Investment: Liu v. Wei

 

A $1.4 million debt is not yet due says property developer Chenyang Wei; written loan terms are a façade, drawn up for tax purposes, while the reality is that financier Changling Liu is a joint venture partner with payment due on project completion, he claims.

The High Court refused fast track summary judgment on Ms Liu’s claim that a $1.4 million debt plus $1.1 million in accrued interest is payable now.  Fast track is halted if there is a plausible defence.  Disputes then must go to a full hearing.

Ms Liu’s claim centres on ten short-term loans made to Mr Wei across 2022-23.  Mr Wei says these ten loans are only a small part of a financing history between the two, with over sixty loans having been made.

He says their arrangement is to have Ms Liu share in the final profit on sale of property developments across Auckland with the interest rate on loans paid from net profits on final sale.  Nominated interest rates are not a per annum rate; they are a fixed percentage of the money invested, paid when a particular development is complete, regardless of how long this takes, he says.

There was evidence of one loan at sixty per cent. 

He suggested Ms Liu acts as a conduit for multiple investors, since on completion of each project he has been instructed to repay loans plus interest into various different bank accounts.

Their deal required payments to be ‘grossed-up,’ so that each investor received net the agreed percentage after their payment of tax.

Ms Liu says the written loan contracts stand alone, and the amount claimed is due.

Associate Judge Sussock ruled there is plausible evidence that previous loan contracts were not enforced to the letter, with payments delayed or rolled over until projects were completed and sold.

Their past business practice created an estoppel: having in the past not strictly enforced loan repayment terms, Ms Liu could not now turn around, seeking to enforce strict wording of the loans in dispute, demanding immediate payment.

Fast track summary judgment was refused.

A full court hearing is needed to identify what is owed, and when.

Liu v. Wei – High Court (26.09.25)

25.208

Seasonal Workers: Soapi v. Pick Hawke's Bay

 

Seasonal labour contracts for Pacific Islanders brought in for Hawke’s Bay horticulture and viticulture amounted to indentured labour, union officials claimed.  Growers said pay deductions were appropriate recoveries for upfront payments made on behalf of pickers.  The Employment Court ordered $25,000 compensation to three Solomon Island pickers for unlawful deductions; employers using the Recognised Seasonal Employer Scheme must comply with wages protection and minimum wage legislation, the Court ruled. 

The Court also questioned employers’ practice of holding seasonal workers’ passports.  Growers said passports were held solely for safekeeping.  The Employment Court questioned why the same facility was not provided for other valuables owned by seasonal workers.

For nearly two decades, Pick Hawke’s Bay has recruited seasonal workers from Vanuatu, Samoa, Solomon Islands, Fiji and Nauru.  It operates as a not-for-profit business, sourcing temporary employees for growers across Hawke’s Bay during harvest season.

Temporary visas are issued through a scheme managed by Immigration New Zealand.

Employers must pay half of workers’ airfares, provide suitable accommodation, and pay New Zealand’s minimum wage.

The Employment Court ruled Pick Hawke’s Bay accounting methods breached employment law rules.

Evidence was given of Pick Hawke’s Bay paying seasonal workers a weekly cash ‘allowance’ of one hundred dollars with the balance otherwise due for each week’s work set off against a reducing balance of employment costs: accommodation; work equipment and clothing; health/travel insurance; and the employee’s half share of airfares. 

Full weekly payments were not made until the ‘reducing balance’ reached zero.

The Employment Court ruled Pick Hawke’s Bay was wrongly charging seasonal workers for work gear, wet weather gear and personal protective equipment.  Health and safety legislation mandates this as an employer’s cost.

Wage deductions for accommodation provided by Pick Hawke’s Bay to some 140 employees were challenged as being excessive; strict rules govern circumstances where accommodation deductions reduce cash-in-hand to below the minimum wage.

The Minimum Wage Act allows deductions for employer-provided board and lodging, with deductions calculated at either an agreed figure or ‘cash value’ of the accommodation provided.  Failing that, any deduction for lodging can be no more than five per cent of wages.   

Pick Hawke’s Bay makes available Portacom buildings equipped with bunk beds separated by curtains.  Kitchens, showers and toilets are in separate buildings.

The court was told Pick Hawke’s Bay had been charging a weekly accommodation fee of between $115-$120 per week.

Union officials claimed this accommodation is so rudimentary as to have an actual cash value of zero, or close to it.

There was evidence that a consortium of Hawke’s Bay growers fund this accommodation, with annual costs charged in full to seasonal workers across the seven month period they are employed.

In a test case, the Employment Court ruled there had been no ‘agreement’ as to accommodation costs, nor proof of the actual ‘cash value’ for this accommodation.  Pick Hawke’s Bay could deduct no more than five per cent of wages for the accommodation provided, the Court ruled.

The Court called for an investigation into the lack of transparency where growers are directly funding seasonal accommodation through Pick Hawke’s Bay, which then on-charges seasonal workers the full year’s costs when this accommodation sits unused for a substantial portion of each year.

Pick Hawke’s Bay was ordered to pay $25,000 compensation in total to the three seasonal workers named in the test case.

In turn, Pick Hawke’s Bay argued that any deductions held to be unlawful were still debts owed by these employees and should be recoverable as unpaid loans.

The Employment Court said recovery as loans was possible, but first required proof by Pick Hawke’s Bay as to the type of benefit provided, the value of the benefit, and its rights as an employer to demand payment.

Soapi v. Pick Hawke’s Bay Inc. – Employment Court (15.09.25)

25.207

Tax Relief: Inland Revenue v. KD Transport Ltd

 

Narinder Singh Dhaliwal’s request for time to pay overdue tax debts exceeding one million dollars owed by his transport company KD Transport Ltd was dismissed despite his complaints that liquidation would cause financial hardship for his family.  Family-owned companies are treated more leniently by Inland Revenue.

Counting against KD Transport was the fact it had continually failed to pay taxes due.  In addition, there were concerns company assets might be transferred to a new company registered in the name of Mr Dhaliwal’s spouse.

Auckland-based KD Transport applied for tax relief under special rules for ‘closely-held’ companies where one individual holds at least half the shares.

Tax law recognises these companies are often the sole source of family income.  Owner’s personal circumstances are taken into account when negotiating payment plans for tax arrears their company owes.   

The High Court was told KD Transport belatedly offered Inland Revenue a part-payment deal for tax arrears in May 2025, when unpaid tax then totalled $650,000 and Inland Revenue was taking steps to liquidate KD Transport.

Mr Dhaliwal had not followed up on earlier Inland Revenue suggestions he get in touch to talk about KD Transport’s arrears.

This part payment offer amounted to an upfront $100,000 payment, plus monthly $12,000 payments to clear what Mr Dhaliwal categorised as KD Transport’s ‘core tax arrears.’

In reply, Inland Revenue asked for detailed information, including full disclosure of Mr Dhaliwal’s personal financial position.  Some information, but not the required detail, was provided.

The part payment offer, and a subsequent further application for tax relief, were both refused by Inland Revenue on grounds no attempts were being made to meet current KD Transport tax debts, let alone contribute to arrears.

The supposed $100,000 offered earlier was not paid across to meet any of KD Transport’s tax arrears.

When Inland Revenue resumed liquidation proceedings against KD Transport, Mr Dhaliwal challenged the process by which Inland Revenue refused his earlier applications for tax relief.

Associate Judge Paulsen declined to intervene, instead putting KD Transport into liquidation.

KD Transport is clearly insolvent, he ruled.  Allowing the company to continue trading puts at risk all creditors, including Inland Revenue.

Tax arrears were continuing to mount.

It is better that company assets now be held by a liquidator and sold under the liquidator’s supervision, he said.

The liquidator subsequently reported that all KD Transport’s trucks were mortgaged and have been seized by secured creditors.

Inland Revenue v. KD Transport Ltd – High Court (15.09.25)

25.206

Family Trust: Lassnig v. Zhou

 

Family trust assets are not sacrosanct when a relationship ends.  The Supreme Court set out guidelines: for a marriage of short duration with no dependent children, family trust assets are divided according to financial contributions each made; otherwise, there is a wider discretion as to how assets might be split.

Equal sharing rules in the Property (Relationships) Act led to wholesale adoption of family trusts to supposedly block one spouse from claiming a half share of assets should their relationship fail.

‘Trust-busting’ litigation followed, with many family trusts then treated as nuptial settlements, having the courts order payouts to a former spouse using the Family Proceedings Act.

Family Proceedings Act has no simple 50/50 rule.  Courts may order any payout from trust assets ‘it sees fit’ where changed circumstances mean the purpose of a nuptial settlement is no longer being achieved.

This requires hypothetical speculation about what was the purpose of a family trust when founded, and then ‘looking forward’ at what future benefits were expected to flow from the trust should the relationship have continued.

Wording of a trust deed is relevant.

Naming a spouse and children as discretionary beneficiaries supports later claims to a share of family trust assets when a relationship ends, with a court order dividing trust assets.

To circumvent this result, instances now surface of spouses not being named as a beneficiary in family trust deeds.

The Supreme Court decision concerned a couple who set up a family trust within three months of marriage, purchasing three Auckland properties funded primarily with bank debt coupled with cash contributions from each.

Named as beneficiaries were themselves, plus close relatives.

The court was told their family trust was established to provide a home for them to live in and also to accumulate assets to support them on retirement.

Their marriage foundered within three years.

Family Proceedings Act litigation followed on how trust assets should be divided.

It was agreed the principal purpose of the trust was to benefit the two of them.  They each have children from earlier relationships, but no dependent children.

The court ruled trust assets were best divided according to financial contributions each made: 80/20.

The Supreme Court cautioned that if it were not a marriage of short duration then non-financial contributions would be relevant, with adjustments in trust asset division necessary ‘to reflect a failure of the [family trust’s] fundamental premise of a continued marriage.’

Lassnig v. Zhou – Supreme Court (15.09.25)

25.205

Settlelement: Lepionka & Co Investments v. Gibson Sheat

 

Litigation costs were the killer in Stefan Lepionka’s foray into a Hawkes Bay lifestyle subdivision.  Attempts to recover these costs from Auckland law firm Gibson Sheat claiming allegedly negligent advice were dismissed by the Court of Appeal.

His claim against Gibson Sheat was settled back in 2016, with an out of court settlement allowing a $105,000 fee reduction, the Court of Appeal ruled.

The court heard detailed evidence of move and counter-move after Mr Lepionka feared his $4.63 million purchase of lots in an intended Hawkes Bay subdivision was at risk.  He paid a $463,000 deposit up front in 2014; this money immediately at risk with Westpac as first mortgagee calling up the property developer’s loan, threatening a forced sale of all lots. 

To protect his investment, a company he controlled called Lepionka & Co Investments Ltd bought out the Westpac mortgage, taking over all rights held by the bank.

Gibson Sheat provided legal advice on how this deal should be structured.

Threats of legal action against Lepionka Investments followed from others with a vested interest in the intended development: financiers, purchasers of other lots and the property developer himself.

Their major complaint centred on allegations of a conflict of interest: Mr Lepionka as one purchaser was now also exercising rights as a secured creditor with power to override their existing rights.

As events panned out subsequently, Lepionka Investments was held to have improperly benefited from its exercise of Westpac’s rights.

But that was for the future.

More pressing was the legal dilemma now facing Gibson Sheat.  It was in an ethical bind: giving legal advice to Mr Lepionka personally (seeking to protect his position as a purchaser) and also acting for his company Lepionka Investments (exercising rights as a mortgagee); their legal interests and obligations had diverged.  

Unravelling this conflict arose at a time when a court hearing date loomed, challenging how Lepionka Investment was exercising its powers as secured creditor.

A dance of death ensued. 

Gibson Sheat said it wanted billing arrears paid and advised it could no longer act for Lepionka Investments because of the conflict.

Mr Lepionka’s legal adviser questioned whether Gibson Sheat was bailing at this late stage with a court hearing scheduled simply in order to hold Mr Lepionka to ransom.

Failure to recognise from the outset that there would later be a conflict of interest meant Gibson Sheat was negligent in the advice first given, Mr Lepionka claimed.

Negotiations followed.

A number of offers and counter-offers were exchanged by email.

Gibson Sheat agreed: it would write off some of its unpaid fees; reduce billing rates for its further work; and resume preparation for the then upcoming court hearing.

Mr Lepionka agreed to abandon a claim for negligent advice and asked Gibson Sheat to ‘get back on the tools’ and progress the upcoming court hearing.

Law Society ethical rules recognise the hazards of lawyers’ personal involvement when faced with claims against them by clients.  There is a clear conflict of interest when lawyers, who owe a duty of loyalty to their clients, are potentially negotiating against their clients’ best interests in reaching any settlement.

Law Society rules require clients get independent advice.

Nearly a decade on, Lepionka Investments looked to resume its negligent advice claim against Gibson Sheat seeking to recover its extensive litigation costs, arguing no independent legal advice was ever received to finalise settlement of his negligent advice claim.

In addition, their email exchanges stated any final settlement agreement would be put in writing and signed by all sides.  This was never done, Mr Lepionka said.

No formal written agreement was needed, the Court of Appeal ruled.  The essential terms of their agreement were spelt out in email exchanges.

Mr Lepionka did get sufficient independent advice, the court ruled.

He discussed the proposals and counter-proposals with lawyers outside Gibson Sheat.

This was sufficient independent advice for a businessman with Mr Lepionka’s business experience and expertise.

He and three other shareholders previously established beverage company Charlie’s Group; sold in 2011, with Mr Lepionka’s share valued at some $18 million.

Lepionka & Co Investments td v. Gibson Sheat – Court of Appeal (12.09.25)

25.204

Forestry: Gisborne District v. Samnic Forest Management

 

It could stand as a textbook case of negative externalities, with those gaining the benefit seeking to have others carry the costs.  Gisborne foresters want to deflect liability for damage caused by slash eroding watercourses and littering beaches following extreme rainfall four years ago.  To date, attempts by Samnic Forest Management directors to avoid personal liability have had little support in the courts.

Torrential rain and flooding on the North Island east coast in 2021-2022 damaged roads and bridges as logging debris scoured out riverbanks and backed up against bridges.

This followed earlier instances of forestry slash being washed up on beaches at Tokomaru and Tolaga Bays nearly ten years earlier. 

Gisborne District Council has been very critical of forestry management in general on the East Coast.  Clean-up costs following poor logging practice fall on ratepayers.  They bear the costs, but do not share in logging profits.

Gisborne District took legal action against Auckland-based Samnic Forest Management Ltd and Gisborne-based Forest Management Solutions Ltd for Resource Management Act offences in failing to properly contain slash, debris and sediment on its 940 hectare pine forest near Tolaga Bay.  Collectively, the two companies were fined $126,000.

Separately, Gisborne District tool legal action in the Environment Court to recover costs of remedying flood damage.

Owner of the forested-land, Woodlett Investments Ltd, accepts liability, but claims Samnic Forest should be paying most of the cost.  Samnic was responsible for managing the forest, it says.

Samnic Forest denies all liability.  It has handed back management responsibility for the forest to Woodlett as the landowner; it is now Woodlett’s problem it says.

Samnic directors Gavin Fortune, Scott Funnell and Richard Hayes strongly dispute any personal liability.

They have appealed an Environment Court ruling holding them personally liable for clean-up costs.

As far back as 2017, they were served with resource management abatement notices requiring improvements to management of logging waste.

Currently, they are resisting an Environment Court order that they pay personally for the first stages necessary to make good damage incurred: a land remediation plan; requiring a risk assessment map and a risk assessment plan.

Woodlett Investments has lodged its proposed plan with Gisborne District.

The three Samnic directors say they need not do likewise: they no longer manage the forest, the ‘huge cost’ would cripple them financially and it is a breach of natural justice in that their company Samnic Forest Management has already been fined.

There was evidence that the required risk assessment plan would cost about $30,000.

Justice MacGillivray said the directors had provided no evidence of their supposedly strained financial position.

Ownership of Samnic Forest Management is concealed behind a nominee shareholding controlled by Dilkhush Harry, a director of Dinu Harry Chartered Accountants Ltd in Auckland.       

Justice MacGillivray refused to place a hold on Environment Court enforcement orders.

These orders are being appealed, but are still enforceable pending the appeal outcome, he said.

No remediation work need start before this appeal is decided, he said.  The extent of directors’ personal liability will then be clarified.

Gisborne District Council v. Samnic Forest Management Ltd – District Court (1.08.24) & re an appeal by Samnic Forest Management Ltd – High Court (9.09.25).

25.203 

Overseas Investment: Ren v. Pan & Zhang

 

It looks like a case of take the money and run.  Jinyuan Pan and Ke Zhang exploited their relationship with an intending immigrant, offering to buy an Auckland property on her behalf with $1.5 million she remitted from China before later borrowing against this property to buy other Auckland investment properties in their own names, later selling up and transferring funds off-shore.

When Xiaojie Ren demanded return of her $1.5 million after failing to get New Zealand residency, they stalled; claiming it was a loan not yet due for payment, whilst using fancy legal footwork to delay a court hearing.

Ordering repayment, Associate Judge Lester said their claims of a loan were a dishonest invention.

In 2020, Ms Ren was looking to emigrate from China.  Her preferences were New Zealand or Australia.

In New Zealand, Jinyuan (William) Pan and Ke (Cecilia) Zhang offered to help.  A series of WeChat messages from March 2020 saw them discussing potential house purchases in Auckland.

Pan and Zhang offered to go on the title of a purchase made on her behalf in Auckland suburb Albany, while aware that use of a trust arrangement to hide her ownership was in breach of Overseas Investment Act rules.  

Initial attempts by Ms Ren to recover her money stalled when Pan and Zhang asked the High Court block any legal action until Ms Ren put up security for their costs should she lose.  Their application was thrown out as simply a ruse to delay the day of reckoning.

Back in the High Court seven months later, Pan and Zhang then claimed they received the $1.5 million as a loan, not falling due for another twelve months.

There was no written contract.

Judge Lester said the series of WeChat messages plus a partial payment made it clear that there was never any loan.  Supposed evidence of a loan was a dishonest invention to delay payment, he ruled.

Pan and Zhang were ordered to repay $1.47 million still outstanding.

In addition, they were ordered to make an increased contribution to Ms Ren’s legal costs.

The court was told the two have apparently sold the Albany property purchased with Ms Ren’s money, plus other properties purchased across Auckland with finance raised on security of Ms Ren’s Albany property, and then sent the net proceeds off-shore.

Ren v. Pan & Zhang – High Court (9.09.25)

25.202

Whangai: re Succession to Sharon Marino

 

Informal Maori whangai adoptions cut across rules that ancestral land devolves along blood lines, leading to disputes within whanau whether family members with no biological link should become part-owners of ancestral land.  Maori Land Court rulings must take into account local sensitivities.

It is routine practice in Maori society to have children raised by family who are not their biological parents.  Family circumstances, whanau tradition and infertility can all lead to a child being passed on to others.

There is no paperwork.  It is an oral agreement.

In contrast, paperwork completed for a statutory Adoption Act adoption sees a child legally considered the child of adoptive parents, severing all links with biological parents.

After Sharon Marino’s death in 2018, there was a dispute whether her whangai son Ricky should join Sharon’s grand-daughter Shayleigh Puhia as successors to her interest in ancestral land, with each taking a half share of Sharon’s interest.

The court was told Sharon had two sons: a natural child John who pre-deceased her, leaving daughter Shayleigh; and Ricky, a whangai son.

Ricky is a biological nephew of John’s father.

He was raised by Sharon from age six months, growing up in the same household and treated by whanau as brother to John.

Te Ture Whenua Maori Act allows whangai descendants to inherit ancestral land, provided that is the custom within a particular iwi or hapu.

The Maori Land Court was told local custom prescribed in this case that all whanau must agree to whangai children inheriting communally owned ancestral land.  Sharon’s sister and one brother objected, blocking a grant of succession rights to Ricky.  Another of Sharon’s brothers said Ricky should inherit.

Judge Thomas ruled against succession, but granted a life interest; Ricky is entitled to receive during his lifetime income distributions paid on the ancestral landholding passing to Shayleigh on succession from her grandmother Sharon.

re Succession to Sharon Marino – Maori Land Court (8.09.25)

25.201

Theft: Nicholas v. R.

 

Self-help remedies can go too far.  Bay of Plenty contractor Elijah Nicholas was convicted of theft after towing away an attached trailer he did not own when recovering his stolen Hino truck.

On the hijacked trailer were a loader and hives containing bees, collectively valued at more than $105,000.

The dishonest apiarist reported this loss to police, later being sentenced to imprisonment for his role in the earlier theft of Nicholas’ Hino truck.

When recovered, the loader and trailer were damaged; the bees dead.

The High Court was told the Hino truck was used by Nicholas for his earthmoving and house relocation business.  He found it two months after it was stolen; disguised, poorly repainted and with false registration plates.

After seizing it back with help of two associates, he initially ignored police requests for return of the trailer and contents.

Several weeks later the trailer and hives were left parked outside the Te Puke police station.  The loader was returned, damaged, some twenty months later.

At trial in the District Court, Nicholas was ordered to pay $32,800 reparations with six months community detention: a daily curfew from 9 pm to 6 am.

Judges frown on vigilante behaviour where theft victims respond in kind.

The trial judge said discharge without conviction is not appropriate when taking vigilante action to punish an offender.

On appeal, the period of community detention was reduced to four months.  The trial judge was unaware that the purloined loader had been returned, albeit belatedly, and damaged.

Nicholas v. R – High Court (8.09.25)

25.200

Investigation: re Waitutu Incorporation

 

Ngai Tahu descendants benefiting from a 1996 agreement with $13.5 million paid in return for government control over cutting rights to West Southland native forest had the Maori Land Court order an investigation into how Waitutu Incorporation has managed this compensation.  They allege a few of their number have benefitted improperly and also complain they have lost control of their major asset with effective control tied up in a voting trust representing untraced or deceased Ngai Tahu beneficiaries.

This 1996 agreement dealt with ongoing political fallout from colonial governments’ common practice of setting aside land of no economic value for local Maori; supposedly honouring earlier promises to leave ‘ample reserves’ for Maori owners when buying land for European settlement.

It was 1906 colonial government legislation which saw land in Southland between the Wairaurahirir and Waitutu rivers allocated to several Ngai Tahu hapu, then described as impoverished and landless.  It was, and is, heavily forested with native podocarp.  Even today, this land is accessible only by sea or a thirty kilometre tramp.

Descendants of these hapu now live elsewhere, with effective control of their major asset now lying with Daniel and Leonie Gale, living in Napier.

For later generations, the only way to achieve an economic return would see clear felling of their forested land.  To avoid total destruction of thousands of hectares of virgin beech forest, government negotiated in the 1960s with Maori owners to achieve a conservation agreement allowing government to control managed cutting rights, with Waitutu Incorporation paid compensation.

Disputes over management of this compensation has led to decades of complaints aired before the Maori Land Court by minority interests in Waitutu Incorporation.

Reordering of the Incorporation’s financial affairs saw logging operations hived off into a separate company.

Some Waitutu members question decisions to transfer rights under the cutting rights agreement from Waitutu Incorporation to a wholly owned subsidiary, Waitutu Holding Co Ltd which initially had Waitutu Incorporation as its sole shareholder, and then later saw individual Incorporation members substituted as shareholders of Waitutu Holding Co Ltd.

Having individuals substituted as shareholders was described as enabling them to sell off their individual logging shareholdings, without affecting their shareholding in Waitutu Incorporation itself.

Also in question are interest-free loans made by Waitutu Incorporation to both Waitutu Holding Co and other unrelated companies.

There was evidence that a lack of clear financial reporting had fuelled suspicions that improper benefits had been creamed off by some members of Waitutu Incorporation.

The court was told attempts to appoint new directors to Waitutu Holding Co has been blocked by a share management trust controlled by forestry manager Daniel Gale and secretary Leonie Gale.  This trust holds a forty per cent controlling block.  As trustees, they hold this stake on behalf of untraced or deceased Waitutu beneficiaries; a group who exercise no control over how their votes might be exercised.

Owners representing twelve per cent of Waitutu shareholding complain they have lost control over a significant portion of their assets.

The Maori Land Court used powers in the Te Ture Whenua Maori Act to appoint an independent examiner with authority to investigate governance issues at Waitutu Incorporation, and then report back to the court.

Waitutu Incorporation has just on 1100 current members, of which nearly six hundred are described as ‘unknown’ or deceased.

re Proprietors of Waitutu Incorporation – Maori Land Court (5.09.25)

25.198

Investigation: Lant v. Mangatu Blocks

 

Estimates of Gisborne-based Mangatu Incorporation’s losses on its failed North America lamb ‘farm-to-plate’ marketing campaign vary from $57.2 million to $86.7 million.  Demands for a Maori Land Court investigation were stymied by a procedural dispute over proxy forms.

Mangatu used carbon credits generated by replanting 8000 hectares of Maori-owned farmland into forestry to finance a Canadian joint venture, exporting meat to North America.  The venture failed.

As a member of Mangatu Incorporation, activist Marise Lant demanded an investigation, alleging Incorporation trustees failed to act properly.  She wants a Serious Fraud Office investigation.

Separately, she wants the Maori Land Court to investigate.

One method of forcing a Te Ture Whenua Maori Act investigation is to have at least ten per cent of incorporation members request an enquiry.

Ms Lant says she has support from twelve per cent of Incorporation shareholding.  Mangatu has 6500 owners, holding just over 850,000 shares.

As evidence of support, she filed in court details of proxy forms signed by Mangatu owners authorising her to act on their behalf at Mangatu’s 2024 annual general meeting.

Judge Milner ruled these proxy forms were not evidence calling for court intervention; they simply authorised her to exercise their votes at Incorporation meetings.

Discounting these proxy forms meant Ms Lant did not reach the required ten per cent threshold for Maori Land Court intervention.

She told the court that Mangatu trustees had ignored her past requests that a resolution calling for an investigation be put to members at the annual meeting.

Lant v. Mangatu Blocks Incorporation – Maori Land Court (5.09.25)

25.199

Trade Accounts: T M Consultants v. Morgan

 

Terms of trade holding customers liable for recovery costs on unpaid accounts is not licence to simply add a flat percentage to recoveries as proxy for actual costs incurred, the High Court ruled.  Enforcement costs must be itemised.  Only actual and reasonable costs can be recovered.

The High Court threw out as unreasonable a twenty-five per cent loading charged on attempts to recover a $29,900 debt, dismissing later explanations for recovery costs billed at $7900 as being implausible.

When asked for an explanation, the debt collection agency responsible itemised its $7900 charge as including ‘initial contact attempts’ for thirty phone calls at fifteen minutes each plus work drafting and sending follow up notices at a charge-out rate of $75.00 per hour.  In addition, there were vague claims of time spent on ‘field activities’ requiring property visits and asset inspections.

The original debt arose from engineering services provided to a client by Christchurch-based T M Consultants Ltd.  She was threatened with bankruptcy for non-payment of the original debt plus debt collection costs to date.

Subsequently, the amount claimed for debt collection costs was contested.

T M Consultants’ trade terms allow it to recover all ‘external costs’ in recovering unpaid accounts, including ‘all legal costs.’

It farmed out to a debt collection agency the job of recovering $29,900 remaining unpaid, later including these debt collection costs as a further debt due when attempting to bankrupt its former customer.

In the High Court, Associate Judge Lester ruled what appeared to be a blanket twenty-five per cent debt collection charge could not be considered ‘actual’ costs incurred.

No final decision was reached on what would be reasonable in this case.  The court was told an out of court agreement had been reached.

Judge Lester further ruled that when businesses such as T M Consultants, which are GST registered, claim recovery costs from defaulting clients, GST should be deducted from any GST-inclusive debt collection charges.  Unpaid creditors in the position of T M Consultants will be claiming a deduction for this GST paid to debt collectors; it is no longer a ‘cost’ incurred, requiring reimbursement by a defaulting customer.

Judge Lester cautioned the legal profession that it cannot just lump collection charges into undefended requests for default judgments on unpaid trade accounts; formal proof is required of actual costs incurred where terms of trade hold customers liable for collection charges.

T M Consultants Ltd v. Morgan – High Court (5.09.25)

25.197

Will: re Estate of Hubert Burke

 

Rules about mental capacity when making a will apply also to revocation, with the High Court ruling Northland resident Hubert Burke’s 2009 will remained valid despite his signature on a later letter supposedly revoking this will, replaced by handwritten notes giving all his assets to caregiver Poppy-Marilyn Handley.  Mr Burke died in 2023 aged ninety, with advanced dementia.

The High Court was told that a solicitor acting as executor under Mr Burke’s 2009 will was surprised to find amongst Mr Burke’s belongings notes dated two months before his death in which Mr Burke stated on death all he owned went to Poppy-Marilyn Patricia Handley ‘lock stock and barrel.’

Evidence was that these notes appeared to be in Ms Handley’s handwriting, signed by Mr Burke, stating Mr Burke was expressing gratitude for the fourteen years support she had provided as ‘confidant, caregiver, housekeeper, driver and good friend.’

The executor also later found Mr Burke’s former solicitor held a recent letter prepared and signed by Mr Handley revoking his 2009 will.

This lawyer refused to prepare a new will until Mr Burke first got a medical certificate certifying his mental competence.  Mr Burke did not do so.  

The High Court ruled this supposed revocation was ineffective; Mr Burke lacked sufficient mental capacity at the time to understand what he was doing.

Medical evidence established that Mr Burke had suffered cognitive decline for at least the previous eight years.

Justice Robinson ruled the 2009 will remained valid, confirming the executor’s appointment as valid.

The court judgment did not disclose who are named beneficiaries under this 2009 will.

He is survived by two adult children.

Ms Handley claims she has been in a de facto relationship with Mr Burke since 2009.

Abandoning any attempt to have the handwritten notes validated under the Wills Act as Mr Burke’s final will, she has set in train Property (Relationships) Act procedures to claim a share of his assets.

re Estate of Hubert Burke – High Court (4.09.25)

25.196

Relationship Property: Boyd v. Powell

 

With the equal division regime for relationship property not applying to relationships of short duration, disgraced businessman Tim Boyd was in court arguing extent of his financial contributions to a de facto relationship of a little over twenty months.  A Family Court judge ruled Boyd forged documents and lied in court.

His de facto relationship with Samantha Powell lasted longer than his subsequent six months stint as chief executive of council-controlled Christchurch City Holdings.  He resigned from City Holdings after allegations he lied about his work history.

In the Family Court, Judge Doyle directed that Mr Boyd’s relationship property evidence be forwarded for criminal investigation by both the police and the Law Society.

In addition, Judge Doyle criticised Mr Boyd for approaching Ms Powell at court during a lunch break when giving evidence, in what Ms Powell described as threatening behaviour seeking to have her settle the case or face legal action dragging on for years.

Mr Boyd denies he made any threats.

The four day Family Court hearing saw Mr Boyd ordered to pay his former de facto partner $70,600.

For relationships of less than three years duration, property division is calculated according to the ‘contribution’ each partner made.

The relationship property pool as at date the two separated in December 2021 totalled $453,000.  Of this, the biggest asset was $310,500 being net proceeds from sale of a property at Jacks Point in Queenstown.  They purchased Jacks Point for $1.32 million six months before separating.

There were multiple, and conflicting, copies of written agreements for this purchase in evidence before the Family Court.

Judge Doyle ruled Mr Boyd was party to having Ms Powell’s signature forged to the first agreement, lying to lawyers about both having signed, and then later created a fake duplicate agreement for the purchase that he had Ms Powell sign.

Judge Coyle also ruled that Mr Boyd fabricated a third purchase agreement at an inflated price of $1.5 million, part of a fraudulent scheme to obtain increased bank finance; all done without Ms Powell’s knowledge.

Judge Doyle also criticised Mr Boyd for giving false evidence at an earlier preliminary Family Court hearing.  Mr Boyd lied when asked if he was personally keeping up payments due on both their mortgage and Jacks Point residency association contributions.  He created doctored screenshots from his bank account to create an illusion of payments made.

When ruling on conflicting evidence between Ms Powell and Mr Boyd, Judge Doyle said Mr Boyd lacked credibility and was not truthful.

Having listed the proved financial contributions each made during their relationship, Judge Doyle ruled Ms Powell provided 55 per cent of cash resources; Mr Boyd 45 per cent.

Adjustments were made for money spent by each post separation in relation to Jacks Point plus an allowance for occupation rent payable by Mr Boyd for a period he remained in Jacks Point after separation and prior to sale.

The net result saw Mr Boyd ordered to pay $70,600.

Boyd v. Powell – Family Court (4.09.25)

25.195