reserved decision of judge s te a milroy · awhina faulkner, and his mother catherine faulkner....

IN TilE MAORI LAND COURT W AIKATO-MANIAPOTO

UNDER

AND

Hearing: 29 May 2006 (Heard at Tauranga)

Counsel: Mr J Koning

Judgment: 5 September 2006

Minute Book: 86 T 141

A20050016043 A20060013362

86 TAURANGA MB 141-154

Sections 18(1)(a) and 19(1)(b) ofTe Ture Whenua Maori Act 1993

TERENCEWETEAFAULKNER Applicant

TANGIW AI V ALMAI EGAN JOEY TE AO TUTAHANGA FAULKNER Respondents

RESERVED DECISION OF JUDGE S TE A MILROY

1. The applicant, Terence Faulkner ("Terence") lives with his mother, Catherine

Faulkner, and his family at 511A Matapihi Road Tauranga. The house in which they

dwell is situated on Matapihi 3A2C1C2C ("the block"). A 50% share in the block

belongs to Terence, while the balance belongs to the estate of Terence's father,

Putere Wetea Faulkner ("Putere"). This dispute concerns the ownership of the

house, which is claimed by Tangiwai Valmai Egan ("Tangiwai") as administrator of

the estate of Hurihia Emery ("Hurihi a") , who is the mother of both Tangiwai and

Putere, and the grandmother of Terence. The dispute arises because an order was

made by the Maori Land Court on the 2ih May 1991 ("the May order") at 49

Tauranga Minute Book 258, determining the ownership of the house as belonging to

Hurihia. There is also another order made by the Maori Land Court on the 15th April

T W FAULKNER And Ors MLC A20050016043 [5 September. 2006]


house belongs to Mr Thomas Egan ("Thomas"). Despite the existence of these

orders Terence claims ownership of the house on behalf of himself and his wife, Pani

Awhina Faulkner, and his mother Catherine Faulkner. Terence's claim rests on the

grounds that he is a 50% shareholder in the land and that his father, Putere, was in

fact the owner of the house, and that Putere's interest passed to Terence by

succession and a family arrangement between Terence, his mother and his siblings.

2. The matter was heard on the 29th May 2006 before Judge Harvey, and

Thomas gave oral evidence at that time. Judge Harvey adjourned the matter to allow

the parties to file closing submissions. The file was then referred to me for decision.

Facts

3. In the late 1980s Hurihia moved to Matapihi, initially moving into a garage

on the block. Thomas and his family returned from Australia and, together with

Hurihia, built the house in about 1991. Hurihia paid for labour and materials, while

Thomas worked with Taho Walker, the builder, to build the house. Thomas also

contributed financially towards payment of materials for the house.

4. Thomas' evidence is that his mother encouraged him to apply for the April

order determining that he was the owner of the house in order to give him some

security of tenure. Hurihia also applied for the May order determining that she was

the owner of the house. It is clear from the facts that during the period from 1991 to

1994 Thomas and Hurihia were co-owners of the house.

5. Thomas' evidence before Judge Harvey was that after living with Hurihia for

a few years problems arose over the land. He moved out of the house and went to

live in Kairua Road. Thomas said that Hurihia and he reached an agreement with

Putere that Putere would pay Thomas to compensate him for his contributions to the

house, and that Putere and his family would then move in with Hurihia. Although

Thomas considered that his contributions were in the order of $35,000 to $40,000 he

accepted a payment of $30,000 and did not seek to claim any further share in the

house.


6. Thomas, Putere and Hurihia all signed a document dated the 21 8t December

1994 ("the December 1994 document") which states as follows:

"I Thomas Egan agree to accept the sum of $30,000 as compensation for part building of the house and land situated at 511 Matapihi Road to my brother Putere Wetea Faulkner and the shares in question from me to Putere consisting of 0.24898 shares in block number Matapihi 3A2C1C2 .... after transferring of monies and land shares I relinquish all claims in 511 Matapihi Road 3A2C1C2."

Thomas acknowledged at the hearing that he had signed the document (see 85

Tauranga MB 97).

7. At the hearing Thomas stated that, after payment of the $30,000, he

considered that the house was Hurihia's (see 85 Tauranga MB 98). However, after

further questioning by Judge Harvey, Thomas indicated that he thought Putere had

probably given him the $30,000 in order to obtain a half-share in the house (see 85

Tauranga MB 99).

8. Prior °to his death Putere filed an affidavit dated 24th June 2005. In that

affidavit he said that Hurihia told him that if he and Catherine paid Thomas for his

share of the house, she (Hurihia) would gift them her share in return for taking care

of her.

9. Catherine Faulkner also confirmed at the hearing that Hurihia had said that as

soon as Putere paid the money to Thomas, she (Hurihia) would make her share of the

house over to Putere. (See 85 Tauranga MB 104). Attached to Putere's affidavit and

marked B is a copy of a Will made by Hurihia dated the 11th November 1994. In

paragraph 5 of that Will it states:

"I give devise and bequeath the house owned by me at 511 Matapihi Road, Tauranga to the said Putere Wetea Faulkner provided however my said son Thomas Marsh Egan is compensated satisfactorily by the said Putere Wetea Faulkner for his financial input into the building of the house."

10. I note the Will is dated prior to the December 1994 document acknowledging

the payment of the sum of$30,000 to Thomas.


11. Catherine Faulkner went on to say that Hurihia decided, as she got older, that

she would make her shares in the house over to Putere before she died, because

Hurihia thought Putere might die before her, and that Catherine would not have a leg

to stand on in respect of a claim to the house. That evidence is supported by Putere's

affidavit at paragraphs 21 to 25. There he states that in 2001 Hurihia wanted to

finalise the gift and that her lawyer (Gerald Michael Fitzgerald) advised her that the

best way to transfer the house would be to enter into a Deed of Acknowledgement of

Debt with Putere, and then to forgive the debt through a Deed of Forgiveness of Debt

and a gifting programme.

12. Gerald Fitzgerald also provided an affidavit dated the 5th August 2005 in

which he confirmed that Hurihia had contacted him and that she wished to transfer

her share in her house at Matapihi to Putere. Mr Fitzgerald states at paragraph 9 of

the affidavit:

"In my professional opInIon, Hurihia instigated, fully understood and ultimately wished to effect, the transfer of her interest in her house to her son Terry [Putere]."

13. Hurihia did not sign that documentation, but Putere' s affidavit states at

paragraph 26 that Hurihia recorded her gift to Putere by signing a written record of

the transaction.

14. A document marked D ("the November 2001 document") attached to

Putere's affidavit states as follows:

"In 1993 my son Thomas Marsh Egan had sold his shares in the house at 511 Matapihi Road Tauranga to my eldest son Putere Wetea Faulkner. I Hurihia Putiputi Emery wish to gift my share in the house at 511 Matapihi Road Tauranga to my said son Putere Wetea Faulkner without any cost to him. I have forgiven the sum of $20,000. This gives him sole ownership of the house."

The document has in small letters the words November 2001 and is signed by

Hurihia and Putere.

15. Hurihia died on the 14th December 2003 at the age of 85. She left a Will

dated the i h June 2002. That Will makes no reference to the house at 511 Matapihi

Road. The residuary provision in Hurihia's Will divides her estate into 13 parts, 12


to be paid to 12 surviving children, and the 13th part to be divided equally between

the children of her daughter Pauline Tawhiao.

16. Tangiwai did not dispute that Hurihia had signed the November 2001

document gifting her interest in the house to Putere. However, Tangiwai stated in

her affidavit dated 20 May 2005 that after the partition in March 2001 of Matapihi

3A2C1C2 into Matapihi 3A2C1C2C and other blocks Hurihia became unhappy with

the way Putere and Catherine Faulkner treated her, and that Hurihia wished them to

move out. Tangiwai also stated (at paragraph 43):

"When Mum discovered that Terry (Putere) had organised his solicitor to make her sign some documents to use the house as collateral for a $20,000 loan she was even more adamant that they should move out of the ... house."

17. Tangiwai's affidavit also referred to disagreements between herself and

Putere over the care of Hurihia. Over the last year of Hurihia' s life she stayed with

other members of the whanau but missed Matapihi. At paragraph 57 of Tangiwai's

affidavit she stated:

"Mum missed Matapihi and I feel this is what contributed to the deterioration in her health. She would often say that Terry (Putere) would have to get out of the ... house after she died."

18. In paragraph 66 of her affidavit Tangiwai stated that she did not believe that

her mother ever gifted shares in the house to either Thomas or Putere and in

paragraph 67 she states that she believes the house belongs to Hurihia's estate.

Applicant's submissions

19. Terence Faulkner was not represented by Counsel. He stated that the

agreement between Thomas, Putere and Hurihia was discussed by all parties and

signed by all parties, and that Catherine Faulkner and Thomas both acknowledged

and testified that the agreement had taken place. Therefore Thomas' share in the

house, he argued, passed to Putere.

20. On the same basis when Hurihia signed the second document gifting her

share in the house to Putere that document constituted a valid gift, which the Court


should recognise. Terence also argued that the gift was in exchange for the love,

care and protection that Putere and Catherine had given to Hurihia for more than ten

years. Terence also made the point that the house sits on land he inherited through

his grandfather's whakapapa.

Respondents'submissions

21. Mr Koning for Tangiwai argued that the May order determined the legal

owner of the dwelling was Hurihia Emery and that that order is to be preferred over

the April order because:

a) the May order was first in time having been filed first;

b) Hurihia had paid for the bulk of the construction costs;

c) Hurihia continued to live in the house until her death; and

d) Thomas Egan acknowledged that he had relinquished any claim to the

dwelling.

22. Counsel also submitted that the May order should have been brought down to

encumber Matapihi 3A2C1C2C at the time of the partition in March 2001, and that it

was an administrative error that this did not occur.

23. Counsel argued that orders under section 30(1)(a) of the Maori Affairs Act

1953, such as the May order, constitute an interest in Maori freehold land and

therefore any alienation must be subject to part 8 of Te Ture Whenua Maori Act

1993. The December 1994 document setting out the agreement between Putere and

Thomas was not executed and attested in accordance with the rules of Court

applying to section 152(1)(a)(i) or 164(4) ofTe Ture Whenua Maori Act 1993. Nor

was that agreement confirmed by the Court pursuant to section 156(1) or 164(3) of

Te Ture Whenua Maori Act 1993. Similarly, Counsel submitted that the November

2001 document between Put ere and Hurihia failed to comply with the rules of Court

and the requirements of part 8 ofTe Ture Whenua Maori Act 1993. Therefore both


agreements were of no force or effect. Counsel also stated that it would be an

"alarming result" if an order of the Court confirming the legal interest could be

displaced by hand-written agreements that were not properly witnessed nor

confirmed by the Court.

The Law

24. Section 30(1)(a) of the Maori Affairs Act 1953 provides as follows:

"30 General Jurisdiction Of Court

(1) In addition to any jurisdiction specifically conferred on it otherwise than by this section, the Court, subject to the provisions of subsection (2) hereof, shall have jurisdiction -

(a) To hear and determine any claim, whether at law or in equity, to the ownership or possession of Maori freehold land, or to any right, title, estate, or interest in any such land or in the proceeds of the alienation thereof."

Subsection 2 of section 30 provides as follows:

"(2) Nothing in the foregoing provisions of this section shall be construed to limit the jurisdiction of any other Court, but no matter that has been heard and determined by the Maori Land Court or the Appellate Court shall thereafter be heard in any other Court."

25. Section 30(1)(a) of the Maori Affairs Act 1953 is very similar to section

18(1)(a) ofTe Ture Whenua Maori Act 1993 in its terms. Any order under section

18(1)(a) may recognise an interest in Maori freehold land or it may determine the

opposite - that someone does not have an interest in the land. The most common use

of this section is to obtain an order of the Court that would provide protection to

someone who has built a dwelling on multiply owned Maori freehold land. The

order is obtained to avoid the effects of the common law regarding fixtures on land,

which, if they become so attached as to form part of the land, pass with the

ownership of that land: see Hinde McMorland Sim Land Law volume 2, paragraph

12.032. The section 18(1)(a) order ensures that the house belongs to the person

named in the order, rather than the owners of the land.

26. Section 148(1) ofTe Ture Whenua Maori Act 1993 provides:


"148 Alienation of undivided interests

(1) An owner of an undivided interest in any Maori freehold land may alienate that interest to any person who belongs to one or more of the preferred classes of alienee."

27. Section 150(1) ofTe Ture Whenua Maori Act 1993 provides as follows:

"150 Manner of alienation of undivided interests

(1) No undivided interest in any Maori freehold land may be alienated otherwise than by a vesting order made by the Court under Part 8 of this Act, unless the Court is of the opinion that the arrangement or agreement of the parties should be given effect to by memorandum of transfer, and so orders."

For sections 148 and 150 to apply the interest must be an interest in Maori freehold

land.

28. Pursuant to section 4 of Te Ture Whenua Maori Act 1993 an alienation is

defined, so far as it is relevant to this matter, as follows:

"4 futerpretation

fu this Act, unless the context otherwise requires, - alienation, in relation to Maori land, -

(a) fucludes, subject to paragraph (c) of this definition,-

(i) every form of disposition of Maori land or of any legal or equitable interest in Maori land, whether divided or undivided; and

(ii) the making or grant of any lease, licence, easement, profit, mortgage, charge, encumbrance, or trust over or in respect of Maori land; and

(iii) any contract or arrangement to dispose of Maori land or of any interest in Maori land; and ...

(c) Does not include -

(i) a disposition by will of Maori land or of any interest in Maori land; or

(ii) A disposition of a kind described in paragraph (a) of this definition that is effected by order of the Court; ... " [Emphasis mine]


In other words the Court can make an order disposing of an interest in Maori land

which does not need to comply with Part 8 of Te Ture Whenua Maori Act 1993.

Partitions are an obvious example.

29. Section 152(1)(a)(i) provides as follows:

"(1) The Court must grant confirmation of an alienation of Maori freehold land if it is satisfied-

(a) that,-

(i) in the case of an instrument of alienation, the instrument has been executed and attested in the manner required by the rules of Court"

30. Section 156(1) ofTe Ture Whenua Maori Act 1993 provides as follows:

"156 Effect of confmnation

(1) No instrument of alienation that is required to be confmned under this Part of this Act shall have any force or effect until it is confirmed by the Court under this Part of this Act."

31. Rule 113 of the Maori Land Court Rules 1994 provides:

(1) Every instrument of alienation of any interest in Maori freehold land shall be executed by the parties to be bound by it.

(2) The date of execution of any instrument of alienation of, or interest in, Maori freehold land shall be stated in the instrument.

(3) Where such an instrument is executed on different dates by several alienors, -

(a) The date of execution by each alienor shall be stated in the instrument; and

(b) For the purposes of section 151(2)(a) of the Act, the date on which the instrument was executed by the alienor shall be the date on which the instrument was first signed by an alienor.

(4) Where such an instrument is executed in New Zealand, the signature of each alienor shall be attested by -

(a) a notary public; or

(b) a solicitor of the High Court; or

(c) a Justice of the Peace; or

(d) an employee of New Zealand Post Limited; or


(e) a Registrar or Deputy Registrar of the High Court or of the District Court or of the Maori Land Court; or

(f) a registered medical practitioner.

(5) The attesting witness shall, in addition to his or her signature, set down the capacity in which the witness attests the document and shall also set out the witness's residential address.

Neither the December 1994 document nor the November 2001 document are

witnessed in accordance with Rule 113(4) and (5), and the November 2001

document is not fully dated.

Discussion

32. There are two main issues, which are as follows:

1. What is the effect of the agreements made between Thomas Egan,

Hurihia Emery and Put ere Faulkner; and

2. Can the Court gIve legal effect to those agreements under the

provisions ofTe Ture Whenua Maori Act 1993.

Interpretation of Agreements

33. The evidence of all the witnesses, including Thomas Egan, was that on being

paid the $30,000 by Putere, Thomas' interest in the house at 511 Matapihi Road was

terminated.

34. Thomas' evidence is that in his view the house belonged to his mother, but he

qualified that in saying that his interpretation of Putere's action in paying him the

$30,000 was that Putere thought he would be obtaining a share in the house. That

certainly seems to have been the interpretation placed upon that transaction by

Hurihia herself. That is borne out by the contents of her Will dated 11th November

1994 and also the November 2001 document signed by Hurihia and Putere which

states that Thomas had sold his share in the house to Putere.


35. A reasonable person looking at the transaction would have strong evidence to

presume that Putere did indeed purchase a share in the house from Thomas so that

Hurihia and Putere were in effect co-owners as between themselves. Moreover

Thomas himself has disclaimed any interest in the house. Hurihia did not claim

Thomas' interest. If his interest in the house did not pass to Putere who did it pass

to? I find that the effect of the transaction that took place was to pass Thomas'

interest to Putere simply as a matter of contract between the parties. The Court order

determining Thomas' ownership in the house ought to have been discharged at the

time the payment was made, but, by an oversight of the parties this was not done.

The Court will correct that matter as part of the orders to be made at this end of this

decision.

36. The question now is whether Hurihia passed her interest in the house to

Putere. I find that the November 2001 document attached to Putere's affidavit and

signed by Hurihia and Putere was intended by Hurihia to pass her interest to Putere.

I am supported in that by the evidence given by Mr Fitzgerald which clearly shows

Hurihia's intention to make the gift. While Hurihia may have been unwilling to sign

formal documents with a solicitor in the absence of Putere and Catherine, Hurihia

was prepared to sign the November 2001 document to give effect to her intention.

Hurihia or Putere should have obtained cancellation of the May order in favour of

Hurihia, but the parties may not have considered that necessary given that Putere

was, at that time, the owner of the underlying land, and that the order was not

brought down onto Putere's title to the block. While Hurihia may have expressed to

Tangiwai unhappiness about her treatment by Putere and Catherine in the last year of

Hurihia's life, I do not consider such complaints to be sufficient to undermine the

intention shown in the November 2001 document. The evidence that Hurihia

changed her mind about the gift is hearsay. Given that Hurihia would have known

that the house was situated on Putere's land I consider that if she seriously intended

to revoke the gift she would have put it in writing, just as she put the gift itself in

writing.

37. To summarise I consider that Thomas passed his interest in the house to

Putere, who was then gifted the balance of the house by Hurihia.


Legal Effect of Agreements

38. The Court accepts that the issue here is whether Putere, and through him the

applicants, have an enforceable equitable interest in the dwelling which could be

perfected to displace the legal interest of Hurihia Emery constituted by the May

order.

39. Mr Koning, for the respondent, relies on the failure to execute and attest the

December 1994 document and the November 2001 document in the manner required

by the Maori Land Court Rules 1994. Neither agreement has been confirmed by the

Court and therefore, Mr Koning argues, they have no force or effect.

40. However, there are two arguments that can be made in relation to that

submission. Firstly, had the parties applied to the Court during Hurihia's lifetime to

give effect to the December 1994 document, the application they would have made

would have been for the cancellation of the April order and, possibly, an amendment

of the May order to include Putere as an owner. For such an application the Court

would merely need to be satisfied that the beneficiary of the April order did indeed

wish to cancel it. Thomas gave evidence that he no longer has an interest in the

house and there is sufficient evidence for the Court to be satisfied that his interest

passed to Putere. A cancellation of the April order would therefore effect the

transaction. The application by Terence, relying on the succession to Putere, is for a

section 18(1)(a) order under Te Ture Whenua Maori Act, and the Court would have

no qualms in granting that application in respect of the share passed from Thomas to

Putere, together with a cancellation of the April order.

41. In Hurihia's case the Court does not have the benefit of her oral evidence.

The provisions of the Maori Land Court Rules in relation to execution and attestation

of instruments have not been complied with so that the Court is unable to make an

order under section 164 or section 152 to effect the alienation from Hurihia to

Putere, and therefore to the applicants. The application has, however, been made

under section 18(1)(a) not sections 164 and 152. The definition of alienation in

section 4( c) does not include a disposition that is effected by order of the Court. If

the Court makes the order applied for under section 18(1)(a) then the requirements of


sections 152 and 164 do not apply. Moreover, I do not consider that this would be

an "alarming result" because Hurihia's interest was given effect to by a similar order

of the Court in the first place. The applicants, in my view, have made a good claim

to Hurihia's share in the house.

42. I would also consider it an unjust result not to make a section 18(1)(a) order,

given the Court's finding that Hurihia did in fact intend to make the gift. I am

supported in this view of the matter by the fact that other members of the family,

who would also be beneficiaries under Hurihia's Will, have not supported the

respondents' action.

43. The second argument is that I am not convinced that the April and May

orders do in fact constitute interests in Maori freehold land to which Part 8

requirements apply. The purpose of the April and May orders is to prevent the house

from being considered a fixture and becoming part of the land so that the ownership

is with the owners of the land. The orders ensure that the house remains a chattel in

the ownership of the persons determined by the Court. Thus the April and May

orders can be seen as determining that the house is not an interest in Maori land and

that the owners of the land do not have an interest in the house. If that is so then Part

8 requirements and the rules of the Court would not apply to the December 1994 and

November 2001 documents, because they deal with interests that are not interests in

Maori freehold land.

Decision

44. For the above reasons I find in favour of the applicant. Orders are as follows:

1. An order cancelling the order under section 30(1)(a) of the Maori

Affairs Act 1953 in favour of Thomas Egan.

2. An order cancelling the order under section 30(1)(a) of the Maori

Affairs Act 1953 in favour of Hurihia Emery.


3. An order under section 18(l)(a) ofTe Ture Whenua Maori Act 1993

granting the ownership of the house at 511 Matapihi Road in favour

of Terence Wetea Faulkner, Catherine Faulkner and Pani Awhina

Faulkner.

4. The interim injunction granted at 84 Tauranga MB 156-157 IS

discharged.

Pronounced at Hamilton this S~ day of September 2006.

JUDGE S TE A MILROY

reserved decision of judge s te a milroy · awhina faulkner, and his mother catherine faulkner....

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