Sutton v Bell

[2023] NZSC 65

NOTE: PURSUANT TO S 35A OF THE PROPERTY (RELATIONSHIPS) ACT 1976, ANY REPORT OF THIS PROCEEDING MUST COMPLY WITH SS 11B, 11C AND 11D OF THE FAMILY COURT ACT 1980. FOR FURTHER INFORMATION, PLEASE SEE

IN THE SUPREME COURT OF NEW ZEALAND

I TE KŌTI MANA NUI O AOTEAROA

 SC 8/2022
 [2023] NZSC 65

BETWEEN	TODD WILLIAM FRANK SUTTON First Appellant TODD WILLIAM FRANK SUTTON AND HOFFMANN TRUSTEES LIMITED AS TRUSTEES OF THE TODD SUTTON TRUST Second Appellants
AND	JOANNA ELISIA BELL Respondent

Hearing:	2 August 2022
Court:	Winkelmann CJ, Glazebrook, O’Regan, Ellen France and Kós JJ
Counsel:	J R Billington KC, L J Kearns KC, Z L Wackenier and H P Short for Appellants V A Crawshaw KC, S M Wilson and J M Gandy for Respondent
Judgment:	1 June 2023

JUDGMENT OF THE COURT

AThe appeal is dismissed.

BThe appellants must pay the respondent costs of $25,000 plus usual disbursements.

____________________________________________________________________

REASONS
(Given by O’Regan J)

Table of Contents

Para No.
Introduction	[1]
Issues	[3]
Section 44	[5]
Background	[7]
The procedural history of Ms Bell’s PRA claim	[19]
Can s 44 apply to a disposition made prior to the commencement of a de facto relationship?	[24]
High Court	[25]
Court of Appeal	[28]
Appellants’ submissions	[34]
Respondent’s submissions	[39]
Our approach	[44]
At what point does s 44 apply to a disposition made before the commencement of a de facto relationship?	[53]
High Court	[54]
Court of Appeal	[55]
Appellants’ submissions	[58]
Respondent’s submissions	[59]
Our approach	[60]
Application to the facts of this case	[72]
Was the disposition by Mr Sutton of the Auckland property to the Trustees made “in order to defeat the claim or rights” of Ms Bell?	[75]
Family Court	[76]
High Court	[80]
Court of Appeal	[82]
Appellants’ submissions	[84]
Respondent’s submissions	[88]
Our approach: Regal Castings applies	[90]
Application of Regal Castings to the facts of this case	[96]
Remedy	[98]
Relevant provisions of the PRA	[99]
Courts below	[104]
Good faith	[107]
Ringfencing and/or postponing relief	[109]
Result	[117]
Costs	[118]
Addendum	[119]

Introduction

1. The first appellant, Mr Sutton, and the respondent, Ms Bell, were in a de facto relationship for about seven and a half years and had two children together.  The relationship ended on 1 September 2012.  Just prior to the commencement of the de facto relationship, Mr Sutton transferred his residential property in an Auckland suburb (the Auckland property) to the second appellants (the Trustees).  Ms Bell argued that this transfer was a disposition of property by Mr Sutton in order to defeat her claim or rights under the Property (Relationships) Act 1976 (PRA) and this came within s 44 of the PRA.  She argued that the disposition should be set aside under s 44 and claimed a half interest in the Auckland property.  She was successful in her claim in the Family Court,[1] the High Court,[2] and the Court of Appeal.[3]

   [1]Cannon v Cox [2019] NZFC 5363, [2019] NZFLR 556 (Judge Druce) [2019 FC…