Hemmingson v Rod - [2015] NZHC 681

IN THE HIGH COURTOF NEW ZEALAND WELLINGTON REGISTRY

CIV-2014-485-9532 [2015] NZHC 681

BETWEEN ROBERT HEMMINGSON Plaintiff

AND

STEVEN ROD First Defendant

THE CLANARD PROPERTY TRUST COMPANY

Second Defendant

Hearing: 31 March 2015

Counsel:

G A Paine and Q S Haines for Plaintiff
J Mahuta-Coyle for First Defendant
No appearance for Second Defendant

Judgment:

13 April 2015

JUDGMENT OF ASSOCIATE JUDGE SMITH

[1] The defendants are the registered proprietors of a property (the land) at

110 Main Street, Foxton, known as the Foxton Hotel.

[2] In July 2014, Mr Hemmingson commenced the present proceeding. In it, he claims a declaration that the land is and remains his property. He seeks an order that the certificate of title be rectified to show him as the sole registered proprietor. The proceeding is set down for trial on 2 and 3 June 2015.

[3] Mr Rod now applies for an order for security for his costs.

ROBERT HEMMINGSON v STEVEN ROD [2015] NZHC 681 [13 April 2015]

Background

[4] The background to Mr Hemmingson’s claims is set out in detail in the judgment I gave in Hemmingson v Rod & The Clanard Property Trust Ltd,1 on 30
April 2014. That judgment was concerned with an application made by Mr Hemmingson to sustain a caveat which he had registered on the title to the land. In the judgment, I concluded that Mr Hemmingson might have an arguable claim to an interest in the land as beneficiary under a trust, but that his claim had not been adequately described in his caveat. I declined to make an order that the caveat should not lapse, but granted leave to Mr Hemmingson to register a second caveat. That was done, and the present proceeding was subsequently issued by Mr Hemmingson.

[5] For a period from July 2007 to 19 July 2011, Mr Hemmingson and Cheryl Hemmingson were the registered proprietors of the land. They held the land as trustees of family trusts which were established by or associated with Mr Hemmingson. At that stage, there were two mortgages registered on the title to the land, a first mortgage to Avanti Finance Ltd (Avanti) and a second mortgage to Mr and Mrs Davis.

[6] Mr Hemmingson ran into financial difficulties, and he was bankrupted on 15

October 2007. However, the land, being held by trustees, was not an asset available to Mr Hemmingson’s creditors in his bankruptcy. The business of the Foxton Hotel was therefore able to continue, initially run by a tenant, Foxton Hotel Ltd. There was never any formal lease in place. Rent was paid on a month-to-month arrangement, with rental payments aligned to cover the interest payable on the two mortgages. When Foxton Hotel Ltd was put into liquidation in March 2008, the trustees put in a manager, with Mr Hemmingson and his partner providing support.

[7] The owners were unable to keep up the required payments on the Avanti mortgage, and Avanti eventually exercised its power of sale. The land was transferred from Avanti…

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 Hemmingson v Rod

Details

AGLC: Hemmingson v Rod [2015] NZHC 681
Case: [2015] NZHC 681
Decision Date: 13 April 2015

CaseChat Overview and Summary

In the High Court of New Zealand, Robert Hemmingson, the plaintiff, brought a proceeding against Steven Rod, the first defendant, and The Clanard Property Trust Company, the second defendant, over the ownership of a property at 110 Main Street, Foxton, known as the Foxton Hotel. Hemmingson claims that the land is and remains his property and seeks a declaration to this effect, as well as an order that the certificate of title be rectified to show him as the sole registered proprietor. The proceeding is set down for trial on 2 and 3 June 2015. Steven Rod now applies for an order for security for his costs. The court considered the application, taking into account Mr Hemmingson's two bankruptcies and his alleged ongoing inability to manage his own financial affairs. The court concluded that there was reason to believe that Mr Hemmingson would be unable to pay Mr Rod’s costs if he were to be unsuccessful in the proceeding. Balancing the interests of the parties, the court ordered that Mr Hemmingson is to pay the sum of $10,000 into Court as security for Mr Rod’s costs, to be paid by no later than 1 May 2015. If the security for costs has not been paid by that date, Mr Rod may apply to have the proceeding stayed, and the 2 June trial date vacated. The time for the defendants to serve their briefs of evidence, and provide additional documents for inclusion in the common bundle of documents for trial, is extended to 12 May 2015. Costs on this application are reserved.

Orders