Moses v Stark - [2023] NZHC 427

IN THE HIGH COURT OF NEW ZEALAND HAMILTON REGISTRY

I TE KŌTI MATUA O AOTEAROA KIRIKIRIROA ROHE

CIV-2022-419-353

[2023] NZHC 427

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

First Defendant

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

EILEEN MARY STARK

Second Defendant

Hearing: On the papers

Counsel:

JWA Johnson and ST Dymond for the Plaintiff

Judgment:

7 March 2023

JUDGMENT OF ASSOCIATE JUDGE SUSSOCK

This judgment was delivered by me on 7 March 2023 at 4.30pm 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 427 [7 March 2023]

Introduction

[1] The plaintiff has filed proceedings seeking the dissolution of a partnership. At the same time an interlocutory application has been filed seeking the interim appointment of a receiver over the partnership assets to protect those assets until the substantive proceeding is determined.

[2] The proceedings are brought by the estate of George John Stark (George) and relate to a farming partnership formed in 1965 by George and his wife, Eileen Mary Stark (Eileen). The partnership is called the GJ and EM Stark Partnership (Partnership).

[3] George passed away on 13 July 2020. Since his passing, his interest in the Partnership has been carried on by his estate (Estate).

[4] Ms Juliet Moses (Juliet) was appointed on 2 June 2021 to act as the sole independent trustee of the Estate in place of the executors appointed pursuant to the will. Originally the will appointed Eileen, Keith Richard Stark (Keith), Eileen and George’s son (and the second defendant), and two of Eileen and George’s other children to be executors and trustees of the will. The will:

(a)made certain conditional bequests;

(b)provided a life interest for Eileen in the Estate’s assets; and

(c)divided the residue of the Estate on Eileen’s death amongst George’s five children.

[5] The will also purported to direct the executors and trustees to retain the farm property owned by George and the shares in Waitotara Farms Limited for five years after George’s death to enable Keith to continue utilising the land to fulfil the terms of a sharemilking contract.

[6] The Estate owns 2188 shares in Waitotara Farms Limited alongside Eileen’s 2186 shares, together treated as Partnership property. The remaining shares are held by Keith (1 share), Keith and his wife Linda (although they appear to be separated) (1 share) and Keilin Farms (5624 shares).

[7] Juliet deposes that Keilin Farms is jointly owned and directed by Keith and Linda. The directors of Waitotara Farms Limited are Keith, Linda and Eileen.

[8] In June 2021 Eileen and all five of her and George’s children signed…

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 427
Case: [2023] NZHC 427
Decision Date: 7 March 2023

CaseChat Overview and Summary

In Moses v Stark, the Estate of George John Stark, represented by Juliet Moses, has filed proceedings seeking the dissolution of a farming partnership with Eileen Mary Stark. The partnership, known as the GJ and EM Stark Partnership, was established in 1965 and involves complex family dynamics, including Eileen's incapacity and Keith Richard Stark's role as Eileen's attorney. The Estate, as the sole asset holder of George's interest in the partnership, has requested the interim appointment of a receiver over the partnership assets to protect them until the substantive proceedings are determined. The court was required to decide on the jurisdiction of Associate Judges to appoint an interim receiver and the necessity of such an appointment given the current circumstances.

The court determined that Associate Judges do have the jurisdiction to appoint an interim receiver, as it is not excluded by the Senior Courts Act 2016 or the High Court Rules 2016. The court also acknowledged its inherent jurisdiction to appoint receivers, particularly in situations where there is a need for the interim protection of property. The court considered the Estate's submission that the appointment of an interim receiver is almost a matter of course in partnership disputes where dissolution is inevitable, but ultimately decided against the appointment at this stage. The court cited various reasons, including the unknown status of the Family Court proceedings, the apparent freezing of the partnership's bank account, and the lack of imminent threat to the remaining assets.

The court declined the application to appoint an interim receiver at this stage but reserved leave to the applicant to re-apply if circumstances warrant it. The court also ordered a telephone conference to ascertain whether a statement of defence is intended to be filed and to make further necessary directions. Costs were reserved.

This case highlights the importance of understanding the jurisdiction of Associate Judges in appointing interim receivers and the court's inherent jurisdiction in protecting partnership assets. It also demonstrates the court's cautious approach in granting such appointments, considering the specific circumstances of each case and the potential impact on the parties involved.

Orders