Official Assignee v Peachey

[2018] NZHC 1949

IN THE HIGH COURT OF NEW ZEALAND WELLINGTON REGISTRY

I TE KŌTI MATUA O AOTEAROA TE WHANGANUI-A-TARA ROHE

CIV-2018-485-428

[2018] NZHC 1949

UNDER

Sub-pt 5 of pt 6 of the Property Law Act 2007

BETWEEN

THE OFFICIAL ASSIGNEE IN BANKRUPTCY IN THE ESTATE OF MARK ESDOT

Plaintiff

AND

COLLEEN ANNE LILA PEACHEY

Defendant

Hearing:	31 July 2018
Appearances:	D Kerr for the plaintiff
Minute:	1 August 2018

JUDGMENT OF ASSOCIATE JUDGE JOHNSTON

[1]    On 5 June 2018 the plaintiff commenced this proceeding by notice of proceeding and statement of claim. The originating documentation was filed and served together with a notice of application for summary judgment and an affidavit sworn by Florestina Fagasoaia-Mead who is a deputy Official Assignee at Wellington and has responsibility for this bankrupt estate.

[2]    There is proof of service for all of the above documentation on the file. It has been served on the defendant, the Bank of New Zealand which is the mortgagee of the property and the Legal Services Commissioner who has caveated the title to the property. None of those parties have taken any step in the proceeding. In particular the defendant has not filed a notice of opposition to the plaintiff’s application for summary judgment.

THE OFFICIAL ASSIGNEE IN BANKRUPTCY IN THE ESTATE OF MARK ESDOT v PEACHEY [2018] NZHC 1949 [1 August 2018]

[3]The matter was called in the Wellington commercial list yesterday.

[4]    The defendant having taken no steps in the matter, I indicated to Mr Kerr, counsel for the plaintiff, that I would enter summary judgment by default for the plaintiff and that I would provide reasons in a written decision. I now do so.

[5]    The Official Assignee seeks orders which will enable him to sell the property at 17 Bythell Street in Wainuiomata registered in the names of the bankrupt and the defendant.

[6]    Upon Mr Esdot’s adjudication in bankruptcy in this Court on 1 December 2015 the Official Assignee of course assumed his interest in the property. The adjudication also operated to sever the joint tenancy.

[7]    The evidence is that the Official Assignee has attempted to resolve matters with Mr Esdot and the defendant but thus far to no avail. I accept that the Official Assignee now has no option but to take steps to exercise her rights.

[8]    There is ample precedent for the use of the summary judgment process contained in pt 12 of the High Court Rules to obtain orders pursuant to the Property Law Act (see McCleary  v  Prasad  and  Prasad  [2012]  NZHC  2151  per  Associate Judge Bell) and I note that the orders sought by the Official Assignee in this case are modelled on those approved in Official Assignee v Faresa (unreported), High Court, Auckland, Winkelman J, 13 February 2008.

[9]    In a memorandum filed prior to the hearing by Mr Kerr helpfully sets out the matters to which the Court must have regard before making the orders sought. These are set out in s 442 of the Property Law Act and include:

(a)the extent of the applicant’s share in the property;

(b)the nature and location of the Property;

(c)the nature of other co-owners in the extent of their shares;

(d)the hardship that would be caused to the applicant by the refusal of the application, in comparison with the hardship that would be caused to anyone else by the granting of it;

(e)the value of any contribution made by any co-owner to the cost of improvements to, or maintenance of, the Property;

(f)and any other matters the Court considers relevant.

[10]   I am satisfied that Mr Kerr is correct in submitting that all of those factors weigh heavily in favour of the orders sought, especially when the positions of the Bank of New Zealand and the Legal Services Commissioner are taken into account.

[11]   In view of the defendant’s obvious lack of interest in opposing this application I am satisfied that it is appropriate to make the orders sought by the plaintiff (which I observe include an opportunity for Mr Esdot or the defendant to raise any concerns they may have within a short period of time).

[12]I make the following orders:

(a)Orders under section 339(1)(a) and 343 of the Property Law Act 2007 that:

(i)the Property shall be sold under the control and conduct of the plaintiff;

(ii)the plaintiff shall appoint a reputable real estate agent or agents to act in respect of the sale of the Property;

(iii)in consultation with such real estate agent or agents, the plaintiff shall determine the most appropriate means of marketing and selling the Property and shall set any asking, selling or reserve prices;

(iv)the plaintiff shall be authorised to execute on the defendant’s behalf any listing agreement, agreement for sale and purchase, memorandum of transfer or other document necessary to carry out or effect the sale of the Property;

(v)pending sale the defendant shall ensure that the Property is kept in a clean, tidy and presentable condition for sale and shall make such reasonable access available for viewing as the plaintiff or her agents shall require;

(vi)within 30 days of being served with notice that an unconditional agreement for sale and purchase of the Property has been entered into, the defendant shall give up vacant possession of the Property to the plaintiff;

(vii)the proceeds of sale of the Property shall be disbursed in the following priority and manner:

1.       repayment of the amount due and owing by Mr Esdot and/or the defendant to Bank of New Zealand under its mortgage over the Property;

2.       payment of any outstanding rates or insurance premiums in respect of the Property, real estate agent’s commission or fees, valuation costs, costs of advertising or marketing, and legal fees incurred in connection with the sale of the Property;

3.       an equal division of the balance between the plaintiff and the defendant, subject to the adjustment referred to at sub-para 4 below;

4.       the costs of this proceeding plus disbursements (as sought at para (b) below) shall be deducted from the defendant’s

share of the net sale proceeds and shall be retained by the plaintiff;

(viii)the orders set out at sub-paras (i) to (vii) shall be stayed for a period of 14 days from the date of service of the Court’s orders on the defendant to enable her to make an offer to acquire the plaintiff’s interest in the Property, should she wish to do so;

(ix)the parties shall have leave to apply for further directions if necessary.

(b)The plaintiff shall be entitled to costs against the defendant on a category 2B basis, together with disbursements as fixed by the Registrar.

Associate Judge Johnston