Soroka v Meredith - [2023] NZHC 2510

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

I TE KŌTI MATUA O AOTEAROA TĀMAKI MAKAURAU ROHE

CIV-2021-404-001316

[2023] NZHC 2510

BETWEEN
GLENN MICHAEL SOROKA and FLYING

CROSS TRUST LIMITED as trustees of the FLYING CROSS TRUST
Applicants

AND

LOUISE CLARE MEREDITH

Respondent

Hearing: 6 September 2023

Appearances:

G Soroka in Person

A A Wooding for Respondent
K W Fulton for Liquidators of Flying Cross Trust Ltd (in liq)

Judgment:

7 September 2023

JUDGMENT OF VENNING J

Interlocutory applications to vary orders and for declarations

This judgment was delivered by me on 7 September 2023 at 3.30 pm, pursuant to Rule 11.5 of the High Court Rules.

Registrar/Deputy Registrar

Date……………

Solicitors: McVeagh Fleming, Albany, Auckland
Craig Griffin Lord, Auckland (C L Waugh)

Counsel: K W Fulton, Auckland
Copy to: Applicants

SOROKA v MEREDITH [2023] NZHC 2510 [7 September 2023]

Introduction

[1] This proceeding was commenced on 16 July 2021 as an originating application by Glenn Soroka and Flying Cross Trust Limited (FCTL) for removal of a notice of claim registered by the respondent Louise Meredith over land at 58 Old Barn Road, RD4, Papakura (the property).

[2] The proceeding was resolved by a Tomlin order made by Powell J on 2 August 2021. The Tomlin order attached a settlement agreement between Mr Soroka and FCTL as trustees of the Flying Cross Trust (FCT), Peter Raymond Kerr and Glenn Soroka as trustees of the Pakau Trust and the Pakau 1 Trust (Pakau Trusts), Mr Soroka personally and Ms Meredith. It also attached a freezing order which was subsequently amended by consent on 16 August 2021.

[3] The Tomlin order and settlement agreement contemplated that the property would be used as security to facilitate Mr Soroka and FCT borrowing the money for a project Mr Soroka was involved in, in Italy at the time, that FCT would advance and fund the procurement of a code compliance certificate (CCC) for the property, and use best endeavours to achieve that by 1 November 2021, and that the property would be sold with an agreed schedule of payments being made, including repayment of the borrowing (if no moneys remained owing a payment to Mr Soroka) and distributions to Ms Meredith.

[4] Unfortunately the resolution and imminent sale of the property contemplated by the Tomlin order has not come to pass. There have been a number of developments. The most significant are:

(a)FCTL was placed in liquidation on 15 July 2022; and

(b)the current mortgagee is now intending to proceed to a mortgagee sale of the property.1

[5]The Tomlin order included a provision that:

1 A Property Law Act notice expired on 31 January 2023 and the mortgagee has issued a s 122 notice.

2For that purpose of the first order, [carrying the terms of the agreement into effect] the parties have permission to apply without the need to issue fresh proceedings on one working day’s notice.

Background to these applications

[6] In reliance on that clause, on 18 August 2023 Mr Soroka personally…

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 Soroka v Meredith

Details

AGLC: Soroka v Meredith [2023] NZHC 2510
Case: [2023] NZHC 2510
Decision Date: 7 September 2023

CaseChat Overview and Summary

Glenn Michael Soroka and Flying Cross Trust Limited, as trustees of the Flying Cross Trust, filed an originating application against Louise Clare Meredith to remove a notice of claim registered over land at 58 Old Barn Road, RD4, Papakura. This was resolved by a Tomlin order made by Powell J on 2 August 2021. The Tomlin order attached a settlement agreement and a freezing order. However, the resolution and sale of the property have not occurred as anticipated. The most significant developments are that Flying Cross Trust Limited was placed in liquidation on 15 July 2022 and the current mortgagee intends to proceed with a mortgagee sale of the property.

Soroka filed an application seeking a variation to the Tomlin order and freezing order dated 2 August 2021, and a declaratory judgment. The application sought a variation to the Tomlin order to appoint a new corporate trustee due to the liquidation of Flying Cross Trust Limited, to enable refinancing of the property to avert an imminent mortgagee sale, and to borrow an additional $120,000 to prepare the property for sale. The application also sought declarations regarding the effect of the liquidation on the trusteeship, the removal of a trustee, and the liquidator's ability to claim costs "qua trustee."

The liquidators opposed the application, arguing that the declarations sought are procedurally flawed and that the application fails to address the rights of Flying Cross Trust Limited, its creditors, and the costs and expenses of the liquidation. Meredith opposed the variation of the Tomlin order, arguing that Soroka is not a party to the original proceedings and that there are no reasonable grounds to vary the order.

The court found that Soroka did not have standing to apply to vary the Tomlin order as he was not a party to the original proceedings. The court also found that the application to vary the Tomlin order went beyond the implementation of the original settlement agreement and dismissed the application. The court further found that the declarations sought should be brought by originating processes, not interlocutory applications, and dismissed the declaratory judgment application. The court ordered that the liquidators and Meredith are entitled to costs on a 2B basis.

In conclusion, the court dismissed both the application to vary the Tomlin order and the declaratory judgment application, and ordered costs in favour of the liquidators and Meredith. The court found that Soroka did not have standing to apply to vary the Tomlin order and that the application went beyond the implementation of the original settlement agreement. The court also found that the declarations sought should be brought by originating processes, not interlocutory applications. The court ordered that the liquidators and Meredith are entitled to costs on a 2B basis.

Orders