Haines v Memelink - [2018] NZHC 3373

IN THE HIGH COURT OF NEW ZEALAND WELLINGTON REGISTRY

I TE KŌTI MATUA O AOTEAROA TE WHANGANUI-A-TARA ROHE

CIV-2018-485-962

[2018] NZHC 3373

IN THE MATTER OF Mortgage 10757448.4

BETWEEN

QUENTIN STOBART HAINES

First Applicant

AND

BPE TRUSTEES (NO 1) LIMITED

Second Applicant

AND

HARRY MEMELINK

Respondent

AND

LYNX TRUSTEES LIMITED

Second Respondent

Hearing: On the papers

Counsel:

C Robertson for Applicants

Judgment:

19 December 2018

JUDGMENT OF GRICE J

(Application for without notice interlocutory application for injunction)

[1] Mr Haines and BPE Trustees (No 1) Ltd own a property registered on the Record of Title Identifier 435936 (Wellington Land Registration District).

[2] Mr Haines says he and BPE Trustees (No 1) Ltd own the property as trustees of a family trust. He says the property is a life style property located at 3\97 Honi Taipua Street, Manakau, Levin which he lives in.

[3] The property has two mortgages registered against it, the first to Basecorp Finance Ltd and the second to Fico Finance Ltd. Both were registered on 1 May 2017, the same date as the transfer to Mr Haines and BPE Trustees (No 1) Ltd. The title also

QUENTIN STOBART HAINES v BPE TRUSTEES (NO 1) LIMITED [2018] NZHC 3373 [19 December 2018]

shows a caveat by Johang Ltd registered on 1 August 2018. Mr Haines does not refer to that caveat in his affidavit in support.

[4] Mr Haines first borrowed money from Fico Finance Ltd in late 2016 when he borrowed $75,000. He said his former client, Mr Memelink, and his trust, Link No 1 Trust, acted as guarantors of that loan. The second loan with Fico Finance Ltd was for $250,000. This was when the mortgage was registered. Other properties also secure this mortgage. Mr Haines says a further loan was obtained in February 2017 from Bright Enterprises Ltd for approximately $250,000 and this was guaranteed by Mr Memelink and his trust.

[5] Mr Memelink subsequently used the second Fico loan to purchase a boat known as the Katherine Johnston. Mr Haines also says that he lent Mr Memelink
$93,425.59 so Mr Memelink could pay his body corporate levies and make his mortgage payments to first mortgage trust, the mortgagee on another property.

[6] Subsequently Mr Haines, who had been acting as Mr Memelink’s lawyer in various pieces of litigation, pleaded guilty to a number of charges under the Prostitution Reform Act 2003. Mr Haines says he ceased practicing as a lawyer on 23 August 2018.

[7] Before he ceased practicing, Mr Haines had undertaken substantial amounts of litigation and legal work for Mr Memelink. He says Mr Memelink was a very active litigant. He says Mr Memelink owes substantial legal fees (the first claim for unpaid legal fees for $1.15 million and the second is for $93,425.59). Mr Memelink presently denies those fees are owing and has made complaints to the Law Society relating to Mr Haines’ failing to ensure Mr Memelink had independent advice on various loans. That matter is yet to be resolved.

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.

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Details

Case: [2018] NZHC 3373
Decision Date: 19 December 2018

CaseChat Overview and Summary

Quentin Stobart Haines and BPE Trustees (No 1) Ltd sought an interlocutory injunction against Harry Memelink and Lynx Trustees Ltd, to prevent Memelink from enforcing a mortgage over property that Haines and BPE Trustees (No 1) Ltd own. The basis for the application was that Memelink had apparently purchased and taken assignment of a loan and mortgage held by Fico Finance Ltd. Haines was unable to determine the quantum of the loan or the status of the mortgage because Fico Finance Ltd would not respond to his queries. Haines feared that Memelink would remove him from the property and applied for an injunction to prevent this. The court had to decide whether it was appropriate to grant the injunction without notice to the respondents. Haines argued that requiring notice would cause undue delay or prejudice, and that the interests of justice required the application to be determined without notice. The court found that there was not enough information before it to decide the matter without notice and directed the matter to proceed on an on notice basis.

The court considered the principles relating to interlocutory without notice applications. To decide whether an application should proceed without notice, the court must be satisfied that: (a) requiring the applicant to proceed on notice would cause undue delay or prejudice to the applicant; or (b) the application affects only the applicant; or (c) the application relates to a routine matter; or (d) an enactment expressly permits the application to be made without serving notice of the application; or (e) the interests of justice require the application to be determined without serving notice of the application. The court found that there was not enough information before it to decide the matter without notice and directed the matter to proceed on an on notice basis. The court also considered that the matter did not have the required degree of urgency, that Memelink was an undischarged bankrupt, and that he had given undertakings to the court that he and Link No 1 Trust would not deal with the assets of the Link No 1 Trust without the Official Assignee’s permission. The court was not satisfied that there was the required information before it upon which it could decide this matter without notice.

In conclusion, the court found that the matter did not have the required degree of urgency and that there was not enough information before it to decide the matter without notice. The court directed that the proceedings be served on the mortgagees, caveator, Official Assignee and respondents, together with any other parties having an interest in the property. The matter will then proceed on an on notice basis in the usual manner. The Registrar will allocate the date for the matter to be called in the new year. The court made no orders for costs.

Orders