Estate: re Succession to Donald McLeod

  

Leaving his only child nothing led the Maori Land Court to award Donald McLeod’s daughter a quarter share of his Maori freehold land, exercising powers under the Family Protection Act to adjust terms of his will.  

The court was told he denied any existence of daughter Kim for most of his life.  She was raised by maternal grandparents who lied, telling Kim that her father had died in a car accident when she was young.

It was only after her grandparents’ deaths that she learnt her father was still alive.  She tracked him down by ringing those named McLeod in the Taumaranui phonebook.

Their relationship developed over the next fifteen years.

In the final year of her father’s life she shifted to Taupo to be closer to him, visiting him regularly and cooking for him. 

On his death in 2021, he left his entire estate to a grand-niece: Jacinta.  They were close.  She was raised by him.

Evidence was given that Donald McLeod’s will was signed a little over one year prior to his death, at a time when a close and supportive relationship had developed with daughter Kim.

There was no explanation in his will as to why nothing was left to his only child.

She made a Family Protection Act claim, stating her father breached a moral duty owed his daughter, severing her and her descendants’ ties to their ancestral land.

Judge Wara said it was a breach of Maori custom to exclude descendants from Maori land inheritance without prior discussion or giving reasons.

Donald McLeod’s also failed to recognise a moral duty owed his daughter, she ruled.

Daughter Kim was awarded a 25 per cent share in her late father’s Maori freehold land.

Her cousin Jacinta retains a 75 per cent share.

Jacinta did not challenge Kim’s Family Protection Act claim.

re Succession to Donald McLeod – Maori Land Court (9.06.26)

26.171

Fair Trading: Commerce Commission v. CityFitness

  

Disguising price increases for members as ‘transaction fees’ and ‘payment authority fees’ cost CityFitness $1.12 million, fined for breaching the Fair Trading Act.

The District Court was told of a calculated decision made in 2023 by CityFitness senior management to recover increased business costs without disclosing increased pricing in its headline advertising.

New members signing up were not told the extra ‘transaction fee’ loaded into weekly or monthly billing would be three per cent of their membership fee.

Existing members were unilaterally charged a ‘payment authority fee,’ adding three per cent to their existing fees.     

Commerce Commission investigated following complaints made by some twenty CityFitness members.

After investigation, it prosecuted CityFitness for breaching the Fair Trading Act; ‘misleading the public as to the nature or characteristic of the service provided.’

Evidence was given that the actual transaction cost on CityFitness billings was about forty cents for each credit card transaction, five cents for direct debits.

CityFitness admitted it was misleading to label its price increases as bank fees.  It denied acting dishonestly.

The Commission said its conduct was deliberate, deceitful and intentional.

CityFitness’ misleading pricing lasted for sixteen months, ending April 2025.

Evidence was given that Commerce Commission put CityFitness on notice in July 2024, with CityFitness failing to correct its advertising for a further nine months.

Judge Clark increased the fine imposed by fifteen per cent as an extra penalty to mark seriousness of the offending; noting CityFitness’ current financial position and ability to pay.

CityFitness annual turnover for the 2025 year was $120 million.  It holds an estimated forty per cent of the national gym membership market.

Commerce Commission v. CityFitness Group Ltd – District Court (5.06.26)

26.169

Trustee: re Ngati Tawhirikura Charitable Trust

  

Maori Land Court Judge Warren stepped back from dismissing warring trustees of a New Plymouth charitable trust which would have had the effect of them never again being able to act as trustee of Ngati Tawhirikura Charitable Trust.  With terms of office for five named trustees having expired or about to expire, he instead ruled each ineligible to stand again for prescribed periods ranging from two years to six years, part of a ‘cooling off’ process.

Trustees had split into two factions in what Judge Warren described as a war waged for control.  Evidence was given of trustees acting without authority and failing to hold or to attend trustee meetings, coupled with sustained patterns of aggressive bullying and disruptive behaviour.

Judge Warren said there were grounds for Te Ture Whenua Maori Act removal of trustees for cause.

The Trust’s governing deed prohibits any dismissed trustee from ever again standing for election as trustee.

There is no evidence that trustee conflict resulted in any significant financial loss to the Trust, he said.  This dysfunction was not attributable to one faction alone, but arose from a collective breakdown in relationships in which all trustees bear some responsibility, he stated.

A ‘cooling off’ period can restore harmony, he indicated.

A six year ban from standing as trustee was imposed on Glen Skipper and Rangi Kupa, described as being central to the conflict.

A lesser ban of three years was imposed on Beverly Gibson; two years for Sharron Wipiti and Tarina Macdonald, with these two described as being least to blame having taken a ‘follow the leader’ approach as divisions became entrenched.

Judge Warren left open for later consideration the question of whether all trustees should be ordered to return any remuneration or honorarium received as trustee.

re Ngati Tawhirikura Charitable Trust – Maori Land Court (5.06.26)

26.170

Money Laundering: Reserve Bank v. ASB

  

Failure to properly set up internal systems to identify possible money laundering cost ASB a $6.7 million fine after Reserve Bank intervention.

The High Court was told of ASB Bank persisting with inadequate software workarounds designed to automatically trigger alerts for suspicious transactions and then being overwhelmed by thousands of ‘false positives,’ many alerts left unexamined for months.

Evidence was given of ASB failing to implement improvements required after routine Reserve Bank audits and delaying purchase of software packages better able to provide monitoring required under the Anti-Money Laundering and Countering Financing of Terrorism Act.

‘Know your customer’ requirements imposed by money-laundering legislation has forced substantial costs on many businesses, particularly financial institutions where the volume and velocity of banking transactions can easily disguise the transfer of ill-gotten gains.

The High Court was told ASB Bank decided in 2012 to use its existing Predator software, designed to detect credit card fraud, as the prime means of detecting potential money laundering.

Predator proved singularly unsuited for this task, despite ASB re-setting parameters within which alerts would be triggered.

Extra staff, and eventually outside contractors, were taken on to follow up on the high volume of alerts generated.

Of some 120,000 Predator alerts involving transactions totalling nearly $12.1 billion, the longest period of time an alert remained unresolved was 1300 calendar days; for more serious high priority alerts, 520 working days.

This led to substantial delays in filing suspicious activity reports with the financial intelligence unit within NZ Police.

As banking industry supervisor, Reserve Bank was also critical of ASB’s limited oversight of transactions through bank accounts of those trusts having a foreign beneficiary; considered high risk as vehicles for money laundering.

Reserve Bank requires these customers to be monitored more frequently and in greater detail.

The High Court confirmed a $6.7 million fine negotiated between Reserve Bank and ASB.

Steps taken by ASB to deal with continued backlogs was patently inadequate and delays in remediation unacceptable, Justice O’Gorman said.

ASB undertook to keep Reserve Bank apprised of improvements to internal procedures.

Reserve Bank v. ASB Bank Ltd – High Court (3.06.26)

16.168

Construction: Keast v. Auckland Council

  

Buying an existing building yet to get Council compliance sign off and then repurposing the building set in train a decade long trail of legal issues leading to Nichola Keast suing Auckland Council for $7.5 million dollars alleging negligence.  Councils owe no duty to protect people from economic loss following council refusal to issue a Building Act code compliance certificate, the High Court ruled.

Problems multiplied for Ms Keast as Council required compliance with a building consent issued for the initial build constructed prior to her purchase plus compliance with a further building consent for her later work converting a West Auckland proposed retirement village into tenanted apartments.

In addition, further issues arose when it was discovered a re-survey of the land dividing the intended retirement village into three separate bodies corporate had inadvertently left Ms Keast’s building with no legal access to the street.

Her project intended in 2012 to create tenanted investment apartments providing retirement income eventually saw mortgagee sales of one of these apartments and a separate property on Big Bay Road north of Waiuku put up as collateral security.

Ms Keast claimed Auckland Council’s certifying process was to blame for her financial losses.

In the High Court, Justice Wilkinson-Smith said Auckland Council could not be held responsible for Ms Keast’s failure to appreciate the complexities of purchasing a building not having a code compliance certificate, her delays in applying for certification and her failure to act on advice received early in the project about lack of legal access.

Evidence was given of Ms Keast buying part of a newly built retirement village off McLeod Road in Te Atatu.

The village did not operate as a retirement village, being subdivided in 2008 into several different titles and sold off as investment assets.

Ms Keast purchased what became lots two and four in the subdivision; built as the administration and recreation centre for the proposed village, including an indoor swimming pool and tennis court.

A 2012 building consent allowed Ms Keast to convert this administration building into three apartments.

The court was told these apartments were completed and tenanted within a year, but no steps were taken for another three years to get Building Act code compliance signed off.

What followed was a further five years of ongoing disputes between Ms Keast and Council over what was or was not required to achieve compliance with both the original building consent and the further 2012 consent.

Ms Keast alleged Council unnecessarily and negligently delayed issuing a compliance certificate.

A compliance certificate was eventually issued in May 2019.

Then, when it was later proposed to further subdivide lot two, a lack of legal access became a complication.

Physical access for lot two exists, but without protection of a registered easement.

Justice Wilkinson-Smith ruled lack of an easement was not Council’s fault.

Ms Keast had preferred to rely on incorrect advice from surveyors instead of acting on corrected advice given her back in 2016, she said.

When sued, Auckland Council said there is no obligation on local authorities to tell property developers what to do to achieve code compliance; there is no duty to help, it said.

A code compliance certificate does have economic value: certifying a building satisfies the building code; consequentially enhancing value of the property and protecting commercial interests of the owner.

But delays in issuing a certificate at a time when a building is later shown to be compliant does not entitle a building owner to damages, Justice Wilkinson-Smith ruled.

That would shift the cost of establishing compliance from the building owner to Council and its ratepayers, she said.

Councils’ Building Act regulatory function does not create a private right to sue for economic loss, she ruled.

Keast v. Auckland Council – High Court (29.05.26)

26.167

Asset Forfeiture: Commissioner of Police v. Xia

  

Suspicious Auckland restaurant staff called police after three men fled a nearby car crash to huddle in the restaurant toilet before returning to their vehicle to extract a shopping bag full of cash and then attempting to bribe staff to hide the cash for them.  They abandoned $77,800 cash at the restaurant, later confiscated as proceeds of crime.

Also abandoned at the restaurant were small quantities of ketamine, methamphetamine and cocaine, some left in the shopping bag, the rest hidden in the toilet cistern at the restaurant.

Catalyst for this chaos was a June 2024 car crash on Remuera Road in which an Audi travelling at speed hit two parked cars.

Police later caught up with occupants of the Audi.

Shuang Xia was arrested for careless driving and possession of methamphetamine for supply.

He said the cash were profits from playing poker.

Forensic examination of his banking records for the previous five years identified $1.7 million coming onto his bank account from unknown sources and $2.8 million transferred out to unidentifiable third parties.

No taxable income was declared in 2024; $5800 declared in 2023.

In the High Court, Justice Mount agreed Xia’s conduct created a strong inference that the abandoned $77,800 cash came from proceeds of crime.  He ordered the cash forfeit under the Criminal Proceeds (Recovery) Act.

The court was told Xia was convicted and fined $250 for careless driving.

Police decided not to charge him with methamphetamine dealing.

Once this decision was made, Police had no further legal justification for retaining the shopping bag cash; it should have been returned to Xia.

Police admitted their wrongdoing.  Justice Mount said it would be contrary to the public interest to refuse forfeiture of the cash simply because Police earlier wrongly held onto the money.

Xia did not attend court to challenge the forfeiture application.

Commissioner of Police v. Xia – High Court (25.5.26)

26.165

Maori Land: Puketapu E Maori Reservation v. Knuckey

  

A schism within a Te Atiawa hapu in New Plymouth is coming to a head with Maori Land Court ordering hapu members removal from their own land, ending a protest occupation near a now disused sewage treatment plant on what was previously Maori land.

The political dispute is over land taken under the Public Works Act for a sewage treatment plant near Bell Block.  It ceased operation in the mid-1980s.  Some members of the Te Atiawa Puketapu hapu demand return of the land to iwi ownership, supporting their views with a long-running land occupation.

The Maori Land Court was told named individuals who whakapapa to Puketapu hapu have been occupying nearby Maori reserve land, living in make-shift dwellings, a house bus, re-purposed containers and tents.

They ignored pleas from trustees of the reserve land that they leave.

Judge Warren issued a permanent injunction banning named individuals from the site.

Staying on site without trustees’ approval amounted to trespass.

Hapu members rights to occupy the reserved land extended to occasional customary use only.

Trustees were authorised to remove all structures left on the land.

Puketapu E Maori Reservation v. Knuckey – Maori Land Court (25.05.26)

26.164

Constructive Trust: Wharewhiti-Tuffery v. Kairama Ahu Whenua Trust

  

It came down to a question of who funded home loan repayments in a dispute over rights to a Dannevirke house sitting on Maori land.

The quick legal answer was that the house belongs to the multiple beneficiaries of Kairama Ahu Whenua Trust; any building affixed to land forms part of the land and is owned by the landowner, in this case the 99 living descendants of Ngahuia Tamehana.

In the Maori Land Court, Judge Stone ruled descendants of one family who had occupied the Dannevirke house for seventy five years were entitled to a five year right of occupation on basis of a constructive trust, with further occupation rights beyond this time a matter of negotiation with Kairama Ahu trustees.

Evidence was given of Ngahuia Rohe building the house in the 1950s, with finance from a Maori Affairs loan.  She never lived in the house, dying unexpectedly one week before she planned to shift in.

Daughter Muriel moved in, living there for over fifty years.

During that time she paid off her mother’s Maori affairs loan, raising seven children with her only income when widowed being a widow’s pension and casual earnings as cook for shearing gangs.

On Muriel’s death, her eldest daughter Mida assumed control as executor of her mother’s estate.

Complications arose after a 2018 decision to have Kairama Trust take receipt of rentals paid by Mida’s sister, now occupying the property.

Trustees later argued the 2018 deal saw ‘ownership’ of the property pass to the Trust.

Mida’s sister argued ‘ownership’ remained with their whanau; the 2018 arrangement was set up simply for administrative convenience, to have the Trust to manage tax filings arising from the rental and to apply rental payments in upkeep and maintenance.

A ‘rent strike’ by Mida’s sister following allegations the Trust was not properly maintaining the property saw their dispute move to the Maori Land Court.

Judge Stone said there was no clear evidence of the source of funds used to pay off the Maori Affairs loan.

Trustees said there was no way that a widow in Muriel’s position could have paid off the loan eighteen years early using only her own financial resources; rent misapplied from lease of adjoining trust land must have been used to pay down the loan, they claimed.

Muriel’s children said she was a careful and frugal woman; as a family they were raised with no luxuries.

Judge Stone ruled it was likely Muriel did fund repayments.

As a result, her whanau had an equitable interest in the house, he ruled.

Whanau could not claim ownership; that lies with Kairama Ahu Whenua Trust as owner of the land.  Whanau were granted a limited right of occupation.

Wharewhiti-Tuffery v. Kairama Ahu Whenua Trust – Maori Land Court (25.05.26)

26.166

Share Issue: Keats v. Finch

  

A universally ignored Companies Act rule requiring detailed disclosure of value provided in return for issue of shares and options was pounced on by Nigel Keats in his long running dispute with management of Connectworks Ltd, forcing public disclosure of circumstances in which his shareholding was diluted after his October 2022 resignation as director.

Connectworks provides software used by accounting and law firms.

Mr Keats was a founding shareholder and director.  He held a 5.05 per cent shareholding as at late 2025 when his latest round of litigation against the company and its management got underway, with his complaint that continuing management had improperly increased its shareholding in Connectworks from 33 per cent to 54 per cent over an eighteen month period, severely diluting his shareholding.

Registration of newly issued shares were supported by directors’ certificates baldly stating the commonly-used mantra: ‘directors are of the opinion that that the consideration and terms of issue are fair and reasonable to the company and all existing shareholders.’

Similarly worded certificates were signed on issue of share options.

In the High Court, Mr Keats argued this was insufficient detail.

In response, management provided updated information: itemising cash paid into the company in return for shares issued and disclosing that share options were issued at an exercise price of one cent per share.  Terms on which options would vest were not disclosed. 

Associate Judge Gambrill was unwilling to rule whether this was sufficient compliance in what was a fast-track summary judgment hearing.  A full court hearing is required.

Keats v. Finch – High Court (22.05.26)

26.163

Farm Mediation: McNamara Farms v. Vermaak

  

Blocked from taking immediate action by sharemilker Marthinus Vermaak’s demand that his sharemilking dispute go to mediation, Waiuku farm owner McNamara Farms had the High Court appoint receivers to take control of his mortgaged dairy herd ahead of concerns Mr Vermaak was likely to sell the herd on the sly, in what is the first instance of court intervention to override effect of the Farm Debt Mediation Act.     

The Farm Debt Mediation Act 2019 prohibits creditors from seizing farm stock without first engaging in mediation.

The High Court was told the McNamaras agreed a 50/50 sharemilking agreement with Mr Vermaak’s farming partnership for the 2025/26 season.

Sharemilkers in a 50/50 agreement are expected to own their own herd.

Not having sufficient capital to buy his own herd, Mr Vermaak was lent $600,000 by the McNamaras who then took security over his livestock.

The High Court was told the McNamaras became concerned about Mr Vermaak’s erratic behaviour.  There were allegations of meth use by Mr Vermaak.

Their sharemilking agreement required farm workers to be drug-free.  He refused to undertake drug tests.

Notice was given terminating their sharemilking agreement three months ahead of what would be season end in May 2026.

The McNamaras became anxious about enforcement of their security over Mr Vermaak’s dairy herd.

Mr Vermaak was described as being uncooperative, difficult, evasive and abusive.

Out of Mr Vermaak’s herd of some 80 cows, at least eleven had been sold already, without permission from the McNamaras as secured creditors.

Local stock and station agents were alerted; one agreeing to hold proceeds of this initial sale while the legal niceties were sorted out.

In the High Court, Justice Becroft appointed receivers to take control of the balance of the herd with authority to sell the stock and account to the McNamaras for money owed.

This was necessary as a matter of urgency, he said.

Mr Vermaak was ignoring the McNamaras rights as secured creditors.

There were fears Mr Vermaak would truck the remaining stock out of the area for sale elsewhere, or sell the animals to an abattoir.

Plus, a new sharemilker was due to move onto the farm in a little over a week.

McNamara Farms Ltd v. Vermaak – High Court (22.05.26)

26.162

Franchise: Mad Butcher v. Vickery

  

Accused of colluding with Christchurch Mad Butcher franchisee Shane Vickery in sale of his franchised butchery, Elliot Booth has been blocked for two years from operating a new butchery business operating from the same Ferry Road site with the same staff, supposedly free from Mad Butcher’s franchise terms.

In the High Court, Justice Paulsen ruled it is likely Mr Booth was well aware of rules governing the Mad Butcher Ferry Road franchise, holding Mr Booth potentially liable for ‘inducing a breach of contract;’ in effect, enforcing against Mr Booth what is a two year restraint of trade blocking Shane Vickery from setting up a new business in competition with Mad Butcher.

Mr Booth was never a party to the Mad Butcher/Vickery franchise contract.

The two year restraint of trade is intended to protect the commercial value of Mad Butcher’s supply chain and customer base.

General principles of franchise law are clear: a franchisee might establish a personal connection with customers, but business assets, both tangible and intangible, belong to the franchisor.

Evidence was given of Mr Vickery’s Harvest Wagon Ltd not renewing the lease for its Ferry Road site in early 2026 at a time when Mr Vickery was in discussions with his acquaintance Mr Booth about the possibility of Mr Booth taking up the lease and buying his business.

Unusually for a Mad Butcher franchise, Mr Vickery’s Harvest Wagon sold grocery items as well as meat.  Evidence was given of meat accounting for about 55 per cent of sales.

The court was told of both Mr Vickery and Mr Booth signalling to Mad Butcher head office that Mr Booth was buying the grocery business only.

Mad Butcher later learnt that Mr Booth had paid $800,000 to buy Mr Vickery’s business, including its butchery equipment, taken out a new seven year lease on the Ferry Road site at a lower rental than that Mad Butcher itself was willing to pay and had hired the nearly twenty employees previously working in Mr Vickery’s fresh meat department.

Imposing a temporary injunction blocking Mr Booth from operating a butchery, Justice Paulsen ruled it is seriously arguable that Mr Vickery’s Harvest Wagon and Mr Booth with his company Harvest Market 2026 Ltd worked to engineer immediate establishment of a butchery in breach of a restraint of trade prohibiting Mr Vickery or any ‘interconnected’ business from setting up in competition for a period of two years.

This injunction does not block Mr Booth’s new business from selling products other than meat.

The court was told there is ongoing litigation between Mad Butcher and Mr Vickery.

Mad Butcher Holdings Ltd v. Vickery – High Court (20.05.26)

26.161

Estate: Hata v. Bedford

  

Gina Bedford was bequeathed a half share of her late mother’s Tokoroa home, but failed to follow up on moves to buy out the other half share.  It took a court order to remove her from the property, coupled with orders that she pay rent for the period in occupation from when estate trustees asked her to pack up and leave, and reimburse the estate for ongoing mortgage payments and for any damage arising during her occupation.

She was given six weeks to vacate.

She did not contest legal action taken by estate executors.

The High Court was told Ms Bedford lived at the Papanui Street home with her mother prior to her mother’s death in 2020.

This property is the estate’s major asset; having a rateable value of some $340,000 as at May 2026.  It was bequeathed in equal shares to Ms Bedford and Shane Bedford, described in the High Court as being Ms Bedford’s cousin, but treated by family as if he were a sibling.    

Evidence was given of Ms Bedford refusing to engage in proposals that she buy out Shane’s half share.  She ignored notice to vacate given by estate trustees.

In the High Court, Justice Andrew ruled estate trustees were entitled to possession of Papanui Street, to enable a sale with net proceeds to be divided equally between the two.

He ruled estate trustees can deduct from Ms Bedford’s half share occupation rent of $40,400 for the period she unlawfully occupied the property plus ongoing mortgage expenses paid to ANZ Bank by her mother’s estate.   

Surplus cash is then to be divided equally between Ms Bedford and her five siblings as the estate’s residuary beneficiaries.

Hata v. Bedford – High Court (15.05.26)

26.160

Employment: Singh & Singh v. Sharma

  

Having defaulted on his promise to accept personal responsibility for wages and holiday pay underpaid by his company Control Plus Ltd, Vimal Sharma became liable not only for $29,600 owed two employees but was fined a further $21,500 by the Employment Court for failing to pay up.

Part of the $21,500 in fines is to be paid to the two employees, the court ordered. 

In 2025, Mr Sharma’s Auckland electrical services company Control Plus was put into liquidation by Inland Revenue.

Around the same time, he faced an investigation over wages allegedly underpaid to two employees: Manjeet Singh and Kulwinder Singh.

Following a mediation conference, Mr Sharma agreed personally to make good amounts owed Manjeet Singh ($18,600) and Kulwinder Singh ($11,000) should Control Plus not pay.

With Control Plus now in liquidation insolvent, the two employees sued in the Employment Court following Mr Sharma’s failure to pay.  He did not attend the court hearing.

Judge Holden dismissed suggestions Mr Sharma has no ability to pay.  Evidence was given of Mr Sharma named on Companies Office records as director and shareholder of three other companies which still appear to be active.

Of the fines imposed under the Employment Relations Act for non-compliance, Judge Holden ordered: $6750 be paid to Kulwinder Singh; $7000 to Manjeet Singh.

Singh & Singh v. Sharma – Employment Court (14.05.26)

26.159

Property: Collins v. Winspear

  

It was a one hundred year old boundary problem, with neighbours over $200,000 apart in agreement over the remedy; Wellington Lyall Bay residents Adam Collins and Jodi Turton arguing substantial compensation was needed from neighbour Shashil Winspear to make good the fact his house overhung their common boundary.

The District Court ordered a Property Law Act boundary adjustment for the ‘wrongly placed structure’ with Mr Winspear to pay $14,000 compensation on gaining title to the affected seven square metres of neighbouring land and pay re-surveying costs.    

The misplaced boundary followed sloppy surveying work on Queens Drive in 1921.

Houses were built on what is now numbers 266 and 268 before the land was later surveyed and divided into two separate lots.

A small part of the house at number 266, now owned by Mr Winspear, was included in the surveyed lot for number 268.

The legal nicety is that part of Mr Winspear’s house and the land under it came to be owned by his neighbour; a complication should either choose to sell.

The District Court was told buyers of the respective properties over the years were aware of the boundary issue.  Despite suggestions by various of these former owners that the position should be regularised, nothing was ever done.

It had not been a practical issue; that is, until objection was taken to Mr Winspear’s attempts to carry out maintenance on exterior of his house.

Lawyers became involved.

He was served with a trespass notice.

It was alleged that Mr Collins and Ms Turton lied about not being aware of the boundary encroachment when they purchased number 268, as they demanded Mr Winspear surrender a large portion of his property in return for a transfer of the affected seven square metres.   

In court, Mr Winspear argued his property rights were protected by an implied easement; for decades the then neighbours had accepted existence of the encroachment.  No compensation was required, he claimed.

Judge Warburton ruled the history of incomplete negotiations between past neighbours signalled no such implied consent had been given; the problem had just been left for someone else to deal with.

Current neighbours were poles apart in their assessment of compensation to be paid in return for a boundary adjustment.

Mr Winspear offered $7000.  Mr Collins and Ms Turton said a better figure was $228,000; which included twenty per cent of the cost Mr Winspear would have to pay if forced to relocate his house.

Judge Warburton ordered payment of $14,000: the current value assessed by a valuer for 7.3 square metres of residential land in Lyall Bay.

Collins v. Winspear – District Court (11.05.26)

26.158

Leaky Home: Chamberlain v. Omana North Ltd

Disgruntled buyers cannot affirm yet disaffirm their contract at the same time, as Chamberlain family found to their cost when seeking to cancel an Auckland $1.25 million apartment purchase after earlier carrying out lengthy negotiations over weathertightness repairs. 

Their purchase stands, the High Court ruled.  At best, the Chamberlains get damages.

In late November 2022, Tony and Lyn Chamberlain settled their purchase of a newly-constructed Milford residential apartment, taking title in name of their family trust.

The contract included a maintenance clause requiring vendor, Mark Gunton’s Omana North Ltd, make good any defects notified in the next twelve months.

Within months, Omana North was given notice of sundry issues requiring attention: insufficient cedar cladding clearance, incomplete painting, unfinished grouting, wiring, and other sundry issues.

Weeks later, low-level black mould and elevated moisture levels signalled problems with water ingress.

Omana North moved the Chamberlains to another apartment, rent free, while remedial work was carried out.

Over the next two years there were ongoing disputes over the extent of work required.

More than one Auckland Council building consent was needed before remedial work could proceed.

By May 2025, the Chamberlains were sufficiently fed up that they gave formal Contract and Commercial Law Act notice supposedly cancelling their agreement to buy, alleging failure by Omana North to comply with the maintenance clause.

In the High Court, Associate Judge Gellert ruled there was no breach of the maintenance clause; delays arose because of the need for detailed inspections by specialist third party investigators and time taken to get Council consents for remedial work.

Even if there were a breach of the maintenance clause, the Chamberlains had lost any right to cancel, having affirmed the contract by their ongoing engagement with Omana North over several years seeking to remedy construction issues, Judge Gellert ruled.

Chamberlain v. Omana North Ltd – High Court (11.05.26)

26.157

 

Joint Venture: Peart v. Samudrala

  

At a time when the Pearts’ marriage was disintegrating, Suresh Chandra Samudrala arrived on the scene with what turned out to be grandiose plans for redevelopment of their Hikurangi property, promising handsome returns.  In the end, they lost their home and their money, having to sue Mr Samudrala.   

The High Court was told that at time of the Pearts’ separation in 2013 Mr Samudrala took an interest in subdividing their six hectare lifestyle block at 56A George Street at Hikurangi, just north of Whangarei.  Access to  the proposed subdivision required purchase of the neighbouring property: number 54.

The Pearts were led to believe he was an architect and experienced property developer.

No joint venture agreement was ever formalised.

Plans evolved over a period of several months, seeing the Pearts sell 56A for $500,000: Helen Peart remaining owner as to a one-third share; Mr Samudrala and his spouse owning the remaining two-third’s share.

Mr Peart was encouraged to leave in the $163,000 received as his half share net from sale of 56A as an ‘investment’ in the proposed subdivision.

A bank loan was taken out for the Samudralas purchase of neighbouring number 54, with Ms Peart indirectly liable on this loan, agreeing to make payment only if the Samudralas defaulted.     

The planned subdivision never went ahead.

The lifestyle block at 56A was sold in a mortgagee sale.

This left Ms Peart with nowhere to live, forced to live for a time in her car, dependent on the charity of friends, the court was told.

In the District Court, Mr Peart sued to recover his $163,000 ‘investment.’

Mr Samudrala claimed this was an equity investment, lost when the project foundered.

Judge Spear ruled it was a loan, ordering repayment.

Also in the District Court, Mrs Peart was successful in claiming Mr Samudrala was in breach of fiduciary duties arising from their business relationship.

There was ample evidence that Mr Samudrala had breached the trust and confidence Ms Peart had placed with him, Judge Spear ruled.

There was evidence of Mr Samudrala not disclosing a 2014 valuation report advising the lifestyle block was ‘not currently ripe for subdivision.’

Further, Mr Samudrala did not place the $163,000 advance received from Mr Peart in a bank account under the joint control of Ms Peart and Mr Samudrala as previously agreed and he then proceeded to divert $100,000 of these funds for his own personal benefit.     

Unhappy with the amount in damages awarded in the District Court, Ms Peart appealed.

In the High Court, Justice Gault ordered Mr Samudrala pay Ms Peart the $167,500 she would have received if the family home had been sold outright in 2014 and she were paid her half share of the net proceeds, plus interest at five per cent on this $167,500 running from 2014.

In addition, Ms Peart was awarded $15,000 general damages for mental distress and $15,000 as exemplary damages to mark judicial displeasure at Mr Samudrala’s conduct.

Ms Peart was also entitled to damages for any proved expenses arising from the failed project, including premature relocation of her horse-riding business and legal aid contributions funding her claim.

Peart v. Samudrala – High Court (8.05.26)

26.155