Thomas v Mackintosh - [2017] NZHC 2656

IN THE HIGH COURT OF NEW ZEALAND CHRISTCHURCH REGISTRY

I TE KŌTI MATUA O AOTEAROA ŌTAUTAHI ROHE

CIV-2016-409-171 [2017] NZHC 2656

IN THE MATTER of the estate of Norman Dean Thomas

IN THE MATTER

of an application for directions under ss 64 and 66 of the Trustee Act 1956

IN THE MATTER

of an application for an order for the removal of a caveat under s 145 Land Transfer Act 1955

BETWEEN

PHILIP DEAN THOMAS Applicant

AND

JOHN BOWDEN MACKINTOSH AND MATTHEW CHADLOW HALL Respondents

Hearing: 25 October 2017

Appearances:

D R Weatherley for the Applicant
C A McVeigh QC for the Respondents

Judgment:

30 October 2017

JUDGMENT OF MANDER J

[1] The applicant, Mr Philip Thomas, has appealed a decision of Heath J ordering him to purchase the first respondents’ (the trustees) share of a farm property known as Mays Block.1 Mr Thomas has applied to this Court for a stay of the judgment pending
his appeal to the Court of Appeal.

1 Mackintosh v Thomas [2016] NZHC 3141.

Background

[2] The first respondents are the professional trustees of the estate of Mr Thomas’s late father. Heath J’s decision was made in the context of a family dispute regarding the distribution of that estate. Mr Thomas has made claims against his father’s estate, and the remaining respondents are either beneficiaries under the father’s will or family members who also have claims against the estate.

[3] In order to pursue his appeal it was necessary for Mr Thomas to apply to the Court of Appeal for an extension of time to file his case on appeal. That application was granted on 24 August 2017.2 The Court’s judgment, delivered by French J, conveniently summarises the background and history to the litigation:

[3] The estate consists primarily of interests in 11 farm properties worth in total approximately $20 million. Mays Block is one of the 11 properties. Mr Thomas is the registered proprietor of one half of Mays Block and the trustees the registered proprietors of the other half. Mr Thomas has lodged a caveat against the one half interest owned by the trustees on the ground that they hold it on a constructive trust in his favour.

[4] The family has for some considerable period been endeavouring to resolve the various differences. On 20 September 2015, a Heads of Agreement was signed, whereby the parties (including Mr Thomas and the second respondents) agreed to allocate the various farm properties between them. The Heads of Agreement did not resolve all outstanding issues and negotiations continued.

[5] Meantime, the point was reached in early 2016 that the trustees urgently required access to funding in order to meet the estate's tax obligations and also pay for the ongoing costs of administering the estate. The trustees applied to the High Court for an order seeking the sale of a property or properties. With the assistance of Heath J, an interim agreement was made under which an immediate cash payment of $550,000 was made to…

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 Thomas v Mackintosh

Details

AGLC: Thomas v Mackintosh [2017] NZHC 2656
Case: [2017] NZHC 2656
Decision Date: 30 October 2017

CaseChat Overview and Summary

The case of Thomas v Mackintosh involved an application by Mr. Philip Thomas for a stay of execution of a judgment made by Heath J, which ordered him to purchase the first respondent's share of a farm property known as Mays Block. The first respondents are the professional trustees of Mr. Thomas’s late father’s estate, and the remaining respondents are either beneficiaries under the father’s will or family members who also have claims against the estate. The legal issue before the Court was whether a condition should be imposed on Mr. Thomas’s stay application requiring him to pay a further sum of $150,000 to meet the growing costs and liabilities of the estate.

The Court considered the arguments presented by both parties. Mr. Thomas argued that the overall interests of justice did not favor a further payment, and the Court of Appeal had already addressed the issue when granting an extension of time on the condition that he pay the trustees $150,000. The trustees, on the other hand, submitted that the Court had a wide discretion to impose appropriate conditions upon the grant of a stay of execution and that the exercise of that discretion should be informed by the Court’s inherent protective jurisdiction in respect of trusts and trustees.

The Court found that it was appropriate that some further contribution should be made as a condition of the stay beyond that required by the Court of Appeal in August. The accumulated liabilities had increased by some $89,000, and based on the calculation of ongoing monthly expenses of $37,000, they would grow by another $74,000 by the end of the year. In order for these rising costs to be controlled and managed pending the resolution of Mr. Thomas’s appeal, the Court considered it just that he make arrangements to provide a further contribution of $85,000.

Accordingly, the Court made an order staying execution of Heath J’s judgment of 19 December 2016 on the condition that Mr. Thomas makes payment of $85,000 to the trustees before the hearing of his appeal on 15 November 2017.

Orders