IN THE MĀORI LAND COURT OF NEW ZEALAND AOTEA DISTRICT A IN THE MATTER OF Papatupu 2A No 2

Transcription

1 363 Aotea MB 257 IN THE MĀORI LAND COURT OF NEW ZEALAND AOTEA DISTRICT A UNDER Section 18(1)(a) of Te Ture Whenua Māori Act 1993 IN THE MATTER OF Papatupu 2A No 2 MAUREEN FLUTEY Applicant Hearings: 356 Aotea MB 3-12 dated 19 July Aotea MB dated 16 August Aotea MB dated 31 August 2016 (Interim Judgment) Appearances: P Allen for the Applicant I Parker for the Executors to the Estate of Jim Huirua Sullivan Judgment: 18 January 2017 JUDGMENT OF JUDGE L R HARVEY Solicitors: I Parker, Parker and Mazengarb, PO Box 33, Whanganui parkermazengarb@xtra.co.nz P Allen, Treadwell Gordon, PO Box 4084, Whanganui pba@treadgord.co.nz

2 363 Aotea MB 258 Introduction [1] This final decision concerns the entitlement of Maureen Flutey to the net proceeds of trees harvested from the Papatupu lands that are the subject of these proceedings. On 31 August 2016 I issued an interim judgment directing Treadwell Gordon solicitors to pay Mrs Flutey 26.5 per cent of the net harvest proceeds held in their trust account. 1 [2] I also invited the executors and trustees to the Estate of Jim Huirua Sullivan to file any further submissions on the balance of the proceeds held by Treadwell Gordon claimed by Mrs Flutey, being 4.27 per cent, within one month from the date of that decision. [3] Mr Parker responded on 30 September Ms Allen filed a reply on 2 November Following the receipt of those submissions I directed both counsel to file any further submissions or evidence within one month and once in receipt of anything additional I would either issue further procedural directions or deal with the apportioning of the proceeds on the papers. [4] Ms Allen confirmed on 23 November 2016 that there were no further submissions or evidence to file on behalf of the applicant. No response was been received from Mr Parker. Issue [5] The issue for determination is should the Court make an order for the remaining 4.27 per cent of the net proceeds as claimed by the applicant? Submissions for the Estate of Jim Huirua Sullivan [6] Mr Parker contends that Ms Flutey is entitled only to the proceeds derived from Papatupu 2A2 which equate to approximately 78.9 per cent of the net proceeds held by Treadwell Gordon. Ms Flutey, he says, would be entitled to per cent of the portion of proceeds attributable to Papatupu 2A2 only assuming that contributions in cash and kind by Mr Sullivan were set off against a notional per cent share of rent for Papatupu 2A2 over the years. 1 Flutey Papatupu 2A No 2 (2016) 358 Aotea MB 38 (358 AOT 38)

3 363 Aotea MB 259 [7] Mr Parker submits that the net proceeds are derived from Papatupu 2A1, 2A2, 2B1 and 2B2. Consequently, he argues that Ms Flutey does not have a right, title or interest in Papatupu 2A1 and 2B1. She is not an owner of either block nor has she ever had any claim for rent from those lands. [8] In addition, Mr Parker contends that, although not included in her application, Ms Flutey is the sole owner of Papatupu 2B2 and would be entitled to 100 per cent of the 2.2 per cent of proceeds attributable to that block. [9] Mr Parker maintains that the appropriate ownership proportion for Ms Flutey is per cent of Papatupu 2A2 block proceeds only. This amounts to 24.3 per cent of the net proceeds. Counsel claims that if the Court varies the application to include the proceeds from Papatupu 2B2 Ms Flutey would be entitled to 26.5 per cent of the net proceeds which the Court has already determined in her favour. Applicant s response [10] Ms Allen submits that the further submissions filed by Mr Parker attempt to restate earlier arguments already put before this Court. [11] Counsel reiterates that that Ms Flutey s understanding of the agreement between her and Mr Sullivan was that when the forestry block as a whole was harvested she would receive per cent of the net proceeds in exchange for Mr Sullivan not paying rent for in excess of 20 years. [12] Ms Allen contends that the arrangement between Ms Flutey and Mr Sullivan was not based on the legal boundaries of the Papatupu lands but instead reflected the give and take nature of the use of the land. Counsel argues that the agreement conveyed the reality of the forestry block being treated as one block. The Papatupu blocks have historically been treated as Papatupu 2A2 lands and when the forest was harvested and invoices paid to Treadwell Gordon no distinction was made between the Papatupu lands. [13] Counsel Allen asks the Court to issue a final order determining that Ms Flutey is entitled to the remaining 4.27 per cent of the net proceeds and that costs be ordered in Ms Flutey s favour.

4 363 Aotea MB 260 Discussion Should an order be issued for the remaining 4.27 per cent? [14] In my interim judgment I concluded that the applicant was entitled to receive payment of the proceeds. I was satisfied that she was entitled to at least the 26.5 per cent of the net proceeds in dispute. I also confirmed that if no response was received from Mr Parker I intended to award the remaining 4.27 per cent to Ms Flutey. 2 [15] Mr Parker has responded. I agree with Ms Allen that Mr Parker s submissions largely re state the stance taken throughout these proceedings that Ms Flutey s entitlement be based on a calculation of the proceeds relating to Papatupu 2A2 block only rather than the net proceeds held by Treadwell Gordon. [16] Ms Allen submits that the arrangement between Ms Flutey and Mr Sullivan was not based on the legal boundaries of the block. She says that the Papatupu lands have historically been treated as Papatupu 2A2 lands and when the forest was harvested and invoices paid to Treadwell no distinction was made between the blocks. [17] In my interim judgment I discussed the nature of the evidence before the Court: 3 [26] Mrs Flutey has appeared in this Court on a number of occasions in connection with proceedings concerning the sale and gifting of Māori land. Almost without exception, in my recollection, she has been the purchaser of interests from whānau or has facilitated family arrangements. Then as now I have found her to be, without exception, an honest and forthright individual. She says that Mr Sullivan came to an agreement with her over the proceeds from the harvesting of trees in lieu of rental payments. In the absence of any compelling evidence to the contrary, I have no reason to doubt her. [27] That there is no independent corroborating evidence is admittedly problematic since Mr Sullivan is deceased. That Mrs Flutey s evidence could therefore be described as self-serving is not in dispute either. Yet even Mr Parker in his contributions to the proceedings made mention of discussions with Mr Sullivan over some of these matters. So it is not as if there is a complete rejection of Mrs Flutey s claim or that the possibility of such an agreement being struck by her with Mr Sullivan was so improbable to the point of being unbelievable. I acknowledge that Mr Parker also confirmed that there was nothing in writing from Mr Sullivan supporting Mrs Flutey s claim. Similarly, there was he acknowledged no evidence that Mrs Flutey had sold her shares to Mr Sullivan or had intended to, beyond Mr Parker s recollection of what he says Mr Sullivan had told him. [28] In any event, having considered the submissions, I am satisfied that the applicant is entitled to receive payment of the proceeds currently held by her solicitors. The question is first, what proportion of the funds held is she entitled to 2 3 Flutey Papatupu 2A No 2 (2016) 358 Aotea MB 38 (358 AOT 38) Ibid at [26] to [28]

5 363 Aotea MB 261 receive? After careful reflection, taking into account the evidence on the Court file and the submissions of the parties, I am also satisfied that Mrs Flutey should be entitled to at least the 26.5% of the proceeds in dispute. I direct that 26.5% of the proceeds currently held by Treadwell Gordon be paid forthwith to Mrs Flutey. [29] I also direct that Mr Parker seek instructions from his clients within one month from the date of this direction as to their views regarding this decision and in relation to the matters previously discussed at the last hearing. If they wish to make submissions on what if any deductions should be made for the costs of planting and maintaining the forest then they should do so within the timeframe specified, noting the earlier adjournment and the request for submissions then. Evidence in support of any alternative position should also be filed within one month. [32] Should no response to this direction be received from Mr Parker or his clients then I give notice now that, in the absence of relevant and compelling submissions to the contrary, I intend to order the disbursements of the remaining 4.27% of the proceeds that Mrs Flutey is claiming to her within one month of the date of this direction. (Emphasis added) [18] Although Mr Parker did file a response his submissions do not go far enough so as to compel a finding to the contrary. I am satisfied that the agreement between Ms Flutey and Mr Sullivan was for a portion of the net proceeds to be paid to Ms Flutey in lieu of Mr Sullivan paying rent. I accept that land boundaries were not discussed and the arrangement was based on the net proceeds of the tree harvest. [19] During the 19 July 2016 hearing Mr Parker sought to argue that Mr Sullivan receive costs for establishing and maintaining the forest. At the time I directed Mr Parker to file further evidence of this claim: 4 The Court: Yes. Mr Sullivan s beneficiaries have one month from today to say why we should not proceed to distribute 26.5% of the proceeds to you within one month of today. The balance if they still wish to dispute that it up to them. On the evidence before me, and I accept that it is interim only, there is no evidence to suggest that Mr Sullivan intended that the costs of establishing and maintaining the forest should be deducted [20] An additional opportunity to file further submission on this point was granted to Mr Parker at the hearing held on 16 August Counsel was then given further time to file submissions on what if any deductions should be made for the costs of planting and maintaining the forest in my interim judgment. Mr Parker has not been able to take Aotea MB 3-12 (356 Aotea MB 3-12) and 357 Aotea MB (357 AOT )

6 363 Aotea MB 262 instructions on this aspect of his claim. In the absence of evidence to support this claim I find that Ms Flutey is entitled to 4.27 per cent of the net proceeds held by Treadwell Gordon. Costs [21] Ms Allen seeks an award of costs. At the initial hearing Ms Allen stated that Ms Flutey had paid $4,000 in costs to date and estimated a further $1,000 would be incurred for preparation and attendances. Initially Ms Allen sought to have the costs deducted from Mr Sullivan s portion of the forest proceeds. However, I raised the possibility that by right Mr Parker s costs might then also be met from the net proceeds. I pointed out to Ms Allen that costs follow the event and indicated that costs will be dealt with once the balance claim had been resolved. [22] Ms Allen reiterates that costs should not have been incurred by Ms Flutey because of the attempts they had made to negotiate and come to an agreement with the Estate which were met by no response and no reply. Ms Allen submits that the Court proceedings were a last resort. [23] In my interim judgment I stated: 5 [34] One final point. Mrs Flutey has made a claim for costs. There was much force in the submissions of counsel on this point. That Mr Parker has acknowledged some of the delays to date have been as a result of his own difficulties in seeking and then receiving instructions is also acknowledged. Mr Parker and his clients should be under no illusion that there remains at least a reasonable prospect of an award of costs, in the absence of compelling submissions to the contrary. [35] In any event, there will be further opportunity for counsel to file and respond to submissions on costs in due course. [24] Counsel for the applicant is invited to file submissions as to costs within two weeks. The respondent will have two weeks from receipt to respond. Decision [25] Treadwell Gordon, solicitors of Whanganui, are directed to pay Maureen Flutey 4.27% being the balance of the proceeds currently held in their trust account from the harvesting of trees from the Papatupu lands. 5 Flutey Papatupu 2A No 2 (2016) 358 Aotea MB 38 (358 AOT 38) at [34] to [35]

7 363 Aotea MB 263 [26] Ms Allen is invited to file submissions as to costs within two weeks citing appropriate authorities where relevant. [27] Thereafter Mr Parker will have 14 days to file a response. These orders are to issue immediately per r 7.5, Māori Land Court Rules Pronounced at 10.45am in Palmerston North on Wednesday this 18 th day of January 2017 L R Harvey JUDGE