Rosamund v Ferdinand - [2023] NZHC 2329

ORDER OF THE COURT PROHIBITING PUBLICATION OR DISCLOSURE OR REPORTING OF THE MATTERS REFERRED TO. THE REDACTED PARTS OF PARAGRAPHS [4], [5], [7], [8], [12], [14], [22], [28], [29] AND [31] ARE PERMANENTLY SUPPRESSED.

IN THE HIGH COURT OF NEW ZEALAND CHRISTCHURCH REGISTRY

I TE KŌTI MATUA O AOTEAROA ŌTAUTAHI ROHE

CIV-2022-409-563

[2023] NZHC 2329

UNDER the Property (Relationships) Act 1976

BETWEEN

[ROSAMUND]

Applicant

AND

[FERDINAND]

Respondent

Hearing: 9 August 2023

Appearances:

M J Radich for Applicant

M K Prendergast for Respondent B R D Burke for non-party

Judgment:

25 August 2023

Reissued:

27 September 2023

JUDGMENT OF ASSOCIATE JUDGE LESTER [REDACTED COPY]

This Judgment has been re-issued under the Slip Rule to anonymise the names of the applicant and respondent throughout.

[ROSAMUND] v [FERDINAND] [2023] NZHC 2329 [25 August 2023]

[1] The applicant [Rosamund], and the respondent [Ferdinand], are wife and husband. While they separated in July 2021, their marriage has not yet been dissolved.

[2] [Rosamund] commenced proceedings in the Family Court under the Property (Relationships) Act 1976 (the Act). That proceeding was transferred to this Court at the end of 2022.

[3] [Rosamund] alleges that [Ferdinand] has legal interests in 18 companies and that those interests are prima facie relationship property. [Rosamund] says those interests were acquired by [Ferdinand] during their marriage. The 18 companies own land and carry debt for which [Ferdinand] has provided personal guarantees. [Rosamund] says that from the commencement of these proceedings in the Family Court she has endeavoured to obtain financial information about the companies which [Ferdinand] has refused to provide.

[4] [Ferdinand] says any interest he has in the companies is held by him on trust for a third party, [X redacted]. [Ferdinand] was, in respect of each of the 18 companies, a director of and the sole shareholder either personally, or via a company of which he is the sole shareholder.

[Rosamund]’s discovery application against [Ferdinand]

[5] [Rosamund] has applied for orders requiring [Ferdinand] to produce financial and other information relating to the companies and for non-party discovery against [X redacted] to obtain what will be substantially the same information.

[6] [Ferdinand] says he has fulfilled his obligations under the standard discovery order that has been made and asserts the documents [Rosamund] seeks are not relevant.

[7] I do not agree. The statement of claim alleges that [Ferdinand]’s shares in the companies are subject to equal division under the Act. There is a pleading that the shares, having been acquired during [Rosamund] and [Ferdinand]’s marriage, are relationship property. That is denied by [Ferdinand] who asserts the shares are held on trust for [X redacted].

[8] Mr Prendergast, counsel for [Ferdinand], submits [Ferdinand] admits the shareholdings are held by him but denies that any interest in the companies is relationship property or indeed his separate property; the shareholdings held on trust for [X redacted]. Mr Prendergast submits that [Ferdinand] has provided evidence of [Ferdinand]’s status as bare trustee, which has not been refuted.

[9] Mr Prendergast submits there is…

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.

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Details

Case: [2023] NZHC 2329
Decision Date: 25 August 2023

CaseChat Overview and Summary

The case of Rosamund v Ferdinand involves a dispute between the parties regarding the division of property under the Property (Relationships) Act 1976. Rosamund has alleged that Ferdinand holds legal interests in 18 companies which were acquired during their marriage, and therefore constitute relationship property. Rosamund has sought discovery of financial and other information relating to these companies. Ferdinand, on the other hand, claims that any interests he has in the companies are held on trust for a third party. This matter came before the High Court of New Zealand, Christchurch Registry, for determination of the legal issues at hand.

The primary legal issues before the Court were whether Rosamund was entitled to discovery of the financial information concerning the companies from Ferdinand, and whether Ferdinand was permitted to bring a counterclaim against Rosamund's co-trustee out of time. The Court considered the obligations of the parties under the High Court Rules 2016 and the Property (Relationships) Act 1976. It also examined the capacity in which Ferdinand held the documents and the relevance of this to his discovery obligations.

The Court held that Ferdinand was required to provide the discovery sought by Rosamund, as it was relevant to the issues in the proceeding. The Court rejected Ferdinand's argument that he had no discovery obligations because he held the shares on trust for a third party. The Court emphasised that discovery is driven by what is relevant to the matters in issue, as determined by the pleadings. Furthermore, the Court found that Ferdinand's capacity in which he held the documents was not relevant to whether he was obliged to disclose them. The Court also granted Ferdinand leave to bring a counterclaim against Rosamund's co-trustee out of time, subject to an extension of time under the relevant rule.

The Court made orders for Ferdinand to provide the discovery sought by Rosamund, with specific timelines for the production of the documents. The Court also granted Ferdinand leave to bring a counterclaim against Rosamund's co-trustee, with the co-trustee becoming a party to the proceeding. The non-party discovery application was adjourned pending the outcome of the discovery from Ferdinand. Costs on both applications were reserved for further determination.

In summary, the Court ruled in favour of Rosamund on the discovery issue and permitted Ferdinand to bring a counterclaim out of time, subject to certain conditions. The Court's decision highlights the importance of considering the relevance of documents to the issues in a proceeding when determining discovery obligations, and the need for parties to comply with the rules governing the filing of counterclaims.

Orders