F X J H v H Y-M Y
| Jurisdiction | New Zealand |
| Judge | J H Walker |
| Judgment Date | 27 April 2011 |
| Court | Family Court |
| Docket Number | FAM-2009-044-000966 |
| Date | 27 April 2011 |
In the Matter of the Property (Relationships) Act 1976
And in the Matter of the Family Proceedings Act 1980
FAM-2009-044-000966
IN THE FAMILY COURT AT NORTH SHORE
Application for declaration that a s21 Property (Relationships) Act 1976 (“PRA”) (spouses or partners may contract out of PRA) prenuptial agreement be declared void or set aside due to serious injustice — parties met in China and applicant came out to NZ on a three month visa to visit respondent — agreement was prepared and signed and the parties married a month later in NZ — three children and five years later the parties separated — whether the agreement was void pursuant to s21F PRA (agreement void unless complies with certain requirements) or should be set aside due to serious injustice — whether s15 PRA (Court may award lump sum payments) or spousal maintenance claims were made out.
R Reed for the Applicant
R Hooker and T Homes for the Respondent
(S 21F, S 21J and S 15 of the Property (Relationships) Act 1976 S 63 and S 65 of the Family Proceedings Act 1980)
RESERVED JUDGMENT OF JUDGE J H Walker
These proceedings relate to matters under the Property (Relationships) Act 1976 (the Act).
The primary application by the wife, F X J Y (Mrs Y), is seeking a declaration that the s 21 prenuptial agreement dated 16 December 1998 (the agreement) between the parties be declared void pursuant to s 21F of the Act, or set aside because of serious injustice pursuant to s 21J of the Act.
The Respondent in these proceedings is the husband, H Y-MY (Mr Y).
In addition, the Applicant is seeking orders relating to division of relationship property, an order under s 15 of the Act relating to economic disparity and orders for occupational rental and for spousal maintenance.
The parties were both born in China. Mr Y was living in New Zealand and previously was married here. He returned to China in 1996, when he and Mrs Y (then Ms H) met. In 1997, when Mr Y visited China again, the parties talked about their relationship and starting a family. Enquiry was made as to whether Mrs Y would be eligible to emigrate to New Zealand. The parties continued correspondence and the future Mrs Y applied to come to New Zealand on a three month visa. She arrived in New Zealand on 12 December 1998.
In early December 1998, the solicitors for Mr Y drafted an s 21 agreement under the Act (“the agreement”) and this was signed by Mr Y in front of his solicitor. Arrangements were made for the future Mrs Y to see a solicitor in Auckland, Mr Chai, and she met with Mr Chai on 16 December 1998 and signed the agreement.
The parties married in New Zealand in January 1999 and had three children: S L Y, born in August 1999 (currently aged 11), R Y, born in April 2001 (currently aged 9) and M Y, born in June 2005 (currently aged 5). The parties separated in December 2004. M was born after the parties separated.
There were consent orders made in the Family Court on 3 May 2006 whereby the children remain in the day to day care of Mrs Y, with Mr Y having contact on Saturdays from 6.00 pm to Monday at 8.00 am and half of each school holiday.
1. The validity of the agreement.
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2. Whether the agreement is void pursuant to s 21F of the Act.
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3. Whether the agreement should be set aside due to serious injustice pursuant to s 21J of the Act.
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4. Is the Applicant entitled to a s 15 claim under the Act?
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5. Is the Applicant entitled to a spousal maintenance order, and if so what orders should be made?
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6. Is Mrs Y entitled to an occupational rental claim and if so what orders should be made?
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7. Division of other relationship property in dispute.
These proceedings were commenced by Mrs Y in April 2009, nearly five years after separation. The parties remain married at the date of the hearing.
Mrs Y has filed 10 affidavits in the course of the proceedings. There have been a number of interlocutory applications and determinations. The Applicant has filed two affidavits from Chinese nationals. The Court was advised at the pre-trial conference that these parties would not be available for the purposes of cross-examination.
At the pre-trial telephone conference it was ascertained that the Applicant waived privilege and an order was made that Mr Chai (now resident in Australia) give oral evidence. Mr Chai was the solicitor who Mrs Y signed the agreement in front of in December 1998. Mrs Y's Counsel obtained a warrant to ensure the attendance of Mr Chai. Shortly before the hearing he also filed a short affidavit.
Subsequent to the pre-trial hearing, Mrs Y filed a late affidavit which required response. On that basis leave was given to Mr Y to respond to matters raised.
A Mandarin speaking interpreter was present throughout the proceedings. In respect to two of Mrs Y's early affidavits, an interpreter provided evidence that these had been read to her prior to her signing stating that she understood the contents.
The credibility of both the parties was at issue during the course of the proceedings. In addition, there was some documentary evidence produced by way of exhibits, the authenticity of which was questionable.
Counsel subsequently filed submissions. Ms Reed in her lengthy submissions in reply, however, expanded her submissions. Accordingly, limited reference is made to these.
During the hearing it emerged that the circumstances surrounding the signing of the prenuptial agreement raised questions as to its validity.
There were two signed copies sent by Ms McMillan, Mr Y's lawyer, to Mr Chai for signing by Mrs Y. At some stage after receipt by Mr Chai, or when the documents were returned to Ms McMillan's office, additions were made to Schedule A, which set out the items to be the separate property of Mrs Y. This alteration was initialled by Mr Y and Ms McMillan but not by Mrs Y or Mr Chai.
Both solicitors gave evidence that the alterations were not made by them. In the case of Mr Chai, his evidence was that he would not have stated, 1/7 th share in a property in China being left by X J H's deceased parents to their seven children, as this was not property belonging to Mrs Y at the time. Ms McMillan's evidence is that it was initialled by her and Mr Y because it was returned to her with alterations.
There is no correspondence between lawyers on this point. However, there is correspondence which supports that Mr Chai failed to sign the certification and notified Ms McMillan the following day. It is also clear that the documents were returned to him the following month and this was completed. There was also correspondence which confirmed that Mr Chai had furnished an account for his services when he had sent the documents back on the first occasion on the instructions of Ms McMillan.
The number of photocopies of the agreement led to some confusion, and only with the production of the original was the sequence made clear. Some issue as to the document's validity was taken because of the alteration. I am unable to make a finding of fact as to in which of the solicitors' offices the alteration occurred. However, the matter of the certification was clearly a genuine error on the part of Mr Chai which was remedied. In respect to the alteration to the schedule, nothing turns on the point as to the matter of when the contract was made. Neither Counsel addressed the matter in legal submissions on that basis, and accordingly the Court is not called to determine the matter.
The relevant statutory provisions in the Act are ss 8, 21, 21F and 21S. Section 8 provides:
[Relationship] property defined
[(1)] [Relationship] property shall consist of—
(a) The [family] home whenever acquired; and
…
[(d) all property owned by either spouse or [[partner]] immediately before their marriage[[, civil union,]] or de facto relationship began, if—
(i) the property was acquired in contemplation of the marriage[[, civil union,]] or de facto relationship; and
(ii) the property was intended for the common use or common benefit of both spouses or [[partners]];
…
Section 21 provides:
Spouses or [partners] may contract out of this Act
(1) A Husband and wife[, civil union partners,] or de facto partners, or any 2 persons in contemplation of entering into a marriage[, civil union] or de facto relationship, may, for the purpose of contracting out of the provisions of this Act, make any agreement they think fit with respect to the status, ownership, and division of their property (including future property).
(2) An agreement made under this section may relate to the status, ownership, and division of property in either or both of the following circumstances:
(a) during the joint lives of the spouses or [partners]:
(b) when 1 of the spouses or [partners] dies.
(3) This section is subject to section 47.
Section 21F provides:
[21F Agreement void unless complies with certain requirements
(1) Subject to section 21H, an agreement entered into under section 21 or section 21A or section 21B is void unless the requirements set out in subsections (2) to (5) are complied with.
(2) The agreement must be in writing and signed by both...
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