Official Assignee of Samoa v Tapusoa

[2020] NZHC 1928

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

I TE KŌTI MATUA O AOTEAROA TĀMAKI MAKAURAU ROHE

CIV-2019-404-002424

[2020] NZHC 1928

UNDER

Joint Family Homes Act 1964

BETWEEN

OFFICIAL ASIGNEE OF SAMOA

Applicant

AND

VAINUU TAPUSOA

Respondent

Hearing:	8 July 2020
Appearances:	Mansi Rathod for the Applicant No appearance for the Respondent
Judgment:	4 August 2020

JUDGMENT OF MOORE J

[On formal proof]

This judgment was delivered by me on 4 August 2020 at 12:00 pm pursuant to Rule 11.5 of the High Court Rules.

Registrar/ Deputy Registrar Date:

OFFICIAL ASIGNEE OF SAMOA v TAPUSOA [2020] NZHC 1928 [4 August 2020]

Introduction

[1]                 Mr Tapusoa, the respondent, was adjudicated bankrupt in Samoa in 2006. On 29 May 2015, the applicant, the Official Assignee of Samoa (“the Official Assignee”) was appointed to administer the respondent’s bankrupt estate.

[2]                 On 10 June 2019, Wylie J ordered that the bankruptcy proceedings be recognised as a foreign main proceeding and the applicant be recognised as the foreign representative for the purposes of the Insolvency (Cross-border) Act 2006. On that basis, the Official Assignee may administer the respondent’s property in New Zealand.

[3]                 Mr Tapusoa’s sole remaining asset is the property at 58 Ambury Road, Mangere Bridge, Auckland (“the property”). It was registered as a joint family home under the Joint Family Homes  Act  1964  (“the  Act”)  on  10  October  1975  by  Mr Tapusoa and his wife. Mrs Tapusoa has since died. Mr Tapusoa does not live at the property. He lives in Samoa. Since 2015, he has been subject to a Departure Prohibition Order which is renewed every six months. This prevents him from leaving Samoa.

[4]                 The Official Assignee seeks judgment by way of formal proof cancelling the settlement of the property as  a  joint  family  home  so  that  it  may  be  sold  and  Mr Tapusoa’s creditors repaid with the proceeds. Mr Tapusoa was served with the application and associated documents on 15 April 2020. He has not responded in any way.

[5]  In the alternative, the Official Assignee applies to direct the Registrar to mortgage or sell the property and repay creditors with the proceeds.

Application

[6]                 When a property is settled as a joint family home, the husband and wife become its legal and beneficial owners. The property is protected against creditors.1 On the death of one, the settled property becomes the property of the survivor. The

1      Joint Family Homes Act 1964, s 9(2)(d).

registration of the settlement as a joint family home may be cancelled by the Registrar in accordance with s 10 of the Act.

[7]                 Ms Rathod, on behalf of the Official Assignee, has identified two paths under s 10 that would permit cancellation in this case. The first is under s 10(1)(e) which allows cancellation of a property where:

“… neither the husband or wife resides; … or where [the property] has ceased to be used exclusively or principally as a home for the husband and wife or either of them and for such of the members of their, his, or her household (if any) as for the time being reside in the flat or dwellinghouse …”

[8]                 In Faumuina v Registrar-General of Lands, it was emphasised that the “social contract” in the Act contemplates continued residence in the settled property as a family home.2 The property is clearly no longer a family home because Mrs Tapusoa has died and Mr Tapusoa has resided in Samoa for some years. The s 10(1)(e) criteria are plainly met.

[9]                 The second option advanced by Ms Rathod is under s 10(1)(d) which permits the Court to order cancellation if a direction is given under s 16. The relevant parts of s 16 provide:

“(1) Subject to the provisions of this section, the High Court, on an application in respect of any settled property made by any creditor or assignee in bankruptcy who may benefit in consequence, and after notice has been given to the owner or owners of the settled property, may—

(a)direct the cancellation of the settlement as to any part of the settled property which is not essential in connection with the dwellinghouse or flat in which the owner or owners thereof reside and have their home:

provided that no such direction shall be given without the consent of the owner or owners of the settled property if the effect of the cancellation will be to reduce to the specified sum or less the net value of the property which remains settled as that value is determined under section 20:

(b)direct a mortgage or sale of the whole of the settled property and a distribution of the money borrowed or of the proceeds of sale in accordance with section 17 …

2      Faumuina v Registrar-General of Lands DC Wellington CIV-2008-085-327, 30 October 2008.

(2)No application to the High Court under subsection (1) shall be made, unless—

(a)the said net value of the settled property exceeds the specified sum at the date of the application; or

…”

[10]              In my view the s 16 route is inapplicable. The part of s 16 relating to cancellation (s 16(1)(a), referred to by Ms Rathod in her oral submissions) refers only to cancellation of the settlement of part of a property. Part cancellation is not contemplated by the Official Assignee. On the other hand, s 16(1)(b), which was discussed as an option by Ms Rathod in her written submissions, empowers me to direct a mortgage or sale of the whole of the settled property. That was sought by  Ms Rathod only as an alternative.

[11]              Nevertheless, the settlement of the property as a joint family home may be cancelled under s 10(1)(e).

[12]              This requires the Registrar to follow the notification process detailed at s 10(3). If the respondent has not acted to dispute this matter after 28 days,3 the Registrar shall effect cancellation by causing a memorial of cancellation to be entered in the register against the property’s title.4

Orders

[13]              I order that  the Registrar commence the notification  process  as  set  out  at  s 10(3). If there is no response from the respondent within the specified time, I direct that the Registrar effect cancellation of the settlement of the property as a joint family home.

[14]              Given there was no contradictor and the Registrar was not represented at the hearing, leave is reserved to the Official Assignee and/or the Registrar to apply for such further or other directions as may be necessary to give effect to the purpose of these orders.

3      The process for doing so is set out at Joint Family Homes Act 1964, s 10(5).

4      Section 10(6).

Costs

[15]              I award costs to the applicant against the respondent calculated on a 2B basis. The applicant may file a memorandum itemising costs and disbursements.

Moore J

Solicitors:

Craig Griffin & Lord, Auckland

Copy to:
The Respondent