Young v Young
| Jurisdiction | New Zealand |
| Judge | Gordon J |
| Judgment Date | 19 November 2020 |
| Neutral Citation | [2020] NZHC 3054 |
| Court | High Court |
| Docket Number | CIV-2019-404-1079 |
| Date | 19 November 2020 |
UNDER the Property Law Act 2007
UNDER the Property (Relationships) Act 1976
Gordon J
CIV-2019-404-1079
CIV-2019-404-2029
IN THE HIGH COURT OF NEW ZEALAND
AUCKLAND REGISTRY
I TE KŌTI MATUA O AOTEAROA
TĀMAKI MAKAURAU ROHE
Family, Property, Trusts — application for an order vesting a property co-owned with her entirely in her and for an order removing a Notice of claim lodged by the second defendant, her son's former wife — whether the son, who was a registered proprietor of a residential property along with his mother, had a beneficial interest in that property — the plaintiff claimed claimed she was the beneficial owner of all of the property and that the half-interest registered in the defendant's name was held by him on a resulting trust for her — s339(1)(b) Property Law Act 2007 — s142 Land Transfer Act 2017 — s42 Property (Relationships) Act 1976
R G Evans for Ella Young
B N Snedden for Shane Young
A G Rowe for Jina Kim
This judgment was delivered by me on 19 November 2020 at 2.30 pm, pursuant to r 11.5 of the High Court
Rules Registrar/Deputy Registrar
Date:
There are two separate, but related, proceedings before the Court. The issue at the heart of the case is whether a son, who is a registered proprietor of a residential property along with his mother, has a beneficial interest in that property.
The plaintiff in proceeding CIV-2019-404-1079 (the property proceeding) Ella Young, lives at 85 Mead Street, Avondale, Auckland (the property). The title to the property records Mrs Young and her son, Shane Young (Shane) 1 as the registered owners of the property. They are joint tenants. It is Mrs Young's position that she is the beneficial owner of all of the property. She says that the half-interest registered in Shane's name is held by him on a resulting trust for her.
She seeks an order under s 339(1)(b) of the Property Law Act 2007 (PLA) vesting the entire property in her.
Mrs Young also seeks an order under s 142 of the Land Transfer Act 2017 for removal of the Notice of Claim registered by Jina Kim, the second defendant, against the property.
Shane supports his mother's case.
Ms Kim is Shane's former wife. Her position is that Shane is both the legal and beneficial owner of a half-share in the property.
The proceeding in CIV-2019-404-2029 is brought by Ms Kim under the Property (Relationships) Act 1976 (PRA) (the relationship property proceeding). It was transferred to this Court from the Family Court. Ms Kim claims that Shane's half-share in the property is relationship property and should be divided equally between the two of them. Mrs Young and Shane defend that proceeding.
Mrs Young is now aged 80. She is a widow. She married her late husband, Ronald Young (Ronald), in 1958. Shane, the only child of the marriage, was born in 1973.
Mrs Young and Ronald bought their first home at 54 Burnley Terrace, Mt Eden, Auckland (Burnley Terrace) in 1974 with their savings from paid employment and with the assistance of mortgage funding. The home was first registered in Ronald's name and then transferred into their joint names under the Joint Family Homes Act 1964.
Mrs Young and Ronald sold the home at Burnley Terrace in 1988 for $140,000. Mrs Young says she and her husband worked hard in the intervening years to pay off the mortgage.
Using the funds from the sale of Burnley Terrace, Mrs Young and Ronald bought a property at 105 Canal Road, Avondale (Canal Road) for $130,000. They did not need mortgage finance for the purchase. The sale proceeds from Burnley Terrace were sufficient to meet the purchase price. After they moved into Canal Road, Mrs Young and Ronald found the house required significant maintenance. In order to carry out remedial work, Mrs Young and Ronald obtained a mortgage, first with United Building Society and then Housing Corporation of New Zealand.
Ronald was diagnosed with terminal cancer while they were living at Canal Road. Following the diagnosis, the couple decided to sell Canal Road. They found it costly to maintain and it still had a number of defects which needed to be remedied. As well, a home of the size of Canal Road was no longer needed. Shane was not living with his parents. He was living and working up north.
In September 1993, Mrs Young and Ronald sold Canal Road for $110,000.
That same month, Mrs Young and Ronald bought the property at 85 Mead Street, Avondale, for $104,000. Although it was a smaller property, as a consequence of taking out the two mortgages, and the need for repayment on sale, Mrs Young and Ronald's equity in Canal Road was not sufficient to meet the purchase price of the property. The purchase was therefore in part funded from the sale of Canal Road and in part by way of a mortgage from the ASB bank in the sum of $40,651.07.
Mrs Young says that in order to obtain the mortgage funding for the purchase of the property, as she and her husband were both beneficiaries by then, the ASB bank would not lend to them unless one of the registered proprietors listed on the title was working 40 hours a week. In her statement of defence, Ms Kim accepts that in the circumstances of Mrs Young and her late husband, normal commercial practice would have been for the ASB to require a joint application by Ronald, Mrs Young and Shane; for Shane to have joint and several liability for the advance made by the ASB, and for Shane to be a registered proprietor of the property.
Mrs Young says that at that time they approached Shane, who was still up north and working full time, and asked him to go onto the title with them so she and Ronald could get the mortgage funding for the purchase of the property. Shane agreed. Shane did not make any cash contribution towards the purchase of the property. Mrs Young says there was no intention that Shane would have any beneficial interest in the property.
It is not known whether there was any written agreement regarding the beneficial ownership of the property. The solicitor who acted for Mrs Young and Ronald on the purchase has passed away and his files cannot be located.
Mrs Young says she and Ronald lived in the property and accepted full responsibility for paying the mortgage and all outgoings, including rates and insurances associated with the property. They did not on any occasion ask Shane to assist with mortgage payments or for any outgoings on the property.
Ronald died on 2 July 1998. In his will Ronald left all of his estate to his wife. Mrs Young's evidence was that at the date of Ronald's death, he and Mrs Young were the only ones living at the property. Shane says he came back to Auckland before his father died and began to live permanently at the property after his father's death.
After Ronald's death Mrs Young continued to make all payments on the property, including mortgage payments, rates and insurances. She sought assistance from WINZ to meet the mortgage payments after Ronald's death. Shane did not assist with any mortgage payments nor did he make any payments for rates or insurance. The mortgage was repaid by Mrs Young on 22 December 1999.
When Shane began living permanently at the property after Ronald's death, he initially paid some rent to his mother. Subsequently, in substitution for rent, he helped his mother with maintenance around the house in return for accommodation.
Shane supported his mother's evidence. He said he made no cash contributions towards the purchase of the property, he did not live at the property at the time of its acquisition, nor did he make any payments towards the property. His inclusion on the title was simply to help his parents satisfy the ASB's loan criteria. In his oral evidence he said he thought he was acting more as a guarantor because he was in stable employment.
Mrs Young and Shane both say that even after Shane came to live at the property he still considered it belonged to his mother.
On Ronald's death title devolved to Mrs Young and Shane as survivors. There was a joint application by Mrs Young and Shane for transmission by survivorship dated 29 November 1999. This document formed a significant part of Ms Lim's case that Shane has both a legal and beneficial interest in half the property. I will return to the document later in this judgment.
At the time of signing the application for transmission of the property to Mrs Young and Shane, there was still an amount owed to the ASB Bank secured by the mortgage. The outstanding balance was repaid the following month.
After a 10 month visit to New Zealand some time prior to 2000, Ms Kim came back to New Zealand in 2004. She met Shane in New Zealand that year. They did not live together before their marriage which took place in June 2006 in South Korea. In January 2007, after returning to New Zealand, they came to live with Mrs Young at the property. They lived there until they separated in February 2012. During that time they travelled back to South Korea on occasion. Shane estimates they would have lived in South Korea for about a total of two years between January 2007 and February 2012. Ms Kim did not agree with this estimate. But she agrees that each time they went to South Korea it was for a period of around one or two months. She says they went there at least four times, approximately every 18 months.
They do agree that on all the occasions they went to South Korea, the property remained their place of domicile. They were only ever visiting South Korea and did not go there to stay permanently. They agree that on one occasion they...
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