Shailer v Shailer - [2015] NZHC 250

IN THE HIGH COURT OF NEW ZEALAND PALMERSTON NORTH REGISTRY

CIV-2013-454-446 [2015] NZHC 250

BETWEEN
DENISE MINNIE SHAILER

Plaintiff

AND

WAYNE LAWRENCE SHAILER, DENISE MINNIE SHAILER AND CHARLES JOHN ANDREWS Defendants

Hearing: 24 October 2014

Counsel:

G Mason for the Plaintiff and second-named defendant, Denise
Minnie Shailer
J W Maassen for the first-named defendant, Wayne Lawrence
Shailer
D Shephard for the third-named defendant Charles John
Andrews

Judgment:

24 February 2015

JUDGMENT OF ASSOCIATE JUDGE SMITH

[1] Mrs Shailer applies for summary judgment on a debt owed to her by the trustees of the Shailer Family Trust (the Trust). Her husband Wayne Shailer, who with Mrs Shailer is a trustee of the Trust, opposes her application. He says that her application is in effect an application by Mrs Shailer for an interim distribution of relationship property under the Property Relationships Act 1976 (the Act), which should be dealt with in the Family Court.

Background

[2] In the course of their marriage, Mr and Mrs Shailer established and ran a family dairy farm and contracting business near Foxton. They established several trusts to operate their farming, contracting and dairying businesses. One of them
was the Trust.

DENISE MINNIE SHAILER v WAYNE LAWRENCE SHAILER, DENISE MINNIE SHAILER AND CHARLES JOHN ANDREWS [2015] NZHC 250 [24 February 2015]

[3] There were originally three trustees of the Trust. Until his resignation very shortly before the hearing of Mrs Shailer’s application, the third-named defendant Mr Andrews was also a trustee. Mr Andrews had been the Shailers’ family solicitor for a number of years, going back at least as far as the creation of the Trust in 1994.

[4] In addition to the various trusts, Mr and Mrs Shailer established a partnership, the Wayne Shailer and Denise Shailer partnership (the partnership), to operate one or more of their businesses. They were the only members of the partnership.

[5] In 2001, Mr and Mrs Shailer transferred certain land owned by them to the trustees of the Trust. The Trust funded the purchase with the assistance of loans back from Mr and Mrs Shailer, each in the sum of $500,000. Over subsequent years, the debts of $500,000 owed by the Trust to Mr and Mrs Shailer were both reduced by gifts made to the Trust by Mr and Mrs Shailer, in equal amounts.

[6] Mr and Mrs Shailer separated on 7 November 2012. At the date of their separation the Trust owed $419,000 to each of them. No repayments have since been made by the Trust, and the sums of $419,000 remain owing by the Trust to Mr and Mrs Shailer.

[7] On 28 August 2013 Mrs Shailer made demand on the defendants as trustees of the Trust for repayment of the $419,000 owed by the Trust to her. In her letter of demand, she provided a formal consent (in her capacity as trustee of the Trust) to the payment being made.

[8] Mrs Shailer noted in her letter that there were funds held to the credit of the…

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.

Continue reading Shailer v Shailer

Details

AGLC: Shailer v Shailer [2015] NZHC 250
Case: [2015] NZHC 250
Decision Date: 24 February 2015

CaseChat Overview and Summary

Denise Shailer seeks summary judgment against the trustees of the Shailer Family Trust, Wayne Shailer and Denise Shailer, and Charles John Andrews for the payment of a debt of $419,000. Wayne Shailer opposes the application, arguing that the Court does not have jurisdiction, and that even if it does, it must apply the principles of the Property (Relationships) Act 1976 and resolve the claim on the basis of the division of relationship property. He further argues that equitable set-off should be applied, and that the Court should exercise its discretion to decline to enter summary judgment.

The Court found that the application for summary judgment was not an application under the Property (Relationships) Act 1976, and that the Court had jurisdiction to hear the claim. The Court rejected the argument that it was obliged to apply the principles of the Act, finding that the claim was for the recovery of a debt, and not for a division of relationship property. The Court held that the set-off defence was not reasonably arguable, as the debts were not interdependent. Finally, the Court found that it should not exercise its discretion to decline to enter summary judgment, as the result would not be oppressive or unjust.

The Court orders that Denise Shailer is entitled to summary judgment, but leaves open the issue of the final form of the judgment, and invites the parties to provide further submissions on the issue. The Court also invites the parties to provide submissions on costs if they are unable to agree.

Orders