Sparks v St Heliers Capital Limited
[2020] NZHC 486
•11 March 2020
IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY
I TE KŌTI MATUA O AOTEAROA TĀMAKI MAKAURAU ROHE
CIV-2019-404-001507
[2020] NZHC 486
UNDER the Property (Relationships) Act 1976 IN THE MATTER
of an application to commence proceedings against a company in liquidation and an application for second notice of claim to be registered
BETWEEN
SARAH PATRICIA SPARKS
Applicant
AND
OLLIVER TRUSTEE COMPANY
LIMITED (In Liquidation) Respondent
BANK OF NEW ZEALAND
Intervenor
CIV-2019-404-002232 UNDER
the Property (Relationships) Act 1976 and the Land Transfer Act 2017
BETWEEN
SARAH PATRICIA SPARKS
Plaintiff
AND
ST HELIERS CAPITAL LIMITED
Defendant
Hearing: 10 February 2020 Appearances:
S Sparks, Applicant in Person
No appearance for or on behalf of Olliver Trustee Company Ltd (In Liquidation)
P J K Spring and J E A B Morton for St Heliers Capital Ltd F B Barton for Bank of New Zealand
Judgment:
11 March 2020
SARAH PATRICIA SPARKS v OLLIVER TRUSTEE COMPANY LIMITED (In Liquidation) [2020] NZHC 486 [11 March 2020]
JUDGMENT OF ASSOCIATE JUDGE PAULSEN
This judgment was delivered by me on 11 March 2020 at 3.30 pm pursuant to Rule 11.5 of the High Court Rules
Registrar/Deputy Registrar Date:
Introduction
[1] These disputes concern contiguous blocks of land, together comprising approximately 28 hectares, at Paraparaumu. The registered owner of the first block known as 109 Kapiti Rd is Olliver Trustee Ltd (In Liquidation) (OTL). The registered owner of the second block known as 77 Kapiti Rd is St Heliers Capital Ltd (SHC).
[2] OTL and SHC are companies associated with Gregory Martin Olliver who was formerly married to the applicant, Sarah Patricia Sparks (Mr Olliver and Ms Sparks respectively).
[3] Ms Sparks lodged notices of claim under s 42 of the Property (Relationships) Act 1976 (PRA) over both blocks. The notice of claim against 109 Kapiti Rd has lapsed and SHC has applied to the Registrar of Land that the notice of claim over 77 Kapiti Rd lapse also.
[4]In these proceedings, Ms Sparks applies for orders:
(a)that she be allowed to lodge a second notice of claim over 109 Kapiti Rd;1 and
(b)that her notice of claim lodged over 77 Kapiti Rd not lapse.2
[5] The application in [4](a) is opposed by the Bank of New Zealand (BNZ) who has been given leave to intervene in the proceeding.
[6]The application in [4](b) is opposed by SHC.
[7] There are overlaps of fact and law in relation to the two applications but for clarity I will keep them separate and deal with each in turn.
1 Land Transfer Act 2017, s 146.
2 Section 143.
109 Kapiti Rd– CIV 2019-404-1507
Background
[8] Ms Sparks and Mr Olliver were married in 2000. They separated in 2012 and their marriage was dissolved in 2014. There has been much litigation between them or entities with which they are associated. In addition to these proceedings there is a proceeding between them in the High Court under the PRA that is part-heard.
[9] 109 Kapiti Rd is approximately 10.40 hectares of undeveloped land. OTL acquired the property in July 2013 for development and sale. Mr Olliver is a director of OTL and owns the shares in the company. OTL is the trustee of the Olliver Family Trust. The trust deed of the Olliver Family Trust is not in evidence.
[10] OTL entered into the following loan agreements with the BNZ to acquire and develop 109 Kapiti Rd:
(a)$9,550,000 revolving credit facility on 17 July 2013; and
(b)$8,170,000 revolving credit facility on 2 February 2016.
[11] BNZ’s advances are secured by a first registered mortgage. BNZ has also made advances to SHC upon security of a first registered mortgage over 77 Kapiti Rd. There are unlimited interlocking guarantees in respect of the advances to OTL and SHC. All advances are further secured by way of a General Security Agreement over the assets of both companies.
[12] OTL and SHC have defaulted on their loans. As at 21 August 2019, the balance owed by OTL in respect of the advances made to it was approximately $21,000,000. The total owed to the BNZ by both OTL and SHC was more than $40,000,000. This amount increases with penalty interest charges at the rate of around $5,000 a day.
[13] On 23 July 2015, Ms Sparks lodged a notice of claim under s 42(2) PRA over 109 Kapiti Rd.
[14] OTL went into liquidation in 2017 and the liquidator applied to the Registrar that Ms Sparks’s notice of claim lapse. Ms Sparks did not receive notice of that application. Consequently, her notice of claim lapsed on 10 January 2019. She learned of this on 18 February 2019 but did not immediately apply to the Court for permission to lodge a second notice of claim as she hoped to settle her relationship property dispute with Mr Olliver. When this did not occur, Ms Sparks applied for leave to commence proceedings against OTL3 and for permission to lodge a second notice of claim.
[15] On 5 November 2019, Associate Judge Smith made an order granting Ms Sparks leave to commence this proceeding against OTL. In the same ruling, the Judge granted the BNZ leave to intervene in the proceeding.4
[16] The liquidators of OTL took no part in the hearing and abide the decision of the Court.
The law
[17]To lodge a notice of claim under s 42 PRA a claimant must have:
(a)been married to, in a civil union with or living in a de facto relationship with the registered proprietor of the land, or a person who is entitled to, or is beneficially interested in the land; and
(b)have an unresolved claim to an interest in the land under the PRA.5
[18] A claim to such an interest is deemed to be a registerable interest for the purposes of the Land Transfer Act and notices of such claim may be lodged with the Registrar-General of Land in the prescribed form.6
3 Companies Act 1993, s 248(1)(c).
4 Sparks v Olliver Trustee Company Ltd [2019] NZHC 2877.
5 R L Fisher (ed) Fisher on Matrimonial and Relationship Property (online loose-leaf ed, LexisNexis) at [9.17].
6 Property (Relationships) Act 1976, s 42(1).
[19] A notice of claim has effect as if it were a caveat against dealings lodged pursuant to s 138 of the Land Transfer Act.7 It does not create any interest in the land. Where a notice of claim has been removed8 or has lapsed9 a second notice of claim must not be lodged by or on behalf of the same person to protect the same estate or interest except by order of the Court.10 The granting of consent to lodge a second notice of claim is an indulgence and the claimant’s claim is scrutinised carefully.11
[20] To justify the making of an order that a claimant may lodge a second notice of claim, the claimant must at least establish an arguable case necessary to sustain the interest claimed. Where the notice of claim lapsed because the claimant failed to exercise his or her rights to apply to sustain the notice of claim,12 some explanation for that failure will normally be required before the Court will exercise its discretion in the claimant’s favour. The Court may refuse its consent even if the claimant establishes an arguable case, if it is shown the continuance of registration of the notice is not reasonably required to protect the claimant’s rights under the PRA.13
Ms Sparks’s explanation for allowing the notice of claim to lapse
[21] Ms Sparks did not receive notice that application had been made that her notice of claim lapse.14 It is unclear whether a notice was not sent to her address for service, or, it was sent and not passed on to her. The BNZ does not argue the Court should refuse her application for this reason. In those circumstances, I accept Ms Sparks has provided an adequate explanation for the failure to exercise her rights under s 143 to apply for an order that her notice of claim not lapse.
7 Section 42(3).
8 Land Transfer Act 2017, s 142.
9 Section 143.
10 Section 146.
11 Cotton v Keogh [1996] 3 NZLR 1 (CA) at 9.
12 Land Transfer Act 2017, s 143(3) and (4).
13 Fisher, above n 5, at [9.28] and Neil Campbell, Campbell on Caveats (3rd ed, LexisNexis, Wellington, 2019) at [10.021d].
14 Land Transfer Act 2017, s 143(2).
The remaining issues
[22] But that does not mean Ms Sparks is entitled to an order that she may lodge a second notice of claim. She must satisfy the Court she has an arguable claim to an interest in 109 Kapiti Rd on the basis set out in her notice of claim. In addition, the BNZ argues the Court should refuse to grant Ms Sparks’s application as the order sought is not required to protect her rights under the PRA.
Does Ms Sparks have an arguable claim to an interest in 109 Kapiti Rd
[23] Ms Sparks argues she established the necessary interest when she successfully registered her notice of claim. This is incorrect. When a notice of claim is presented for registration in proper form the Registrar is obliged to enter the notice on the register. The Registrar does not have to be satisfied the claimant is entitled to lodge the notice.15 That is a matter for the Court to decide.
[24]Ms Sparks’s notice of claim describes her interest in 109 Kapiti Rd as follows:
Derivation from Registered Proprietor
Gregory Martin Olliver, as company director and shareholder of Olliver Trustee Limited, is entitled to, or beneficially interested in WN40D/130 by virtue of an unregistered agreement or other instrument or transmission, or an express or implied trust, or by virtue of some other circumstances.
Relationship Details
Under the Property (Relationships) Act 1976, an interest is claimed by virtue of the marriage with the above spouse or partner.
[25] The argument that Ms Sparks advances to an interest in 109 Kapiti Rd is not founded on her notice of claim and I deal with this below.
[26] As far as the notice of claim is concerned, Mr Olliver’s shareholding and directorship of OTL does not give him a legal or beneficial interest in 109 Kapiti Rd against which Ms Sparks may make a claim under the PRA.16
15 Section 147.
16 Pisidia Holdings Ltd v Darby [2019] NZHC 1216 at [16]; Strait Views Ltd v Hannaway (2005) 6 NZCPR 725 (HC) at [28]; Ten Pin Properties Ltd v Bowlarama (New Zealand) Ltd HC Christchurch M655/89, 18 December 1989 cited in Mahon v The Station at Waitiri Ltd [2017] NZCA 387, (2017) 18 NZCPR 760 at [35].
[27] The issue then arises whether Mr Olliver has a beneficial interest in 109 Kapiti Rd under “an unregistered agreement or other instrument or transmission, or an express or implied trust, or by virtue of some other circumstances.” OTL is the trustee of the Olliver Family Trust. The trust deed of the Olliver Family Trust is not in evidence. It has not been established that Mr Olliver is a beneficiary of the trust. It cannot be inferred that he has an interest in 109 Kapiti Rd as a beneficiary of the Olliver Family Trust. There is also no evidence from which the Court could find that OTL holds the land by way of an implied or constructive trust for Mr Olliver.17
[28] In addition, Ms Sparks presented no argument as to how it is, assuming Mr Olliver has a beneficial interest in 109 Kapiti Rd, she has any claim to an interest in the property under the PRA in circumstances where it was acquired post-separation and the purchase was funded by the BNZ.
[29] All that, however, is by-the-by because at the hearing Ms Sparks claimed an interest in 109 Kapiti Rd on an entirely different basis. She argued 109 Kapiti Rd is held upon a constructive trust for her in reliance upon Lankow v Rose.18
[30] Ms Sparks’s alternative claim to an interest in 109 Kapiti is unsound. An interest as beneficiary under a constructive trust is not the interest claimed in her notice of claim. Where a claimant lodges a notice of claim on one basis but seeks to justify it on another, the notice will generally be held to be defective.19
[31] More substantively, such a claim as Ms Sparks now makes is not an interest pursuant to the PRA as is required by s 42(1). Fisher notes:20
Thus, a party who is claiming to have an interest based, for example, on a constructive trust (rather than the Act) cannot use a s 42 notice but must resort to a caveat under the Land Transfer Act 2017. A s 42 notice that has been lodged on this basis will be removed.
17 Heazlewood v Joie de Vivre Canterbury Ltd [2015] NZCA 213, (2015) 30 FRNZ 521.
18 Lankow v Rose [1995] 1 NZLR 277.
19 Colin Adams Ltd v Baker CA178/98, 5 May 1999 at [5] and [7].
20 Fisher, above n 5, at [9.28].
[32] In Heazlewood v Joie de Vivre Canterbury Ltd, the Court of Appeal also noted a claimant’s interest in land under a constructive trust “…may sustain a caveat under the Land Transfer Act but it will not sustain notices of interest under the PRA.”21
[33] I am also satisfied Ms Sparks does not have an arguable interest in 109 Kapiti Rd under a constructive trust. Lankow v Rose is authority that in the context of domestic relationships where one party contributes in a more than minor way to the acquisition, preservation or enhancement of the property of the other the Court will give effect to the reasonable expectations of both parties. The Court does this by the imposition of a constructive trust in respect of such share or interest in the property as is necessary to recognise the parties’ expectations.22 For that reason, a Lankow v Rose constructive trust will not be found in the absence of an actual common intention as to how property is to be shared.23
[34]A claimant asserting an interest in property in reliance upon Lankow v Rose
must establish four features:24
(a)that they made direct or indirect contributions to the property in question;
(b)an expectation of an interest in the property;
(c)that such expectation is a reasonable one; and
(d)that the owner of property should reasonably expect to yield to the claimant an interest in the property.
[35] Direct financial contributions as well as indirect contributions that assist in the acquisition, improvement or maintenance of the property or its value will qualify. Provisions that help the other party acquire, improve or maintain the property or its
21 Heazlewood v Joie de Vivre Canterbury Ltd, above n 17, at [38] citing Fisher, above n 5, at [9.29]. See also Parry v Parry [2019] NZHC 2388 at [30].
22 Fisher, above n 5, at [4.32].
23 Charles Rickett “Instrumentalism in the Law of Trusts – The Disturbing Case of the Constructive Trust upon an Express Trust” (2016) 47 VUWLR 463.
24 See Lankow v Rose, above n 18 at 294.
value will also qualify.25 However, in Wakenshaw v Wakenshaw the Court of Appeal held a claimant’s contributions must be more than minor, causally related to the acquisition, preservation or enhancement of the property, and manifestly exceed any benefits that the claimant derives from the arrangement.26 Merely living together in a domestic relationship with the mutual sharing of support and affection is, on its own, insufficient, and sharing unequally in household and domestic expenditure does not generally give rise to a claim either.27
[36] There is no evidence that Ms Sparks contributed to the acquisition of 109 Kapiti Rd. It was purchased after Mr Olliver and Ms Sparks separated. The purchase was funded entirely by the BNZ. There is no evidence she has contributed to the property’s enhancement or preservation either. There is no evidence she made any other relevant contribution to the property.
[37] Ms Sparks referred to there being relevant evidence in the part-heard PRA proceeding but she did not produce any such evidence and the Court cannot be expected to look for it nor could I make any assessment of such evidence which is yet to be subject to a ruling by another Judge.
[38] Given the absence of any contribution to the property and the circumstances under which it was acquired Ms Sparks cannot reasonably expect to have any interest in 109 Kapiti Rd and OTL cannot be expected to yield one to her. Her claim to an interest in the land on this basis is not arguable.
The BNZ’s position
[39] The BNZ’s interest as registered mortgagee takes priority over and is unaffected by any interest that Ms Sparks may seek to protect with her notices of claim.28 The BNZ argues there is no equity in either 109 or 77 Kapiti Rd that might at some stage in the future be available to Ms Sparks or any creditors. There is no
25 At 295.
26 Wakenshaw v Wakenshaw [2017] NZCA 252 at [25].
27 Fisher, above n 5, at [4.33].
28 Property (Relationships) Act 1976, ss19 and 46.
practical advantage in allowing her to lodge a second notice of claim as she has no legitimate interest to protect.29
[40] Evidence was given for the BNZ by Craig John Dungey (Mr Dungey). He is an experienced banker with the BNZ since 1978 and is responsible for the administration of the loans of OTL and SHC and other entities associated with Mr Olliver.
[41] Mr Dungey described the borrowings of OTL and SHC and says the companies have defaulted on their loans. The BNZ has been considering its options regarding 77 Kapiti Rd and 109 Kapiti Rd and there are no commercially attractive options available.
[42] The BNZ commissioned valuations of both 77 Kapiti Rd and 109 Kapiti Rd in July 2018. Colliers International valued the freehold market value of the properties in an “as is” state at:
(a)77 Kapiti Rd - $7,900,000 plus GST (if any);
(b)71/109 Kapiti Rd - $4,950,000 plus GST (if any); and
(c)the properties together (if titles were amalgamated) - $10,900,000 plus GST (if any).
[43] As at 29 August 2019, the balance owing on OTL’s loans alone was approximately $21,000,000. On the valuation evidence available to it and the current loan balances the BNZ’s shortfall upon mortgagee sale would be around $16,000,000 in relation to OTL alone. A mortgagee sale of both 77 Kapiti Rd and 109 Kapiti Rd would likely result in a shortfall in the region of $25,000,000.
[44] Based on the BNZ’s estimates, if 109 Kapiti Rd was developed and sold, the shortfall in relation to OTL’s loans would be between $2,000,000 and $12,000,000.
29 200 Victoria Street Ltd v Henderson HC Auckland CIV-2010-404-3894, 30 June 2010 at [8].
[45] The estimated shortfalls are, of course, growing every day with penalty interest.
[46] The BNZ has not identified any possible scenario where there is equity remaining in the properties after the BNZ’s loans are repaid. It has also not been able to identify any assets of OTL or SHC of any value beyond the properties that might satisfy the debt.
[47] The BNZ is opposed to Ms Sparks’s application because as mortgagee it wishes to be free to take such actions as it considers appropriate based on commercial considerations to minimise its losses. A notice of claim would inhibit the ability of OTL to refinance the debt owed to the BNZ as any refinance would require conditional agreements to purchase at least part of the property post-development. This would be harder to achieve if there was a notice of claim on the title as it would prevent OTL from being able to subdivide and/or provide title to prospective purchasers. A notice of claim could therefore prevent the BNZ’s access to the assets that should be available to it as mortgagee.
[48] Ms Sparks raises several matters in response to Mr Dungey’s evidence. First, she says in previous litigation involving entities associated with her and Mr Olliver, Mr Dungey gave evidence on behalf of the BNZ that it would not recover the total outstanding under loans secured by mortgage over properties at St Heliers but when the properties were sold the BNZ was fully repaid. She argues this may be a case of history repeating itself. She also says that the BNZ’s position has not been tested by putting the properties on the open market.
[49] In the case to which Ms Sparks refers, CIT Holdings Ltd v Glover No 2 Ltd, Associate Judge Osborne refused to order the removal of caveats against St Heliers properties.30 He rejected an argument that the caveator had no legitimate interest in the properties as there was no equity in them because there was evidence that the price at which the registered owner intended to sell the properties did not represent market value.31 This included that the intended sale price of the properties was $6,000,000
30 CIT Holdings Ltd v Glover No 2 Ltd [2014] NZHC 3114.
31 At [62] – [87].
less than recent capital valuations and the sales were to interests associated with the registered owner and Mr Olliver.
[50] There is no evidence that suggests the Colliers valuations upon which the BNZ relies are unreliable. It is not enough that Ms Sparks asserts the valuations may be wrong. In circumstances where she has presented no valuation evidence of her own and there is no other reason for me to consider the Colliers valuations unreliable I accept them. The absence of other valuation evidence is particularly note-worthy when the expected shortfalls upon the sale of 77 Kapiti Rd and 109 Kapiti Rd are so large it is inconceivable the Colliers valuations are incorrect to an extent that there could be a surplus after sale.
[51] Ms Sparks says the BNZ is meddling and colluding with Mr Olliver. I see no evidence of that and accept the BNZ’s only interest is the recovery of the money it is owed. Ms Sparks relies upon a judgment of the Court of Appeal that identified a concern that the BNZ may collude with Mr Olliver.32 In fact, the Court was referring to Ms Sparks’s concern and made no finding of collusion.
[52] There are presently Planning changes affecting the properties which have been publicly notified and will become operative once appeals in respect of them have been determined. Those changes will alter the uses to which the properties may be put and are likely to result in an increase in their values. The Colliers valuations take account of the changes.
[53] Based on the evidence before me, I am completely satisfied Ms Sparks has no legitimate interest in 109 Kapiti Rd and she will not be prejudiced by the refusal of her application to lodge a second notice of claim. There is no prospect the BNZ will be paid what is owed under its mortgage upon the sale of the property whether in a developed or undeveloped state.
[54] It follows from all of the above that Ms Sparks’s application for permission to lodge a second notice of claim must fail.
32 Glover No 2 Ltd v Bank of New Zealand [2016] NZCA 182 at [49].
77 Kapiti Rd– CIV 2019-404-2232
Background
[55] 77 Kapiti Rd is approximately 17.6 hectares of undeveloped land. SHC is the registered owner of 77 Kapiti Rd. Mr Olliver is sole director of SHC. The Bankhouse Trust Ltd (Bankhouse Ltd) is the sole shareholder of SHC. Mr Olliver is the director and the sole shareholder of Bankhouse Ltd. Bankhouse Ltd is a corporate trustee for the Bankhouse Trust. The Bankhouse Trust was created by deed of trust dated 19 March 2001. Mr Olliver is the settlor of the Bankhouse Trust and is both a discretionary and a final beneficiary. On 12 September 2014, Ms Sparks was removed as a discretionary beneficiary of the trust and the spouse of Mr Olliver as at the date of final distribution was excluded as a final beneficiary.
[56] 77 Kapiti Rd was formerly owned by Kapiti Ventures Ltd. The property was heavily encumbered by several mortgages. CIT Holdings Ltd (CIT) was a company incorporated by Mr Olliver and Ms Sparks owned by the trustees of the Glover Trust. The Glover Trust was established to benefit Mr Olliver, Ms Sparks and their children. CIT paid interest on debt secured against 77 Kapiti Rd and obtained an option to purchase the property from the then first mortgagee. CIT declined to exercise the option and nominated Bankhouse Ltd to do so. Bankhouse Ltd acquired the property in October 2010 and it was immediately transferred to SHC. The purchase was funded by the BNZ at a price of approximately $6,150,000. The BNZ took a first registered mortgage over the property. In October 2014, CIT took a mortgage over the property which I understand was to secure repayment of the interest payments that had been made by it amounting to $260,000. This has been repaid. Further advances have been obtained from the BNZ and as at 30 October 2019 the amount owing to the BNZ was
$21,559,218.
[57] On 23 July 2015, Ms Sparks lodged a notice of claim over 77 Kapiti Rd. On 30 September 2019, SHC applied to the Registrar-General of Land that the notice of claim lapse. Ms Sparks received notice of this on 30 September 2019 and made her application for an order the notice of claim not lapse on 16 October 2019.
The law
[58] Before the Court will sustain Ms Sparks’s notice of claim she must show a reasonably arguable case in support of the interest she has claimed. An order for removal of the notice of claim will not be made unless it is clear the notice of claim cannot be maintained either because there was no valid ground for lodging it or because the ground upon which it was lodged no longer applies.33 The Court retains a discretion to remove the notice of claim if it is completely satisfied the removal will not prejudice the interests of Ms Sparks.34 Applications of this kind are not generally suitable for finally resolving the rights of the parties, resolving disputed questions of fact or deciding disputed questions of law. In circumstances where there is conflict between the affidavits, the Court will generally prefer the evidence of the claimant.35
Does Ms Sparks have an arguable claim to an interest in 77 Kapiti Rd?
[59]Ms Sparks’s notice of claim describes her interest in 77 Kapiti Rd as follows:
Derivation from Registered Proprietor
Gregory Martin Olliver is entitled to, or beneficially interested in WN16B/638 by virtue of an unregistered agreement or other instrument or transmission, or an express or implied trust, or by virtue of some other circumstances.
Relationship Details
Under the Property (Relationships) Act 1976, an interest is claimed by virtue of the marriage with the above spouse or partner.
[60] Mr Olliver is not and has never been the registered owner of 77 Kapiti Rd. SHC is the registered owner and the sole shareholder of SHC is Bankhouse Ltd. Although Mr Olliver is the sole shareholder of Bankhouse Ltd and a discretionary and final beneficiary of the Bankhouse Trust, he does not have a beneficial interest in the land. Any beneficial interest he has can only be in the shares of Bankhouse Ltd and not in the land.36 It was recognised by Keane J in Unkovich v Marbeck,37 where a
33 Sims v Lowe [1988] 1 NZLR 656 (CA) at 659 – 660.
34 Philpott v Noble Investments Ltd [2015] NZCA 342 at [26].
35 Bethell v Rickard [2013] NZCA 68 at [22].
36 Pisidia Holdings Ltd v Darby, above n 16.
37 Unkovich v Marbeck [2015] NZHC 742 at [24].
spouse’s interests lie only in shares of the company that owns land and not the land itself this can be fatal to the validity of a s 42 notice.
[61] Once again Ms Sparks did not present arguments based on her notice of claim. She argued that her interest in 77 Kapiti Rd was under a constructive trust. For the reasons I have already given above that is not an interest that will sustain a notice of claim under s 42(1) PRA.
[62] I am again satisfied Ms Sparks does not have an arguable case to an interest in 77 Kapiti Rd on this basis. Ms Sparks claims to have made contributions to 77 Kapiti Rd in several respects. Her evidence is contained in an affidavit of 23 January 2020 in reply to an affidavit of Mr Olliver. I set out the relevant evidence in full:
… Contributions were made directly and indirectly by the Plaintiff both in her role as spouse, Mother and funder supporting her whānau and her husband in the form of working free on entity business in the roles of Director and Trustee and advancing funds [Exhibit A] to keep him afloat and the entities afloat all during the course of the marriage which included when the Kapiti property was acquired.
Mr Olliver used the plaintiff to acquire Kapiti then disposed of her after separation. The Plaintiff was actively involved in the property acquisition and refers to documents showing her copied in on all emails regarding the security documentation and insurance and her signature is side-by-side Mr Olliver’s.
This evidence and more is well documented and before High Court in the matrimonial matter CIV-2015-404-2828 should His Honour seek to have that adduced for more visibility.
…
The Applicant’s expectation was always that she shared fairly and justly in the fruits of the marriage and Bankhouse Trust was included in that …
[63] She refers to her role as a spouse, mother and funder supporting her family and her husband working for free on entity business in the roles of director and trustee. As I noted earlier, providing domestic support will generally not qualify as a relevant contribution to the property of another. Ms Sparks was also never a director of SHC or of Bankhouse Ltd or a trustee of the Bankhouse Trust and so did not perform services in that capacity.
[64] Next, Ms Sparks refers to advancing funds to keep Mr Olliver afloat during the marriage and attaches as an exhibit an email dated 5 June 2009 which refers to legal
fees of $207,000 paid to Minter Ellison Rudd Watts. There is no other evidence the payments were made or where the funds came from and, if paid by Ms Sparks, this was prior to 77 Kapiti Rd being acquired. There is no apparent connection between them and the acquisition, maintenance or improvement of 77 Kapiti Rd.
[65] Ms Sparks says she was actively involved in the property’s acquisition and attaches emails she was copied into concerning security documentation and insurance. Being copied into emails does not amount to a contribution to the property.
[66] Ms Sparks also attaches a deed pursuant to which CIT assigned its option to purchase 77 Kapiti Rd to Bankhouse Ltd but Ms Sparks’ signature was in her capacity as a director of CIT, not on behalf of SHC or Bankhouse Ltd.
[67] Given the evidence I am unable to see that Ms Sparks made any direct or indirect contributions to 77 Kapiti Rd and find that her claim to an interest in the property based on a constructive trust is not arguable.
Exercise of the discretion
[68] For reasons I have already given in relation to 109 Kapiti Rd, even if, contrary to my findings, Ms Sparks has an arguable claim to an interest in 77 Kapiti Rd under the PRA she has no legitimate interest in maintaining her notice of claim as there is no equity in the property to protect. In the exercise of the Court’s discretion her notice of claim should be allowed to lapse on this basis also.
Result
[69] I dismiss Ms Sparks’s application for leave to lodge a second notice of claim against 109 Kapiti Rd.
[70] I dismiss Ms Sparks’s application for an order that her notice of claim against 77 Kapiti Rd not lapse. There shall be an order that notice of claim 10134192.2 lodged by Ms Sparks against Record of Title Identifier 822686 shall lapse.
[71] I reserve leave for the parties to apply for such further directions as may be required to give effect to the orders made in this judgment.
[72] Costs are reserved. If the parties cannot agree on costs I will receive submissions by way of memoranda within 21 days from SHC and BNZ. Ms Sparks will have 14 days to reply. Memoranda are to be no longer than 5 pages.
O G Paulsen Associate Judge
Solicitors:
Keegan Alexander, Auckland Anderson Lloyd, Dunedin
And to: S Sparks, Applicant
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