Adamant
that he was the sole owner of a Ponsonby property purchased at auction over fifteen
years ago, Karl Henry was told by the High Court that his purchase was just
another in a family history of collectively buying properties across Auckland
and that he held title as trustee for himself and three other family members,
including his mother.
Dispute
over ownership of seven Brown Street, Ponsonby, was raised straight after the
auction with Karl as successful bidder signing the auction purchase in name of
himself or nominee.
He then
claimed to be the sole owner of Brown Street, since he alone signed the
contract.
Brother
Frank, who was also present at the auction, told the High Court that auction
staff had been told there were multiple purchasers. Since not all were present at the auction,
staff said having Karl sign on their behalf ‘as nominee’ would suffice.
Siblings
Frank and Nicole and their mother Jeanette subsequently protected their claim
by registering a caveat over Brown Street, a caveat which sat on the title for over
a decade before legal action was taken to clarify ownership.
The High
Court was told of multiple purchases of real estate in and around Auckland over
many years by members of the Henry family, title being taken in various
combinations of family members. Most
purchases were in the inner city Herne Bay/Ponsonby area.
News in
2010 that seven Brown Street was on the market proved significant; it bounded
land already owned by family interests.
Karl
registered for the auction, making the winning bid at $785,000.
Brother
Frank was at his side. Sister Nicole and
their mother listened in by conference call.
Karl paid
the $78,500 deposit, filling out a blank cheque signed by their mother drawn on
her bank account.
Evidence
was given of email exchanges between family members prior to the auction
suggesting ways in which ownership could be structured and confirming payments
to their mother’s bank account, required to cover her payment of the deposit.
After the
auction, Karl took title in his own name.
He subsequently
paid for Brown Street with his own funds, plus a bank loan.
Other
supposed family purchasers were mollified by a comment from Karls’ lawyer that
while title was taken in his client’s name alone, this was just a precursor to
later sorting out the issue of family ownership.
Buoyed by
this advice, their mother paid some $70,000 for renovations, getting Brown
Street up to tenantable standard.
Ownership
was never settled. A history of
dissension between Karl and Frank deepened.
Diplomatic intervention by both Nicole and their mother came to nothing.
Eventually
in the High Court, Justice MacGillivray ruled Karl held title to Brown Street
on trust for all four family members.
By time of
the auction there was a common understanding there would be joint ownership,
with each contributing to the purchase, he said.
Karl’s
claim that he only was to be owner lacked credibility, he ruled.
Karl’s use
of money from his mother and his siblings to pay the deposit at auction was not
explained. His failure to challenge
pre-auction suggestions of how joint ownership might be structured counted
against his claim that it was intended all along that he would be sole owner.
At the
family’s request, Justice MacGillivray went no further than ruling on
ownership.
It was left
to negotiation between the four family members to decide how Brown Street
expenses incurred over the last fifteen years are to be allocated.
Henry v.
Henry – High Court (17.06.26)
26.184