Official Assignee v Harrison (bankrupt) - [2020] NZHC 1548

IN THE HIGH COURT OF NEW ZEALAND CHRISTCHURCH REGISTRY

I TE KŌTI MATUA O AOTEAROA ŌTAUTAHI ROHE

CIV-2020-409-241

[2020] NZHC 1548

UNDER the Land Transfer Act 2017

IN THE MATTER

of an application to sustain a caveat

BETWEEN

OFFICIAL ASSIGNEE, in bankruptcy of Angela Janice Harrison

Applicant

AND

ANGELA JANICE HARRISON (bankrupt)

Respondent

Hearing: 1 July 2020

Appearances:

D M W Dingwall for Applicant

Ms Harrison (bankrupt) in person respondent

Judgment:

3 July 2020

JUDGMENT OF ASSOCIATE JUDGE LESTER

This judgment was delivered by me on 3 July 2020 at 9.30am pursuant to Rule 11.5 of the High Court Rules

Registrar/Deputy Registrar 3 July 2020

OFFICIAL ASSIGNEE v HARRISON (bankrupt) [2020] NZHC 1548 [3 July 2020]

[1] This proceeding concerns an application by the Official Assignee (OA) to sustain a caveat lodged by the OA over a property of which the respondent, Ms Harrison, is the sole registered proprietor.

[2] Ms Harrison was bankrupted by order of this Court on 29 November 2016.1 The OA lodged a caveat, the subject to this application, against Ms Harrison’s property the following day. On 28 May 2020, Ms Harrison applied to lapse the caveat. Ms Harrison having taken that step; the OA brought this originating application to sustain the caveat over the property.

Basis of application to sustain

[3] The OA’s position is straightforward, being that all property belonging to Ms Harrison vested in the OA under s 101 of the Insolvency Act 2006 (the Act) upon bankruptcy. Nothing further was required to give effect to that vesting. As the property is now vested in the OA, the applicant has a caveatable interest in the property.

[4] The caveat as lodged identifies the interest claimed by the OA as arising by virtue of s 101 of the Act.

[5] Ms Harrison was adjudicated bankrupt on 29 November 2016. She has not yet completed a statement of affairs, meaning that pursuant to s 290 of the Act she is not due for automatic discharge from bankruptcy. The three years for automatic discharge does not start to run until after the filing of a statement of affairs.

1 Hrrison v Harrison [2016] NZHC 2854.

[6] Hinde McMorland & Sim Land Law in New Zealand discusses the impact of bankruptcy on a land owner’s interests under the Land Transfer Act 2017 (LTA). The authors state:2
A bankruptcy commences on the date and at the time when the debtor is adjudicated bankrupt. Section 101 of the Insolvency Act 2006 provides that on adjudication all property belonging to the bankrupt vests in the Assignee without the Assignee having to intervene or take any other step in relation to the property. Any rights of the bankrupt in the property are expressly extinguished. Nothing in the Land Transfer Act 2017 restricts the operation of sections 101-104 of the Insolvency Act 2006.

Section 101 of the Insolvency Act 2006 overrides the title of the registered owner of the land within the exception of the Land Transfer Act 2017 s 51(3)(b).

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.

Keep reading for free

Create a free CaseChat account to read Official Assignee v Harrison (bankrupt) and more:

Read every judgment in full
Ask AI and get answers linked to paragraphs
See how each paragraph was cited in later cases
Download judgments as PDF or Word

Continue with Google

One click creates your free account or signs you in.

By continuing you agree to the Terms and Privacy Policy.

Details

Case: [2020] NZHC 1548
Decision Date: 3 July 2020

CaseChat Overview and Summary

The Official Assignee (OA) applied to sustain a caveat over a property of which Ms Angela Janice Harrison, who was adjudicated bankrupt, is the sole registered proprietor. Ms Harrison had applied to lapse the caveat. The primary issue for the court was whether the OA had a caveatable interest in the property in question. The OA argued that all property belonging to Ms Harrison vested in the OA under section 101 of the Insolvency Act 2006 (Act) upon her bankruptcy. The caveat as lodged identified the interest claimed by the OA as arising by virtue of section 101 of the Act. Ms Harrison opposed the application on the basis that she had not completed a statement of affairs, meaning that she was not yet due for automatic discharge from bankruptcy. The court held that the application must be granted, as Ms Harrison was bankrupt and the effect of section 101 of the Act meant that the OA was entitled to maintain a caveat over the property. The court noted that the OA had the onus of establishing a caveatable interest and was satisfied that the effect of section 101 of the Act meant that onus had been satisfied. The court also noted that it did not have the power to review the decisions of Associate Judge Matthews and Associate Judge Osborne that led to Ms Harrison's bankruptcy, as the adjudication order was a final order. The court held that in the absence of an appeal against the adjudication order, section 61 of the Act bound Ms Harrison, the OA and the court. The court ordered that the caveat not lapse and that the Official Assignee is entitled to costs on a 2B basis together with disbursements as fixed by the Registrar.

Orders