Failing to properly engage with his wife’s relationship property claim resulted in the High Court removing a Taranaki dairy and takeaway proprietor as trustee of a family trust and ordering him to vacate their trust-owned family home.
In dispute were family trust assets including a five hectare rural lifestyle block containing a small pine plantation, a dairy and takeaway business, boats, motor vehicles and motor-cross bikes, valued in total at $987,000.
The names of husband and wife were anonymised as Mr & Mrs K in published court proceedings. They separated in 2017, after a relationship lasting sixteen years. A family trust was established after they had been in a relationship for four years. Both were named as trustees, together with an independent trustee from a local accounting firm. Assets accumulated during their relationship went into this family trust.
The High Court was told Mrs K was continually frustrated in attempts to resolve her relationship property claim after the 2017 separation and subsequent divorce. She was no longer living in the family home. Repeated offers by Mr K to buy out his spouse came to nothing after efforts to raise finance stalled. His failure to implement procedures agreed in the Family Court led to High Court intervention. The same pattern of behaviour was repeated. Mr K blamed his failure to engage with the court process on ‘being busy’ and on ‘not doing email.’ He had provided an email address as his point of contact for court documents.
In November 2022, Mr K did turn up in court on the day set down for a decision on his wife’s relationship property claim. He repeated proposals to buy out his spouse, proposals which he had failed to implement in the past. Justice Gwyn decided it was time to press on, given what she described as Mr K’s failure or unwillingness to act on previous court rulings or his own proposals.
Mr K was removed as trustee of their family trust. He was ordered to facilitate a valuation of trust assets and to co-operate in marketing the family lifestyle block. If bank financing could not be retained over the dairy and takeaway business, it too was to be sold. Mr K was to pay the Trust $47,500 rent on account of his occupation of the family home since separation. On sale of Trust assets, the net proceeds were to be divided in half, with each half going to new family trusts controlled separately by Mr & Mrs K.
Six months later, Mrs K was back in court. Her husband was obstructing attempts to sell the family home, refusing to allow real estate agents’ access. Justice Gwyn ruled Mr K to be an unlawful occupier, giving him two weeks to leave.
K. v. K. – High Court (28.11.22 & 15.05.23)
23.069