Matau v Fusi

[2017] NZHC 3210

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

I TE KŌTI MATUA O AOTEAROA TĀMAKI MAKAURAU ROHE

CIV-2017-404-2988 [2017] NZHC 3210

UNDER

The Charitable Trusts Act 1957 and the High

Court Rules 2016, Part 19

IN THE MATTER

of the Reformed Christian Church of Tuvalu in New Zealand Trust

BETWEEN

MALO MATAU, PULENI TAOMIA AND MAKUSA VAELEI (as the remaining 2004 trustees of the Board)

Applicants

AND

REVEREND TEATU FUSI First Respondent

…/cont

Hearing:	On the papers
Counsel:	R S Pidgeon for the Applicants
Judgment:	19 December 2017

JUDGMENT OF GORDON J

This judgment was delivered by me

on 19 December 2017 at 12.30 pm, pursuant to r 11.5 of the High Court Rules

Registrar/Deputy Registrar

Date:

Solicitors:           Botting Legal Limited, Auckland

Counsel:            R S Pidgeon, Auckland

MATAU v FUSI [2017] NZHC 3210 [19 December 2017]

REVEREND TEATU FUSI, HELINA TELII, ALEE TALAVA, REVEREND HENELE TEKAVEI, MELEATA NAKALA, PONI FAAVAE, IUSITINI FALEASIU, LOGOFOU PEPAA, TAUI ALEFAIO, PITOKI FILIPO, LAGAFAOA LAVATA, LAVINIA TEATU FUSI AND ENOSA FAIKI

Second Respondents

TE EKALESIA KELISIANO TUVALU Third Respondent

REVEREND SUAMALIE N T IOSEFA Fourth Respondent

SILIGA TALA, KAANI SEKONE, KALANISE FAAUILA, ARMSTRONG TEKIE, SAULO HAULAGI, PELEKAI TUIA, IUSITINI FALEASIU, NOUATA TANE, TUSIALOFA POEALA, IAPESA VAVE, TALATEA BOREHAM, KITIONA TAUSI, TUAFAFA LATASI, SAINI MALALAU, FEALUINA LEULI AND VAKAALIKI FAGATOA

Fifth Respondents

Introduction

[1]      This is a without notice application under r 19.5 of the High Court Rules for leave to proceed by way of originating application, dated 15 December 2017.

Background

[2]      The proceeding arises as a result of  a dispute within a Tuvaluan church community in Auckland over who are the trustees of a charitable trust established by the Church and which rules govern their church community.

[3]      In the late 1990s the Tuvaluan congregation separated from a combined Pacific Island congregation and established its own Tuvaluan church congregation in West Auckland.   In 2004, once the church had fundraised sufficiently, it purchased a property for the church at 92 Grassmere Road, Henderson.

[4]      A new charitable trust, The Congregational Christian Church of Tuvalu in Auckland Trust, was established by the church and incorporated as a charitable trust board. The purchase of the property at 92 Grassmere Road was completed in the name of the new charitable trust. The purchase was funded both by way of a fund raised by the church as noted above, and by way of lending from the Bank of New Zealand. There is a mortgage over the property in favour of the Bank of New Zealand.  The loans secured by the mortgage are significantly in arrears and apparently the Bank of New Zealand agreed with the applicants that it would not to take enforcement steps if the current application was filed by 15 December 2017.

[5]      The Trust continues as the registered proprietor but its name was changed in

2010 to The Reformed Christian Church of Tuvalu in New Zealand Trust.

[6]      The applicants are the only three surviving trustees of those appointed in 2004. There have been three attempts to appoint additional trustees to the Trust Board, the first in 2010, the second in 2015 and a third in 2017.  The applicants’ position is that the 2010 and 2015 attempts are invalid.  They further say that a purported change of name and change of rules in 2015 is also invalid.

[7]      In 2017, the applicants attempted to comply with the rules in appointing additional trustees.  Part of the originating application is to confirm the validity of those 2017 appointments as the Trust is presently operating without quorum.

Orders sought in originating application

[8]      As is required, the applicants filed their originating application with the application for leave. The orders sought are as follows:

(a)      That the original 2004 rules of the Reformed Christian Church Of Tuvalu in New Zealand Trust be declared to be valid and operable and of full legal effect; and

(b)That the appointment of new Board members to the Reformed Christian Church Of Tuvalu in New Zealand Trust filed with the Registrar of Incorporated Societies and date stamped 6 May 2010 is invalid and of no legal force or effect.

(c)       That the alteration of rules, change of name and change of trustees of

Reformed Christian Church Of Tuvalu In New Zealand Trust, dated

27 November 2015 filed with the Registrar of Incorporated Societies and date stamped 2 December 2015 is invalid and of no legal force or effect;

(d)That [named] persons be declared the present trustees of the Trust Board (which Board is the registered proprietor of 92 Grassmere Road, Henderson Valley).

Submissions in support of application

[9]      Mr Pidgeon, counsel for the applicants, commenced his memorandum  in support by realistically accepting that there is a strong case to decline the application and direct that the proceeding proceed by way of statement of claim.

[10]     However, he submits that many recent examples where applications have been granted are from the Family Court jurisdiction in terms of guardianship and the Protection of Personal and Property Rights Act 1988 and that there is a broad and loose analogy as between an infant and an incapacitated person, both of whom who are unable to speak, and the Church to whom all parties belong but whose views regarding best interests diverge.

[11]     Mr Pidgeon submits that applying the interests of justice test, the speed of disposal is a key issue here with the number of people affected both in the congregation and the Bank of New Zealand as mortgagee.

[12]     He submits that discovery and interlocutory procedures are not likely to be necessary.   While acknowledging that viva voce evidence and cross-examination ought to occur, that can be accommodated under the rules.

[13]     Mr Pidgeon further submits that identifying the facts is likely to be the key issue. He says the facts are only discernible from two sources, namely the resolutions and documentary evidence, which are contained in four detailed affidavits filed in support and evidence in person.

[14]     Mr Pidgeon properly acknowledges likely arguments that the respondents may raise, namely justification of their acts, denial of any pressure to sign, general factual divergence and justification of steps taken for the common good. Mr Pidgeon accepts this clearly militates against granting the application but, he says, for the interests of justice.

[15]     Mr Pidgeon submits that the interests of justice favour the securing prompt resolution for the church and the originating application procedure will afford the respondents a chance to participate in the process and have their arguments heard.

[16]     Finally, Mr Pidgeon acknowledges that the rules of the Charitable Trust Board are not as clear as they might be and along with factual disputes, the interpretation of those rules will be a large part of the contentious element.

Decision

[17]     The  Court  may permit  originating  applications  to  be  used  to  commence proceedings in addition to those set out in HCR19.2-19.4. The only criteria expressly referred to in r 19.5 are the interests of justice.  In Hong Kong and Shanghai Banking Corporation Ltd v Erceg,1  after reviewing a number of decisions on applications brought under r 19.5, the High Court stated:

These cases show that the type of proceeding suited to the originating application procedure is a straightforward application, not requiring detailed pleadings or interlocutory orders for its fair resolution. Such a type of proceeding tends to be an application under a specific statutory provision, where the issue that arises can be clearly defined, and the issues confined. The procedure is not well suited to the determination of substantive rights involving the application of common law doctrines as distinct from statutory tests. It is not well suited to cases involving multiple parties, and cases where there is the possibility of crossclaims or counterclaims.

[18]      In my view, applying the interests of justice test, this is not a proceeding which should be commenced by originating application.  My reasons are as follows:

(a)      There are three substantial and detailed affidavits filed in support of the application.  It appears clear that there are facts here which create a potential for controversy between the parties.

(b)It  is  apparent  that  the  factual  issues  will  not  be  within  a  narrow compass.

(c)      There are five respondents and some of the respondents are comprised of multiple individuals.

(d)Notwithstanding the detail that has already been provided by way of the affidavit evidence, that does not obviate the need for discovery.

(e)      Given Mr Pidgeon’s indication that the rules of the Charitable Trust

Board are not clear and will be a large part of the contentious element, this is not a simple case of, e.g. applying statutory tests.

1      Hong Kong and Shanghai Banking Corporation Ltd v Erceg (2010) 20 PRNZ 652 at [25].

[19]     I acknowledge the applicants’ wish for a speedy resolution but weighing this matter against the other matters referred to above, I decline the application.

Result

[20]     The  application  for  leave  to  bring  proceeding  by  way  of  an  originating application is  declined.  I direct that the proceeding be commenced by way of

statement of claim.

Gordon J