K P MALCOLM LIMITED AND ANOR V MALCOLM AND ANOR HC ROT CIV 2008-463-403

K P MALCOLM LIMITED AND ANOR V MALCOLM AND ANOR HC ROT CIV 2008-463-403

Applying Lankow v Rose, the plaintiffs hold a beneficial interest to be quantified by the net present value of their direct financial contributions (purchase price plus allowed capital inputs) after deducting an agreed notional lease rental and taking into account uncompensated services by defendants; fertiliser disallowed, half of water claim allowed, significant fencing post-2004 allowed; accountants to recalculate exact figures: plaintiffs' net contribution approximated $594,000 of a $1,792,750 valuation (Sept 2010) giving c.33% then uplifted 5% to 38% to account for abrupt cessation by Clive and other factors, resulting in plaintiffs 38% and defendants 62%.

Citation
openlaw-37b8767b_24b7_4e4b_b8e4_fe94024fe043.pdf
Parties
First Plaintiff: K P Malcolm Limited; Second Plaintiffs: Kenneth Petrie Malcolm and Sylvia Jane Malcolm; First Defendant: Linda Margaret Malcolm; Second Defendant: Clive Stuart Malcolm
Court
High Court
Jurisdiction
New Zealand
Judgment Date
18 February 2011
Procedural Posture
Civil Property/constructive Trust / Judgment After Trial/hearing
Outcome
Declaration that plaintiffs hold a beneficial interest in Ferndale quantified at 38% and defendants jointly 62%.
Legal Topics
Constructive Trust, Resulting Trust (abandoned), Quantification of Proprietary Interest, Beneficial Interest, Contributions and Offsets, De Facto Relationship Principles
Property Law Equity Trusts Family Law Civil Procedure Constructive Trust Resulting Trust (abandoned) Quantification of Proprietary Interest +3 more

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Parties

K P Malcolm Limited

First Plaintiff

Kenneth Petrie Malcolm and Sylvia Jane Malcolm

Second Plaintiffs

Linda Margaret Malcolm

First Defendant

Clive Stuart Malcolm

Second Defendant

Procedural Posture

Civil Property/constructive Trust / Judgment After Trial/hearing

Legal Issues

  1. 1 Whether plaintiffs hold a beneficial interest in Ferndale by constructive trust
  2. 2 How to quantify the plaintiffs' beneficial interest (what contributions count and netting of benefits)
  3. 3 Whether specific expenditures (fertiliser, water supply, fencing) are capital contributions

Ratio Decidendi

Applying Lankow v Rose, the plaintiffs hold a beneficial interest to be quantified by the net present value of their direct financial contributions (purchase price plus allowed capital inputs) after deducting an agreed notional lease rental and taking into account uncompensated services by defendants; fertiliser disallowed, half of water claim allowed, significant fencing post-2004 allowed; accountants to recalculate exact figures: plaintiffs' net contribution approximated $594,000 of a $1,792,750 valuation (Sept 2010) giving c.33% then uplifted 5% to 38% to account for abrupt cessation by Clive and other factors, resulting in plaintiffs 38% and defendants 62%.

Court Disposition

Declaration that plaintiffs hold a beneficial interest in Ferndale quantified at 38% and defendants jointly 62%.

Orders

  • Plaintiffs entitled to a beneficial interest in Ferndale to be quantified and treated as 38% (defendants 62%) in accordance with this judgment
  • Plaintiffs have sole liability for any debts secured over or relating to Ferndale and shall indemnify the defendants in that regard