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MacKinnon-Johnson v Clark

MacKinnon-Johnson v Clark

Case [2023] NZHC 3819 20 December 2023

Testamentary Capacity

Contract Formation

Breach of Contract

Unconscionable Conduct

Unjust Enrichment

Dishonest Assistance

Duty of Care

Wills and Succession Law

Contract Law

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IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

I TE KŌTI MATUA O AOTEAROA TĀMAKI MAKAURAU ROHE

CIV-2021-404-002220

[2023] NZHC 3819

BETWEEN
JOEL MACKINNON-JOHNSON, EMMA ELIZABETH MACKINNON, and KATIE JOY MACKINNON

Plaintiffs

AND

BELLA ROBERTA CLARK and ROBYN

ANN McCLEARY as administrators of the Estate of Rangiterewai Elizabeth McCleary First Defendants

BELLA ROBERTA CLARK and ROBYN ANN McCLEARY

Second Defendants

KIERAN NALLY

Third Defendant

Hearing: 7 September 2023

Appearances:

A E McDonald and S C S Rutledge for the Plaintiffs L A Foley for the First and Second Defendants

K Burkhart and A Wilson for the Third Defendant

Judgment:

20 December 2023

JUDGMENT OF ASSOCIATE JUDGE GARDINER

This judgment was delivered by me on 20 December 2023 at 4.00 p.m. pursuant to Rule 11.5 of the High Court Rules.

Registrar/Deputy Registrar

Date.......................................

MACKINNON-JOHNSON v CLARK [2023] NZHC 3819 [20 December 2023]

Introduction

[1] Rangiterewai McCleary (Rangi) had three daughters: Heather MacKinnon (Heather) and the second defendants Bella Clark (Bella) and Robyn McCleary (Robyn). In the late 1990s Rangi got into financial difficulties in a business venture. Heather purchased mortgages over Rangi’s home at 1A Bannerman Road, Western Springs, to prevent a mortgagee sale. In 2004, they agreed that Rangi would transfer 1A Bannerman Road, and two properties Rangi was about to purchase (1 Bannerman Road and 65 Fairview Road, Waiheke Island) to Heather. The arrangement, recorded in a formal deed, was that Heather was to hold 1 and 1A Bannerman Road on trust for Rangi as beneficiary. The deed recorded that Rangi transferred the Fairview Road property to Heather in full and final settlement and satisfaction of any entitlement Heather might have to Rangi’s estate upon her death.

[2] In a will executed in 2007, Rangi appointed Heather as executor and trustee and named Bella and Robyn as beneficiaries, recording that Heather had received her share of her estate during her lifetime. However, in a further will executed in 2010, Rangi appointed Heather as executor and trustee and provided that her estate should be divided equally between Heather, Bella, and Robyn, and if any daughter pre- deceased her, that their children would take their mother’s share.

[3] Heather died in 2013. In 2015, the executors and trustees of her estate, two of her three children – Joel MacKinnon-Johnson (Joel) and Emma MacKinnon (Emma)
– entered into a further deed with Rangi, through Mr Kieran Nally, her court-appointed property manager. This deed was said to settle all claims that Rangi may have against Heather’s estate, and all claims Heather’s estate may have against Rangi. The deed required Heather’s estate to pay Rangi a sum of money and to transfer the title of 1A Bannerman Road back to Rangi. The deed also acknowledged that in consideration for the transfer of Fairview Road to Heather in 2004, Heather had received her share and entitlement to Rangi’s estate during her lifetime and had no further claim on Rangi’s estate.

[4] Rangi died later in 2015. Bella and Robyn were appointed administrators of Rangi’s…

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 MacKinnon-Johnson v Clark

Details

AGLC: MacKinnon-Johnson v Clark [2023] NZHC 3819
Case: [2023] NZHC 3819
Decision Date: 20 December 2023

CaseChat Overview and Summary

The case of MacKinnon-Johnson v Clark involves a dispute between the plaintiffs, Joel MacKinnon-Johnson, Emma Elizabeth MacKinnon, and Katie Joy MacKinnon, and the defendants, Bella Roberta Clark, Robyn Ann McCleary, and Kieran Nally. The plaintiffs are the children of Heather MacKinnon, who died before the deceased, Rangiterewai Elizabeth McCleary. The defendants are either children or representatives of Rangiterewai. The plaintiffs claim that the defendants improperly administered Rangiterewai's estate by not distributing one-third of the estate to the plaintiffs, as they are entitled to share equally in the one-third share of the estate that Heather would have been entitled to had she lived. The defendants argue that the 2004 and 2015 deeds, which they claim settled any entitlement Heather had to Rangiterewai's estate, should prevail.

The legal issues in this case include whether the plaintiffs' claim that they are entitled to one-third of Rangiterewai's estate, because the 2004 and 2015 deeds are invalid and of no effect, is reasonably arguable. The court considered the principles of disclaimers and renunciations made before the testator's death, and whether a disclaimer or renunciation made for consideration is enforceable. The court also considered whether the defendants had a duty of care to the plaintiffs in administering the estate and whether the third defendant, Kieran Nally, engaged in misleading and deceptive conduct in breach of the Fair Trading Act 1986.

The court found that the plaintiffs' claim that the 2004 and 2015 deeds were invalid and ineffective was reasonably arguable. The court held that a disclaimer of any entitlement in an estate before the testator dies is ineffective, and that a pre-death contract to renounce is not clearly established as enforceable. The court also found that the plaintiffs' claim that Kieran Nally owed them a duty of care in administering the estate and that he engaged in misleading and deceptive conduct was reasonably arguable.

As a result, the court dismissed the defendants' interlocutory applications for orders striking out the first, second and sixth causes of action in the plaintiffs' statement of claim, and the third defendant's interlocutory application for orders striking out the third, fourth and fifth causes of action against the third defendant. The court ordered that the plaintiffs are entitled to costs from the defendants on a 2B basis plus reasonable disbursements.

In summary, the court held that the plaintiffs' claims were reasonably arguable and should proceed to trial. The court dismissed the defendants' applications to strike out the claims and ordered that the plaintiffs are entitled to costs from the defendants.

Orders