Sayes v Sayes

[2014] NZHC 936

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

CIV-2009-404-5931 [2014] NZHC 936

BETWEEN

MAURINE DOROTHY SAYES

Plaintiff

AND

SHELLEY ANN SAYES and SAYES FAMILY TRUSTEE COMPANY LIMITED

First Defendants

MICHAEL WENTWORTH SAYES Second Defendant

CIV-2007-404-516

BETWEEN  GERRARD WENTWORTH SAYES Plaintiff

ANDPRUDENCE JANE TAMATEKAPUA First Defendant

SHELLEY ANN SAYES Second Defendant

JULIE BELLE GREER Third Defendant

KENSINGTON SWAN Fourth Defendant

WALTERS WILLIAMS & CO Fifth Defendant

KENNETH JOHN CROSSON and JOHN BEVAN

Sixth Defendants

NIGEL GREER and MATTHEW CARSON

Seventh Defendants

COLIN JAMES WRIGHT Eighth Defendant

SAYES v SAYES [2014] NZHC 936 [13 May 2014]

MICHAEL WENTWORTH SAYES Ninth Defendant

SAYES FAMILY TRUSTEE COMPANY LIMITED

Tenth Defendant

Hearing:

On the papers

Appearances:

G M Illingworth QC and H M McKee for trustees
S Barter for Gerrard Sayes
No appearance for Michael Sayes

C J Lucas for Shelley Sayes (in her personal capacity) No appearance for remaining parties

H Sumich for Maurine Sayes

Judgment:

13 May 2014

[SUPPLEMENTARY] JUDGMENT OF LANG J

This judgment was delivered by me on 13 May 2014 at 2 pm, pursuant to Rule 11.5 of the High Court Rules.

Registrar/Deputy Registrar

Date……………

[1]      Following  delivery  of  my  judgment  on  8 April  2014,1   the  Registry  has received memoranda from Mr Michael Sayes dated 17, 22 and 28 April 2014. Mr Sayes has asked the Court to deal with several issues that he says he raised in memoranda filed prior to the hearing on 8 April 2014, but were not dealt with in the judgment that I delivered on that date.   Counsel for the trustees has filed memoranda in response dated 22 April and 8 May 2014.

[2]      Strictly speaking, the hearing was held to determine the application by the trustees for final directions in relation to distribution of the assets to the children of the late Peggy and Beau Sayes.  It can therefore be argued that issues falling outside the application for directions were not formally before the Court.  In my judgment, however, I endeavoured to deal with all outstanding issues, including those that Michael had raised in memoranda filed prior to the hearing.   I took that approach because I considered it important that finality be reached in this long-running litigation.  For that reason, I am now prepared to deal with the matters Michael raises in his memoranda to the extent that they have not already been dealt with in earlier judgments.

Provision of settlement statement or tax invoice in respect of Holdens Road property

[3]      Mr Sayes seeks a direction requiring the trustees to provide him with a tax invoice, or settlement statement, in respect of the transfer of the Holdens Road property to him.

[4]      A tax invoice would normally be provided by a vendor to a purchaser when property is sold and the vendor is registered for GST under the Goods and Services Tax Act 1995.  As I understand the present position, however, the entity that owns the Holdens Road property is no longer registered for GST.  For that reason alone there is no need for a tax invoice to be issued in respect of the distribution of the property to Michael.

[5]      In addition, the transfer of the Holdens Road property to Michael is not a sale of that property .  Rather, it is a distribution that is to be made in accordance with

1      Sayes v Sayes [2014] NZHC 720.

directions given by the Court in relation to the agreement that the Sayes siblings have reached.  For that reason, even if the present owner was registered for GST, I very much doubt that a tax invoice would be required in respect of the transfer.

[6]      A settlement statement is generally issued by the vendor when a property is to be transferred to a purchaser.  The purpose of a settlement statement is to apportion outgoings payable in respect of the property as at the date of the transfer.

[7]      My understanding in the present case, however, is that any outgoings payable in respect of the Holdens Road property up until the date of distribution will be debited  against  the  amount  ultimately payable  to  Michael  in  terms  of  the final distribution.  The apportionment of those outgoings will appear in the statement that the trustees provide to the beneficiaries after they have made the final distribution.  I therefore see no need for the trustees to provide Mr Michael Sayes with a settlement statement apportioning outgoings up until the date of transfer.

[8]      Finally, I record that the value to be ascribed to the Holdens Road property for distribution purposes (excluding any adjustment for outgoings) has been finally determined by earlier judgments of the Court.  I do not propose to re-visit that issue.

GST payable in respect of the trees on the Holdens Road property

[9]      Mr Sayes seeks an order requiring each of his siblings to preserve the sum of

$225,000 in the trust account of the trustees’ solicitors until 2030. This is to preserve the position in respect of any future GST liability that may be found to exist in respect of the trees growing on the Holdens Road property.

[10]     Counsel for the trustees points out that the trustees sought professional advice in relation to this issue.  As recorded at [32] in the judgment dated 8 April 2014, the trustees have paid the GST payable in accordance with that advice.   Mr Sayes disputes the reliability of that advice, because he says  that the trustees did not provide the accountants who gave the advice the correct facts.

[11]     At this stage I am not prepared to make the order that Mr Sayes seeks.   I

direct, however, that counsel for the trustees is to provide the accountant from whom

the trustees obtained advice regarding GST with a copy of Mr Sayes’ memorandum dated 28 April 2014.   They are also to seek confirmation from that person that nothing in Mr Sayes’ memorandum alters the advice that he or she has previously given  regarding  the GST payable in  relation  to  the trees  on  the Holdens  Road property.

Interest on payments to grandchildren for remainder interest on 74 Lucerne

Road

[12]     Mr Sayes contends that the grandchildren should receive interest in respect of the payments that they received when Shelley Sayes purchased their remainder interests in the property situated at 74 Lucerne Road.

[13]     Two points can be made in response.  First, virtually all of the grandchildren have now reached the age of majority. Mr Sayes has no right to speak or act on their behalf.  Secondly, none of the grandchildren has made a claim for interest.

[14]     More importantly, the trustees did not originally have the power to sell the grandchildrens’ remainder interests to Shelley.   They were given that right in the judgment that I delivered on 21 November 2008.2    I did not, however, direct that a sale had to occur or, if it did, when it should take place.   Whether or not a sale proceeded ultimately depended upon whether Shelley wished to continue with the purchase.  She was under no obligation to buy out the remainder interests.  She could

have continued living in the property until the date of her death.   In those circumstances it is difficult to see why the grandchildren should be entitled to the payment of interest in respect of sums that they would otherwise potentially have had to wait years to receive.

[15]     Moreover, for reasons that should be obvious given the observations I have just made, I did not direct Shelley or the trustees to pay interest to the grandchildren in respect of the sums that they were to receive for their remainder interests.  For that reason it is not now open to the grandchildren to seek interest in respect of those

sums.

2      Sayes v Tametekapua HC Auckland CIV 2009 404 5931 21 November 2008 at [33].

The manner in which funds are to be held on behalf of Mr Sayes’ children who

are still minors

[16]     Mr Sayes has raised an issue in relation to the manner in which monies should be held on behalf of his two children who are still minors.  He contends that the funds payable to them should be paid into a solicitors trust account, and retained on interest earning deposit or otherwise invested until the children reach the age of majority.

[17]     This is a new issue, and Mr Sayes should deal directly with the trustees in relation to it.  It should be capable of resolution without further resort to the Court.

Outgoings in respect of 74 Lucerne Road

[18]     Mr Sayes raises an issue as to whether the trustees have correctly debited

Shelley Sayes with the outgoings payable in respect of 74 Lucerne Road since 19

November 2008.

[19]     Counsel for the trustees has confirmed that, as the distribution spreadsheet shows, the outgoings paid by the trustees in relation to 74  Lucerne Road have already  been  apportioned  to  Shelley  Sayes  from  19  December  2008.    Those payments will be deducted from her share of the assets.  There is therefore no need

for any further direction in relation to this issue.

Lang J

Solicitors: Glaister Ennor Barter & Co Ltd

Andrew Seton Law Ltd

Sellar Bone & Partners
Counsel:

G M Illingworth QC

H Sumich

Copy to: M Sayes