Lieven v Grieve - [2023] NZHC 1034

IN THE HIGH COURT OF NEW ZEALAND WELLINGTON REGISTRY

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

CIV-2021-485-757

[2023] NZHC 1034

IN THE MATTER OF the Trusts Act 2019

BETWEEN

TANYA MARIA LIEVEN

Plaintiff

AND

GRAEME STEPHEN GRIEVE

Defendant

Hearing: 22 February 2023

Counsel:

D G Hayes for the Plaintiff D S Lester for the Defendant

Judgment:

3 May 2023

JUDGMENT OF GWYN J

[1] This is a claim by the plaintiff, Ms Lieven, relating to two bare trusts. The plaintiff alleges that the defendant, Mr Grieve, as trustee of the trusts, has used trust funds or funds derived from borrowing against trust properties, for his own purposes.

Background

[2] Ms Lieven and Mr Grieve were married in 2000 and separated in 2021. They have two children together. Ms Lieven has another daughter from her first marriage.

[3] The parties purchased a property in Roseneath, Wellington (the property), in February 2004 for $2,003,000. The purchase was in both the plaintiff and defendant’s names. They obtained first mortgage funding from the then-National Bank of New Zealand Ltd, for $1,700,000. Mr Grieve says that the balance of the funding, or most of it, was met from the proceeds of his prior share investments. The mortgage

LIEVEN v GRIEVE [2023] NZHC 1034 [3 May 2023]

was also in the parties’ joint names. Tenancy agreements in respect of the properties were also in the parties’ joint names.

[4] The acquisition of the property was as a result of a Court order to complete the purchase. The parties incurred significant legal fees as a result of those proceedings. They undertook subdivision of the property, creating three separate titles, with the new titles being issued on 7 January 2005. Further work was done on the properties to complete two townhouses and obtain code of compliance certificates. It appears that this process involved significant legal costs for the parties.

[5] On 7 January 2005 title in the subdivided properties was transferred to the defendant. Mr Grieve says that the registration of the property in his name was because Ms Lieven was potentially pursuing her father’s estate for further provision and did not want her name on the property as that might have the effect of lessening or diminishing her claim.

[6] The evidence for both parties is that they struggled financially after buying the property, principally because of the costly legal battle. In addition, the applicants in the proceedings relating to the purchase was a developer who had been the prime source of work for Ms Lieven’s real estate business. She lost work as a result.

[7] Mr Grieve said that in 2003 and 2004 he sold properties in another Wellington suburb, to assist with the legal costs.

[8] Over time the parties continued to buy and sell property. It appears that neither party has a complete record, or recollection, of all of the properties involved and the costs incurred and income received. Mr Grieve’s evidence is that the purchase of various properties was conducted through…

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 Lieven v Grieve

Details

AGLC: Lieven v Grieve [2023] NZHC 1034
Case: [2023] NZHC 1034
Decision Date: 3 May 2023

CaseChat Overview and Summary

Tanya Maria Lieven brought a claim against Graeme Stephen Grieve, seeking to address alleged breaches of trust and mismanagement of trust assets. The dispute centres around two bare trusts established over properties in Wellington, New Zealand. Lieven asserts that Grieve, as the trustee, improperly used trust funds for personal purposes and failed to maintain proper accounts. Grieve counters with a claim that Lieven has mismanaged rental income and has not accounted for her share of expenses and income since their separation. The court considered whether Grieve had breached his duty as trustee by failing to maintain proper accounts and whether he had used trust funds for personal benefit. The court found that the plaintiff did not plead a cause of action regarding the failure to maintain accounts and declined to allow an amendment to the statement of claim due to potential prejudice to the defendant. The court further found that the plaintiff's refusal to allow Grieve access to necessary documents hindered the ability to resolve the claim on its merits. Regarding the breach of trust, the court could not reach a conclusion due to insufficient evidence, partly due to the plaintiff's actions in denying access to the Kāpiti house. The court dismissed the first and second causes of action, awarding wasted costs to the defendant. It further directed that Grieve should be granted access to the Kāpiti house to retrieve relevant documents, after which he would have 60 days to reconcile the material and provide it to Lieven. Lieven would concurrently provide a supported accounting of the rental income. If the parties remained unsatisfied with the material provided, they could return to court for further directions, potentially including an inquiry under Part 16 of the High Court Rules.

Orders