Legal Research
Cases
Klimenko v Klimenko

Klimenko v Klimenko

Case [2021] NZHC 2592 30 September 2021

Constructive Trust

Presumption of Advancement

No judgment structure available for this case.

Type to search within this case.

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

I TE KŌTI MATUA O AOTEAROA TĀMAKI MAKAURAU ROHE

CIV-2021-404-1211

[2021] NZHC 2592

IN THE MATTER of Part 19 High Court Rules 2016

AND IN THE MATTER

of an application by Andrei Klimenko for orders pursuant to Section 143 of the Land Transfer Act 2017 in respect of caveat claims 12110027.1 and 12110510.1

BETWEEN

ANDREI KLIMENKO

Applicant

AND

ANTON KLIMENKO

First respondent

ANNA GONCHARENKO

Second respondent

Remote hearing: 22 September 2021

Appearances:

P J Stevenson for the applicant

G Steyn for the first and second respondents

Judgment:

30 September 2021

JUDGMENT OF JAGOSE J

This judgment was delivered by me on 30 September 2021 at 10.00am.
Pursuant to Rule 11.5 of the High Court Rules.

………………………… Registrar/Deputy Registrar

Counsel/Solicitors:
P J Stevenson, Barrister, Auckland McVeagh Fleming, Auckland

KLIMENKO v KLIMENKO [2021] NZHC 2592 [30 September 2021]

[1] Given the commonality (but not universality) of surnames, meaning no disrespect, I refer to the parties by their given names.

[2] The applicant (“Andrei”) seeks orders caveats lodged over six properties — variously in North Auckland, South Auckland, Otago and Southland Land Districts, of which the respondents (Andrei’s son, “Anton”, and Anton’s wife, “Anna”) are registered owners as joint tenants — not lapse.

Background

[3] The caveats are expressed in terms of Andrei’s claim to a “[b]eneficial interest in the land by virtue of financial contribution and a constructive trust between Anton
… and Anna … as trustee and Andrei … as caveator and beneficiary”.1 Andrei
contends directly or indirectly to have funded the properties’ purchase by Anton and Anna for joint investment. Anton and Anna argue Andrei’s funds were at best an unsecured loan for repayment as demonstrated by subsequent dealings between the parties, and thus incapable of supporting Andrei’s claim.

The law

[4]The Court of Appeal recently stated:2

Section 143 of the Land Transfer Act provides that the registered owner of an estate or interest affected by a caveat can apply to the Registrar for the lapse of the caveat.3 The Registrar must give notice of the application to the caveator and the caveat lapses unless, within 10 working days after the date on which the Registrar gives notice, the caveator gives notice to the Registrar that an application has been made to the Court for an order that the caveat not lapse, and, within 20 working days after the caveator gives notice to the Registrar, an order made by the Court is served on the Registrar.4 There are provisions permitting this time period to be extended until the Court can deal with the application.

The principles on which the jurisdiction to remove or extend a caveat falls to be exercised are not set out in the section but they have been developed by the Courts. … [T]he relevant principles were succinctly restated by this Court in Philpott v Noble Investments Ltd as follows:5

1 Andrei’s name is misspelled “Andrey” in respect of one of the Dunedin properties.
2 Wallace v Studio…

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 Klimenko v Klimenko

Details

AGLC: Klimenko v Klimenko [2021] NZHC 2592
Case: [2021] NZHC 2592
Decision Date: 30 September 2021

CaseChat Overview and Summary

The case of Klimenko v Klimenko involves an application by Andrei Klimenko to prevent the lapse of caveats over six properties in New Zealand. The properties in question are owned jointly by his son Anton and Anton’s wife, Anna. Andrei claims a beneficial interest in the properties based on his financial contributions and an alleged constructive trust. Anton and Anna argue that any funds provided by Andrei were loans intended to be repaid and thus do not support Andrei’s claims. The High Court was tasked with determining whether Andrei had a reasonably arguable case to support his claim of a beneficial interest in the properties, which would justify the continuation of the caveats.

The court considered the principles governing the removal of caveats, including the onus on the applicant to demonstrate a reasonably arguable case for the interest claimed. It was established that summary procedures for caveat lapse applications are not suited for resolving disputed questions of fact. The court noted that the nature of Andrei’s financial contributions to the purchase of the properties was disputed, and thus the case was not appropriate for summary determination. However, the court found that Andrei’s claims, whether based on a resulting trust or a remedial constructive trust, were reasonably arguable and could support the caveats. The court also determined that Andrei’s legitimate interest would not be prejudiced by the removal of the caveats if his claims were not substantiated.

Consequently, the court ordered that the caveats not lapse, but conditionally, pending Andrei’s prompt issuance and diligent pursuit of a substantive proceeding to establish his interest in the properties. The court reserved the issue of costs, suggesting they be determined in conjunction with the substantive proceeding or through short memoranda if the parties could not agree. This decision ensures that the caveats remain in place to protect Andrei’s claims until a definitive resolution is reached in the substantive litigation.

Orders