29 August 2024

Mortgagee Sale: Westpac v. Heslip

 

Caveats filed by Daniel Heslip over land in Fairlie, South Canterbury, leased from his father, could not stop Westpac’s forced sale.  The properties were sold at mortgagee sale ‘subject to existing tenancies or occupations (if any).’ 

The High Court was told Daniel leased from his father Glen two properties around Fairlie; one residential, the other rural.  These leases run to January 2025.  Neither lease is registered on the title.

Daniel’s November 2024 LinkedIn profile highlights his interests in the tourism industry together with his aversion to the legal profession with what he describes as ‘lawyers making money off others misfortune.’

Evidence was given that he challenged Westpac’s rights as mortgagee to sell the two properties he leased.

Shortly after the mortgagee sale, and some two weeks before the buyer was required to make payment, Daniel lodged caveats over title to both properties to block transfer of ownership.

Associate Judge Lester ordered the caveats removed.

The general rule is that a mortgagee can ignore any unregistered lease, provided it has not agreed to the lease.  In cases of an unconsented unregistered lease, a mortgagee sale sees the tenant’s rights vanish into thin air.

Different rules apply to mortgagee sales of land where there is a residential tenancy in place.  The Residential Tenancies Act allows a tenant to remain in occupation; the new landlord must accept the tenancy and then exercises the same rights as the previous landlord. 

Terms of sale for the Westpac mortgagee sales in dispute expressly stated the buyer took title subject to any existing tenancies.

It is for the buyer to now negotiate with Daniel over his current and future rights as tenant, Judge Lester said.  Daniel could not use his status as tenant occupying the mortgaged properties to block a forced sale.

Westpac New Zealand Ltd v. Heslip – High Court (29.08.24)

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