AKR v S Phcak
| Jurisdiction | New Zealand |
| Judge | Wylie J |
| Judgment Date | 10 October 2011 |
| Neutral Citation | [2011] NZHC 1509 |
| Docket Number | CIV 2011-404-002998 |
| Court | High Court |
| Date | 10 October 2011 |
In the Matter of the Family Proceedings Act 1980
and
[2011] NZHC 1509
CIV 2011-404-002998
IN THE HIGH COURT OF NEW ZEALAND
AUCKLAND REGISTRY
Appeal from Family Court (“FC”) decision — cross-appeal as to jurisdiction of FC — parties married in Fiji and marriage dissolved 27 years later in Fiji — no children — husband sought division of matrimonial property and orders dealing with joint and several liabilities in Fiji — wife now lived in NZ and husband temporarily resident in NZ for medical treatment — parties established Trust in 2001 in NZ which purchased two apartments in Auckland — whether FC had jurisdiction to grant a stay to an application under s182(1) Family Proceedings Act 1980 (Court may make orders as to settled property, etc).
J Hunter for the Appellant
DAT Hollings QC for the First Respondent
LM Nicholson for the Second Respondent
[RESERVED] JUDGMENT OF Wylie J
The appellant, Ms R, appeals against part of a decision of Judge de Jong delivered in the Family Court at Auckland on 27 April 2011, The part of the decision appealed against is the Judge's decision to stay an application made by Ms R under s 182 of the Family Proceedings Act 1980 (“the Act”), until proceedings commenced by the first respondent, Mr P, in Fiji, have been determined.
Mr P cross-appeals Judge de Jong's decision. He submits that the Family Court did not have jurisdiction to hear Ms R's application under s 182.
The second respondent is a corporate trustee. It administers a trust established by the parties with assets in New Zealand. The trust is known as the Kasba Trust.
The appeals raise two issues:
The second issue only arises if the first issue is decided in favour of Ms R.
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(a) first, is Ms R entitled to apply for relief in New Zealand under s 182 of the Act when the order dissolving the parties' marriage was made in Fiji; and
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(b) secondly, is Fiji the forum conveniens for determining relationship property and trust issues between the parties?
Ms R was born in New Zealand, but she has spent much of her life in Fiji,
Ms R and Mr P married on 9 July 1981 in Suva, Fiji. They separated in early 2008, and their marriage was dissolved on 26 May 2009 by an order made by the Family Law division of the Magistrates Court of the Fiji Islands at Suva under the Family Law Act 2003 (Fiji).
There were no children of the marriage,
Mr P commenced proceedings in the Family Law division of the Magistrates Court in Suva on 18 November 2008. He sought division of the matrimonial property and orders dealing with their joint and several liabilities. Ms R has actively participated in those proceedings. By way of example, she filed her financial statements on 25 February 2009. Since then, various affidavits and applications have been filed with the Court in Fiji. Some of the applications have been filed by Ms R, Further, Ms R has herself filed proceedings in Fiji. In July 2009, she commenced proceedings seeking maintenance. She subsequently withdrew those proceedings in August 2010.
Ms R has resided in New Zealand since late 2007.
Mr P resides largely in Fiji, but since January 2010 he has been temporarily resident in New Zealand so that he can obtain medical treatment. He needed a liver transplant. Mr P gave evidence before me. He had the transplant in April 2010 and it appears to have been successful. He stated that his “results are stable” and that he does not need to attend a further clinical appointment for some three months. He has recently been back to Fiji, and he intends to return to Fiji permanently as soon as he is able to do so. In his words, “I have to go back home. I don't live — never lived here”.
On 16 August 2001, the parties settled a trust known as the Kasba Trust. Ms R was the settlor, and the second respondent is the corporate trustee. The trust was established because Mr P's medical condition began to seriously deteriorate in approximately 2000. At much the same time, there was a coup d'etat in Fiji. Mr P took steps to establish the trust so that he could transfer funds out of Fiji and use those funds as assets of the trust to purchase a suitable residence for him in Auckland, located conveniently to his doctors and the Auckland Hospital Liver Transplant Unit.
Mr P arranged for his cousin, a solicitor in Auckland, to draft a suitable trust deed. The document was executed at Mr P's offices in Suva. Mr P caused monies to be transferred from Fiji in the name of Ms R, to the second respondent as trustee of the Kasba Trust. Those monies were derived from the sale of the parties' former matrimonial home in Suva, which was originally in their joint names.
The amount initially gifted by Ms R to the trust was NZ$503,455. Subsequently, Ms R has gifted a further $202,645.43. The Reserve Bank of Fiji approved the remittance of funds to New Zealand because of Mr P's medical condition, and because he needs to stay in Auckland from time to time for the ongoing management of his condition.
The trustee has purchased two apartments in Grafton Road, Auckland. One unit, unit 10B, was purchased in May 2002 for $655,501. An additional unit, unit 7C, was purchased in September 2002 for $410,000.
At the time of separation, Ms R was living in apartment 10B. As I understand it, she was not paying any rent to the trust, In November 2008, she vacated the apartment at the trustee's request. The property is subject to a mortgage in favour of the ASB bank securing $320,000, and the trustee was concerned that the trust was unable to meet the mortgage payments on the property.
Mr P has since taken up residence in the apartment, because he needed to reside in Auckland before and after his liver transplant. He has paid rental through his insurance company at a market rate for the use of the apartment.
Ms R registered a notice of claim against apartment 7C. She was invited by the trustee to remove that notice of claim so that the apartment could be sold. While she did not agree to do so, she took no steps to sustain her claim after notice was given under s 145 of the Land Transfer Act 1952. The trustee is now intending to market apartment 7C for sale.
It is common ground that the trustee has kept the parties informed of all proposed actions to date. Further, the trustee has indicated that it will continue to do so.
Both Ms R and Mr P are beneficiaries under the Kasba Trust's deed. There is, however, a clause — cl 13.3, which provides as follows:
No part of the capital or income of the Trust Fund may under any circumstances be paid or lent to or applied for the benefit of the Settlor and none of the provisions of this deed shall operate for the direct or indirect benefit of the Settlor.
Ms R, as settlor, expresses concern about this clause, and considers that it is extremely unfair.
Mr P for his part acknowledges that the parties' interests under the trust comprise part of their matrimonial property, and that they are the subject of the current matrimonial property application before the Fijian Courts. He has disclosed the existence of the Kasba Trust and the respective interests of himself and Ms R thereunder. He has further deposed that the Court in Fiji has all the necessary powers to make orders as between him and Ms R to effect a division of their matrimonial property. Mr P has stated (and it is not disputed) that the Family Law Act of Fiji is closely based on, although not identical to, the Family Law Act 1975 in force in Australia, and that the Fijian Courts can make similar orders to those which are made by the Family Court of Australia. He states that the courts in Fiji have wide powers to make orders which can go behind trust arrangements and which can operate in personam against the parties to property proceedings in respect of trusts and otherwise.
As noted above, the proceedings in Fiji have been strongly contested, and there have been and still are, a variety of applications before the Court. Ms R was cross-examined about the current state of the proceedings and copies of various orders made by Wati J in the Family Division of the High Court of Fiji on 21 September 2011 were made available to me. Various matters were due to be heard on that date but the hearings were adjourned by consent. A request by one of the parties for access to a property in Sydney owned by Ms R but said to be matrimonial property, and for the sale of that property, is now to be heard on 27 October 2011. If matters cannot be finalised on that day, then they are adjourned for further hearing on 18 November 2011. An application for sale of one of Kasba Trust's New Zealand assets, presumably apartment 7C, is also to be heard on 27 October 2011. An application by an intervenor, Blue Water Real Estate, is to be heard on the same day, as is an application for sale of a property at Wailoku. This property is also said to be matrimonial property. An application for a property settlement is due to be called for mention on 18 November 2011, as is an application for access to chattels in Auckland. A direction for third-party disclosure is for hearing on 18 November 2011, along with an application that Mr P's counsel be disqualified from, and/or cease acting for him against Ms R in the proceedings.
Mr P gave evidence that he is “pushing for timetables … to get [the proceedings] over and done with”.
Against this background, Ms R filed an application pursuant to s 182 of the Family Proceedings Act 1980 in the Auckland Family Court seeking relief on I December 2009.
On 19 February 2010, Mr P filed a notice of protest to jurisdiction, and on 22 February 2010, the second respondent...
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