Rangitukunga v Koning [2015] NZCA 24 (24 February 2015)

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Rangitukunga v Koning [2015] NZCA 24 (24 February 2015)

Last Updated: 5 March 2015

IN THE COURT OF APPEAL OF NEW ZEALAND
CA212/2014 [2015] NZCA 24
BETWEEN	RAPATA TE HAA RANGITUKUNOA Applicant
AND	JOHN PIETER KONING AND HIRIA REWETI Respondents

Hearing:	9 February 2015
Court:	Ellen France P, Randerson and White JJ
Counsel:	Applicant in person A Isac for Respondents
Judgment:	24 February 2015 at 4 pm

JUDGMENT OF THE COURT

1. The application for an extension of time is dismissed.
2. The applicant must pay the respondents costs for a standard application on a band A basis and usual disbursements.

____________________________________________________________________

REASONS OF THE COURT

(Given by Ellen France P)

Introduction

[1] This is an application for an extension of time under r 29A of the Court of Appeal (Civil) Rules 2005 to appeal a decision of Lang J. Lang J made orders giving effect to a settlement reached between the parties during the course of a hearing.^[1]

Background

[2] The current litigation arises from events dating back to the 1990s relating to a residential Māori freehold property at Matapihi owned by the applicant, Mr Rangitukunoa, and his wife.
[3] Two mortgages were registered over the property. The second mortgage in favour of Trust Bank Bay of Plenty Ltd (Trust Bank) was in arrears and a mortgagee sale scheduled for 23 August 1991. The mortgagee sale was averted when Mr Rangitukunoa’s uncle, Mr Reweti, arranged for the full amount (some $43,000) secured by the mortgage to be repaid to Trust Bank. Rather than discharge the mortgage, a transfer of it to Mr Reweti was arranged. The transfer of the second mortgage to Mr Reweti was registered against the title in October 1992.
[4] Mr Reweti died in 1995. Arrears remained outstanding under the mortgage. Mr Rangitukunoa’s solicitors offered to settle the matter on a without prejudice basis in early 1998. That offer was rejected by the solicitor acting for the estate. The executors and trustees of the estate arranged a mortgagee sale auction which was to take place in June 2004. The auction was cancelled when an offer by Mr Rangitukunoa and his wife to pay $50,000 in settlement was accepted. However, no payment was ever made.
[5] The next relevant event occurred in March 2007 when the first respondent, Mr Koning, was appointed as the sole executor and trustee of the estate. Mr Koning is a lawyer. In his capacity as executor and trustee, Mr Koning made an application to the Māori Land Court for an order for possession based upon rights contained in the Trust Bank mortgage. He sought an order for possession rather than sale and intended that income from the land be utilised to repay the arrears. The Māori Land Court concluded that Mr Koning was entitled to an order for possession.^[2]
[6] Mr Rangitukunoa appealed to the Māori Appellate Court. The appeal was allowed but an order substituted under a different section of Te Ture Whenua Maori Act 1993 for delivery of possession to Mr Koning. That order was conditional upon Mr Rangitukunoa not applying to the High Court by 31 March 2013 under s 112 of the Land Transfer Act 1952 to discharge the second mortgage.^[3] Section 112 permits the discharge of a mortgage where the remedies thereunder are statute barred.^[4]
[7] The application for a discharge was duly made to the High Court. The matter came before Lang J in the High Court. The possibility of settlement was raised in the course of the hearing. Ultimately, after an adjournment, Lang J made various orders consequential on the parties having reached an agreement as to the terms upon which the action could be settled. In particular, the Judge recorded it had been agreed that Mr Rangitukunoa would pay the sum of $35,000 on or before 31 March 2014. At that time, the Judge stated, Mr Rangitukunoa would be entitled to a discharge of the Trust Bank mortgage. The Judge continued:^[5]

[3] I give effect to the settlement by granting Mr Rangitukunoa’s application. The order is to lie in Court, however, until such time as counsel for Mr Koning files a memorandum confirming that the sum of $35,000 has been received. At that point, the orders may be sealed and will become effective. In the event that the payment is not made by 31 March 2014, the order will be rescinded and Mr Rangitukunoa’s application will be dismissed with costs reserved. In either event, I would be grateful if counsel for Mr Koning could arrange for the appropriate order to be sealed.^[6]

[8] On 24 April 2014, Mr Rangitukunoa filed an application to this Court for an extension of time to file his notice of appeal against Lang J’s orders.

The relevant principles

[9] The test for whether an extension of time to appeal should be granted under r 29A is as expressed in My Noodle Ltd v QueenstownLakes District Council.^[7] The factors include the reasons for and length of the delay, the conduct of the parties and the extent of any prejudice caused by the delay. Further, this Court in Havanaco Ltd v Stewart said that an applicant for an extension of time is seeking an indulgence from the Court, and the Court will not grant such an indulgence where the proposed appeal has no merit.^[8] The ultimate test is whether granting the extension of time would meet the overall interests of justice.^[9]

Application of the principles

[10] We deal first with delay.
[11] Mr Rangitukunoa originally made an application in the High Court to continue the hearing in that Court. Lang J issued a minute on 26 November 2013 pointing out that the matter would have to be pursued in this Court.^[10] The application for an extension of time was not filed until almost five months after that minute. Further, Mr Koning says that notice of the application was not served until 18 June 2014. Mr Rangitukunoa explains the delay by reference to two occasions on which he was admitted to hospital.
[12] The material before us does not provide a complete explanation for the delay. However, we see the interests of justice in this case turning primarily on whether or not the proposed appeal has any merit and we now address that aspect.
[13] It is well settled that consent orders may be set aside where there is good ground for doing so. This Court made that point in Auckland Regional Services Trust v Lark, noting that the High Court has an inherent jurisdiction to set aside a consent order “if the interests of justice require it but good ground must be established to warrant that course”.^[11] The Court in that case cited a number of other cases including Waitemata City Council v MacKenzie.^[12] In the Waitemata City Council case, Casey J stated that the Court had “an inherent jurisdiction to set aside a sealed consent order obtained without authority or as a result of a mistake if the interests of justice require it”.^[13]
[14] Mr Rangitukunoa’s argument is that he was intimidated into agreeing to the settlement by Lang J. In particular, he says he felt threatened by Lang J’s observation that he might end up paying more if he did not settle the matter at the figure suggested. Mr Rangitukunoa also told us that he had not advanced the possibility of settlement and that he had not understood that the order for a discharge would be “rescinded” upon non-payment. He also says his underlying claim for a discharge of the mortgage has merit because his uncle forgave the loan and because the lawyer acting for his uncle at the time was fraudulent in registering the mortgage.
[15] In his notice of application for an extension of time, Mr Rangitukunoa describes himself as having “reluctantly” gone along with the settlement offer because of the Judge’s threat. We consider that, while agreement may well have been reluctantly given, it is clear from the record that Mr Rangitukunoa both accepted the settlement on the terms set out in the Judge’s orders and that he understood exactly what that involved. The record also shows that Mr Rangitukunoa initiated the discussion of a possible settlement. There is nothing on the record to support the claim the Judge somehow forced Mr Rangitukunoa into settling by threatening him. There is therefore no basis to suggest that Mr Rangitukunoa would be able to show that it is in the interests of justice to set aside the consent order.
[16] It is helpful to say a little more about what occurred at the High Court. The hearing commenced on 29 October 2014. In the course of Mr Rangitukunoa’s cross-examination of Mr Koning, Mr Rangitukunoa asked whether Mr Koning would agree “that this is a good time to settle this matter”. He continued:

Where it’s come to a stalemate, where it’s been going on for so long now that things should have happened even long before my uncle died ... so don’t you think it’s the right time, an honest time, a good time, a fair time for everyone ...

[17] At that point the Judge told Mr Rangitukunoa that he had to ask Mr Koning a question. Mr Rangitukunoa continued:

Yes, if you can just give us an answer on what you think about trying to settle this in this, in this Court today to ...

[18] Mr Koning responded that it was not for him to agree to settlement in court and he explained some of the limits on him arising from his obligations as an executor.
[19] There was some discussion then about two costs orders made in the High Court each of $8,000 for which the estate was otherwise liable. Mr Rangitukunoa persisted saying he would be prepared to pay something. He referred to a discussion with Lang J earlier about what the Judge thought might be satisfactory which Mr Rangitukunoa also thought was “fair”. He asked Mr Koning to come up with a reasonable figure to settle so that everyone could “get on with [their] lives”.
[20] In answer to a question from the Judge, Mr Koning explained how he would like the principal repaid so that figure could be distributed amongst the three beneficiaries. The Judge told Mr Rangitukunoa that the reality was that to settle there had to be a payment. He said he thought Mr Koning was being generous in terms of the costs that he was offering to have written off. After a further discussion, the Judge said:

If we were to go down that track it would have to be on the basis that I make orders that discharge the mortgage conditionally upon you paying the executor 31,000 within a set time, failing which your application is dismissed, which leaves the mortgage there and the order for vacant possession.^[14]

[21] Mr Rangitukunoa said he would be “really appreciative” if that would happen. There was then further discussion about the mechanics of the proposal and the need for Mr Koning to talk to the beneficiaries and so on. The culmination of the discussion saw the Judge explaining that settlement would involve an order from the Court granting the application, meaning that the mortgage would be discharged “subject to the condition that 35,000 is paid with a – by a specified date”. The Judge explained that the effect would be that if the money was not paid by the date, Mr Rangitukunoa’s application for discharge would be dismissed and “the mortgage then sits there securing it, the order for vacant, for possession kicks in and then they would go down the track that they would have to go down”. Mr Rangitukunoa’s response was that he understood. Later, Mr Rangitukunoa repeated his claim that his uncle had forgiven the loan and he referred to his allegations of fraud on the part of the solicitor then acting for his uncle. But, when Lang J asked what should happen and whether Mr Rangitukunoa was content to go down the “[settlement] track”, Mr Rangitukunoa answered “yes”. Later, he acknowledged that in settling he was giving up a little.
[22] There was then an adjournment. The hearing resumed on 5 November 2013. It is unclear exactly what occurred at the resumed hearing but the Judge then made the orders we have outlined above.
[23] We consider it is clear from this narrative that Mr Rangitukunoa, having initiated the prospect, did agree to settle albeit reluctantly. He also understood what was involved in settling the matter. At that point in time he appears to have taken the view it was better to end the litigation so everyone could move on. He was willing to give up his claim just as he had been on the two earlier occasions to which we have referred.^[15] While he maintains the merits of his position, our assessment is that he accepted that the best course was to settle the matter. He did so and the record discloses no intimidation from the Judge. In the circumstances, the proposed appeal is without merit. We add that, in terms of his underlying claim based on alleged fraud, that claim has been aired and considered in both the Māori Land Court and in the Māori Appellate Court. There are concurrent factual findings in those Courts rejecting the claim of fraud. Similarly both Courts concluded that the loan was not personal.^[16] Mr Rangitukunoa says his late aunt was present at the meeting when he says his uncle forgave the debt. She was available at the hearing in the Māori Land Court but he did not call her.
[24] In these circumstances, we consider the interests of justice do not favour granting an extension of time.

Result

[25] The application for an extension of time is dismissed. We see no reason why costs should not follow the event. We accordingly order that the applicant pays the respondents costs for a standard application on a band A basis and usual disbursements.

Solicitors:
Koning Webster Lawyers, Papamoa for Respondents

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^[1] Rangitukunoa v Koning HC Tauranga CIV-2013-470-281, 5 November 2013 (Orders of Lang J).

^[2] Koning v Smith – Matapihi 1A3D4C1 (2011) 18 Waikato Maniapoto MB 220 (18 WMN 220).

^[3] Rangitukunoa v Koning – Matapihi 1A3D4C1 [2012] Māori Appellate Court MB 690 (2012 APPEAL 690) at [97]. In the Māori Land Court and in the Māori Appellate Court, the applicant was referred to by the name Robert Smith.

^[4] In this case there were limitation issues.

^[5] Rangitukunoa v Koning, above n 1.

^[6] The settlement was conditional upon Mr Koning obtaining formal confirmation from the children of one of the beneficiaries that they had no claim to the amount Mr Rangitukunoa would be paying to settle the claim.

^[7] My Noodle Ltd v Queenstown Lakes District Council [2009] NZCA 224, (2009) 19 PRNZ 518 at [19].

^[8] Havanaco Ltd v Stewart [2005] NZCA 158; (2005) 17 PRNZ 622 (CA) at [22].

^[9] Havanaco Ltd v Stewart, above n 8, at [5].

^[10] Rangitukunoa v Koning HC Tauranga CIV-2013-470-281, 26 November 2013 (Minute of Lang J) at [2].

^[11] Auckland Regional Services Trust v Lark [1994] 2 ERNZ 135 (CA) at 139.

^[12] Waitemata City Council v MacKenzie [1988] NZCA 142; [1988] 2 NZLR 242 (CA).

^[13] At 249.

^[14] The figure initially proposed was $31,000. During the subsequent discussion this was raised to $35,000 to allow for a payment of $4,000 in fees to Mr Koning’s legal firm.

^[15] Mr Rangitukunoa says those offers were made on the instructions of others. Whether or not that is so is neither here nor there. The earlier offers support the view that Mr Rangitukunoa knew settlement involved giving up his claim and making a payment to keep the land.

^[16] Koning v Smith – Matapihi 1A3D4C1, above n 2, at [53], [57], [63], [80], [88] and [89]; Rangitukunoa v Koning – Matapihi 1A3D4C1, above n 3, at [66].