SONIA ADAMS v DESMOND ADAMS [2023] NZHC 608

SONIA ADAMS v DESMOND ADAMS [2023] NZHC 608 [28 March 2023]IN THE HIGH COURT OF NEW ZEALANDHAMILTON REGISTRYI TE KŌTI MATUA O AOTEAROAKIRIKIRIROA ROHECIV-2020-419-0034[2023] NZHC 608UNDER Property Law Act 2007, Trusts Act 2019,Declaratory Judgments Act, AdministrationAct 1969IN THE MATTER OF of an application for an order for sale of realproperty and distribution of the proceeds andan application for directionsBETWEEN SONIA ADAMSPlaintiffAND DESMOND ADAMSFirst DefendantPAULINE PARAKUSecond DefendantHearing: 14 March 2023Appearances: A Osama for the Plaintiff (Respondent)J C LaHatte for Chemell Paraku (Applicant)P A Depledge for the First DefendantJudgment: 28 March 2023JUDGMENT OF ASSOICIATE JUDGE BRITTAINThis judgment was delivered by me on 28 March 2023 at 2.00 pm.Pursuant to Rule 11.5 of the High Court Rules...Registrar/Deputy RegistrarSolicitors:Ord Legal, Wellington for PlaintiffMcKenna King Dempster, Hamilton for First DefendantMike Walmsley, Paeroa for Second Defendant[1] Marion Te Omiraki Putere1 (the deceased) previously owned a property at37 Roto Street, Te Kauwhata (the property). The deceased died on 6 July 1990, leavinga will dated 3 December 1986 (the will).[2] Under the will, the deceased appointed a solicitor, Ian Douglas Todd, as herexecutor and trustee. The deceased's estate was bequeathed to her trustee, who wasdirected to pay debts and expenses and to hold the residue on trust, in equal shares, forthe deceased's surviving children that attained the age of 20. The deceased wassurvived by ten of her children, including the first and second defendants. All havebeen served with the proceeding.[3] On 29 April 1991, the property was transferred into the name of Mr Todd, asthe executor of the deceased's estate. On 26 May 2006, Mr Todd transferred theproperty to the plaintiff, a grandchild of the deceased, and the first and seconddefendants, children of the deceased. The circumstances that led up to that transferremain unclear, as discussed further below.[4] The plaintiff seeks two alternative remedies in the proceeding:(a) A declaration that the plaintiff and the first and second defendants holdthe property on constructive trust for the beneficiaries of the deceased'sestate and an order that the plaintiff and the first and second defendantstransfer the property to Alan Wilson. Mr Wilson is a solicitor who hasagreed to act as executor of the deceased's estate and to completeadministration of the estate in accordance with the deceased's will.That would result in Mr Wilson selling the property, paying the estate'sdebts and distributing the residue according to the terms of the will.(b) Alternatively, the plaintiff seeks orders under s 339 of the Property LawAct 2007, requiring the property to be sold and the proceeds of saledistributed to the beneficiaries of the deceased's estate. As pointed outby Peters J in a minute dated 11 October 2021, the cause of action under1 This is the deceased's name as spelt in her will. I note that the parties refer to the deceased asMarion Te Omiraka Putere.s 339 of the Property Law Act appears to be problematic, given that thebeneficiaries of the deceased's estate are not all co-owners.[5] During the hearing of the application for joinder, the plaintiff's counsel advisedthat the plaintiff is primarily seeking a declaration of a constructive trust and ancillaryorders under the Trusts Act 2019, but she does not wish to formally abandon thealternative cause of action under s 339 of the Property Law Act.[6] The applicant, Ms Chemell Paraku, is a granddaughter of the deceased, bornapproximately seven years before execution of the will. The applicant lived with thedeceased when she was a child, and the applicant has deposed that she was a whāngaichild of the deceased and the deceased's husband. That is disputed by the applicant'smother, Pauline Paraku, the second defendant. The applicant seeks to be joined as aparty to the proceeding.[7] Other than the plaintiff and the first and second defendants, the only other childof the deceased that has taken any steps in the proceeding is Harry Adams. He hasfiled a notice of appearance dated 12 September 2022, and he does not oppose thesubstantive relief sought by the plaintiff.The application[8] The applicant applies to be joined as a party to this proceeding underr 4.56(1)(b)(ii) of the High Court Rules 2016, which provides:4.56 Striking out and adding parties(1) A Judge may, at any stage of a proceeding, order that—(a) the name of a party be struck out as a plaintiff or defendantbecause the party was improperly or mistakenly joined; or(b) the name of a person be added as a plaintiff or defendantbecause—(i) the person ought to have been joined; or(ii) the person's presence before the court may benecessary to adjudicate on and settle all questionsinvolved in the proceeding.[9] The application for joinder is opposed by the plaintiff and the defendants.The circumstances surrounding the transfer of the property in 2006[10] The deceased's whānau held hui regarding the property, including a hui in 1994and a hui on 14 April 2006. There are unsigned minutes of the latter hui, from whichit can be inferred that at least some of the deceased's whānau were treating the propertyas if it were subject to some form of trust.[11] On 12 July 2006, Mr Todd wrote to Evans Bailey, the solicitors then acting forsome or all of the beneficiaries of the deceased's estate. In his letter, Mr Toddexplained the reason for his transfer of the property to the plaintiff and the first andsecond defendants as follows:Basically, since then all I was wishing for was to receive firm instructionsfrom the family as to whom the property should be transferred to as I did notwish it to remain in my name. More recently in April of this year I receivedinstructions from the family that they had elected as trustees of the FamilyTrust, Desmond Alexander Adams, Pauline Rangiwauwai Pareku and SonyaAdams. In accordance with those instructions the property was transferred tothem.[12] On 3 December 2012, Mr Todd wrote to the solicitors then acting for theplaintiff, Niemand Peebles Hoult, further explaining the transfer:The family were in dispute as to whether the house should be sold or whethera family member should purchase it.The family formed, independently of the writer, a Trust and I receivedinstructions to transfer it into the names of Desmond, Pauline and Sonya.[13] There is other documentary evidence suggesting that at least some of thewhānau were treating the property as subject to a trust.[14] There is no evidence of a trust deed, or any documents that purport to createan express trust.[15] It appears that various members of the whānau have resided at the propertyover the years. The applicant presently resides there.Legal principles[16] The object of r 4.56 is to provide for the inclusion of necessary parties. Theapproach to joinder is liberal. In Newhaven Waldorf Management Ltd v Allen, theCourt of Appeal said:2This Court has previously noted that r 4.56 imposes "a fairly low threshold".A cause of action need not necessarily be advanced (or lie) against a defendantto be added. Indeed, where the plaintiff opposes joinder, a cause of actionagainst the additional defendant may not be apparent unless the Court ordersre-pleading by the plaintiff. It is the nature of the impact of the proceeding onthe additional defendant's rights that is important. As Pegang and Gurtnermake clear, these are not necessarily confined to legal rights, although the casefor joinder may be stronger in such a case. Joinder for the defendant is notwithout risk, of course. It Will be bound directly by an adverse outcome, andexposed to costs.[17] The issue is whether the applicant's presence before the Court is necessary sothat the Court can adjudicate on and settle all questions involved in the proceeding.This gives rise to the question, will the proceeding impact on the applicant's rights?SubmissionsThe applicant[18] The applicant argues that the collective approach taken to decision making byMāori, recognised by the Supreme Court in Ellis v R,3 requires that the applicant bejoined to this proceeding. Mr LaHatte, counsel for the applicant, referred to thefollowing statement by the Court:4The Court is unanimous that tikanga has been and will continue to berecognised in the development of the common law of Aotearoa/New Zealandin cases where it is relevant. It also forms part of New Zealand law as a resultof being incorporated into statutes and regulations. It may be a relevantconsideration in the exercise of discretions and it is incorporated in the policiesand processes of public bodies.[19] The applicant asserts that "most of the whānau" agree to the property beingimpressed with a trust in favour of the whānau.2 Newhaven Waldorf Management Ltd v Allen [2015] NZCA 204, [2015] NZAR 1173 at [46](footnotes omitted).3 Ellis v R [2022] NZSC 114.4 At [19] (footnotes omitted).[20] The applicant does not assert any legal rights in respect of the property butwishes to be heard regarding what should or might happen with the property in thefuture.[21] Mr LaHatte accepted that even if the applicant was the deceased's whāngaichild, s 19(1) of the Adoption Act 1955 applies; that is, the applicant is not consideredto be a child of the deceased for the purposes of determining the class of beneficiariesunder the will and therefore has no standing to challenge the will.[22] Mr LaHatte confirmed that the applicant is not asserting that she is abeneficiary of a trust, whether express or constructive or of any other nature, arisingfrom or in connection with the transfer of the property from Mr Todd to the plaintiffand the first and second defendants. The applicant does not wish to file a pleadingasserting any rights of that nature.[23] The applicant accepts that if the property is transferred to Mr Wilson as trusteeof the deceased's estate, then Mr Wilson will be free to administer the estate inaccordance with the will.The plaintiff and the defendants[24] The plaintiff and the defendants argue that the applicant has no rights thatmight be affected by the outcome of the proceeding. All parties to the proceeding thathave taken steps, including Harry Adams, support the appointment of Mr Wilson astrustee of the estate and distribution of the estate in accordance with the will.Accordingly, the plaintiff is seeking to proceed by way of formal proof.[25] The plaintiff's evidence is that the beneficiaries of the estate have been unableto agree on the establishment of a trust, despite several attempts to do so, including bymediation. The plaintiff describes her relationship with the first and second defendantsas dysfunctional.[26] The first defendant, the applicant's uncle, has deposed that he does not agreeto the applicant continuing to live at the property, and he does not agree to thesettlement of a trust.[27] The second defendant, the applicant's mother, opposes an order joining theapplicant as a party.Discussion[28] The applicant's assertion that there is broad whānau support for theestablishment of a trust is not substantiated by any pleadings, notices of appearance orevidence. On the contrary, the pleadings, the notice of appearance from Harry Adamsand the affidavits filed by the parties all point to consent to the relief sought by theplaintiff.[29] I accept that the applicant may feel a strong connection to the property.However, the applicant cannot point to any substantive rights that she possesses,whether sourced in tikanga or otherwise, that might possibly be affected by the reliefsought by the plaintiff in this proceeding. In his oral submissions, Mr LaHatteconfirmed that the applicant merely relies on tikanga as providing a procedural rightto be heard.[30] The joinder of parties is governed by the High Court Rules. Joinder ultimatelyinvolves an exercise of a discretion, and I note the Supreme Court's view that tikangamay be a relevant consideration in the exercise of a discretion. However, given thatthe applicant has not established that she has rights that can be impacted upon by theproceeding, I am not persuaded that I should exercise my discretion to allow thejoinder.[31] If the applicant was joined, then that would create the potential for the applicantto defend the proceeding at trial, requiring viva voce evidence and extending theduration of the trial, adding to costs and delay for parties who are essentially seekingorders by consent.[32] One of the deceased's children, Wayne Adams, has subsequently passed away.The plaintiff's pleading alleges that Wayne Adams' share in the deceased's estate haspassed to his six children. Those children, who are the deceased's grandchildren, havebeen served with the proceeding on that basis. The applicant is in a different positionbecause her mother is still alive.[33] As an aside, I note there is no clause in the will which provides forWayne Adams' share of the estate to pass to his children, so establishing that hischildren are entitled to his share of the residue of the deceased's will depends onWayne Adam's own testimony of provisions. There is presently no evidence on thatmatter before the Court.Result[34] The application for an order joining Chemell Paraku as a party to thisproceeding is declined.Costs[35] Given the whānau history and the unusual features of the administration of thedeceased's estate, and the prior engagement of the whānau in attempts to establish atrust, it is not surprising that the applicant has sought to remain involved and toparticipate in the proceeding.[36] The application has required minimal affidavit evidence, all of which will beuseful if the matter proceeds to formal proof. The hearing of this application on14 March 2023 was completed in an hour.[37] The parties will likely be able to recover the costs of the proceeding if the estateis administered by Mr Wilson, as sought by the plaintiff. Costs on this applicationshould lie where they fall.Directions[38] It appears that the proceeding is now ready to be allocated a formal proofhearing. Counsel are requested to confer and to file a joint memorandum outlining:(a) Whether any further affidavits are required.(b) An estimate of the hearing time required.(c) Any other pre-trial directions required.[39] The proceeding is adjourned to a telephone conference in the weekcommencing 17 April 2023, to be allocated by the Registrar.______________________Associate Judge Brittain