Kemp v Kemp-Upton - [2024] NZHC 398

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

I TE KŌTI MATUA O AOTEAROA TĀMAKI MAKAURAU ROHE

CIV-2022-404-1753

[2024] NZHC 398

UNDER the Contract and Commercial Law Act 2017

BETWEEN

JANET KEMP

Appellant

AND

ANDRE KEMP-UPTON

Respondent

Hearing: 23 February 2023

Appearances:

M Phillipps for the appellant J Donkin for the respondent

Judgment:

1 March 2024

JUDGMENT OF ROBINSON J

This judgment was delivered by me on 1 March 2024 at 10:00 am pursuant to Rule 11.5 of the High Court Rules

…………………………………………………………………… Registrar/Deputy Registrar

Solicitors/counsel:
VA Trust Law, Auckland GM Legal, Auckland
J Donkin, Auckland

KEMP v KEMP-UPTON [2024] NZHC 398 [1 March 2024]

Introduction and Procedural Background

[1] In September 2014 the parties separated after 32 years of marriage. On 6 March 2015 they entered into an agreement pursuant to s 21 of the Property (Relationships) Act 1976 (PRA) which they called a “Relationship Property Trust Property and Related Agreement” (Agreement). They entered the Agreement in their personal capacities and also as trustees of Andre Kemp-Upton and Janet Christine Kemp-Upton Family Trust (Trust).

[2] The Agreement expressly set out how the parties would share the assets they owned and the liabilities they owed personally. And it expressly set out how they would distribute the assets they held as trustees of the Trust. But the Agreement did not expressly set out how they would deal with the Trust’s liabilities. These Trust liabilities included, most significantly, a secured debt to Westpac of “approximately
$1.7 million”.

[3] On 3 March 2021 Mr Kemp-Upton issued proceedings against Ms Kemp in the District Court at Waitakere. He alleged it was a term of the Agreement the parties would each be liable to pay half the liabilities, including the debt to Westpac. Mr Kemp-Upton claims that he has paid more then half of those liabilities and that Ms Kemp is obliged to pay him $136,136.20 in order to equalise the payment of liabilities as required under the Agreement.

[4] In her Statement of Defence dated 27 April 2021 Ms Kemp denied it was a term of the Agreement that the parties would each be liable to pay half the Trust’s liabilities. She referred to correspondence from Mr Kemp-Upton’s solicitor noting that the Agreement “appears to be silent on the division of liabilities owed by the Trust”. On 8 July 2021 Ms Kemp filed an Amended Statement of Defence alleging further that the Agreement failed to include an essential term relating to the division of Trust liabilities and that the terms of the Agreement are otherwise too uncertain to be enforceable. At the same time Ms Kemp applied for summary judgment against the plaintiff.1

1 Pursuant to the District Court Rules 2014, r 12.2(2) and 12.4(4).

[5] Not to be deterred, on 6 August 2021 Mr Kemp-Upton filed an amended statement of claim alleging that it was an implied term of the Agreement that they would each be responsible for a half-share of the Trust liabilities.2 Mr Kemp-Upton alleges that he and…

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.

Keep reading for free

Create a free CaseChat account to read Kemp v Kemp-Upton and more:

Read every judgment in full
Ask AI and get answers linked to paragraphs
See how each paragraph was cited in later cases
Download judgments as PDF or Word

Continue with Google

One click creates your free account or signs you in.

By continuing you agree to the Terms and Privacy Policy.

Details

Case: [2024] NZHC 398
Decision Date: 1 March 2024

CaseChat Overview and Summary

The case of Kemp v Kemp-Upton involves a dispute between Janet Kemp and Andre Kemp-Upton regarding the interpretation of a settlement agreement they entered into following their separation after 32 years of marriage. The primary issue is whether the agreement implied a term that the parties would equally share the liabilities of a family trust, including a significant debt to Westpac. Janet Kemp argues that the agreement does not include an essential term regarding the division of trust liabilities and is too uncertain to be enforceable. Andre Kemp-Upton contends that it is a term of the agreement that they would each be responsible for half of the trust liabilities.

The High Court of New Zealand, Auckland Registry, dismissed Janet Kemp's application for summary judgment, finding that it was "clearly arguable" that the court should imply a term into the contract for the equal sharing of trust liabilities. Janet Kemp appealed this decision. The appeal raises issues regarding the admissibility of extrinsic evidence in interpreting the agreement and whether the agreement is too uncertain to be enforceable due to the omission of terms relating to the division of trust liabilities.

The court found that the file note created by Stephen O'Neill, a chartered accountant who advised both parties, was admissible as it tended to prove the common mutual understanding of the parties at the time of the agreement. The court rejected the argument that documents created before the parties received independent legal advice should rarely be admitted. The court also held that the privilege under s 57 of the Evidence Act 2006 did not apply to the file note as there was no dispute between the parties at the time of the meeting.

The court concluded that at this interlocutory stage, it was not satisfied that Andre Kemp-Upton's claim could not succeed. The court found that there may be an evidential basis for the court to conclude that a reasonable person with all the background knowledge reasonably available to the parties at the time of the agreement would have understood the agreement to require the equal division of trust liabilities. The court held that the evidence needed to be heard in full to determine whether Andre Kemp-Upton could establish that it is strictly necessary to imply the term alleged, or whether the agreement is either void for uncertainty or has been fully performed. The appeal was dismissed, and Andre Kemp-Upton was awarded costs.

Orders