Darby v Haywood [2019] NZFC 6937

Published 10 May 2021

Notice of claim — Property (Relationships) Act 1976, ss 2, 9, 42 & 44 — Land Transfer Act 2017, s 143 — Family Proceedings Act 1980, s 182 — Clayton v Clayton [Vaughan Road Property Trust] [2016] NZSC 29, [2016] 1 NZLR 551 — Heazelwood v Joie de Vivre Canterbury Ltd [2015] NZCA 213, (2015) 30 FRNZ 521 — Arrow Farms Ltd v Jackson (1991) 7 FRNZ 561 — Huang v Chung [2015] NZHC 686, (2015) 30 FRNZ 188 — Bourne v Baker [2016] NZFLR 944 — Fisher on Matrimonial and Relationship Property. The parties were embroiled in a dispute over the division of their relationship property. They had been in a relationship for seven years and signed a contracting out agreement 18 months after their marriage. The respondent challenged the validity of two notices of claim that the applicant had placed on two properties. She applied to the Registrar General of Land to lapse the notices while the applicant sought to have them remain until the substantive hearing relating to the parties' property division issues. Property A was owned by a company of which the respondent was the sole director and shareholder. Property B was owned by the two trustees (one of whom was the respondent) of a trust. To sustain the notices the onus was on the applicant to show: (a) he was in a qualifying relationship with a person who is legally entitled to, or beneficially interested in the land, and (b) there was a valid unresolved claim to an interest in that land under the Property (Relationships) Act. The applicant claimed he was in a relationship with the respondent who had control over the two properties. He planned to argue that she had been able to gather her own assets by relying on his income during the relationship. The respondent submitted that as the company and the trust were the owners of the properties, the applicant could not establish he had been in a qualifying relationship with the person who owned the property. The Judge found it would be unfair to lapse the notices on the basis of the respondent's arguments, especially as she was the sole director and shareholder of the company and had substantial control over the trust. It was unclear whether the ownership of the properties had been set up to enable the respondent to divest herself of legal ownership of each of them such as to defeat any claim of the applicant. However, for the purposes of determining solely whether or not the Notices of Claim continue or not, the issue was at least arguable. Pending resolution of the substantive property proceedings, it would be prejudicial for the Notices of Claim to lapse. Judgment Date: 30 August 2019. * * * Note: names have been changed to comply with legal requirements. * * *