Roberts v Mauga

[2024] NZHC 3047

IN THE HIGH COURT OF NEW ZEALAND ROTORUA REGISTRY

I TE KŌTI MATUA O AOTEAROA

TE ROTORUA-NUI-A-KAHUMATAMOMOE ROHE

CIV-2024-463-126

[2024] NZHC 3047

BETWEEN

MOEWAI ROBERTS

Plaintiff

AND

MARAMOA MAUTIKI MARGARET- ANNE MAUGA

First Defendant

MICHAEL KAHU WILSON

Second Defendant

Hearing:	On the papers
Appearances:	Tim Conder/Jayden McNeil for the Plaintiff
Judgment:	18 October 2024

JUDGMENT OF ASSOCIATE JUDGE C B TAYLOR

[Application for leave under r 19.5 of the High Court Rules 2016]

This judgment was delivered by me on 18 October 2024 at 3:00pm

pursuant to Rule 11.5 of the High Court Rules

…………………………. Registrar/Deputy Registrar

Solicitors:

Holland Beckett (Tim Conder/Jayden McNeil), Tauranga, for the Plaintiff

ROBERTS v MAUGA [2024] NZHC 3047 [18 October 2024]

Introduction

[1]        The applicant, Ms Moewai Roberts, has applied by without notice interlocutory application dated 2 October 2024 for leave to commence a proceeding by originating application. The application seeks an order permitting the proceeding, being a proceeding not mentioned in rr 19.2 to 19.4 of the High Court Rules 2016, to be commenced by originating application pursuant to r 19.5.

Background

[2]        The proposed originating application is for orders under ss 339 and 343 of the Property Law Act 2007 (the PLA), being a proceeding not specifically provided for in r 19.2.

[3]        The applicant is the owner of a half share in a property located at 8 Matahi Valley Road, Waimana, being an estate in fee simple contained in record of title 316284 (the Property).

[4]        The respondents are executors and trustees of the estate of Celia Kahu Wilson Tutauha (the deceased). The deceased remains the registered owner of the other half share of the Property, despite passing away on 2 October 2009. Probate in the deceased’s estate was not granted until 19 October 2023 and the deceased’s share in the Property has not been transmitted to the respondents as executors, nor distributed to the named beneficiaries.

[5]        The Property is land only and is currently leased to the neighbouring property which operates as a dairy unit and uses the Property for grazing (the Lease). The Lease expired in 2007 but the tenant has continued to occupy the Property. The applicant has not been able to re-negotiate the lease terms or enter into a new lease as the respondents refuse to engage with the applicant and the lease rental remains at

$7,000 plus GST per annum (the current rental). All outgoings are deducted from the current rental before payment to the applicant and the respondents. A current market appraisal of the Property as annexed to the affidavit of Phillip Mervyn Berry

dated 20 August 2024 indicated the rental returns on the Property should be in the range of $36,000 to $48,000 per annum, and the Property has an indicative sale price of $1.729 million to $1,975 million.

[6]        The applicant says that the current rental of the Property is severely undervalued and that she is unable to unilaterally cancel the Lease as the respondents refuse to engage in contact or negotiation.

[7]        The applicant is elderly and wishes for the Property to be sold to release capital from the Property for her assistance with her expenses and future care. The applicant says such an order would mean the applicant no longer carries the burden of rising rates, insurance and other outgoings attributable to the Property.

[8]        Despite many attempts which the applicant has made through engaging a number of solicitors since her late husband’s death, no resolution has been reached with the respondents, and the parties are in deadlock and without the consent of the respondents the applicant cannot sell the Property or terminate the Lease under the PLA.

Grounds for the application

[9]        By way of originating application, the applicant is seeking an order for sale of the Property and distribution of the proceeds of sale. The grounds on which the application for leave to commence the proceedings by originating application pursuant to r 19.5 is made are:

(a)the proposed originating application will be made on notice to the respondents;

(b)pursuant to s 341 of the PLA, an application for an order for sale and division of the proceeds may be made by a co-owner of the subject property;

(c)the application for an order for sale and division of the proceeds among co-owners, pursuant to s 339 of the PLA, is a straightforward

application. The statutory tests  and considerations  are prescribed by s 342 of the PLA;

(d)the considerations the Court is required to take into account in determining the proposed originating application are stipulated by s 342 of the PLA and all evidence relevant to those considerations can be efficiently addressed by affidavit evidence (with all relevant documents being exhibited);

(e)the issues to be determined between the parties as co-owners of the Property are clearly defined;

(f)the dispute between the parties does not involve wide-ranging factual issues and does not require particularised pleadings, interlocutory applications, or discovery before proceeding to a hearing;

(g)the Court will not be required to determine substantive rights and/or the application of common law doctrine and principles.

Legal principles

[10]Rule 19.5 of the High Court Rules 2016 provides as follows:

19.5 Court may permit proceeding to be commenced by originating application

(1)The court may, in the interests of justice, permit any proceeding not mentioned in rules 19.2 to 19.4 to be commenced by originating application.

(2)The court’s permission may be sought without notice.

(3)The proposed application must be filed with an application for permission under this rule.

[11]      The originating application procedure, in contrast to standard proceedings, provides a short and streamlined civil litigation procedure.1 It is a “genuine exception” to the standard procedure and is an expedient in cases where there is, in reality, no

1      Hong Kong and Shanghai Banking Corp v Erceg (2010) 20 PRNZ 652 (HC) at [20].

opposing party. The procedure is not intended routinely to be used where there is another party with contrary interests.2 As well, where the proposed proceeding does not fall into one of the categories prescribed in r 19.2, the originating application procedure is strictly exceptional.3

[12]      Rule 19.5 provides that a court may, in the interests of justice, permit any proceeding not mentioned in rr 19.2 to 19.4, to be commenced by originating application. The “interests of justice” entails securing the just, speedy and inexpensive determination of the proceeding.4

[13]      A primary indicator for whether a proceeding is amenable to the originating application procedure is whether the issue or issues the subject of that proceeding are “predetermined or obvious under the relevant statute or other rule of law, or whether the issues need to be defined by an exchange of pleadings”. As well, cases where there are likely to be underlying factual disputes are often ill-suited to the originating application procedure.5

[14]      The leading authorities in relation to r 19.5 are Hong Kong and Shanghai Banking Corp Ltd v Erceg6 and Solar Bright Ltd v Martin.7 A useful statement of the Court’s approach to leave applications is the statement of Asher J:8

… the type of proceeding suited to the originating application procedure is a straightforward application, not requiring detailed pleadings or interlocutory orders for its fair resolution. Such a type of proceeding tends to be an application under a specific statutory provision, where the issue that arises can be clearly defined, and the issues confined. The procedure is not well suited to the determination of substantive rights involving the application of common law doctrines as distinct from statutory tests. It is not well suited to cases involving multiple parties, and cases where there is the possibility of cross- claims or counterclaims.

2      Jones v H W Broe Ltd (1989) 5 PRNZ 206 (HC) at 207; and Re Hollinshead [2020] NZHC 2119 at [11].

3      Lung v Liu [2021] NZHC 1810 at [9].

4      See young v Young [2020] NZHC 2569 at [12]; and Solar Bright Ltd v Martin [2019] NZHC 300, at [18] to [26]. This is also the overriding objective of the High Court Rules 2016: see r 1.2.

5      100 Investments Ltd v Walker [2020[ NZHC 1947 at [11].

6      Hong Kong and Shanghai Banking Corp v Erceg (2010) 20 PRNZ 652 (HC), at [25].

7      Solar Bright Ltd v Martin [2019] NZHC 300, at [18].

8 Above, n 6 at [25].

[15]Section 339 of the PLA provides:

339     Court may order division of property

(1)A court may make, in respect of property owned by co-owners, an order –

(a)for the sale of the property and the division of the proceeds among the co-owners; or

…

(2)An order under subsection (1) (and any related order under subsection (4)) may be made –

(c)only on an application made and served in the manner required by or under section 341; and

(d)only after having regard  to  the  matters  specified  in section 342.

…

(4)A court making an order under subsection (1) may, in addition, make a further order specified in section 343.

[16]Section 342 of the PLA provides:

342     Relevant considerations

(1)A court considering whether to make an order under section 339(1) (and any related order under section 339(4)) must have regard to the following:

(a)the extent of the share in the property of any co-owner by whom, or in respect of whose estate or interest, the application for the order is made;

(b)the nature and location of the property;

(c)the number of other co-owners and the extent of their shares;

(d)the hardship that would be caused to the applicant by the refusal of the order, in comparison with the hardship that would be caused to any other person by the making of the order;

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

(f)any other matters the court considers relevant.

Result

[17]      I am of the view the application by the applicant for leave under r 19.5 should be granted for the following reasons:

(a)the proceeding under s 339 of the PLA deals with the application of a statutory test, and is therefore a narrowly defined proceeding;

(b)pleadings in relation to the originating application are defined and it is unlikely that there will be a need for more detailed pleadings;

(c)there is no need to join other parties, and it is unlikely discovery orders will be necessary;

(d)the proceedings are amenable to being heard on affidavit evidence;

(e)the situation of the applicant, who is currently paying rates and insurance and other outgoings on the Property and is receiving a rental considerably under the current market rental of the Property, dictates that in the interests of justice there should be a speedy and inexpensive resolution of the dispute, and the originating application procedure is appropriate for that reason. The proceeds from the sale of the Property are required for her expenses and future care;

(f)the applicant has tried over many years, and engaged a number of solicitors, to endeavour to reach a resolution with the respondents but the respondents have refused to engage and consequently the parties are deadlocked. She has no ability to cancel to re-negotiate the Lease on her own and the interests of justice indicate that this matter should be resolved as quickly and as inexpensively as possible.

Orders

[18]I make the following orders:

(a)The application for leave to commence this proceeding by originating application under Part 19 of the High Court Rules 2016 is granted.

(b)Costs are reserved.

…………………………….. Associate Judge Taylor