Watkin v Jenkin HC Wellington AP Nos 81/00, 244/00

[2001] NZHC 290

IN THE HIGH COURT OF NEW ZEALAND
WELLINGTON REGISTRY AP Nos 81/00, 244/00

IN THE MATTER of the Matrimonial Property Act 1976

BETWEEN NEVILLE RAYMOND WATKIN
Appellant

AND SANTHA ELISE JENKIN
Respondent

Hearing: 11 July 2001

Counsel: Appellant in Person (with “MacKenzie Friend”)
Respondent in Person
T H Druce in attendance

Judgment: 24 April 2001

RESERVED JUDGMENT OF GENDALL J

[1] This is an appeal from a judgment of the Family Court at Lower Hutt delivered on 5 October 2000 in proceedings brought under the Matrimonial Property Act 1976. The appellant, I refer to as “the husband” and the respondent is “the wife”. The judgment dealt with supplemental matters to, and aimed at implementing, an earlier judgment of Judge Frater dated 16 June 1998. Her Honour then made decisions on primary matters in dispute, but leave was reserved to either party to return to the Court for further directions. That judgment of Judge Frater was the subject of an appeal by the husband which was heard in this Court on 10 June 1999 and the subject of a reserved judgment by me dated 16 June 1999. The appeal was dismissed and Judge Frater’s conclusions, findings and orders upheld. Accordingly this judgment must be read together with the earlier decision dismissing the appeal against the findings of Judge Frater.

[2] The judgment the subject of appeal relates to disposal of the proceeds of sale of a property at 95 Revan Street, Featherston, the manner of disposal of a property in Masterton, issues of share valuation, claims for deductions or the giving of credit to the husband in respect of setting up of his new home, the dealing with postseparation rental, income and expenses, interest and the question of credit to be given to the husband for principle reductions made in respect of joint loans. There are other issues relating to costs and minor matters but the impact of the judgment under appeal was to finalise the ultimate settlement figure and manner of final disposition of family assets.

[3] There is a further appeal (under No. 81/00) which the husband brings against an order made in the Family Court at Lower Hutt on 28 March 2000, which order related to the payment to the wife of the $36,665.09 plus interest, being held in a solicitor’s bank account, such amount to be on account of the wife’s overall entitlement.

The orders under appeal (AP 244/00)

[4] Judge Carruthers ordered that the wife should retain the sale proceeds together with interest of a property at 95 Revan Street, Featherston, such proceeds amounting to $36,665.09 plus interest of $809.45, these moneys to be brought into account in the final matrimonial settlement. That is the same order as Judge Moss made. The funds came from one of two Wairarapa properties, which had been, by consent, directed to be placed on the market for sale, and such sale ordered by Judge Frater. The Revan Street property was sold and proceeds of sale had been held in a solicitor’s trust account but on 28 March 2000 Judge Moss had ordered, or directed, that they be paid to the wife on account of her eventual overall property entitlement which was clearly going to exceed that amount. The appellant challenges the authority of Judge Carruthers to confirm that order made by Judge Moss. As I have said he separately appeals against the order of that Judge.

[5] The other Masterton property, having a value of $67,000, was dealt with by giving to the appellant an option of retaining it, provided the full settlement of all matters as between the parties was completed within 21 days, that is by 24 October 2000. If settlement was not concluded then the Registrar of the Family Court at Lower Hutt was authorised to sell the property at auction with leave then reserved for the matter to be returned to the Court for determination as to how the proceeds of sale were to be applied. The Judge made orders that share valuations submitted by the husband were accepted and to be applied in the final settlement as between the parties.

[6] The Judge assessed post separation rental income from matrimonial property, at Rotorua and in the Wairarapa and declared that it should be shared equally. In assessing the net income for equal division, and after taking into account expenses to be levied against that income, and credits to be given to the husband, the Judge fixed such income at $5,460.96. The husband had claimed travel expenses in managing those properties and the Judge allowed these at .62c per kilometre.

[7] The husband had claimed an adjustment in his favour in respect of principal payments made on the joint mortgage debt of the parties and the Judge determined this as being $10,949.12. From this he deducted $5,460.96 being net rental income. As a consequence the Judge ordered the post separation principal reduction paid by the husband from his own funds was $5,488.16. The Judge ordered that the husband receive credit of one half of that amount, namely $2,744.08.

[8] The wife had sought interest on unpaid settlement moneys claiming that what was owed to her was to settle all matters was a figure of $53,368.76. The Judge allowed interest at the rate of 9% but only on the sum of $20,000 as from 20 March 1998 to the date of settlement. There are minor matters upon which the Judge made orders in relation to the sale of a greenstone mere by auction with the proceeds to be divided between the parties, and that the existing mortgage on the former matrimonial home, which home was vested in the wife, was declared to be her separate debt with her to provide a release and discharge to the husband. In addition the wife was to receive $129.38 from the husband as an adjustment for one half the valuation fee of the Masterton property which rental property was to be transferred contemporaneously with the payment by the husband of the amount outstanding for settlement.

[9] It is against all of those orders that the husband appeals.

The appeal against the decisions or directions of Judge Moss (AP 81/00)

[10] The husband’s appeal against the decision of Judge Moss under AP81/00 generally alleges that the Judge had no jurisdiction to make the order or direction that she did; she acted in an unlawfully discriminatory manner contravening the New Zealand Bill of Rights Act 1990 and the Human Rights Act 1993, and in that she failed to observe the principles of natural justice. The husband complains that Judge Moss discriminated against him in directing that he file his evidence first, and generally, he alleges, acted partially against him.

[11] I dispose of that appeal first.

[12] None of the matters can be dealt with by way of appeal. Whether or not judicial review exists is a moot point. I would suggest that it does not, given the passage of time and the subsequent lengthy hearing, argument, evidence and orders of Judge Carruthers. In any event apart from the transcript of such conference which does not provide sufficient evidence to support the husband’s contentions, there is no other material before the Court that even remotely establishes the grounds alleged.

[13] But, in any event this was an interlocutory directions or orders and accordingly s71A(2) of the District Courts Act 1947 applies. Leave is required from the District Court under s71A where an appeal is brought against a whole or part of any interlocutory order. An interlocutory order means a decision made in relation to an interlocutory application. Application to the District Court for leave to appeal must be filed within 21 days after the date on which the order was sealed. If no application is made within that period then the High Court may grant special leave provided that an application is made to it within one month after the expiry of the 21 day period (see s71A(5)).

[14] It seems to me that in proceedings 81/00 being the appeal against Judge Moss’ decision that an application for leave to appeal was filed in the District Court on 14 December 2000 but such has not been granted. There further is no jurisdiction for the High Court to consider an application for leave to appeal, time long since having expired. The husband sought leave from this Court to appeal, which he said that he made based upon “His Honour Justice Doogue recommending that this application should be made, notwithstanding that it is out of time”. In fact the Minute of Doogue J dated 11 December does not record such “recommendation”.

[15] In fact at a considerably earlier date on 19 June 2000, when dealing only with the appeal from the order of Judge Moss, I made directions which made it clear that the appellant was on notice if he wished to apply for leave to be granted to appeal. There I noted that counsel for the respondent contended that the orders of Judge Moss were interlocutory and where leave was required to be granted but that the appellant contended otherwise saying that the decisions were final orders.

[16] I made directions on an interim basis in which I said:

“It is entirely for the appellant to decide whether he wishes to seek leave to appeal to this Court, the respondent claiming that such leave is required but the appellant denying such claim. He is on notice. If as a matter of law leave is required and the appellant proceeds to the hearing not having obtained such leave then he would do so at his own risk.”

[17] Although the order of Judge Moss was not sealed - so time may not have commenced to run - nevertheless the same order was made by Judge Carruthers, and is the subject of the second appeal. Assuming for the sake of argument leave to appeal had been granted, the appeal is in any event without merit because the later hearing, and orders, have overtaken and supplanted the first order. No one challenges the wife’s entitlement to receive more than the amount of the funds held in the solicitor’s trust account. The payment out, of these, to her was appropriate.

[18] But the husband says that Judge Moss did not have jurisdiction to make the order, at a judicial conference, without the husband’s consent. He relies on R11 of the Matrimonial Property Rules 1988. That Rule gives the Judge power to call a conference:

“For the purpose of ensuring that any application . . . under the Act may be determined in a just, expeditious, and economical manner . . . ”

[19] The husband says R11 does not enable orders to be made without consent. The argument totally overlooks R12 which specifically gives the Judge jurisdiction:

“At any conference held pursuant to rule 11 of these rules the Family Court Judge presiding may make such orders and give such directions as appear best adapted to secure the just, expeditious, and economical disposal of the application under the Act.”

[20] There is no statutory or other requirement that consent is required. Given that the application under the Act had been substantially dealt with by Judge Frater’s decision on 16 June 1998, and all that really remained was the implementation of it and calculations of various credits/debits or claims to interest costs and the like, the order could well be seen to have been designed to secure a just disposal of the remaining application.

[21] Further, provided a party has given proper notice to be heard, as was the case here, orders under s33(3) of the Act may be extremely wide and, for example, under subsection (1), the Court may give such directions as may be necessary or expedient to give better effect to any order made under s25 which enables the Court to make:

“Such order as it considers just [in] dividing the matrimonial property or any part thereof”

[22] An order directing payment to the wife of part of the matrimonial property, in the circumstances as existed before Moss DCJ (bearing in mind that at that time there had already been orders made by Frater DCJ which had been upheld on appeal by this Court) could not be said to be made without jurisdiction.

[23] The appeal against the order of Judge Moss is dismissed both on the grounds that leave to appeal has not been granted, and on the merits.

The appeal against the decision of Judge Carruthers (AP 244/00)

[24] Generally the husband submitted that, as he put it, the issue was “credibility” of the wife and also “of the Family Court”. He was critical of the Judge’s conduct of the hearing and took me at length through parts of the transcript of evidence which he says, showed that the Judge was dismissive of his arguments and wrong to find fault on the husband’s part. I add that similar criticisms were made about Judge Moss’ handling of the conference and that the husband broadly argued that the Lower Hutt Family Court was to be held accountable and criticised for its “poor decisions generally” and that the High Court had to submit Family Court decisions to vigorous scrutiny. The husband said that just as others had criticised Family Courts generally, his case was an example of such decisions which made such criticism deserving and which was an illustration of the poor quality of justice being delivered.

[25] This Court hears appeals on individual cases. It will not speak about other Courts “generally”. I have carefully reviewed the notes of evidence, Court documents, affidavits, judgments, orders and directions on a very extensive file and can find no foundation for the husband’s claims. He obviously believes his claims, because a number of decisions have not accorded with his wishes but he has had, and pursued, appeal rights from decisions or orders of three Judges. He is entitled to do so and, if error occurred so that a Judge was plainly wrong, then a remedy exists. But his arguments are not assisted by criticism of Judges’ handling of procedures in their Courts, where there is no evidence in truth, to support that criticism. Judges may intervene or ask questions so as to be able to understand what a litigant is saying, claiming or arguing, particularly if the relevance of it is unclear. Likewise, Judges are quite entitled to tell counsel, or the parties, to (for example) “get to the point” or “refrain from wasting time” or “you do not need to read out the contents of letters that are exhibits”. There is absolutely nothing in any of the transcripts which discloses improper or erroneous actions on the part of the Judges.

[26] I turn to the husband’s specific contentions.

“Depreciation” claim

[27] The appellant challenges the findings of the Judge where His Honour said that a claim by the appellant for depreciation on property would be disallowed. The appellant argues that he made no such claim. A careful review of the notes of evidence suggests that the appellant is correct. The error or misunderstanding may have arisen because such an item was part of the rental property accounts and the wife’s solicitor may have got the impression - and conveyed to the Judge - that it was claimed by the husband. But it does not matter because having made no such claim, and none being allowed by the Judge, the appellant is not disadvantaged. He says it led the Judge into adopting a critical attitude of the husband, but there is no support for this proposition.

“Interest” claim

[28] Challenge was made to the Judge’s assessment of interest, costs of holding rental properties and to his assessment of the net rental property income. Those were matters of fact based upon the evidence heard by the Judge who clearly directed his mind to the claim made by the appellant. It was for interest out of moneys that the appellant borrowed after separation either to purchase a property in Naenae and the Judge refers to the appellant’s claim that if he had been able to borrow moneys against rental property, and therefore set off interest against rent for tax purposes (but which he was unable to do) he would have been in a more advantageous position. The husband submitted to me that he had been able to claim interest for tax purposes, and thus the Judge was wrong. But the Judge was simply saying, as a matter of fact and his own conclusion, that interest paid by the husband on borrowings made to acquire what was to be separate property was not to be allowed as a deduction or set-off against income earned on matrimonial property. The Judge said that the claim was misguided and would be disallowed. That was a finding of fact, entirely open to the Judge on the evidence before him. It is not a finding that this Court can or would disturb on appeal.

Lack of jurisdiction

[29] The husband argues that the Judge had no jurisdiction to “confirm a previous Court order”. By this he refers to the order made by Judge Moss directing payment of proceeds of sale of a Featherston property of approximately $36,000 plus interest to the wife on account and towards her ultimate property entitlement. As I have held Judge Moss had jurisdiction and authority to make the order. It was acted upon and had been executed. In terms of s33 of the Matrimonial Property Act 1976, a Judge has power to make orders and the giving of directions as may be necessary or expedient to give effect or better effect to any other order, and it is beyond any shadow of a doubt that the Court may order the vesting of any property owned by both spouses in one spouse or the payment of the sum of money by one spouse to another spouse. Whatever Judge Moss did so could Judge Carruthers and he was quite entitled to confirm it as being his order, namely that the wife receive as part of her overall entitlement the proceeds of 95 Revan Street, Featherston which had already been paid to her pursuant to the order of Judge Moss. This argument has no merit.

Mortgage principal repayment adjustment

[30] The Judge awarded to the husband a credit of $2,744.08 being one half of the principal repayments made by the husband after deducting net rental income retained by him. The husband submits that the Judge made an “error of fact” in the manner by which he came to calculate that credit. The Judge assessed post separation rental income as $5,460.90. The husband accepts that figure. The total of mortgage principal repayments was $10,949.12 which figure the husband accepts. Likewise the husband accepts that the net rental income retained by him being from rental matrimonial property, required to be taken into account. The balance was $5,488.16, in respect of which the Judge allowed a credit of one half $2,744.08. In essence, the husband does not contest that, although he says the figures should be $5,474. But it is the husband’s argument that he should have been given a further credit of $2,744 (being 50% of $5,488) to represent what he submits is his “personal property component” of the mortgage repayment and not just his rightful matrimonial property component. That argument was presented to the Judge in intricate and detailed analysis in writing, but not accepted - or reflected - in the orders.

[31] It may be that the husband has had difficulty in understanding how s2(2) of the Matrimonial Property Act 1976 allows to the Court a general discretion as to valuation dates, although this shall generally be the value at the date of hearing unless the Court otherwise decides. Here the value of the home, as agreed to by the parties, was fixed by the earlier order of Judge Frater dated 16 June 1998 which vested the home in the wife at a value of $160,500. Clearly allowances can be given for post separation contributions and factors affecting the value of property at the date of hearing Meikle v Meikle [1979] 1 NZLR 137 (CA) but in the present case the value was constant and fixed, at the date of hearing by Judge Frater. What altered was the extent of debt. It is the reduction in the matrimonial debt, post separation, that has occurred and the Judge decided that it should be determined at the date of hearing in the usual way. The wife assumed liability for the mortgage secured over the home but the debt had been reduced by (net) $5,489 by the husband.

[32] The Court had to assess the quantum of any credit to be given to the husband for the reduction in the debt and as he had an obligation to meet one half of the debt himself, as did the wife. The Judge held that as the husband had, in effect, paid the wife’s one half share of that debt he should be given credit for that. The husband claimed an additional adjustment for what he called his personal property component, but that may overlook the fact that 50% was his personal liability, just as 50% was the wife’s. He argues that the wife paid nothing off the principal, yet that is why she is required to give him credit for, in effect her half share of repayments. I have reviewed the figures as best I can from the wealth of detail provided and can find no error of fact or principle. If the husband’s argument is allowed there would, through the adjustments be, double counting in his favour, and not against him to allow to the husband a further credit would effectively mean that the wife was meeting in excess of her half share of the debt.

[33] The Judge has not been shown to have made an error of fact.

Conclusions contrary to the weight of evidence

[34] The appellant submitted that the weight of evidence showed that it was his wife who was responsible for delays in resolving all issues of matrimonial property and that he had always been ready and willing to reach a good faith final settlement figure and that the Judge’s conclusion that delays were principally the appellant’s fault were not supported by the evidence. The observations of the Judge were made in relation to the claim by the appellant to costs and the Judge referred to the appellant’s claim that he had made genuine efforts to complete everything but had been frustrated in his attempts to do so. The Judge’s conclusions on the question of costs are matters of fact with which this Court cannot interfere. The Judge accepted that the appellant placed himself in a position where he could settle the matter. The Judge observed that there was a resiling from the possibility of final settlement “whenever that seemed to hover close”. His Honour observed that part of the appellant’s difficulty “has been that he has been acting for himself and has not understood how the matter could be concluded”. I do not see that as necessarily a harsh criticism or judgment of the appellant but he, having appealed from the decision of Judge Frater, Judge Carruthers, and has sought leave to appeal from the decision of Judge Moss, might lend weight to the views expressed by Judge Carruthers. In any event, the award of costs of $1,500, as the Judge said “a modest award”, and is not able to be disturbed.

[35] The Judge’s conclusions were in accordance with the evidence as he assessed it to be and this argument fails.

Failure to make a determination

[36] The appellant submitted that the parties were left in the same position as before without a settlement figure and the Judge abdicated his task by not determining a “final” settlement figure. I am not sure that I fully understand this argument. The Judge could only rule, and make orders, on the outstanding issues involved in finalising the orders, made over two years earlier, by Judge Frater. His Honour made orders and directions that enabled the parties to reach a final figure. But he could not set that figure given that, if the husband did not exercise the option to retain the 11A Fleet Street, Masterton property at a valuation of $67,000, then it would be sold - for more or less - and thus the settlement figure (that is the payment due to the wife) would be more or less. The basis for concluding the dispute had been resolved by the Court orders. All that remained was for the appellant to exercise or not, the option the retain the property.

[37] The orders have been sealed and finally dispose of all matters subject to their implementation or enforcement. The husband has paid, under protest and without prejudice, a sum of $59,104.90 to the wife, he exercising his option and retaining the property. His case is presented on the basis that a refund is due to him by the wife. He says he should be paid $4,086 (although he says a further $6,258 being costs and interest awarded ought also be repaid). But that is the sum with which these proceedings are concerned. Some might regard it as minor, when viewed against total matrimonial property of over $500,000 and litigation spanning over four years, but the husband’s strongly held view is that it has led to injustice to him.

Disclosure issue

[38] The appellant refers to the his wife’s disclosure of post separation income, from matrimonial property securities, of $5,021.82. The appellant in his memorandum to the Judge dated 7 July 2001 submitted that the wife had not made full disclosure but that he had since “had to give up” on this issue, and concentrate on the more significant issues. He submits that the wife owes him an additional (half share) adjustment in the sum of $530.67 to correct her position. He submits that an order under s33(I) of the Act should be made directing the payment of that sum to him by the wife so as to correct the position. The wife disputes this.

[39] The claim is one of fact. This Court is not able to re-open that matter in light of that. It must be remembered in the absence of clear error the Court should be slow to interfere with the discretionary awards of the trial Judge in this field. The ultimate determination of the parties shares is in the end a highly discretionary process, of course within the statutory rules laid down, but as the Court of Appeal said in McGirr v McGirr (CA10/91, 14 May 1992):

“On several occasions the view has been expressed in this Court that, on appeal under this Act, the Court would be slow to disturb a discretionary decision of a Judge alive to the spirit of the Act . . . Appeals in this area, are sensitive as it is discretionary, are not to be encouraged.”

“Bank interest rates”

[40] The Judge directed that interest of 9% be paid on a figure of $20,000 as from 20 March 1998 to the date of settlement, in favour of the wife. She had contended that she was owed a further amount to settle all matters at a figure of $53,368.78 and sought interest at 11%. Since the date of hearing on 20 March 1998 (before Frater DCJ). The Judge expressly turned his mind to this question and concluded that an interest rate of 9% was appropriate. Interest is within the Judge’s discretion and could have been fixed as high as 11%. A figure of 9% cannot be challenged. The Judge’s assessment was generous to, and very much to the advantage of, the appellant because he fixed interest only at figure of $20,000 after setting aside the rental properties from which both the parties had derived income which had been taken into account in the final settlement. The husband submits that the interest was awarded because the Judge wrongly found him to be “at fault”. But that was not the case and there is no substance to the appellant’s argument that the Judge erred in the award of interest and the level at which he fixed it. Indeed it could have been greater.

Other submissions by the appellant

[41] The appellant addressed the broad range of submissions generally alleging that the Judge engaged in what the appellant said was “unfair Courtroom conduct” being dismissive of the appellant’s arguments and generally, the appellant argues, being difficult, obstructive and revealing a lack of understanding of the issues. I have already dealt with that item in paragraph [24] and [25].

[42] In addition the appellant complains about lack of adequate Courtroom facilities. A review of the notes of evidence do not lend any support to the complaints of the appellant. They cannot be justified on the record. The Judge was at pains to ensure that the appellant had every opportunity to present his intricate, technical and detailed arguments and analysis and it is quite impossible to discern from the evidence any basis for the appellant’s arguments. Simply because a Judge tells a litigant, or counsel, that something may not be relevant or urges them to get to the point, so as to assist and enable the Judge in deciding the issues, cannot be elevated into the sort of complaint the appellant makes. These arguments fail.

Generally

[43] The husband submits that the orders did not reflect the weight of evidence, and perpetual lengthy errors of the wife for which he was not to be blamed. He submitted that the outcome, in the end was “not fair or reasonable in the circumstances.” But the Judge could have in his discretion, still awarded interest at a higher rate on a greater sum. The end result to the husband, as well as the wife, were orders that settled the final implementation of the orders already made by Judge Frater. As the Act says, its principles are designed to provide for “a just division” of matrimonial property and the end result of the exercise of the Judge’s discretionary powers cannot be said to have led to unjust division.

[44] The appeal is dismissed. The wife is entitled to costs. Whilst, at this hearing, she appeared without counsel, (and does not therefore qualify for costs on this hearing alone) she required solicitors up until one week before the hearing and counsel was required to appear on several occasions on the appeal against Judge Moss’ decision and at directions hearing. I fix costs payable to her by the appellant at $2,500.