Moses v Stark - [2023] NZHC 844

IN THE HIGH COURT OF NEW ZEALAND HAMILTON REGISTRY

I TE KŌTI MATUA O AOTEAROA KIRIKIRIROA ROHE

CIV-2022-419-353

[2023] NZHC 844

UNDER Section 73 of the Partnership Law Act 2019

IN THE MATTER OF

the GJ & EM STARK PARTNERSHIP

BETWEEN

JULIET ANNA MOSES in her capacity as executor and trustee of the Estate of GEORGE JOHN STARK

Plaintiff

AND

EILEEN MARY STARK

Defendant

KEITH RICHARD STARK in his capacity as attorney in relation to property of

EILEEN MARY STARK

Second Defendant

Hearing: 18 April 2023

Appearances:

JWA Johnson and ST Dymond for the Plaintiff

Judgment:

20 April 2023

JUDGMENT OF ASSOCIATE JUDGE BRITTAIN

This judgment was delivered by me on 20 April 2023 at 3.00 pm pursuant to r 11.5 of the High Court Rules

Registrar/Deputy Registrar

Solicitors/Counsel:
North End Law, Hamilton
Bankside Chambers, Auckland Copy to: Mr K Stark

MOSES v STARK [2023] NZHC 844 [20 April 2023]

Introduction

[1] The plaintiff, Juliet Moses, is one of two partners in the GJ & EM Stark Partnership, in her capacity as the executor and trustee of the estate of George Stark, who passed away on 13 July 2020. The other partner is George’s surviving wife, the first defendant, Eileen Stark.

[2] Mrs Stark is not competent to manage her own affairs, and the second defendant, her son Keith Stark, is her attorney in relation to property pursuant to a power of attorney.

[3] Ms Moses seeks the interim appointment of a receiver to the partnership pending determination of the substantive proceeding, to enable her to further her administration of the estate.

[4]The partnership’s assets include:

(a)a farm on Tahuna Road, Ohinewai;

(b)a rural property on Rutherford Road, Ohinewai, which may be subject to a claim by Mrs Stark that this is her separate property;

(c)loans to Keith Stark, his former wife Linda Stark, and a company they control, Keilin Farms Ltd;

(d)43.74 per cent of the shares in Waitotara Farms Ltd; and

(e)a bank account.

[5] The remaining shares in Waitotara Farms Ltd are owned by Keith Stark, Linda Stark and Keilin Farms Ltd. From the limited evidence available at present, it appears that Keith Stark may be farming the partnership’s farm on Tahuna Road, the rural property on Rutherford Road and Waitotara Farms Ltd as one farming operation.

The substantive proceeding

[6] The amended statement of claim dated 14 April 2023 pleads that the partnership dissolved on George’s passing, pursuant to s 69 of the Partnership Law Act 2019 (the PLA), which provides:

69 Partnership dissolved by death or bankruptcy

(1)A partnership is dissolved with respect to all the partners by the death or bankruptcy of any partner.

(2)This section is subject to any agreement between the partners

[7] Ms Moses seeks a declaration that the partnership is dissolved, also relying in the alternative on the Court’s discretion to dissolve a partnership under s 72 of the PLA, which provides:

72 Court may dissolve partnership

The court may, on an application under section 73, declare a partnership to…

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 Moses v Stark

Details

AGLC: Moses v Stark [2023] NZHC 844
Case: [2023] NZHC 844
Decision Date: 20 April 2023

CaseChat Overview and Summary

In the High Court of New Zealand, Juliet Moses, in her capacity as executor and trustee of the estate of George Stark, has brought a proceeding against Eileen Mary Stark and Keith Richard Stark in his capacity as attorney in relation to property of Eileen Mary Stark. Moses seeks the interim appointment of a receiver to the partnership pending determination of the substantive proceeding, to enable her to further her administration of the estate. The substantive proceeding seeks a declaration that the partnership is dissolved, pursuant to s 69 of the Partnership Law Act 2019. In the alternative, Moses seeks a declaration that the partnership should be dissolved under s 72 of the Act. The court was required to decide whether there were grounds to appoint an interim receiver to manage the partnership's affairs. The court held that it was appropriate to appoint an interim receiver in this case. The court found that the partnership dissolved by operation of law on the death of George Stark. The court found that it was not yet appropriate for the receiver to take any steps to sell the partnership’s real estate or tangible assets. However, the court found that it was appropriate for a receiver and manager to be appointed to manage the ongoing business of the partnership, including the sale of stock in the ordinary course of business, and to recover any loans owed to the partnership by third parties. Steven Khov and Kieran Jones were appointed as receivers and managers of the GJ & EM Stark Partnership. The receivers may take steps to manage the ongoing business of the partnership and to recover any loans owed to the partnership by third parties. The receivers may not take any steps to sell the partnership’s real estate or tangible assets, except as permitted in order (a), without further directions from the Court.

Orders