Maori Trustee v King

[2017] NZHC 1083

IN THE HIGH COURT OF NEW ZEALAND WHANGAREI REGISTRY

[2017] NZHC 1083

UNDER	the Property Law Act 2007
BETWEEN	MĀORI TRUSTEE Applicant
AND	D L KING Respondent

Hearing:	23 March 2017; 4 May 2017
Counsel:	JA McMillan and RA Monigatti for Applicant PT Harmon for Respondent
Judgment:	23 May 2017

JUDGMENT OF TOOGOOD J

This judgment was delivered by me on 23 May 2017 at 4.00 pm

Pursuant to Rule 11.5 High Court Rules

Registrar/Deputy Registrar

MĀORI TRUSTEE v KING [2017] NZHC 1083 [23 May 2017]

[1]      The Māori Trustee has made an originating application for orders under the

Property Law Act 2007.

[2]      The applicant is the registered proprietor of a property at 8 Constitution Hill, Auckland.   The property is subject to a lease between the Māori Trustee and the respondent,  Mr  DL  King,  who  is  a  prisoner  serving  a  sentence  of  preventive detention in the Northland Region Corrections Facility at Ngawha.   The essential terms of the lease of the property are comprised in:

(a)       A Memorandum of Lease dated 26 June 1959, as varied by a Deed of

Covenant dated 18 March 1977; and

(b)      A Memorandum of Extension of Lease dated 25 November 2003.

[3]      The lease was originally entered into in 1977 and then extended in 1980 for a period of 21 years.   It was further extended for 21 years from 1 July 2001.   The respondent paid rent until 1 May 2013 but then fell into default.

[4]      On 26 September 2014 the applicant obtained judgment against Mr King in the sum of $32,261.91 for rent arrears from 1 May 2013 to 16 May 2014 and rates arrears for the period from 1 May 2013 to 30 June 2014.   Nothing has been paid since judgment was entered, with the result that additional rent and rates are payable for the period since 1 July 2014 to date.  It is clear that Mr King is egregiously in arrears for rent and rates and in serious breach of his obligations under the lease.

[5]      Notices  of  intention  to  cancel  the  lease  were  served  on  Mr King  on

26 October 2016 and he was required to remedy the breaches by 25 November 2016. He failed to do so and has still taken no step to remedy the breaches.

[6]      The  Māori Trustee,  therefore,  seeks  orders  granting  vacant  possession,  a cancellation of the lease and orders for payment of arrears and interest, together with costs and disbursements.

[7]      Mr King opposes the applications, arguing that damage to an internal gutter in the property has caused water damage leading to loss of income which ought to be set-off against his obligation to pay rates and rent. Although Mr King has provided a lengthy detailed statement setting out his concerns about the leak and the effect on the property, including hazardous effects on the electrical wiring system, he has taken no formal step to pursue any claim against the applicant in this regard.  It is by no means clear, either, that the applicant has any liability to Mr King for the alleged damage  or  that  the  cost  of  remedying  it  would  exceed  Mr King's  longstanding liability for arrears.

[8]      The application was served on Mr King on 25 February 2017.   He had not taken any formal steps to oppose the making of the orders sought until the matter was first called on 23 March 2017.  As an indulgence to Mr King I adjourned the matter to be placed in a callover list on 4 May 2017 and directed that Mr King was required to file and serve a notice and affidavit in opposition to the application in the meantime.  I also said that Mr King would need to persuade the Court that there was a genuine defence available to him and/or a reasonable prospect of a set-off which would entitle him to resist the orders sought by the applicant.  I indicated that the mere prospect that Mr King might obtain a substantial sum by way of damages sometime in the future would not be sufficient to hold up the proper exercise of the Māori Trustee's rights.  I said that, in such claims in damages as Mr King might have would continue, but the Māori Trustee was entitled to exercise the statutory rights available to him to recover the property in view of the undeniable breaches of the lease.

Application for recusal

[9]      When the matter was called again in a telephone conference on 4 May 2017, counsel for Mr King submitted that I should recuse myself from hearing the application.  The ground asserted was that I was the Judge who had presided over Mr King's criminal trial  and who had sentenced him to  preventive detention on

12 December 2012.1   It was suggested that justice ought to be both done and be seen to be done and that my involvement with Mr King's prosecution, conviction and sentencing suggests that I might be biased against him in this proceeding.

[10]     The test for disqualification of a judge on the grounds of apparent bias is whether a fair-minded lay observer might reasonably apprehend that the judge might not bring an impartial mind to the resolution of the question the judge is required to decide.2  The test requires an apprehension of a real, not remote, possibility of bias.3

[11]     Mr King was sentenced to preventive detention because he was found guilty by a jury of serious crimes involving sexual offending against young women.  His appeal against his conviction and the sentence imposed was dismissed by the Court of Appeal.4   Presiding over Mr King's criminal trial and sentencing him involved no more than carrying out my judicial function in accordance with the law.

[12]     Hearing the present proceeding, in circumstances where my assignment to the case is purely coincidental, does not indicate that I have any particular interest in making the orders sought so as to unfairly disadvantage Mr King.   In accordance with the judicial oath to be independent and impartial in deciding cases before me, I am required simply to apply the law to the facts of this case.

[13]     There is no proper basis upon which I should disqualify myself from making a determination of the issues which arise.

Discussion

[14]     I am satisfied that there is no reason why the Court should refuse to make the orders sought in the light of the clear breaches of Mr King's obligations as lessee. Mr King has not paid rent to the trustees since April 2013 and is in breach of his

obligation to pay rates.   In such circumstances, relief against forfeiture would be

1      R v King [2012] NZHC 3353.

2      Saxmere Company Ltd v Wool Board Disestablishment Company Ltd [2009] NZSC 72, [2010] 1

NZLR 35.

3 At [4].

4      King v R [2015] NZCA 506.

only rarely granted.5    I am  satisfied  there is  no  genuine defence or  reasonable prospect of a set-off which justify depriving the applicant of the exercise of its rights.

[15]     The Māori Trustee has  undertaken  to  allow  Mr King and  his  sub-tenant

30 days from the date on any order to vacate the premises.

Orders

[16]     Accordingly, I make the following orders:

(a)      The Māori Trustee is granted vacant possession of 8 Constitution Hill, Auckland 1010, situated at Lot 3 on Deposited Plan 19624 (being the land in Identifier NA71D/230).  The order will take effect on 23 June

2017.

(b)The lease described in the Memorandum of Lease dated 26 June 1959 as  varied  by  the  Deed  of  Covenant  dated  18 March 1977,  the Memorandum  of  Extension  of  Lease  dated  22 July 1980,  and  the Memorandum  of  Extension  of  Lease  dated  25 November 2003  is cancelled as from 23 June 2017.

(c)      Mr King shall pay to the Māori Trustee all unpaid rent due up to the date  of  cancellation  or  such  later  date  as  Mr King  yields  up possession.

(d)Mr King shall pay to the applicant the equivalent of all unpaid rates due up to the date of cancellation or such later date as Mr King yields up possession.

(e)       Mr King shall pay the Māori Trustee interest on the outstanding rent

and rates at a rate of five per cent per annum (5%) until payment is made in full.

5      Andrew v Horner HC Wellington M459/95, 16 November 1995 at 7; Paros Property Trust Ltd v

Faith [2014] NZHC 3155, (2014) 15 NZCPR 896.

(f)      In  accordance  with  clause 11  of  the  lease,  Mr King  shall  pay the Māori  Trustee's  reasonable  costs  and  disbursements  incurred  in relation to the issuing of notices and this proceeding on a solicitor/client basis in a sum to be approved by the Court.  Counsel for the applicant shall file a statement of the costs incurred by the Māori Trustee for approval before the judgment is sealed.

........................................

Toogood J