Hemara v Lowe - [2023] NZHC 1253

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

I TE KŌTI MATUA O AOTEAROA TĀMAKI MAKAURAU ROHE

CIV-2022-404-675

[2023] NZHC 1253

IN THE MATTER OF a proceeding in equity for breach of trust under Part 18 of the High Court Rules 2016

BETWEEN

JOHN SHANE HEMARA

Plaintiff

AND

KELLEE LOUISE LOWE

Defendant

Hearing: 24 May 2023

Appearance:

S A Grant for plaintiff

Date of judgment:

26 May 2023

JUDGMENT OF JAGOSE J

This judgment was delivered by me on 26 May 2023 at 11.00am.
Pursuant to Rule 11.5 of the High Court Rules.

………………………… Registrar/Deputy Registrar

Counsel/Solicitors:
Sandra Grant, Barrister, Auckland Carter Atmore, Auckland

HEMARA v LOWE [2023] NZHC 1253 [26 May 2023]

[1] As duty judge, I have for formal proof John Hemara’s claim Kellee Lowe was acting in breach of trust to pledge and sell a property in Northland’s Hikurangi. Mr Hemara seeks a declaration Ms Lowe holds the property on trust, and an order revesting the property. Ms Lowe is the property’s registered proprietor.

Background

[2] The property was the family home of Mr Hemara, together with his nine siblings, as children of the late Joseph Moses Hemara and Turu May Hemara. After the parents’ deaths the property ultimately was transferred to the children as tenants in common. They later transferred the property to Ms Lowe, who pledged it as security and sold the property (albeit the sale did not settle).

[3] The factual background is set out in greater detail in this Court’s judgment in a related proceeding, granting Mr Hemara’s application his caveat over the property not lapse in the face of Ms Lowe’s challenge to it,1 which findings I adopt.

Discussion

[4] On a formal proof hearing, I need only to be satisfied Mr Hemara has filed affidavit evidence establishing each cause of action relied upon.2

[5] So far as the establishment of an express trust is concerned,3 I am satisfied by Mr Hemara’s affidavit evidence — including undated minutes of a family meeting at which Ms Lowe was present recording “House belongs to children of May & Joe Hemara and must remain with them, until passed onto next generation”; record of the property’s 27 July 2009 transfer to Ms Lowe for a purchase price of $100,000 as a debt owed to those children; and their 20 October 2009 gift to her of the forgiveness of that sum in consideration of their natural love and affection for her — the property was transferred to Ms Lowe as trustee for the benefit of the children and their whānau,

1      Hemara v Lowe [2022] NZHC 1215 at [12]–[37]; appeal struck out, Lowe v Hemara [2023] NZCA 134.
2      High Court Rules 2016, r 15.9(4).
3      Trusts Act 2019, s 15(1)(b). See also Knight v Knight (1840) 3 Beav 148, 49 ER 58 (Ch) at 68 and
Foreman v Hazard [1984] 1 NZLR 586 (CA) at 594.

on terms including the property would not be mortgaged, charged or sold, but in any event with duties…

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 Hemara v Lowe

Details

AGLC: Hemara v Lowe [2023] NZHC 1253
Case: [2023] NZHC 1253
Decision Date: 26 May 2023

CaseChat Overview and Summary

In this case, John Shane Hemara initiated legal proceedings against Kellee Louise Lowe in the High Court of New Zealand, alleging that Lowe breached a trust by pledging and selling a property in Hikurangi, Northland. The property was originally the family home of Hemara and his nine siblings, who were children of the late Joseph Moses Hemara and Turu May Hemara. After the deaths of their parents, the property was transferred to the children as tenants in common and subsequently to Lowe. Hemara sought a declaration that Lowe holds the property on trust and an order to revest the property in the children. The legal issues before the court were whether Lowe held the property on trust for the benefit of the children and whether she breached that trust by mortgaging and selling the property. The court found that the property was transferred to Lowe as trustee for the benefit of the children and their whānau, and that Lowe breached the trust by mortgaging and selling the property. Consequently, the court declared that Lowe holds the property on trust for the children of the late Joseph Moses Hemara and Turu May Hemara. The property was ordered to vest in John Shane Hemara and Barbara Rose Hemara, who were directed to hold it on trust for the descendants of the late Joseph Moses Hemara and Turu May Hemara, consult with the other children on a draft trust deed, and submit the draft trust deed to the court for approval within four weeks of the vesting registration. Costs were reserved pending the conclusion of the matter. The court also noted that Lowe's failure to file a defence and her appeal being struck out for non-compliance contributed to the decision to proceed with the formal proof hearing.

Orders