P D STAITE and Others as trustees of the WHAOA NO 1 LANDS TRUST and Others v A M KUSABS and Others as trustees of the TUMUNUI LANDS TRUST and Others

JurisdictionNew Zealand
CourtHigh Court
JudgeChristiansen
Judgment Date25 July 2013
Neutral Citation[2013] NZHC 1851
Docket NumberCIV 2009-463-000888

[2013] NZHC 1851

IN THE HIGH COURT OF NEW ZEALAND ROTORUA REGISTRY

CIV 2009-463-000888

Under the Trustee Act 1956 and the Declaratory Judgments Act 1908 and the Land Transfer Act 1952

BETWEEN
Peter Daniel Staite, Jean Tanirau-Carston, Deborah Pakau, Leonie Rei Nicolls and Bruce Anderson Bamber as trustees of the Whaoa No 1 Lands Trust
First Plaintiffs
and
Andrew Matutuehu Kusabs, Donald Mairangi Bennett, Julian Kumeroa Keepa and Wiremu Waaka as trustees of the Tumunui Lands Trust
First Defendants

and

Peter Daniel Staite, Jean Tanirau-Carston, Bruce Anderson Bamber, David Te Nohi Jan Nikora, Lucky Jr Pehi, Oonagh Berenice Marino as trustees and representatives of the beneficiaries of the Ngati Whaoa Maori Reservation
Second Plaintiffs

and

Andrew Matutuehu Kusabs and Donald Mirangi Bennett retired as trustees of the Tumunui Lands Trust
Second Defendants

and

Edie Te Hunapo Moke and Pipi Pheobe Moke as personal representatives of the Estate Of Edward Paurini Moke as a former trustee of the Whaoa No 1 Lands Trust and the Ngati Whaoa Maori Reservation
Third Defendants
Appearances:

M McKechnie for the Applicants/Defendants

D Chesterman for the Plaintiffs/Respondents

Application under r15.1 High Court Rules (dismissing or staying all or part of proceeding) to strike out the plaintiff's first amended statement of claim — dispute over lease of Maori land owned by the plaintiff, the Whaoa Trust — allegation chairman of two trusts (Whaoa Trust and Tumunui Trust) breached his fiduciary duty to ensure that his duty as trustee of both did not cause any conflict of responsibilities — alleged he arranged for Tumunui to take the lease in circumstances which favoured one and disadvantaged Whoa — declaration sought that chairman had breached his fiduciary duty to the beneficiaries of the Whaoa Trust and sought to have the Tumunui lease set aside as a breach of the Rule against Self-dealing — doctrine of laches, whether claim was barred by s4 Limitation Act 1950 (limitation of actions of contract and tort, and certain other actions) — whether or not the defence of laches was only suitable for consideration at trial and not on an interlocutory application for strike out where the only evidence for consideration was affidavit evidence.

The issues were: whether the claim was statute barred under the Limitation Act 1950 (“LA”); and whether a Laches defence could be examined pre-trial

Held: There was a lack of specific particulars pleaded in support. It also seemed that a number of assumptions about lease term disadvantages were qualified by little more than claims that the particular lease terms were less favourable than those of a “standard” farm lease between commercial parties. Whaoa claimed to have recently located other material which supported the pleading of those claims. But there had been no discovery of that material. Whaoa had also submitted they were able to prove the pleading that the lease obtained by Tumunui was a poor commercial bargain and did not compare with “standard farming leases” today but there was no evidence to support those as relevant factors in standard farming leases nor could these be assumed. There was unchallenged evidence from Tumunui that M had not taken part in the discussions with the previous lease holder and Whaoa had taken legal advice on the matter. There was nothing in the evidence presented by Whaoa which was identified as being supported by any action or record identifying support of its generalised and unspecified claims.

Section 4(9) LA (section does not apply for claims for equitable relief) excluded claims for equitable relief from the time limits set out in s4 LA. Time limits in s4 LA could be applied “by analogy” to claims for equitable relief, in situations where there was a relationship between proceedings in equity and at common law under which Courts of Equity would apply the common law limitation rules in certain instances by analogy. The “limitation by analogy” rule operated in addition to the purely equitable doctrine of Laches. Laches permitted a defendant to set up the plaintiffs delay in bringing or pursuing his or her remedy with due speed as a defence to a claim for equitable relief. Importantly, delay in commencing a suit and/or delay in prosecuting a suit could trigger Laches.

No case authority had been cited to the court where in the absence of a limitation defence by analogy, there would be the availability of Laches upon a strike out application. Whether Laches was made out depended on an analysis of the facts of each case, with an assessment of where the overall balance of justice lay. Consideration would be given to:

  • - nature of the remedy sought;

  • - position of the plaintiff;

  • - whether those prejudiced were the defendant or a third party;

  • - whether there were evidential difficulties caused by delay;

  • - nature of the transaction involved;

  • - length of delay including any explanation for it.

Laches was a personal defence which meant a trustee need not be stigmatised by the actions of a prior trustee.

Although brought by the trustees of the Whaoa Trust and the Reserve Trust, it was represented that the claim was brought for the beneficiaries even though the trustees might in the past have endorsed the actions of prior trustees. Without that claim of a separate interest of the beneficiaries it was not clear on what basis the claims of the Whaoa trustees could have been brought at all. There ought to be a sufficient case available to warrant the Court acknowledging there were competing equities needing balance. Whaoa had not made out on appropriate case. More was required of pleadings than general allegations of impropriety. In this case those allegations appeared improbable or extravagant. What had been provided was inadequate. The case was about a lease the terms of which were engaged by all after an extensive process of review. Claims of influence by M were not supported by any evidence at all.

It involved Tumunui taking bare land which it improved and maintained at considerable expense thereafter, and for which it provided significant added value for the purpose of running a dairy farming activity and at the end of the lease Whaoa would receive the benefit of all improvements free of any cost. Claims of a poor lease bargain were not explained by reference to any material or evidence. The parties’ business arrangement had endured for about 18 years until the proceeding was filed.

Laches should not provide a defendant with any means to challenge the adequacy of a plaintiffs case which pleaded that because of perceptions of double-dealing a plaintiff was entitled to a trial hearing to assess whether the equities of both sides need rebalancing.

The proceeding was struck out.

DECISION

JUDGMENT OF ASSOCIATE JUDGE Christiansen

1

This judgment concerns the defendants' application for strikeout of the plaintiffs' first amended statement of claim.

The proceeding
2

The proceeding was initially filed on 17 December 2009. It was an 8 page document comprising 40 paragraphs and contained a single cause of action of an alleged breach of the Rule against Self-dealing.

3

The named plaintiffs were noted as being trustees of the Whaoa No.1 Lands Trust (the Whaoa Trust) and the Ngati Whaoa Maori Reservation, and Mr P D Staite. The defendants were named trustees of the Tumunui Lands Trust.

4

On 19 July 2012 the plaintiffs filed an application for leave to file an amended statement of claim, to add new defendants, and to remove and add a second plaintiff.

5

The proposed amended statement of claim was a 41 page document comprising 161 paragraphs and containing six causes of action.

6

The application to leave to file the amended statement of claim was opposed.

7

My judgment upon that application issued on 14 December 2012. It reviewed a not uncomplicated history of issues now emerging concerning the lease by the Tumunui Trust of Maori freehold land owned by the Whaoa Trust for 42 years from 1 June 1990. When the Tumunui Trust took over the land in question from the previous tenant it converted its use from dry stock grazing to a dairy unit and had completed this by 1 June 1990 before the lease term began.

8

The leased land comprised part of the 529.8624 hectares owned by the Whaoa Trust. On 31 October 1985 the Maori Land Court made a recommendation that 174.0183 hectares of the said land be set aside as the Whaoa Reserve for the purposes of a timber reserve, catchment area and a place of historical interest for Ngati Whaoa. On 17 February 1986 that reserve land was set apart by Gazette notice.

9

From 1964 the balance of the land (i.e. that which was not eventually set aside as a reserve) comprising approximately 355.72 hectares was leased by a Mr Mills, through his company, for dry stock grazing.

10

In October 1985 and, the Court assumes, as a precursor to the events formalised by the aforesaid orders of the Maori Land Court, the Whaoa Trust and Mr Mills entered into a partial surrender of the leased area whereby occupation of an area of 174.0185 hectares was surrendered.

11

Mr Kusabs a trustee of the Tumunui Trust deposes the Trust was informed that Mr Mills wished to quit his lease of the Whaoa Land. In discussions that followed Tumunui reached a settlement to acquire Mr Mills lease in early 1989. Mr Kusabs said it was understood that the consent of the Whaoa Trust would be required to any assignment of the lease. Mr Kusabs says extended discussions between the trustees of Tumunui and Whaoa Trusts then occurred. Both trusts were at that time represented by experienced lawyers. In that process the Whaoa Trust instructed surveyors to undertake a land survey for the purpose of defining the area to be leased by the Tumunui Trust. In the plan...

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