Thomas v Thomas HC Christchurch CIV-2011-409-002514

[2011] NZHC 2007

IN THE HIGH COURT OF NEW ZEALAND CHRISTCHURCH REGISTRY

CIV-2011-409-002514

UNDER  the Land Transfer Act 1952

IN THE MATTER OF     an application under s 145A of that Act for an Order that caveat be sustained

BETWEEN  PHILIP DEAN THOMAS Plaintiff

ANDNORMAN DEAN THOMAS Defendant

Hearing:         13 December 2011

Counsel:         D O Hayward for Plaintiff/Applicant

G M Brodie for Defendant/Respondent

Judgment:      14 December 2011

INTERIM JUDGMENT OF ASSOCIATE JUDGE MATTHEWS

[1]      This is an application for an Order that Caveat 8628917.1, lodged against dealings by the defendant with the land described in the caveat, not lapse.   This judgment is issued as an interim decision on the application, not a final decision. The matter was called in a List before me on Tuesday, 13 December 2011.  I have received and considered memoranda from the plaintiff and from the defendant.  I had the benefit of very brief oral argument from Mr Hayward and Mr Brodie.   I was asked for an urgent fixture to determine the application.  I am unable to allocate a fixture prior to the close of the court for the summer vacation, due to the pressure of other court business.  I reserved a decision on the application in order to have more

time to consider the evidence, memoranda, and oral submissions.

PHILIP DEAN THOMAS V NORMAN DEAN THOMAS HC CHCH CIV-2011-409-002514 14 December 2011

[2]      I record that the defendant has filed a notice of opposition but has not yet filed any evidence by way of affidavit due to pressures of time.   The timing constraints in the Land Transfer Act require urgent consideration of this application, even if only on an interim basis at this point.

[3]      Details of the caveat have been produced in evidence.   Under the heading

“Estate or Interest Claimed” the document reads:

The abovenamed caveator claims an interest in Norman Dean Thomas’s share in the land contained in the above Certificates of Title by virtue of a certain agreement dated 21st  April 1983 whereby Norman Dean Thomas agreed not to sell, assign or otherwise part with his share or interest in the land contained in the above Certificates of Titles and further granted to the caveator an option to purchase Norman Dean Thomas’s share in the land contained in the above Certificates of Titles and in the alternative the above- named caveator claims a beneficial interest in Norman Dean Thomas’s share in the land contained in the above Certificates of Title as cestui que trust of which Norman Dean Thomas is trustee and the caveator as beneficiary.

[4]      The onus of satisfying the Court that it has an arguable case to establish interest or estate in land claimed, which entitles him or her to the protection of the caveat, lies on the cavaetor: Sims v Lowe.[1]

[1] Sims v Lowe Sims v Lowe [1988] 1 NZLR 656

[5]      The caveat has been lodged against certain certificates of title which are held as joint tenants by the plaintiff and the defendant.  The defendant is the plaintiff’s father.  He is in his 80s.  Mr Brodie informed me that he does not enjoy good health and indeed has had severe health difficulties within the last year, though at present his condition is slightly better.

[6]      It is the defendant’s wish to sever the joint tenancy by registering a transfer which will result in the land being held by the plaintiff and the defendant as tenants in common in equal shares.  Plainly the defendant’s health is a factor requiring some urgency in taking this step as it would remove the right of survivorship of the plaintiff.

[7]      Clause 14 of the partnership deed between the plaintiff and the defendant dated 21 April 1983 provides that where the partnership is terminated by death or

otherwise, the surviving partner may purchase the share of his former partner in the capital and assets of the business by giving three months’ notice in writing of his intention to complete the purchase during the term or at the conclusion of such notice.  There is provision for the price and, if necessary, terms of purchase to be agreed, or to be the subject of arbitration.

[8]      On the evidence before me I am satisfied this is, to the extent required for this interim judgment, an option to purchase giving the plaintiff an interest in the land against which the caveat has been registered, sufficient to sustain that caveat.  This is the first ground on which the caveat claims an interest in the land.  That being the position, it is unnecessary for me to consider, at this point, the second ground, namely whether there is an arguable case that the plaintiff has an interest in the defendant’s land under a constructive trust.

[9]      Next I must consider whether sustaining the caveat would be of any practical advantage to the caveator.   Mr Brodie for the defendant advised that his client wished only to register a transfer to himself in order to sever the joint tenancy, and would consent to the caveat remaining to prevent any other dealing with the land.

[10]     In Pacific Homes Ltd (In Rec) v Consolidated Joineries Ltd,[2]  Blanchard J

stated:

An order will be made for removal only where the Court is completely satisfied that the legitimate interests of the caveator will not thereby be prejudiced.   If, on the facts of a case, it can be seen that the caveator can have no reasonable expectation of obtaining benefit from continuance of the caveat in the form of the recovery of money secured over the land or specific performance of an agreement or if the caveator’s interests can be reasonably accommodated in some other way, such as by substituting a fund of money under the control of the Court, then it may be appropriate for the caveat to be removed notwithstanding that the right to the claimed interest is undoubted.

[2] Pacific Homes Ltd (In Rec) v Consolidated Joineries Ltd [1996] 2 NZLR 652

[11]     Neither of the claimed interests in the land is dependent on the defendant’s share being held as a joint tenant; each is equally sustainable if his share is held as a tenant in common.   Accordingly a caveat preventing registration of a transfer as intended will not serve any useful purpose in protecting the plaintiff’s claim to the interests specified in the caveat.  Adopting the language in the above passage, the

caveator’s interests can be reasonably accommodated by discharging the caveat and granting leave to the plaintiff to file a second caveat claiming an estate or interest in the land on the same basis.

[12]     In my view that is the correct course to follow. Accordingly I direct: (a)       Subject to paragraph (c) below Caveat 8628917.1 will lapse.

(b)The plaintiff is granted leave to register a second caveat against the lands described in Caveat 8628917.1 claiming the same estates or interest in the land, on identical terms.

(c)    The order directing that the caveat lapse will take effect immediately before the registration of the second caveat.

[13]     Costs are reserved.

J G Matthews

Associate Judge

Solicitors:

Shirley Law, Christchurch. Email:  [email protected] /  [email protected]

Meares Williams, PO Box 660, Christchurch (R C Gray). Email:  [email protected]