Rerekura v TSB Bank Limited
[2020] NZHC 385
•4 March 2020
IN THE HIGH COURT OF NEW ZEALAND WELLINGTON REGISTRY
I TE KŌTI MATUA O AOTEAROA TE WHANGANUI-A-TARA ROHE
CIV-2018-443-54
[2020] NZHC 385
IN THE MATTER of the Property Law Act 2007 and an
application for an injunction under of the High Court Rules 2016
BETWEEN
HERBERT REREKURA
Applicant
AND
TSB BANK LIMITED
Respondent
Teleconference: 24 February 2020 Counsel:
B Tūpara for Plaintiff
P D McCarthy and CA Silk for Defendant
Judgment:
4 March 2020
JUDGMENT OF CLARK J
Introduction
[1] Mr Rerekura is being evicted from his home for failing to pay rates. He has applied for an interim injunction against TSB Bank Ltd. Mr Rerekura seeks to achieve what he describes as a “holding pattern” until the Waitangi Tribunal has completed its inquiry into related matters and the Court has inquired into the legality of the eviction notice.
Background
[2] Mr Rerekura has owned a residential property in Browne Street in Normanby, Taranaki (the property) since 2004. The property is owned subject to a mortgage to the respondent.
REREKURA v TSB BANK LIMITED [2020] NZHC 385 [4 March 2020]
[3] It is a term of Mr Rerekura’s mortgage that he will punctually pay all rates payable in respect of the property.
[4] Mr Rerekura refuses to pay rates in exercise of rights he claims under the Treaty of Waitangi. As at 26 February 2020 the outstanding balance is $28,514.15.
[5] In March 2017, TSB requested Mr Rerekura to remedy the default but the rates remained unpaid. TSB then took steps towards exercising its rights under the mortgage by arranging for the property to be sold by mortgagee sale. The required notices under the Property Law Act 2007 (the PLA) were served on Mr Rerekura and his partner Ms Bailey. Arrangements were made to auction the property. The High Court Registrar, through whom the auction was arranged, reported a disrupted auction at which a police presence was required.
[6] Following the unsuccessful attempt to sell the property by way of mortgagee sale, TSB applied to the High Court for a possession order under s 137 of the PLA. The application was filed in August 2018, served on Mr Rerekura and, in accordance with directions of the Court given on 5 September 2018, served on Ms Bailey. In November 2018 the High Court confirmed proper service had been effected on Mr Rerekura. The documents were couriered to Mr Rerekura on 22 November 2018. By 21 February 2019 there had been no response and TSB, in a memorandum dated 21 February 2019, sought the grant of the possession order applied for in its application filed in August 2018.
[7] An order for possession of land was made on 22 February 2019. The sealed order of the High Court is in the following terms:
Before Associate Judge Johnston (in Chambers)
After reading the Statement of Claim dated 29 August 2018; the Affidavits of John Andrew Kendall dated 14 August 2018, Allen Stuart Mazengarb dated 21 August 2018; and the memorandum of Counsel for the Plaintiff dated 21 February 2019, on the Application of Mr McCarthy, Counsel on behalf of the Plaintiff, and being satisfied that the Defendant has made no appearance after being properly served and notified about the Application, this Court orders:
1.that an Order for possession of the land described as that parcel of land containing 809m2 being Lot 146 Deposited Plan 4 and being all
the land contained within Record of Title TNB4/1379 (Taranaki Registry) and being the property situated at 44 Browne Street, Normanby, Taranaki is granted in favour of the Plaintiff as Mortgagee.
Dated this 22nd day of February 2019 [signed]
Deputy Registrar
[8] On 5 March 2019, the possession order was served on Mr Rerekura together with a notice of entry into possession of mortgaged land. The documents were accompanied by a letter from TSB giving Mr Rerekura a period of time to vacate the property. In further compliance with its obligations under s 156 of the Act TSB served a notice of the possession order on Ms Bailey and gave public notice of entry into possession of mortgaged land.
[9] By 26 March 2019, which was the deadline date given for vacation of the property, Mr Rerekura had not vacated. TSB had become aware the property may have been tenanted and, exercising its rights as mortgagee in possession, gave notice to terminate the tenancy. The notice to tenants was dated 5 April 2019.
[10] Further, in compliance with its statutory reporting obligations as a mortgagee in possession, TSB reported to Mr Rerekura (as the mortgagor) and to Ms Bailey (as the covenantor). The first report delivered on 18 April 2019 included with the particulars of debts and liabilities to be satisfied the sum of $20,990.06 in unpaid rates. A second report was delivered to Mr Rerekura and Ms Bailey on 22 October 2019.
[11] On 30 October 2019, TSB took steps to enforce the possession order by seeking a possession order under r 17.81 of the High Court Rules. On 4 November 2019 the High Court issued a possession order in the following terms:
To The Sheriff at the New Plymouth High Court.
Note: in this Possession Order, ‘liable party’ means Herbert Rerekura.
1.This Court orders that you are authorised and required to take possession for TSB Bank Limited (the entitled party) the liable party’s land which is occupied by the liable party and described as
that parcel of land containing 809m2 being Lot 146 Deposited Plan 4 and being all of the land contained within Record of Title
TNB4/1379 (Taranaki Registry) and being the property situated at
44 Browne Street, Normanby, Taranaki, ejecting others from the land as necessary.
2.This Court further orders that you are authorised to deliver possession of any land received under this Possession Order to entitled party.
Dated this 4th day of November 2019 [signed]
Registrar
[12] On 17 December 2019, the senior credit controller at TSB received confirmation that the Bailiff for Taranaki had served on Mr Rerekura a notice to vacate. The notice gave Mr Rerekura until 6 January 2020 to vacate the property.
[13] Mr Rerekura remains in possession of the property. On 23 January 2020 he filed a statement of claim, an interlocutory application for an injunction, an affidavit in support, an undertaking as to damages and a memorandum of counsel.
The application for an interim injunction
[14] The application is sparse. It does not state the order sought although it states the grounds for the interim injunction as being that Mr Rerekura “will suffer irreparable harm unless an interim order is made”.
[15] Mr Rerekura’s affidavit in support of his application offers more detail than the application itself as to the nature of the order sought. Mr Rerekura seeks:
An interim injunction order requiring [TSB] not to act on the eviction notice pending the hearing of claim [sic] to the Waitangi Tribunal and the proceedings to the Court referring to the illegality of the eviction notice.
[16] Mr Rerekura has filed an undertaking as to damages in accordance with r 7.54 of the High Court Rules 2016.
[17] For Mr Rerekura, Mr Tūpara submitted the imposition of rates on Mr Rerekura has been in dispute and remains unresolved. Consequently, Mr Rerekura has filed a claim to the Waitangi Tribunal which will be heard in 2020 being part of the first phase of The Housing Policy and Services Kaupapa Inquiry (Wai 2750). The inquiry will
address homelessness and if the possession order is enforced, Mr Rerekura will be homeless.
[18] Mr Tūpara further submitted that rates are imposed pursuant to the Local Government (Rating) Act 2002 (the Rating Act) but the Rating Act does not refer to the Treaty of Waitangi or any of its provisions. In the exercise of his sovereignty, independence and tino rangatiratanga Mr Rerekura has refused to pay the rates imposed under the Rating Act.
[19] Mr Tūpara cited the following findings of the Waitangi Tribunal which, he submitted, are applicable to Mr Rerekura’s refusal to pay rates.1
The rangatira who signed te Tiriti o Waitangi in February 1840 did not cede their sovereignty to Britain. That is, they did not cede authority to make and enforce law over their people or their territories.
The rangatira agreed to share power and authority with Britain. They agreed to the Governor having authority to control British subjects in New Zealand, and thereby keep the peace and protect Māori interests.
It was an arrangement that explicitly guaranteed rangatira their ‘tino rangatiratanga’, their independence and full chiefly authority, while seeking for the Crown the power of ‘kawanatanga’, which was essentially explained as the authority to control settlers. This was an arrangement that the rangatira were prepared to accept, and indeed welcome.
[20] Further, Mr Tūpara argued the respondent failed in its duty to Mr Rerekura in that he was not independently advised before signing mortgage documents. Mr Rerekura is up-to-date with his mortgage payments and yet TSB seeks to evict him as a consequence of unpaid rates which Mr Tūpara submitted was “astounding given the bank is not out of pocket presently as far as its mortgage is concerned.”
[21] In oral argument Mr Tūpara explained that Mr Rerekura took no steps when TSB first filed court documents in 2017 nor any steps to oppose TSB’s application for a possession order, nor after the order had been made, as Mr Rerekura does not recognise the authority of the Court.
1 The report on stage 1 of the Te Paparahi o Te Raki Inquiry, para 10.4.4, at 529.
Respondent’s position
[22] TSB opposes the interlocutory application on the grounds there is no serious question to be tried and the application is frivolous and vexatious. The notice to vacate was not unlawful. It was issued following a proper process. Nor was the notice to vacate untimely. TSB claims it has suffered loss and it contends Mr Rerekura has no reasonable prospect of success in relation to his claim in the Waitangi Tribunal. Further:
(a)The nature of Mr Rerekura’s obligations and liabilities under the mortgage were explained to him by independent legal advisors.
(b)The balance of convenience favours TSB especially as any damage caused to Mr Rerekura from the sale of the property prior to the Waitangi Tribunal issuing a determination, would be adequately addressed by compensatory damages.
(c)For these reasons, which Mr McCarthy, counsel for TSB elaborated in argument, the overall justice of the position favours TSB.
Discussion
[23] At the end of the hearing2 I inquired of counsel for TSB whether TSB would undertake not to take steps to enforce its rights pending delivery of this judgment. The undertaking was given. The analysis immediately following demonstrates that an undertaking did not need to be sought from TSB because its stance is incidental to the legal impediment to the injunctive relief Mr Rerekura seeks.
[24] The applicant’s property is subject to an order for possession made by the High Court in favour of TSB. The validity and effect of that order, requiring the Sherriff to take possession, is not in dispute. Mr Rerekura, with full and effective notice, declined to participate in the High Court process. This constitutes an informed waiver by Mr Rerekura of his right to dispute the s 137 application. Mr Rerekura’s
2 Which was by way of telephone conference.
asserted non-liability to pay rates would have been justiciable at the s 137 hearing, as would the other arguments raised now in support of an injunction.
[25] The application itself, signed by counsel, did not attempt to frame the nature of the order. It is plain from the arguments advanced in support of the application that the application is directed to TSB. But:
(a)At the time the application was made there was an extant order to the Sherriff and a notice to vacate served by a bailiff.
(b)Consequently, any interim injunction would be directed not to TSB (which was not obliged to take any further steps to obtain vacant possession) but effectively to officers of the Court acting, as they were required to act, on the order of the High Court.
(c)The High Court could issue no injunction against its officer or a bailiff acting on the direction of the High Court to prevent the enforcement of a valid (and, in this case, uncontested) order of the same Court.
(d)The object of an interim injunction is to preserve the court’s ability to give effect to the plaintiff’s legal or equitable rights at trial.3 In his statement of claim, that is Mr Rerekura’s substantive claim, an interim injunction is sought by way of relief and for the reasons which are set out above. At this juncture it may be said that, self-evidently, no such relief is available.
[26] These points are sufficient to determine the application for the interim injunction. However, because the parties each filed a memorandum of submissions and spoke to those submissions at the hearing I respond briefly to the primary points made.
3 Andrew Barker “Interim Injunctions” in Rt Hon Sir Peter Blanchard (ed) Civil Remedies in New Zealand (Thomson Reuters, Wellington, 2011) 277 at 278.
[27] Mr Rerekura protests the “untimely” eviction notice. From his point of view he was to be evicted from his papakāinga during the Christmas — new year period. The evidence shows that Mr Rerekura had a considerable period of notice. He had been aware for some time of his obligation to remedy the rates default and of the consequences of failing to do so. That was formally communicated to him in June 2017 when he was served with the required notice under the Act. And the point must have continued to be brought home over a period of some 18 months through the commencement of proceedings, the attempt to sell the property by auction, and the notification of the requirement to vacate the property.
[28] I asked Mr Tūpara during the hearing whether there had been any attempt to negotiate an arrangement with the South Taranaki District Council for the payment of the outstanding rates. Mr Tūpara said the payment of rates “remains in dispute”. He advised the Court there were ongoing exchanges of emails between Mr Rerekura and the Council but the discussions had been put on hold because the Council’s authority to levy rates was questioned in light of Mr Rerekura’s Treaty rights.
[29] I have reviewed the extensive evidence filed by the parties. An email from TSB’s solicitors to Mr Tūpara dated 12 April 2018 is relevant to any suggestion of a potential agreement with the Council. In response to Mr Rerekura’s apparent agreement in 2018 to pay the rates arrears, and to enter into an arrangement with the Council to achieve that, the TSB solicitor stated:
We had understood from your email dated 21 August 2017 (10.25am) to our firm that you had received instructions to arrange settlement of the rates arrears payable to the South Taranaki District Council.
However we understand this has in fact not occurred.
As you will be aware, the proposed mortgagee sale of the property is being undertaken through the Registrar of the High Court in Wellington pursuant to the provisions of the Property Law Act.
[30] The point is, the potential for entering into an arrangement to pay rates by instalment was considered by, and available to, Mr Rerekura some time ago but not pursued.
[31] As to Mr Rerekura’s claim in the Tribunal and its likely prospects of success, the following points are taken from a decision issued by Judge Savage of the Waitangi Tribunal on 24 January 2018:
(a)On 22 December 2017 the Tribunal received an urgent application from counsel for Mr Rerekura concerning the mortgagee sale of Mr Rerekura’s papakāinga due to the non-payment of rates.
(b)As neither the application nor supporting documents contained any details regarding the papakāinga, Mr Rerekura was directed to file the certificate of title which was received by the Tribunal in January 2018.
(c)Having noted that it is not usually desirable to comment on the ultimate merits of a case when considering urgency Judge Savage stated “… in some cases it can be highly relevant”.4
(d)It was not proper to grant urgency to a claim assessed “as having only a bleak prospect of success”. Judge Savage continued:
[11] It is of particular note in this claim that the pleadings did not disclose that:
a) the land is in fact general land;
b) there is another body, that has an interest in this land, namely TSB Bank under a mortgage registered in 2004; and
c) there is another person who has filed a notice of claim as recently as June last year under the Relationship Property Act 1976.
[12] I am somewhat dismayed that counsel acting failed to disclose these three highly relevant matters.
[13] The applicant is bound to pay rates under the Local Government (Rating) Act 2002 but must also have inevitably contractually bound himself to pay those rates in terms of the mortgage. In view of all these matters, I see little prospect of success and I decline urgency.
4 Wai 2679, #2.5.2 at [10].
[32] That said, Judge Savage was careful to note that his observation of the merits was for the purpose of the urgency application only and had no weight or influence in the ultimate hearing of the claim. Nevertheless, the Tribunal’s decision would have a bearing on the “serious question” threshold that is to be met if an interim injunction is to be granted.
Result
[33]For the foregoing reasons the application for an interim injunction is dismissed.
Karen Clark J
Solicitors:
Auld Brewer Mazengarb & McEwen, New Plymouth for Defendant
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