Bankrupt: BNZ v. Kerr

  

A case of international arbitrage.  Former high flying businessman George Kerr, now bankrupt in both England and New Zealand, unsuccessfully attempted to have his New Zealand bankruptcy put on hold while his England bankruptcy plays out.

Insolvency law in New Zealand has its origins in English bankruptcy law, but the two have now diverged with differing rules potentially resulting in differing outcomes.

Mr Kerr told the High Court there could be multiple problems should both his England and New Zealand bankruptcies run in parallel, particularly questions over control of assets and allocation of liabilities.

In England, he was bankrupted in July 2026 on an unpaid business debt of some US$400,000.

Ten days later in New Zealand, he was bankrupted on a $88.3 million debt owed Bank of New Zealand.

Now aged sixty, he has had a colourful business career with more than a decade of New Zealand litigation behind him, primarily disputes relating to operation of Pyne Holdings and his Torchlight Fund.

Most recently, his business operations have been run out of Guernsey, a crown dependency technically not part of the United Kingdom.

Refusing to put Mr Kerr’s New Zealand bankruptcy on hold, Associate Judge Malarao said both New Zealand and England have in place similar rules to deal with concurrent bankruptcies; rules based on a 1997 model law proposed by the United Nations Commission on International Trade Law, setting a framework to deal with any legal complications in concurrent bankruptcies of having assets and liabilities extending beyond national boundaries.

Bank of New Zealand v. Kerr – High Court (5.08.26)

26.219

Restraint of Trade: Mirabito v. Waterman

  

While Kevin Waterman denies bad-mouthing purchasers of his Kerikeri dairy shed maintenance business beyond jokingly calling them ‘dumb Aucklanders’ and equally denies going behind their backs in breach of a restraint of trade on sale of his business by offering to continue working for former customers with under the table payments in cash, Justice MacGillivray issued a strongly-worded High Court injunction reinforcing the restraint of trade pending any further court hearing.      

The court was told Lauren Moribito paid $585,000 in 2025 to purchase assets of Mr Waterman’s business: Northern Dairy Specialists Ltd.

Northern Dairy installed and maintained dairy sheds.

Sale price included $362,000 paid for goodwill; payment for anticipated future revenue expected for ongoing work coming from Mr Waterman’s existing Northern Dairy customers.

As is the norm, the sale agreement contains a restraint of trade clause.  Mr Waterman promised for the next five years not to compete against Ms Moribito’s business in areas of North Auckland, north of Kawakawa.

Ms Moribito alleged in the High Court that Mr Waterman instead set out to undermine her new business from the outset.

A Northern Dairy staffmember, now working for Ms Moribito, reported hearing Mr Waterman tell his former customers that Ms Moribito and her spouse were dumb Aucklanders, useless, incompetent and destined to fail. 

Various witnesses said they had seen Mr Waterman giving former customers his personal mobile number, telling them that he was available for work with payments to be in cash and the Moribitos not told.

Mr Waterman denied all these allegations.

Comments about the Moribitos’ abilities were made as a joke, he said.

He passed on his personal mobile number just to keep in touch with customers he considered personal friends, he said.

He denied doing any under the table jobs for cash since selling in 2025.

Justice MacGillivray ruled there was sufficient evidence to justify issuing an injunction, reinforcing terms of the restraint of trade, pending a full court hearing into whether Mr Waterman had in fact breached the restraint of trade he signed.

Mirabito v. Waterman – High Court (4.08.26)

26.217

Asset Forfeirture: Commssioner of Police v. Pritchard

  

Having their family home registered in the sole name of his partner Angelina Singh did not stop Police claiming a half share in the net equity of Martin Pritchard’s Auckland home, seized as proceeds of crime after his conviction for drug offences.

Pritchard was convicted and sentenced in 2024 to twelve years six months imprisonment for methamphetamine importation.

His partner Ms Singh did not face any related criminal charges.

Police seized cash and motor vehicles in Pritchard’s possession, allegedly proceeds of crime.

The High Court was told Criminal Proceeds (Recovery) Act negotiations with Police saw Pritchard agree assets to the value of $558,500 would be surrendered as a profit forfeiture order.

Cash and motor vehicles already seized did not cover this amount.

Police said his family home on Waituarua Drive in Takanini was liable to forfeiture as ‘tainted property.’  Cash generated from illegal activity was used in part to pay down a mortgage over the house, Police allege.  

While the family home is registered in name of Ms Singh alone, it is relationship property with Pritchard entitled to a relationship property half share.

As part of a court-approved proceeds of crime settlement, Pritchard was given time to raise further finance, potentially on security of Waituarua Drive, up to the value of his relationship property interest, to pay the balance of the agreed $558,500 profit forfeiture order.

Failure to do so may lead to a forced sale of Waituarua Drive.

Commissioner of Police v. Pritchard – High Court (4.08.26)

26.216

Building Consent: Complete Shelf Co No.8 Ltd v. Chrictchurch City

  

It is a protracted legal game of cat and mouse.  Christchurch property developer Wolfbrook Residential claims Christchurch City must cover losses on a planned multi-storey development after errors by Wolfbrook’s own consultants led to council approval of a non-compliant building consent.  After losing a preliminary round in the High Court, Wolfbrook put into liquidation its subsidiary nominated for the projected build; by mistake, it says.

Associate Judge Lester ordered Wolfbrook pay $162,400 into court within three weeks to cover Christchurch City’s possible trial costs if it wants to proceed further.

This ruling negates Wolfbrook’s otherwise tactical advantage of pursuing litigation for its benefit in the name of a subsidiary, now in liquidation, whilst insulating itself from liability for costs if losing.

The High Court was told existing proposals for a sixty unit residential block on Lincoln Road in Christchurch were picked up by Wolfbrook subsidiary Complete Shelf Company No.8 Ltd in 2022. 

Architects acting for Complete Shelf exchanged emails with Christchurch City over balcony design changes necessary to achieve building code compliance.

Six weeks after building consent was granted, Christchurch City realised required changes to Wolfbrook’s application had not been made.

Complete Shelf alleges negligence by Christchurch City, claiming council staff should have picked up the error.

Complete Shelf is claiming damages for what it says are increased costs: management time, further design work and holding costs for project delays.

In a May 2025 High Court fast track summary judgment ruling, Associate Judge Lester ruled there are too many unknowns.  A full court hearing is needed to determine if there was any liability, and if so, how it should be spread between council, Complete Shelf and its consultants.

He questioned why Complete Shelf claimed this issue has put its whole project on hold.

Its code compliance dispute concerned balconies.  That should not delay ground-level preliminary site works, he suggested.

Just over one year later, Christchurch Council was in court demanding Complete Shelf pay money into court as security should the dispute come to a full hearing and Complete Shelf lose.

Wolfbrook as shareholder put Complete Shelf into liquidation in early 2026, council told the court.

Council potentially faces substantial legal costs defending Complete Shelf’s claim, and Complete Shelf had no means to pay if it loses, council alleges.  

Complete Shelf claimed it has a litigation funder willing to cover all legal costs.

Under questioning from Judge Lester, Complete Shelf eventually disclosed that its parent company Wolfbrook Residential is its litigation funder.

Judge Lester questioned the legality of such an arrangement; any damages recovered would be for the sole benefit of the supposed litigation funder: Wolfbrook.

He ruled Complete Shelf cannot progress its claim against Christchurch City unless it first pays into court council’s potential legal costs.

Council should not carry the risk of an unrecoverable costs award against a shell company when that company claims to have arranged financial support to pay, Judge Lester said.

Complete Shelf complained potential legal costs set at $162,400 is too high.

Judge Lester ruled Christchurch Council is entitled to take into account extra legal costs it may face given that Wolfbrook consultants involved in the building consent application are now involved in the litigation.

Complete Shelf Company No.8 Ltd v. Christchurch City Council – High Court (20.05.25 & 4.08.26)

26.218

Family Trust: Ross v. Hoffman

  

Weeks before Carl Hoffman’s death in 2024, former spouse Moyra shifted into his family trust-owned Rotorua home against his express wishes and remained, with a court order needed to evict her.

The two had separated thirty-two years previously.  Moyra was paid $320,000 in 2006 on condition that she then surrendered all rights as beneficiary of Carl’s family trust; a trust he had established in 1981 at conclusion of an earlier relationship.

The trust subsequently purchased a family home on State Highway 30 at Rotorua where Carl lived with their two children: Kurt and Kane.

As trust settlor, Carl indicated to trustees that he wished to have the property sold on his death and the proceeds divided equally between his four children: Kurt and Kane, plus two children from an earlier relationship.

He also firmly told trustees that his former wife Moyra was to have no access to trust assets or the Rotorua home, saying ‘she has already had more than enough money from me.’

In the nearly two years since Carl’s death, Moyra and Kurt have continued living in the house, despite being asked to leave in readiness for a sale, paying no rent and in the company of ten cats, a dog, plus several sheep and pigs, trustees told the High Court.

The property is not being properly maintained, they claimed.

Vacant possession is necessary to achieve Carl’s wish that the property be sold and net proceeds divided amongst his children, trustees said.

Associate Judge Wild ruled Moyra and Kurt had no legal rights to remain in possession.  They were given three weeks to leave.

Trustees had offered special assistance for Kurt, Judge Wild said, offering to assist with any bond needed for a new rental and assistance in re-homing his animals.  Kurt was described as having ongoing mental health issues.

Neither Moyra nor Kurt defended the eviction application.

Ross v. Hoffman – High Court (3.08.26)

26.215

Estate: Abel v. Jessiman

  

Adamant that their late father intended to leave them his share of a Hawkes Bay home owned jointly with their stepmother, Nathan and Rebecca Abel attempted unsuccessfully to bring a relationship property claim on his behalf intended to extract half the value of a $1.35 million home.

The disputed property at Clive had been purchased jointly.  Their late father’s half share passed automatically to their step-mother by survivorship on his death.

His children from an earlier relationship sued, seeking to establish what would be their late father’s share of relationship property if he had been alive, intending to then split his share between themselves.

Relationship Property Act rules allow claims to be made against an estate.  Where effective beneficiary of any claim is children exercising rights of a deceased parent, courts look closely at any financial justification for this claim.    

In the High Court, Justice Radich ruled the relationship property claim promoted by siblings Nathan and Rebecca could never succeed; their father’s estate was not substantial and they are comfortably well off.

Evidence was given of Rebecca working for an oil company in Texas and her family home having net equity of some $1.6 million.  Nathan was described as owning four properties in Hawkes Bay, together with his wife, plus a fifth property through a company he controls; properties sufficient to currently support borrowings of $2.6 million.

Their father Glenn was in a relationship with their stepmother Jan Jessiman for about 26 years before his death in 2024 at age seventy.

His only asset of substance was their home in Clive, owned jointly.

Son Nathan claimed it was never their father’s intention that Ms Jessiman take full ownership on his death.

Joint ownership of their Clive home should have been registered as tenants in common, to prevent Ms Jessiman inheriting their late father’s share by survivorship, he claimed.

Nathan said his father had stated it was intended that his children would inherit his half share in conversations both with himself and a family friend.

Even if that were his intention, it was not acted on, Justice Radich said.  

Nathan pointed to a 2002 family trust established by their father which stated a wish that, if the trust owned a home on his death, then his children could live in the property for the duration of their lives.

No money ever held by this trust was used to buy the Clive property.  The trust did not own any share of the Clive home, Justice Radich pointed out.

Evidence was also given of a Microsoft word document left on their late father’s computer titled as ‘last will and testament of Glenn Abel.’  This document was created just over two years prior to his death.  Part of this document stated: ‘Jan to live in the house at Clive, but when it is sold half the proceeds go to Nathan.’

Ms Jessiman told the court she did not know who drafted the document, adding that it was full of factual errors and did not match her late spouse’s writing style.

With provenance in question, this document could not be accepted in court as evidence of Mr Abel’s intentions, Justice Radich ruled.

Collectively, evidence before the court was insufficient to override Ms Jessiman’s current right of survivorship, Justice Radich ruled.

Mr Abel’s children provided no evidence of a serious injustice to themselves sufficient to support a possible relationship property claim on behalf of their father, Justice Radich ruled.

Their stepmother retains full ownership of the Clive property.

The court was told she has children of her own from an earlier relationship.  Her and Glenn had no children themselves. 

Abel v. Jessiman – High Court (3.08.26)

26.214

Trustee Discretion: Perpetual Trust v. Cooke

  

Brian Cooke’s threat to smash in the head of a Perpetual Trust staff member tasked with handling his late mother’s estate set the tone for a difficult relationship, with the Court of Appeal subsequently ruling there was no criticism of the manner in which Perpetual sold his mother’s Orewa home, but it was not appropriate to evict Mr Cooke from his life interest in her Wellsford rural property.

In court, Mr Cooke claimed Perpetual had not done a proper job handling his late mother’s estate; a claim Perpetual denied.

The Court of Appeal was asked to rule on the legal standard applied in exercise of trustees’ discretionary powers.  Principles previously buried in case law are now out in the open, spelt out in the Trusts Act.

Judges do not seek to ‘second guess’ what a trustee should have done, rather that trustees should have properly canvassed possible options.

On her death in 2017, Naomai Joan Cooke named her daughter Anne together with son Mr Cooke in her will as executors of her estate.

Her Orewa property was to be sold; the proceeds split between her two children.  Mr Cooke was given a life interest in her six hectare Wellsford property, with executors given a discretion to sell this property with the proceeds to be used either to buy a replacement property for Mr Cooke or to invest the proceeds paying him an annual income.  

Estate administration got off to a bad start with Mr Cooke shifting into the Orewa property after their mother’s death, telling his sister he was not going to budge.

This resulted in a court order removing them both as executors, with Perpetual Trust appointed.

Attempts to sell Orewa were fraught from the start.

A court order was needed to evict Mr Cooke.

At his sister’s suggestion, Perpetual had the property tested for methamphetamine exposure before sale.  Traces were found, leading to decontamination costs.

Mr Cooke was of the view Orewa was worth at least $1.8 million and suggested he might buy.

Perpetual held a $1.025 million valuation from a registered valuer, a figure slightly below rating valuation.  It was trying to sell in the middle of covid-19 pandemic disruptions.     

It received an offer just above this valuation in a direct approach from an intending buyer.  Perpetual accepted this offer at a time when Mr Cooke was still under the impression he could buy, but had yet to make any offer.

He challenged this off-market sale as being at an undervalue.

The Court of Appeal ruled Perpetual acted properly within its discretion as to the timing and manner of the sale.

The property was rundown with repairs needed.  The risk of Perpetual making a counter-offer was that the intending purchaser would walk away.  A private sale saved real estate commission.

The court ordered that costs of methamphetamine decontamination be deducted from Mr Cooke’s share of net sale proceeds.

It was proper for Perpetual to carry out testing, the court said.  Perpetual acted on advice from Mr Cooke’s sister.  She was aware of her brother’s criminal history for drug offending.  Mr Cooke was in sole occupation for two years prior to the tests.

After Mr Cooke moved to his late mother’s Wellsford property, Perpetual sought court ‘blessing’ to its actions, having evicted him from that property.

Perpetual claimed he was in breach of terms of the life interest allowing him occupation, in particular failing to pay rates and to keep the property in the same condition as at his mother’s death.  Perpetual objected to Mr Cooke shifting 20-foot shipping containers on site, adding security fencing and installing cameras.

He threatened to set his dog on contractors employed by Perpetual attempting to carry out a site inspection.

The Court of Appeal confirmed a High Court ruling that Mr Cooke be allowed to reoccupy Wellsford.  Perpetual had plans to sell.

There was a only short delay in paying rates.  It was wrong to block inspections.

But Perpetual incorrectly exercised its discretionary power of sale in seeking to evict Mr Cooke from the Wellsford property the Court of Appeal ruled.

His mother was aware of her son’s criminal history.  Allowing her son a life interest only was intended to give him somewhere to live, while preserving capital for his daughters later use.

In exercising its discretionary powers as executor, Perpetual did not consider reasonable alternatives beyond eviction that might achieve his mother’s aims, the court said.

Perpetual cannot charge to the estate costs incurred evicting Mr Cooke from the Wellsford property, the court ruled.

Perpetual Trust Ltd v. Cooke – Court of Appeal (31.07.26)

26.213

Receiver: Ryan v. Lobb

  

In a rare move, the High Court blocked possible further attempts to sue a court-appointed receiver bringing finality to repeated litigation disputing division of family trust assets.  Stuart Lobb was described as taking repeated steps to frustrate receiver Digby Noyce in a dispute over sale of Mr Lobb’s former family home known as ‘Lothbury,’ in Auckland suburb of Remuera.

Over a six year period since Mr Noyce was appointed receiver, Mr Lobb and his allies have explored every possible legal stratagem to prevent sale of Lothbury, resulting at one point in Mr Lobb being held in contempt of court.

Legal moves and counter-moves have seen Mr Noyce in court multiple times defending attempts to carry out High Court instructions for potential sale of Lothbury.  After a sale was achieved, Mr Lobb threatened to sue Mr Noyce, alleging this sale was made ‘off-market and under market value.’

Evidence was given that Mr Lobb is currently suing Lothbury’s purchaser, seeking to recover chattels he alleges were wrongly sold as part of the house sale.

Mr Lobb’s primary complaint has been that he should retain control of Lothbury; he owned the asset before it was transferred to a family trust, he should get it back when the trust is divvied up, he claims.  

Mr Noyce was appointed by the High Court in 2020 with authority to sell Lothbury and to divide the proceeds between trust beneficiaries: Mr Lobb and former spouse Verena Ryan.  The two separated ten years ago.

With this task complete, Mr Noyce asked to be discharged from his role as court-appointed receiver – a normal procedure.

Unusually, Mr Noyce further asked he be protected from any further litigation from Mr Lobb and his allies.

Mr Lobb continues to allege that Mr Noyce failed to properly do as instructed, has ‘extorted’ money from him, and has breached fiduciary duties as receiver ‘over fifty times.’

He separately complains that Mr Noyce has not properly accounted for money received.

Mr Noyce has made full disclosure of all financial details in his regular reports to court, Justice Andrews said.

In ruling that Mr Noyce and his employees cannot be further sued for steps taken as part of the court-ordered receivership, Justice Andrew followed similar practice in England and Australia where judges have assumed an inherent power to grant immunity in appropriate circumstances.

There is a real risk Mr Lobb will otherwise litigate and re-litigate his perceived grievances, Justice Andrew said.

Ryan v. Lobb – High Court (30.07.26)

26.212

Maori Land: Kaka v. Kaka

  

Maori Land Court intervened after extended whanau challenged Karen Kaka’s descendants right to occupy Maori land near Oakura in Northland, questioning their late mother’s paternity and physically forcing them off-site.

Her four children are entitled to inherit, Judge Williams ruled.

Evidence was given of intimidation and violence directed at Karen Kaka’s husband and family after her 2023 death.

There had been opposition four years previously to an occupation order in her favour covering two hectares of land held by trustees of the Henare Aperahama Wharemate Whanau Trust; a trust set up in 2013 to consolidate shareholding in Maori land then held by 34 different owners.

This occupation right had been approved by the then trustees of the Henare Trust and confirmed by the Maori Land Court.

The occupation right takes up about ten per cent of the communally owned Trust land.

Karen Kaka and her family subsequently paid for and shifted four relocatable cabins onto the site, plus a container used for storage.

After her death, other hapu members shifted in, breaking locks and allegedly removing equipment and items of furniture.

The relocatable cabins were offered for sale, without permission from her family.

When challenged, they pointed to terms of the Henare Trust deed which stated those entitled to benefit from trust land were blood descendants only; those adopted as whangai were expressly excluded.

They claimed Karen was not a Henare blood descendant, demanding a DNA test be taken.

Judge Williams pointed out that Maori Land Court records stretching back decades identified her as a blood relative.  To now claim she was a whangai adoption is ‘highly unpersuasive,’ he said.

Her four children were now entitled by descent to inherit their mother’s occupation right, he ruled.

Her partner Philip was granted limited rights of occupation that do not pass on his death.  His right of occupation is limited to a life interest only, or until he remarries, since he does not whakapapa to the land.

Judge Williams warned of further court intervention should hapu members continue to challenge Kaka family members rights of occupation.

A minor adjustment was made to the Kaka families’ occupation-right boundary, allowing wider hapu access to another building on site.

Kaka v. Kaka – Maori Land Court (29.07.26)

26.211

Joint Venture: Zhou v. Liu

  

New Zealand resident Nicholas Liu lied, cheated and used forged documents to fool China-based joint venture partner Yuchen Zhou into thinking he was part owner of property developments across Auckland.  High Court orders for compensation exceeding eight million dollars are now hampered by the fact Mr Liu remains in control of companies owning these properties and his present whereabouts are unknown.

Mr Liu did not appear in court to defend claims against him.  His spouse says he is in China.

The High Court was told of two joint venture property deals now in dispute: a 2017 agreement intending purchase and redevelopment across three neighbouring sites on Arran Street in Avondale; and a 2019 agreement for purchase of a commercial building on Kitchener Road in Milford.

A common thread across both projects was Mr Liu’s behaviour in lying about the purchase prices (having the effect of increasing the cash contribution put in by Mr Zhou), failing to have ownership recorded in agreed proportions (giving Mr Liu complete control), and borrowing against the joint venture properties (both to provide funds for his share of the purchase prices and to generate cash used for his own purposes).

In addition, Mr Zhou was encouraged to provide loan capital for supposed development of townhouses at the Arran Street site on the pretext that debt capital was expensive to raise in New Zealand.  No development ever started.  What Mr Liu has done with this six million dollar loan is unknown.  

In the High Court, Mr Zhou said he had relied on Mr Liu to negotiate purchase of the properties plus set-up and manage legal structures to own and operate the joint ventures.

He rarely visited New Zealand.  Travel was further hampered by covid-19 pandemic restrictions.

Mr Zhou said he only became aware of lack of progress at the Arran Street site after viewing Google Earth mapping.  Mr Liu had previously sent him photographs showing earthmoving equipment on site, supposedly ready to start.

By mid-2024, Mr Liu had stopped responding to requests for information.  Mr Zhou sued to gain control of the projects and to recover money due.

Mr Liu was held to be in breach of their joint venture agreements and in breach of fiduciary duties owed his joint venture partner. 

Justice MacGillivray ordered sale of the Arran Street properties to repay Mr Zhou’s six million dollar loan plus interest and also repay the extra $2.1 million extracted from Mr Zhou through use of false purchase prices entered on forged agreements for sale and purchase.

Mr Liu controls companies owning the Arran Street sites.

Justice MacGillivray signalled he is sympathetic to putting these companies into receivership in an initial step to force a sale.  Overseas Investment Office clearance is first required since sale proceeds would be going to Mr Zhou as an overseas resident.

The Kitchener Road property is owned by a chain of companies ultimately under control of Mr Lui.

As with the Arran Street project, Mr Liu bumped up the supposed purchase price for Kitchener Road when asking Mr Zhou to remit his ‘share’ of the purchase price.  He then mortgaged their joint venture asset for his own personal benefit.

Justice MacGillivray ruled all shares in the company owning Kitchener Street are now held in trust for Mr Zhou.

Mr Liu and his spouse were invited to put before the court evidence of any financial contributions they may have put towards the properties.

Zhou v. Liu – High Court (29.07.26)

26.210

Loan: Lal v. Jajal

  

It was a commercial arrangement between friends, not a consumer credit contract requiring precise statutory loan disclosures the High Court ruled on enforcement of Sachindra Lal’s guarantee of a loan to builder Giri Tata, enabling completion of work on the Lals’ family home in Auckland.

The three-way financing arrangement was intended as a bridging loan, protecting Mr Lal’s credit rating at a time when he was seeking extra finance to complete construction of his home at the beachside suburb of Maraetai.   

The High Court was told the Lals are currently living at the property.  It does not currently have a building code compliance certificate.  There is an ongoing dispute with Mr Tata’s building company about construction issues.

Evidence was given of Mr Lal needing bridging finance necessary to complete construction in early 2024.  Negotiations with ANZ Bank for further funding had stalled.

A short agreement signed by all three parties acknowledged that Mr Tata was borrowing $100,000 from Anirudda Jajal, described as a friend of Mr Tata, with interest payable at $1087.50 per month.  This agreement anticipated repayment within the month.

In fact, the loan was extended twice and then left unpaid, before Mr Jajal sued Mr Lal on his guarantee nine months after the funds were advanced to Mr Tata.

Mr Lal had signed the tri-partite agreement agreeing ‘the loan is on [him] eventually.’

It was intended repayment would come out of what was then anticipated further ANZ bank financing.

Refusing to pay on his guarantee, Mr Lal argued the Jajal/Tata loan he had guaranteed was a consumer contract, unenforceable because of failures to make mandatory disclosures required by the Credit Contracts and Consumer Finance Act.    

Confirming an earlier District Court ruling, Justice Andrew said this was not a consumer credit contract.

Mr Jajal was not in the business of lending money.

Mr Tata was not acting as a ‘broker’ by facilitating arrangements for Mr Lal to finance further construction.  He was not paid any fee.

Mr Tata did get an indirect benefit in that work for his building company could progress.

Even if it were a loan which required Credit Contracts and Consumer Finance Act disclosures, it is difficult to envisage what further disclosures might be required, Justice Andrews said.

Mr Lal guaranteed a simple, uncomplicated, loan arrangement.

He was provided with all the relevant information.

The money lent to Mr Tata was spent on construction of Mr Lal’s house.

There was no evidence that Mr Lal misunderstood what he was guaranteeing.

Lal v. Jajal – High Court (27.07.26)

26.207

Family Trust: re Neal Grenville Johnson Trust

  

Before his death in 2010, Neal Johnson learnt the family trust he had established three decades earlier left capital tied up until 2058 with no ability to access capital or terminate the trust early.  His two children, now in their eighties, needed High Court approval to release trust capital.

Children Richard and Diana saw no advantage in allowing the trust to trundle along until such time as their own children were in their eighties before capital could be released.  They wanted their own children to benefit immediately.

The High Court was told trustee expenses were eroding income available for distribution, with expenses for the 2025 year amounting to nearly fifty per cent of trust income.

Distributions from trust income had been made to Neal’s widow, up to her death in early 2026.

Trust capital currently totals just over three million dollars.

Public Trust is named as trustee.

It supported moves to terminate the Neal Grenville Johnson Trust.

Trusts Act High Court approval was given to family proposals for trust capital to be split in two: one half share to be divided equally between Richard’s two children; the other half placed in a trust for the benefit of Diana’s children.

At issue were rights of contingent beneficiaries named in Neal Johnson’s original family trust.

Listed as potential beneficiaries are children and grandchildren of a cousin; named to receive trust assets in 2058 should no children, grandchildren or great-grandchildren of Neal survive to that date.

Given there are eleven Neal great-grandchildren currently alive who would be aged between 37 and 51 in 2085, the chance of any alternative contingent beneficiary inheriting is so remote as to be almost theoretical, Judge MacGillivray said.  Their potential interest in the Trust could be ignored when resettling Neal Johnson’s family trust assets on two new trusts.

re Neal Grenville Johnson Trust – High Court (27.07.26)

26.209

Costs: McGuire v. Inland Revenue

  

In what looks like regular high-stakes games of chicken, the Court of Appeal heard Jeremy James McGuire has more than once faced bankruptcy applications from Inland Revenue forcing payment of tax due.  Most recently, he was ordered to pay, in full, Inland Revenue’s $50,200 legal costs defending what was described as a ‘hopeless’ legal challenge to a current tax ruling; a challenge most likely intended to delay bankruptcy, the court said. 

The most recent challenge saw Mr McGuire seeking judicial review of a District Court ruling enforcing Inland Revenue’s assessment of income tax and penalties due for multiple tax years: some $39,700.

Normal procedure would involve an appeal to the High Court of a District Court decision, not judicial review.

An appeal considers whether legal principles were properly applied; judicial review looks at the process by which a decision was reached, not the merits of a decision.

The Court of Appeal was told Mr McGuire’s application for judicial review was filed after Inland Revenue had served a bankruptcy notice; first step in potentially having him bankrupted for failing to pay the $39,700 taxes as ordered by the District Court.

This judicial review application was later dismissed.

Inland Revenue asked for indemnity costs; reimbursement of its litigation costs in full, ordered by a trial judge where there has been ‘flagrant misconduct’ by a litigant.

Ordering payment, the trial judge stated Mr McGuire’s judicial review application was ‘hopeless’ and ‘so clearly untenable that it could not succeed.’

On appeal, the Court of Appeal confirmed indemnity costs of $50,200 must be paid, despite Mr McGuire’s claim he had made genuine mistakes about the outcome of prior negotiations with Inland Revenue.

It came out in evidence that on a previous occasion Mr McGuire belatedly paid some $76,600 in tax and penalties, to avoid being bankrupted then by Inland Revenue.

McGuire v. Inland Revenue – Court of Appeal (27.07.26)

26.208

Unit Title: Dominion Seven Ltd v. Body Corporate 82981

  

Unit title apartment owners can be separately billed for any ‘substantial benefit’ to their apartment following body corporate authorised repairs, regardless of whether they voted in favour or not.

Owners of adjoining apartments on top floor of the Dominion Building in central Wellington unsuccessfully challenged reimbursement of some $140,000 demanded after repairs to their cantilevered balconies were carried out at the same time as roofing remediation.

At issue were changes to the Unit Titles Act in 2010 intended to overcome the then problem of owners letting their individual apartments run down, continually deferring much-needed repairs and maintenance, leaving other apartments at risk.

New rules allow bodies corporate to initiate repairs.

Two top floor owners in the Dominion Building argued they could not be forced to pay for repairs specific to their apartments, part of a seven million dollar roof remediation, even if these repairs happened to benefit them exclusively.

Their balconies were temporarily removed, enabling installation of an external goods lift elevator for the roof remediation.

The Dominion Building is nearly one hundred years old.

A new top floor was added in the 1980s with units 29 and 30 on that floor unusual in having cantilevered balconies hanging in mid-air over land owned by Wellington Council.

Arguably, these balconies form part of body corporate common property, but practically are only available for the exclusive use of each apartment owner.

During the re-roof, balconies being re-attached to units 29 and 30 were repaired, made safe with installation of new decking.  

In the High Court, Justice La Hood confirmed a prior District Court ruling that it is irrelevant whether a body corporate or an apartment owner initiates the repair; if work results in a separate substantial benefit for specific apartment owners, they pay.

Dominion Seven Ltd v. Body Corporate 82981 – High Court (24.07.26)

26.206

Lease: 3i Southern Cross v. Christchurch Airport

  

With Christchurch Airport as landlord attempting to evict 3i Southern Cross Ltd from a leased commercial site, the High Court dismissed 3i’s argument that the Airport’s demand for a bank guarantee of rentals necessarily implied that the premises were fit for use and that it was the Airport’s fault that it could not get the necessary guarantee.  

3i argues difficulty in getting a guarantee is proof Christchurch Airport is in the wrong and has to make good alleged building defects.

3i Southern Cross operates as a stevedoring and logistics company.

It took over a large commercial site in Dakota Park at Christchurch Airport after the previous tenant went bust.

3i went into possession before all the paperwork was finalised, failing to produce a required $1.15 million bank guarantee to cover future rentals should it default.

Christchurch Airport’s High Court Property Law Act application to have 3i’s lease cancelled saw 3i argue the building is defective.  Christchurch Airport is at fault, it alleges.  Defects hampered its ability to get a bank guarantee, it argued.

Christchurch Airport says the building is up to Code.

Any bank is free to refuse guaranteed support for a tenant’s rental payments for any reason whatsoever, Associate Judge Lester said.

For a bank, this is a commercial decision, separate from the state of the building being tenanted.

A rental guarantor has no legal interest in the building being tenanted, Judge Lester said.  It cannot take over the lease, replacing the tenant, after payment of rental arrears.

If forced to pay rent arrears, a guarantor merely enforces whatever rights it has against the tenant, he said.

3i Southern Cross Ltd v.  Christchurch International Airport Ltd – High Court (23.07.26)

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