Published 28 November 2024
Relationship property proceeding — de facto relationship — disposition to a Trust — personal rights — Property (Relationships) Act 1976 ss 44 & 44C — Lambly v Silk Production Ltd [1976] 2 NZLR 427 (CA) — Sutton v Bell [2023] NZSC 65 — Regal Castings Ltd v Lightbody [2008] NZSC 87, [2009] 2 NZLR 433 — Golden v Herring [2023] NZFC 7971 — Deng v Zheng [2022] NZSC 76 — LG v KFW [2012] NZFC 5566 — Lavery v Lavery [2018] NZHC 3235 — Jackson v Jackson [1984] 1 NZLR 382 (CA) — Flay v Flay (1990) 6 FRNZ 131 — Branch v Vickey HC Auckland HC57/98, 25 August 1998. The parties were in a de facto relationship and had a child together, and had since separated. The issue for determination was whether the transfer of property into a trust was a disposition of property to defeat the applicant's rights under ss 44 and 44C of the Property (Relationships) Act (PRA). Two properties were in contention. The applicant claimed that the properties were relationship property that was disposed to a Trust during their relationship to defeat her claim under the PRA. The applicant submitted that the respondent bought the properties in his personal capacity because the sale and purchase agreements were not signed on behalf of the Trust as the other trustees did not sign the agreement. She further submitted that due to the significant intermingling between the Trust's funds and the respondent's personal account used to purchase the properties, they were relationship property. The applicant submitted that the properties' disposition to the Trust was to defeat the applicant's rights and the respondent was aware of this. A family trust was established by the first respondent's father and the discretionary beneficiaries were his children and grandchildren. The applicant was not a beneficiary of the Trust. The first respondent's father died leaving an estate worth $9 million. The Trust's source of income was the respondent's inheritance. The agreements for sale of both properties were signed in the respondent's own name as a nominee for the Trust. The first property's deposit was paid from the respondent's own account and the second property's deposit was paid by the Trust. The respondents submitted that the first respondent signed the agreement for sale and purchase for the properties on behalf of the other trustees and there was no disposition of property to the Trust. The respondents claimed that the first respondent was unaware that he was potentially acquiring personal rights or defeating rights. The Court determined that the respondent entered into the agreement for the sale and purchase of the properties on behalf of the Trust and he believed he signed the two agreements for the properties to be owned by the Trust. The Court found that the applicant failed because neither property was relationship property at the time they were bought by the Trust. The application was unsuccessful. Judgment Date: 17 June 2024. * * * Note: names have been changed to comply with legal requirements. * * *
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