Mead v Mullholland
[2015] NZHC 356
•4 March 2015
IN THE HIGH COURT OF NEW ZEALAND WELLINGTON REGISTRY
CIV-2014-485-11290 [2015] NZHC 356
BETWEEN BRUCE ALAN MEAD
Plaintiff
AND
EDWARD MARTIN ERIC MULHOLLAND, TEENA MARIE PEARCE AND MARIELLA MULHOLLAND
Defendants
Hearing: 3 March 2015 Counsel:
J C Gwilliam for Plaintiff
E M E Mulholland in Person
T M Pearce in Person
No appearance for M MulhollandJudgment:
4 March 2015
JUDGMENT OF ASSOCIATE JUDGE SMITH
[1] On 16 July 2014, Mr Mead entered into an agreement with ANZ Bank New Zealand Ltd (the Bank) to purchase a property at Main Road, Te Marua, Upper Hutt (the property). The Bank was selling as mortgagee, in the exercise of its power of sale under mortgage number 7070712.2 registered on the title to the property. The defendants were the registered proprietors of the property, and the mortgagors named in the mortgage to the Bank.
[2] Mr Mead settled the purchase on 18 August 2014, and subsequently became registered as the sole proprietor of the property.
[3] Following the settlement, at least one of the defendants (Mr Mulholland) remained living on the property, and refused to leave when he was requested by Mr Mead to do so. Mr Mead then commenced this court proceeding, seeking an
order for possession of the property and an order for costs. On the basis of his belief
BRUCE ALAN MEAD v EDWARD MARTIN ERIC MULHOLLAND, TEENA MARIE PEARCE AND MARIELLA MULHOLLAND [2015] NZHC 356 [4 March 2015]
that the defendants had no defence to the claim for possession, Mr Mead applied for summary judgment on his claims.
[4] The summary judgment application came before me 11 November 2014. At that time, only Mr Mulholland had been served with the court papers, and service on him had not been effected until 23 October 2014. Mr Mulholland did not file any notice of opposition to the application, and nor did he or any of the other defendants appear when the case was called.
[5] I adjourned the application to 25 November 2014, for Mr Mead to effect service on the other two defendants. Mr Mead was directed to notify Mr Mulholland of the further hearing date.
[6] Mr Mulholland did not appear when the case was called on
25 November 2014. I made an order against him for recovery of the property, and directed that he deliver up possession of the property to Mr Mead immediately. I also made an order for costs against him, on a Category 2 Band B basis, with disbursements to be fixed by the Registrar.
[7] Ms Mariella Mulholland had been served with the summary judgment application only on 18 November 2014, and Ms Pearce had still not been served when the case was called on 25 November 2014. The applications for summary judgment against Ms Pearce and Ms Mulholland were further adjourned, to
17 February 2015.
[8] The summary judgment entered against Mr Mulholland on
25 November 2014 proved to be sufficient for Mr Mead to recover possession of the property. Mr Mulholland was served with a trespass notice on 8 December 2014, giving him 48 hours to leave the property. He was forcibly removed from the property, with the assistance of the police, on 10 December 2014. Mr Mead then took possession, and changed the locks on the property. He has been possession ever since.
[9] It appears that neither Ms Pearce nor Ms Mulholland was present when Mr Mead secured possession of the property on 10 December 2014 (I note in that regard that Ms Mulholland had been served with the proceedings at an address in Raglan).
[10] Shortly before the case was called again on 17 February 2015, a lengthy document was filed by the defendants. It was described as an “Affidavit of truth seeking remedy for property gained by criminal actions and notice of intent”. Although the document was described as an affidavit, it was not signed as such, or indeed at all. A signed copy (still unsworn) was subsequently filed on 24 February
2015.
[11] At the hearing on 17 February 2015, Mr Mulholland and Ms Pearce appeared in person. After hearing from them, and Ms Verndora Smith, whom I permitted to speak on behalf of Ms Mariella Mulholland, I directed that the “affidavit of truth” should be treated as an informal application by Mr Mulholland to set aside the summary judgment that had been entered against him on 25 November 2014, and as an application by Ms Pearce and Ms Mulholland for an extension of time to oppose the application for summary judgment which was sought against them. I adjourned the matter for further hearing on 3 March 2015, and directed that Mr Mead should file any notice of opposition and supporting affidavits by 24 February 2015.
[12] Mr Mead duly filed a notice of opposition, and there was an affidavit in opposition sworn by Mr Mead. In addition, Ms Pearce and Ms Mariella Mulholland filed a document entitled “Statement of Claim Notice to Principal is Notice to Agent. Notice to Agent is Notice to Principal. All Rights Reserved!”
[13] Ms Verndora Smith, although not a solicitor (and therefore lacking standing to file Court documents on behalf of parties), filed two further documents. One is counter-signed by Mr Mulholland and Ms Pearce, who confirm in a handwritten annotation on the document that its contents are accurate. This document essentially repeats matters which were set out in the “affidavit of truth”, adding that the Bank, which has received the proceeds of sale, is still holding the proceeds and refusing to turn them over to the defendants. The second document was in the form of a
memorandum, and it is not counter-signed by any of the defendants. In it Ms Verndora Smith alleges that Mr Gwilliam has been acting under a conflict of interest, he having acted for the defendants in certain matters back in 2006.
[14] In the course of the hearing on 3 March 2015, Mr Gwilliam confirmed that there is no evidence that Ms Mariella Mulholland has been on the property and failed to yield up possession to Mr Mead. In those circumstances there is no basis for the entry of summary judgment against her. The summary judgment application will be dismissed insofar as it relates to Ms Mariella Mulholland.
The Issues
[15] The following issues fall to be determined:
(1)Is there any basis for setting aside the summary judgment entered against Mr Mulholland?
(2)Does Ms Pearce have an arguable defence to the summary judgment application?
[16] I will deal with each issue in turn.
Issue 1: Is there any basis for setting aside the summary judgment entered against Mr Mulholland?
[17] Rule 12.14 of the High Court Rules provides:
12.14 Setting aside judgment
A judgment given against a party who does not appear at the hearing of an application for [summary judgment] may be set aside or varied by the court on any terms it thinks just if it appears to the court that there has been or may have been a miscarriage of justice.
The defendants’ arguments
[18] There is a substantial amount of repetition in the assertions made by the defendants in the “affidavit of truth”, and much of what is said in the document seems to be irrelevant (for example, alleged breaches by the Bank of the
Crimes Act 1961 or the New Zealand Bill of Rights Act 1990). However it is possible to discern from the document that the defendants’ main complaint is that they do not believe the bank was entitled to sell the property by mortgagee sale. They assert that they are still the legal freehold proprietors, and that they are “seeking redress against [the Bank] for theft and sale of land”.
[19] A recurring theme in the “affidavit of truth” is that the defendants’ loan was taken out originally with the National Bank of New Zealand Ltd. They say that there is no (or at least insufficient) evidence showing that the amount claimed was in fact owing to the National Bank of New Zealand Ltd, or that the Bank is entitled to exercise rights given by them to the National Bank of New Zealand Ltd. The defendants assert generally that Mr Mead has been guilty of collusion with the Bank. They repeat at length that Mr Mead did not have any agreement with them as lawful owners of the property, and assert that the sale agreement between Mr Mead and the Bank was unlawful.
[20] While the defendants say in the “affidavit of truth” that the agreement between Mr Mead and the Bank was unlawful, and that Mr Mead colluded with the Bank, they also suggest that Mr Mead should seek damages from the Bank, on the basis that the Bank failed to fully disclose relevant matters to him. At the same time, the defendants say in the document that they will themselves vigorously seek compensation from the Bank.
[21] There were two other arguments raised by the defendants. First, they allege that Mr Mead sold valuable items owned by one or more of them after he took possession of the property on 10 December 2014. Secondly, they claim copyright and trademark rights in their names, and allege that these rights have been breached by Mr Mead in pursuing his claims and in issuing his court proceeding. There is said to be a proceeding filed in the Wellington District Court claiming $1 million for “unauthorised trademark infringements”, but no copy of the proceedings was produced.
Mr Mead’s response
[22] In his affidavit in opposition, Mr Mead confirms that he had no dealings direct with the Bank regarding the purchase of the property: all of his dealings were through the local real estate agent. He says that the property was advertised as a mortgagee sale at a fixed price, and that he duly made an offer at that price. He bought the property sight unseen, as he was advised by the real estate agent that none of the occupants (Mr Mulholland and his family) would allow prospective buyers onto the property prior to them making an offer.
[23] In response to the allegation that he has sold some of the defendants’ personal property, Mr Mead says that, with the exception of some perishable items such as food which the defendants left at the property, he has not sold their belongings. He says that they have either been delivered to the address now occupied by Mr Mulholland and Ms Pearce, or they are being stored. He says that the defendants have refused to engage with him or his lawyer in regard to the delivery of their personal items.
My conclusions on the defendants’ arguments
[24] I note first that any arguments between the defendants and the Bank are not matters with which Mr Mulholland needed to be concerned as a purchaser from the Bank selling as mortgagee. Section 105 of the Land Transfer Act 1952 (the Act) provides in material part:
105 Transfer by mortgagee
Upon the registration of any transfer executed by a mortgagee for the purpose of exercising a power of sale over any land, the estate or interest of the mortgagor therein expressed to be transferred shall pass to and vest in the purchaser, freed and discharged from all liability on account of the mortgage, or of any estate or interest except an estate or interest created by any instrument which has priority over the mortgage or which by reason of the consent of the mortgagee is binding on him.
[25] In this case, the Bank was the “mortgagee”, and the defendants were the
“mortgagor”.
[26] Mr Mead produced unchallenged evidence of the registration of the transfer from the Bank to himself, and he produced a copy of the certificate of title to the property showing that he has been registered as the sole proprietor. A copy of the Land Information New Zealand instrument showing details of the transfer to Mr Mead, registered on 18 August 2014, shows the transferor as “ANZ Bank New Zealand Ltd formerly ANZ National Bank Ltd by change of name dated 29 October
2012 as mortgagee under mortgage number 7070712.2 of which [the defendants] are the mortgagors”. The document shows Mr Mead as transferee, and it refers to the transfer as having been made in pursuance of the power of sale contained in the Bank’s mortgage over the property.
[27] In those circumstances, there has clearly been a registration of a transfer executed by a mortgagee for the purpose of exercising a power of sale over land, and the effect of s 105 of the Act is that the estate or interest of the defendants as mortgagors passed to and vested in Mr Mead as purchaser, free from any liability on account of the mortgage.
[28] Other sections of the Act confirm that Mr Mead, absent fraud on his part, had no need to be concerned with the ability or otherwise of the Bank to sell the property to him. Section 62 of the Act materially provides that, except in the case of fraud, the registered proprietor of any land shall hold the land (subject to any encumbrances, liens, estates, or interests as may appear on the title to the land) “absolutely free from all other encumbrances, liens, estates or interests”. There are three exceptions to that stated in the section, but none of them applies in this case.
[29] Section 63 of the Act provides that no action for possession of any land shall be sustained against the registered proprietor under the provisions of the Land Transfer Act, except in a number of circumstances set out in the section, none of which is relevant here.
[30] The combined effect of these provisions in the Act is that once Mr Mead became registered proprietor of the land without any fraud on his part, he was entitled to rely on the certainty of registration which the Act confers on registered proprietors of land.
[31] There is no evidence whatsoever that Mr Mead has been guilty of fraud, and therefore no basis on which the defendants can challenge his ownership of the property. If the defendants have complaints with the Bank, those complaints should be pursued with the Bank – they are not matters which can prevent Mr Mead from asserting his title to the property, and claiming possession of it.
[32] It is not strictly necessary in the light of that finding for me to consider the defendants’ argument that their loan was from the National Bank of New Zealand Ltd, and not from the Bank. Mr Mead’s registration as proprietor of the land, without any fraud on his part, would trump any such argument, even if there were merit in it. But it appears in any event that there is no merit in the argument. Although the loan was taken out originally with the National Bank of New Zealand Ltd, registered mortgage number 7070712.2, which the defendants must all have signed, shows the mortgagee as “ANZ National Bank Ltd”. And the instrument details from Land Information New Zealand to which I have referred, sufficiently show that the party who sold the property to Mr Mead (ANZ Bank New Zealand Ltd) was formerly known as “ANZ National Bank Ltd”. All that has occurred is that the Bank’s name changed between the date of registration of the mortgage given by the defendants in 2006, and the date of the transfer to Mr Mead in 2014.
[33] As for the allegation that Mr Mead has sold valuable items owned by the defendants, I note first that no detail of any sold items has been provided, and that Mr Mead denies selling the defendants’ property. The defendants’ document in which this claim is made was unsworn, and in the circumstances does not meet the threshold of an arguable defence, or arguable counterclaim.
[34] Similarly, there is nothing in the contention based on alleged copyright and/or trademark rights in the defendants’ names. No evidence has been produced which would establish that the defendants have trademark rights in their names, and nor has any evidence been produced to substantiate the contention that the names constitute original literary works in which copyrights (owned by the defendants) could subsist. I note also that s 59 of the Copyright Act 1994 provides that copyright is not
infringed by anything done for the purposes of judicial proceedings.1 Mr Mead was clearly entitled to use the defendants’ names in filing and prosecuting this Court proceeding.
[35] The defendants produced lengthy documents headed “Common Law Copyright Notice”, which purport to preclude any use of their names. The document purports to be a form of contract, under which any unauthorised use by a third party of the defendants’ names would contractually bind the third party to the document’s terms, including an obligation to grant to the defendants a security interest in the third party’s assets in the sum of $1 million for each unauthorised use. There is no evidence of Mr Mead accepting these terms, and of course he has not. They appear to be little more than a device, intended to discourage parties such as Mr Mead with legitimate claims against the defendants, from pursuing their rights.
[36] The only remaining matter to mention is Ms Smith’s allegation that Mr Gwilliam has acted in a conflict of interest situation. That is not an allegation which has been made in admissible form by any of the defendants, and I do not think it appropriate to entertain the allegation in the context of this proceeding. The simple fact is that Mr Mead became the registered proprietor of the property, and thereupon become entitled to possession. Any complaints the defendants may have about Mr Gwilliam or his firm having acted for them some years ago, cannot bear upon the question of whether or not Mr Mead, having become the registered proprietor of the property, was or was not entitled to possession. There is nothing in the point to suggest that allowing the summary judgment to stand will or might result in a miscarriage of justice.
[37] None of the various matters raised by Mr Mulholland persuade me that he had an arguable defence to the summary judgment application, or that the entry of summary judgment against him did or might have resulted in a miscarriage of justice on some other basis. Mr Mulholland’s application to set aside the summary
judgment entered on 25 November 2014 will accordingly be dismissed.
1 Copyright Act 1994, s 59(1).
Issue 2: Does Ms Pearce have an arguable defence to the summary judgment application?
[38] To the extent that Ms Pearce relies on the same defences Mr Mulholland has argued, she has also failed to show that she has any arguable defence to the summary judgment application. The only additional matter affecting the summary judgment application against Ms Pearce is whether there is evidence that she remained on the property, and refused to leave, after the defendants were asked by Mr Mead to go.
[39] I am satisfied that there is sufficient evidence of Ms Pearce remaining in possession of the property to justify the making of a costs order against her. (Mr Mead having recovered possession of the property, costs is now the only remaining issue between him and Ms Pearce).
[40] In his affidavit in opposition, Mr Mead states that Ms Pearce lived with Mr Mulholland at the property at relevant times. And in his earlier affidavit, filed in support of his application for summary judgment, Mr Mead stated that he believed that Mr Mulholland and Ms Pearce were residing at the property, they having remained in possession of the property since he settled the purchase of the property.
[41] Those allegations have not been denied by Ms Pearce, and I note that in the “affidavit of truth” it is alleged that Mr Mead has sold valuable items of “the defendants”. The use of the plural “defendants” tends to confirm that it was not just Mr Mulholland’s belongings which were on the property. And the only other defendant who would have had belongings on the property after the date Mr Mead secured possession, was Ms Pearce.
[42] For the foregoing reasons, Ms Pearce has not shown that she had any arguable defence to the application for possession of the property when it was filed by Mr Mead. While Mr Mead no longer has any need for an order granting him possession of the property, he has been put to the expense of filing a court proceeding, and it is appropriate that Ms Pearce should bear responsibility for an appropriate share of Mr Mead’s costs, in accordance with the High Court Rules. There will be an award of costs against Ms Pearce, for which she and Mr Mulholland will be jointly and severally liable.
Result
[43] I make the following orders:
(a) Mr Mulholland’s application to set aside the summary judgment entered against him on 25 November 2014 is dismissed. That judgment stands.
(b)Mr Mead’s application for summary judgment against the third-named defendant, Mariella Mulholland, is dismissed.
(c) I make an additional order for costs against Mr Mulholland, on a
Category 2, Band B basis, in respect of the hearings on
17 February 2015 and 3 March 2015. I also order him to pay any additional disbursements which Mr Mead may have incurred since the entry of summary judgment against Mr Mulholland on 25 November
2014. The amount of any such additional disbursements is to be fixed by the Registrar.
(d)I make an order for costs on the summary judgment application against Ms Pearce, on a Category 2, Band B basis, and an order for disbursements to be fixed by the Registrar. These costs are the same as, and are not additional to, the total costs awarded to date against Mr Mulholland. I direct that Mr Mulholland and Ms Pearce are jointly and severally liable for all of the costs I have awarded to Mr Mead.
Associate Judge Smith
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