20 April 2023

Partnership: Moses v. Stark

With their Waikato farming partnership dissolved automatically on George Stark’s death in 2020, family complain son Keith is running down the Ohinewai farm treating farm assets as his own.  Receivers were appointed to take control of farm management and to recover partnership loans made to Keith, his former wife Linda and their company Keilin Farms Ltd.

Juliet Moses was appointed executor of George Stark’s estate.  She is also a partner in the GJ & EM Stark Partnership in her own right.  This partnership farms on Tahuna Road at Ohinewai.  The other partner is George’s widow, Eileen.  Son Keith controls Eileen’s interest in this partnership through a power of attorney triggered after Eileen was judged unable to manage her own affairs.  The High Court was told Keith manages the partnership farm in conjunction with a neighbouring farm he owns through a family company.

Juliet told the High Court that discussions with Keith over farming operations were deadlocked.  She alleges Keith is selling partnership livestock without correctly accounting for the proceeds and further alleges he is taking excessive fees for partnership management.  There was evidence from a farming consultant that the farm is run down and poorly maintained.   As a further complication, there is an application before the Family Court to have Keith removed as Eileen’s property manager.

The Partnership Law Act states partnerships come to an end automatically on the death of any one partner, unless the partnership agreement states otherwise.  The court was told the Stark partnership agreement was signed in 1965.  It was initially for a six year period, terminable on one month’s notice after this six year period finished.   

The GJ & EM Stark Partnership ended on the death of George Stark in July 2020.  In the normal course of events, it is for surviving partners to wind up a partnership.  No agreement could be reached because of the deadlock between Juliet as one partner and Keith acting as attorney for Eileen as the other partner.

Associate judge Brittain ruled appointment of a receiver was necessary because of Keith’s conflict of interest.

Moses v. Stark – High Court (20.04.23)

23.052