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Mahon v The Station at Waitiri Limited

Mahon v The Station at Waitiri Limited

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IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

CIV-2017-404-114 [2017] NZHC 631

BETWEEN
NEVILLE CHRISTOPHER MAHON

Applicant

AND

THE STATION AT WAITIRI LIMITED Respondent

Hearing: 6 March 2017

Appearances:

D Bigio QC and A Glennie for the Applicant
D Chisholm QC and M Lenihan for the Respondent

Judgment:

4 April 2017

JUDGMENT OF ASSOCIATE JUDGE R M BELL

This judgment was delivered by me on 4 April 2017 at 3:00pm
pursuant to Rule 11.5 of the High Court Rules

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

Solicitors:
Anderson Creagh Lai Ltd, Auckland, for the Applicant
Brown Partners, Auckland, for the Respondent

Counsel:
David Bigio QC for the Applicant
David Chisholm QC for the Respondent

MAHON v THE STATION AT WAITIRI LIMITED [2017] NZHC 631 [4 April 2017]

[1] Mr Neville Mahon applies to sustain caveat 10665372.1 lodged against the titles to properties at 12, 18, 20, 24 Park Street, and 9 Brisbane Street, Queenstown. These are the Park Street properties. The interest claimed in the caveat is:

As beneficiary under a constructive trust arising on or prior to 16 December
2015, in connection with an agreement or representation giving rise to an estoppel to the effect that the registered proprietor, The Station at Waitiri
Limited, would transfer the property to the caveator upon notice.

The Station at Waitiri Ltd, a company under the control of Mr Tim Edney is the registered proprietor. Mr Mahon says that he has a caveatable interest in the properties via three pathways:

[a] Under an oral option agreement made in December 2015 for which he relies on part-performance in early 2016;

[b] by an institutional constructive trust reflecting a common intention held by Mr Mahon and Mr Edney formed in December 2015; and

[c] by an institutional constructive trust arising out of an equitable estoppel which arose from representations by Mr Edney in December
2015 upon which Mr Mahon reasonably relied to his detriment.

[2] The nub of Mr Mahon’s case is that he had a warehousing arrangement with Mr Edney for the Park Street properties. Through a related company he made an agreement to buy the properties from a third party but he assigned it to a company controlled by Mr Edney under an understanding that he could buy the properties back. He now wants the land but Mr Edney refuses to transfer it to him.

General principles on caveat applications

[3] In Holt v Anchorage Management Ltd, McMullin J stated the purpose of a caveat against dealings under the Land Transfer Act:1

1 Holt v Anchorage Management Ltd [1987] 1 NZLR 108 (CA) at 113.

Once lodged, a caveat is notice to all who search the title to the land against which it is registered and to the registered proprietor of the land (to whom notice of its receipt is given pursuant to s 142) that the caveator claims the estate or interest the subject of the caveat. It is both a warning to the persons mentioned that the caveator asserts rights against the…

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.

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Details

Case: [2017] NZHC 631
Decision Date: 4 April 2017

CaseChat Overview and Summary

Neville Christopher Mahon sought to sustain a caveat over land held by The Station at Waitiri Limited. The caveat was based on an alleged oral agreement made in December 2015, by which Mr Edney would transfer the property to Mr Mahon upon notice. Mr Mahon claimed that he had a caveatable interest in the properties via three pathways: an oral option agreement made in December 2015, an institutional constructive trust reflecting a common intention held by Mr Mahon and Mr Edney formed in December 2015, and an institutional constructive trust arising out of an equitable estoppel which arose from representations by Mr Edney in December 2015 upon which Mr Mahon reasonably relied to his detriment. The Station at Waitiri Limited rejected each of Mr Mahon’s claims and sought to remove the caveat. The court found that Mr Mahon’s claim based on an oral contract was not enforceable as there was no written agreement and there had been no acts of part performance. The court also found that Mr Mahon’s claim based on a common intention institutional constructive trust was not valid as it did not provide for the freehold titles to the Park Street properties to be transferred to him. The court found that Mr Mahon’s claim based on equitable estoppel was weak as there was no clear and unequivocal representation made by Mr Edney. The court concluded that Mr Mahon had not made out a case for a caveatable interest under any of his three heads and the caveat must lapse. The court ordered that the caveat lapse with effect from 21 April 2017 and that Mr Mahon pay costs on the application.

Orders