Bitter that his wife was claiming a half share of relationship property when he had provided the bulk of relationship assets, Stuart Lobb attempted to end run a court-ordered 50/50 split of the value of an Auckland home held by their family trust by later claiming former spouse Verena Ryan had to contribute to half the cost of repaying a $1.4 mortgage.
Their family home named ‘Lothbury’ on Orakei Road in Auckland suburb Remuera was held by a family trust at time of their 2016 separation. They personally remained jointly liable on a Westpac mortgage secured over the property despite ownership being held separately by trustees of the family trust.
The High Court was told Mr Lobb lived at Lothbury after separation. Under pressure from Westpac, Mr Lobb subsequently repaid the mortgage with financial assistance provided by his father. Mr Lobb claimed his former spouse was liable to pay him half the cost of the repaid Westpac mortgage. She was liable to contribute half the cost because his full repayment had removed her personal liability to repay, he said.
There is a backstory.
While Mr Lobb’s claim for an equitable contribution to the mortgage repayment was underway, separate relationship property proceedings saw Ms Ryan awarded a half share of family trust assets with her half share being settled on a new trust in Ms Ryan’s name. As part of the calculation, Ms Ryan was acknowledged as being jointly liable under the Westpac mortgage; $700,000 was deducted from her share of trust assets. Now, Mr Robb was in the High Court separately arguing she was still liable for this $700,000 share.
As a general rule, all claims regarding relationship property start in the Family Court. Having assets tied up in family trusts can create complications. Justice Walker dismissed Mr Lobb’s High Court claim for an equitable contribution following the family trust’s refinancing of the Westpac mortgage. Both Mr Lobb and Ms Ryan were liable on the Westpac mortgage. This debt was a ‘transaction’ governed by the Property (Relationship) Act, she said. The Family Court had jurisdiction to deal with this debt and had done so, she ruled.
Lobb v. Ryan – High Court (29.05.23)
23.080