  There is a dispute as to who provided the money, and whether one share was held on trust for the other.

[6]      It seems it was always the plan for Mr Heeg to come first and secure his residency or citizenship.  Mrs Heeg would then follow.  Mr Heeg came in 2003 and lived in the property they had purchased.  This was sold in 2005 and another one purchased.  That further property was then put on the market in 2010.  The dispute as to the first property continues on through these other transactions.

[7]      The other aspect to the immigration situation was that the route by which Mr Heeg sought to gain New Zealand citizenship involved having for a period a deposit  of  $1,000,000  in  a  New Zealand  bank  account.    This  was  achieved  by Mrs Heeg borrowing the money against a property she owned in Germany.  There is a  dispute  about  how  Mrs Heeg  came  to  own  that  property,  and  what  was  the arrangement in relation to the loan.

[8]      It seems clear that Mrs Heeg by now could not herself meet the interest payments.  For a period Mr Heeg paid the German interest.  By the time he stopped doing this, Mr Fuchs was on the scene.  He had known Mrs Heeg for many years, but in 2009 they entered into a relationship, and in 2010 began cohabitating.   He took over paying the interest on the loan.  I understand the property has now been sold and the loan repaid.

[9]      As noted, Mr Heeg places the four loan advances made by Mr Fuchs into this history.   Mr Lester submits, with some fairness, that how these loans fit has been

somewhat of a moving feast.  Initially it seemed the claim was to link them to the inheritance aspect, and then they were a gift out of love, and now they are said to be reimbursement  of  the  interest  payments  Mr Heeg  made  on  the  German  loan. Mr Heeg considers there has been money going back and forward between him and his mother, and that a reckoning which has regard to all these matters is needed to see who owes whom.

[10]     Mr Heeg’s  related  position  is  that  the  four  payments  were  not  loans  or advances by Mr Fuchs in his own capacity.   Rather, they were made on behalf of Mrs Heeg.  He says at the time of asking for the money (on four separate occasions in 2010) he made it clear to his mother that if Mr Fuchs actually provided the money that was nothing to do with him – it was a matter between her and Mr Fuchs.  He says he spoke only to his mother.

[11]     The evidence of Mr Fuchs and Mrs Heeg is quite the opposite.  It is evidence I accept.   Whatever the correct position as regards Mr Heeg and his mother, I am satisfied these four loans were advances made by Mr Fuchs personally and which were to be repaid.  There was no set date for repayment other than when Mr Heeg obtained access to the million dollars he had on deposit.  Mr Heeg had initially told him that he expected that to occur shortly but it seems it was delayed.

[12]     Matters came to a head in early 2011 when Mr Fuchs and Mrs Heeg came to New Zealand with the intention of settling here.  At that point it soon became clear that Mr Heeg did not intend to repay Mr Fuchs and denied that Mrs Heeg had any interest in the Nelson property.  Mrs Heeg and Mr Fuchs took legal advice and then immediately returned to Germany.

[13]     The reasons I accept the evidence of Mr Fuchs and Mrs Heeg can be briefly stated.

[14]     I do not accept Mr Heeg’s evidence that at the time of seeking the loans he spoke only to Mrs Heeg.  Both Mr Fuchs and Mrs Heeg said this was not so.  An unfortunate aspect of this case is that Mr Heeg was acting for himself and did not challenge them on this evidence.   However, what they say better accords with the realities of the situation.

[15]     Mrs Heeg was living with Mr Fuchs.  She had no ability to personally help her son out.  It strains credibility to suggest on four separate occasions Mr Fuchs – who was to be the source of the funds – had no involvement.  He says he talked to Mr Heeg, found out why the money was needed and how much, and then arranged the payments.  The electronic signature to some of the emails between mother and son is in Mr Fuchs’ name, indicating they were using his computer.

[16]     Mr Heeg proffered his dislike of Mr Fuchs as a reason in support of his evidence that he did not discuss anything with Mr Fuchs.  Mr Heeg referred to an incident about the care of a dog many years ago when Mr Heeg was a young man and friends with Mr Fuchs’ son.  It was not convincing evidence.  More compelling is  the  reality  that  Mr Heeg  was,  by  his  own  admission,  in  dire  financial circumstances at the time.

[17]     If Mr Heeg’s position is correct, then Mr Fuchs has made four advances with no expectation of return in circumstances where it is not known, even by Mr Heeg, how much money it is that Mrs Heeg is to reimburse.   That position is not really tenable. The circumstances of the fourth loan also tell against Mr Heeg’s position.  It was by far the largest amount, and unlike the others, was solely to assist Mr Heeg’s business and was paid directly to the business account.   Objectively it is a circumstance more suggestive of a loan than some intra-family transaction.

Conclusion

[18]     I am well satisfied that the advances were made in the circumstances as alleged by Mr Fuchs.  The money was to be repaid out of Mr Heeg’s immigration deposit once that was released to Mr Heeg.

[19]     Judgment is for the sum of 40,000 euros to be converted into New Zealand dollars on the rate applicable on judgment date.  Interest is payable from the date of filing of the proceedings. The plaintiff is entitled to costs on a 2B basis together with

reasonable disbursements to be fixed by the Registrar if necessary.

Simon France J