Hurlimann v Noland [2020] NZCA 42 (9 March 2020)

Last Updated: 17 March 2020

IN THE COURT OF APPEAL OF NEW ZEALAND I TE KŌTI PĪRA O AOTEAROA

CA554/2018 [2020] NZCA 42

	BETWEEN	GAVIN JOHN HURLIMANN Appellant
	AND	BEVERLEY ANNE NOLAND Respondent

Hearing:	6 August 2019
Court:	Clifford, Mallon and Moore JJ
Counsel:	S I Perese for Appellant B M Stewart and K N Sabine for Respondent
Judgment:	9 March 2020 at 10 am

JUDGMENT OF THE COURT

1. The appeal is dismissed.
2. The appellant is to pay the respondent costs for a standard appeal on a band A basis and usual disbursements.

____________________________________________________________________

REASONS OF THE COURT

(Given by Clifford J)

Introduction

[1] On 3 September 2015 the respondent, Beverley Noland, paid the appellant, Gavin Hurlimann, $305,902 pursuant to their relationship property settlement. That payment principally represented Mr Hurlimann’s entitlement to a one-half share in the family home. Some 11 days later, in circumstances to which we return, Mr Hurlimann paid $250,000 of that money back to Ms Noland. Then, in September 2016, Mr Hurlimann asked Ms Noland to return that $250,000 to him. Ms Noland refused to do so. She said the money was a gift she was entitled to keep.
[2] Mr Hurlimann subsequently sued Ms Noland in the High Court for the return of that money. He said it had not been an outright gift. Rather, given the circumstances in which he had paid it back to Ms Noland, it was held by her for him on a resulting trust, or because its payment represented an unconscionable bargain, or because it had been paid as a result of deceit by Ms Noland. Brewer J declined Mr Hurlimann’s claim on each of those grounds.^[1]
[3] Mr Hurlimann now appeals.

Background^[2]

[4] Mr Hurlimann and Ms Noland, at Ms Noland’s instigation, separated in 2012, after 12 years of marriage. However, the two retained amicable contact and for some time went to relationship counselling.
[5] On 8 January 2015, Ms Noland discovered Mr Hurlimann in bed with another woman. This led to her applying for an order for the dissolution of the marriage.
[6] Ms Noland was shocked, and very angry, when Mr Hurlimann responded by claiming an interest in her home. The matrimonial home was Ms Noland’s home from a previous marriage. When Mr Hurlimann moved in with Ms Noland before their marriage he would appear to have given some form of oral assurance he would never make a claim against it.^[3] Ms Noland resented bitterly having to borrow money from her parents to pay Mr Hurlimann the $305,902 which Ms Noland was compelled to concede he was entitled to under relationship property law.
[7] Some 11 days after making the payment, on 14 September 2015, Ms Noland and Mr Hurlimann met, at Mr Hurlimann’s initiative, for dinner at a restaurant. Mr Hurlimann was seeking a reconciliation. Unbeknownst to Mr Hurlimann, although nothing in particular turns on this for our purposes, Ms Noland taped the conversation which took place at that restaurant, as she had other calls preceding that meeting. Those tapes were played in the High Court. Copies of texts and emails exchanged in the days prior to that meeting were also in evidence. It was during the course of that dinner that Mr Hurlimann transferred the $250,000 to Ms Noland’s bank account.
[8] After that payment Ms Noland and Mr Hurlimann did try to reconcile: they were, in fact, soon back on familiar terms and resumed a sexual relationship, although they never lived together. But in September 2016, Ms Noland advised Mr Hurlimann she had become romantically involved with another man and no longer wished to continue any relationship with him. That prompted Mr Hurlimann to demand the return of the $250,000.

The High Court decision

Mr Hurlimann’s causes of action

[9] Mr Hurlimann’s three causes of action may be summarised as follows:

• (a) Resulting trust

At all material times Mr Hurlimann had wanted to reconcile with Ms Noland. The payment of the $250,000 was made at Ms Noland’s request, on the basis it would enable a reconciliation to be achieved. It was an implied term of payment that if the parties did not reconcile, Ms Noland would return the $250,000 to Mr Hurlimann.

(b) Unconscionable bargain

At the time of that payment, and due to an earlier brain injury, Mr Hurlimann suffered from impaired judgement and poor planning. That led him to make impulsive decisions. Since 2009, moreover, he had been suffering from “somatisation, anxiety, depression, and anxiety-related disorders”. Ms Noland was aware of those matters. Before Mr Hurlimann made the repayment, Ms Noland promised that their relationship might resume if he did so. It was in reliance on that promise that Mr Hurlimann made that payment. The attempted reconciliation was unsuccessful. In those circumstances, the payment of the $250,000 represented an unconscionable bargain. Ms Noland had taken advantage of Mr Hurlimann’s mental health issues and equity called for the repayment of that amount to Mr Hurlimann.

(c) Deceit

The understandings reached between Mr Hurlimann and Ms Noland before the payment constituted representations of fact made by Ms Noland. Those representations were false when made. Ms Noland acted deceitfully: she knew them to be false, or made them recklessly. She made them to induce the payment. By making that payment, Mr Hurlimann relied on them to his detriment. Because of Ms Noland’s deceit, Mr Hurlimann was entitled to the return of the payment.

The Judge’s findings

[10] The factual conclusions the Judge reached on the resulting trust claim were also central to his rejecting Mr Hurlimann’s other claims. We therefore summarise them out here.^[4]

• (a) Mr Hurlimann acknowledged he had no moral entitlement to the money. However, he very much wanted to reconcile with Ms Noland.
• (b) Mr Hurlimann contacted Ms Noland at or around the date Ms Noland’s solicitor made the transfer of funds to Mr Hurlimann’s solicitor. In the Judge’s view, this was not coincidental. Mr Hurlimann knew he now had a lever to move Ms Noland towards reconciliation.
• (c) It was Mr Hurlimann who linked payment of money to the beginning of a process of reconciliation. At first, it was a straight offer (“The reason I rang you on Father’s day — because I still love you and if I give you the money back, will you take me back[?]”). Ms Noland did not accept the offer. She made it clear that if money were paid it would be a big start, but much more would need to occur.
• (d) There was no doubt Mr Hurlimann understood he could not buy a reconciliation. Moreover, he never linked the payment of the money to there being a reconciliation.

[11] The Judge saw the following statement by Mr Hurlimann after the transfer had been made as significant:

It’s a small part of the journey of undoing the bad things I’ve done — you’ve got to start somewhere right. Now that money there, that money it’s yours, to do with what you want with it okay, it’s not my money now okay. So it’s up to you what you want to do with it.

The Judge said:

[52] In my view, this passage exactly expresses Mr Hurlimann’s position with regard to the transfer of the money. It is consistent with everything he did and said subsequently, including in declarations he made to Work and Income in which he described having “gifted” the money to Ms Noland. It was only, in 2016, when Ms Noland finally ended the relationship that he asked for the money back.

[12] Reflecting that view of the evidence, the Judge reasoned Mr Hurlimann had not intended to retain beneficial ownership of the money.^[5] Rather it had been a gift from Mr Hurlimann to Ms Noland. He had paid it to clear the bad feeling that had arisen when he made his claim to Ms Noland’s home from a former relationship. That finding rebutted the presumption equity makes that a voluntary payment of money gives rise to a resulting trust. Moreover, that gift was not conditional: it had not been made on terms that required its return if a reconciliation was not achieved.
[13] There was no unconscionable bargain, as the payment was not consideration for a bargain in the first place.^[6] Nor had the payment been made in circumstances which made its retention by Ms Noland unconscionable. Mr Hurlimann had not established his mental ill-health had caused him to make an irrational and impulsive decision. Whilst there was evidence of mental health issues, no real linkage had been established between the effects of those issues and Mr Hurlimann’s behaviour at the time the payment was made.^[7]
[14] In rejecting Mr Hurlimann’s claim in the tort of deceit, the Judge reasoned Ms Noland had not made any representation as to past or existing fact. All she had done was acknowledge that, if the money were paid, that would be a first step towards an uncertain process of reconciliation.^[8]
[15] The Judge concluded:

[69] In my view, Mr Hurlimann very much wanted to reconcile with Ms Noland, and knew that by returning a very significant part of the money she had paid to him the door would open to a possible reconciliation. It might be there was an element of impulsiveness to this. It might be that a more prudent person would not simply have paid the money unconditionally. However, in the context of the relationship between Mr Hurlimann and Ms Noland, it was not an irrational act.

...

[76] I have found on the facts that Mr Hurlimann intended to gift Ms Noland the $250,000, hoping it would lead to a long-term reconciliation. I do not find that Mr Hurlimann’s mental health issues make the retention of that gift by Ms Noland unconscionable. I have no doubt Ms Noland welcomed the payment and felt it was fair for Mr Hurlimann to make it. However, she did not in any way mislead him. Indeed, Ms Noland made it very clear to Mr Hurlimann that payment of the money would be one step, albeit an important step, in beginning a difficult process of healing their relationship. The actions of both parties in the months after the transfer of the money showed genuine attempts to reconcile, which ultimately proved unavailing. That was the risk Mr Hurlimann took. There was never any deceit practised by Ms Noland.

Mr Hurlimann’s appeal

[16] In arguing Mr Hurlimann’s appeal, Mr Perese did not pursue the assertions of resulting trust or of deceit. Nor did he focus on whether the payment was a bargain or a gift. Rather he submitted that, however the payment was categorised, it would be unconscionable for Ms Noland to retain it or any part of it. The main reason for that was the Judge had been wrong not to find that Mr Hurlimann was suffering from mental illness that caused him to act irrationally and impulsively, and that Ms Noland knew, and took advantage of, that.
[17] In asking us to take that approach, Mr Perese emphasised the gist of Mr Hurlimann’s claim. That was, given:

• (a) Mr Hurlimann’s clear wish to reconcile with Ms Noland and to re‑establish the permanent relationship they once had had; and
• (b) Mr Hurlimann’s mental vulnerability, which Ms Noland knew of; and
• (c) that Ms Noland had knowingly created a false hope of such a reconciliation and had exploited that false hope by telling Mr Hurlimann the key to him achieving that was the payment of the $250,000 and encouraging on the spot, as it were, to make that payment,

it was unconscionable that she should be allowed to keep that money.

Analysis

The legal context

[18] The overlapping claims Mr Hurlimann made in the High Court influenced the way Brewer J considered the issue. Given the way this appeal was argued, we think the law of gifts provides the appropriate framework for our analysis. Put simply, Mr Hurlimann gave the $250,000 back to Ms Noland. But that does not mean he cannot be entitled to its return. Moreover through the law of undue influence, as it applies to gifts, the unconscionability Mr Hurlimann asserts — including as based on the mental health issues Brewer J recognised — can in our view best be analysed.
[19] Turning, then, to the law of gifts. A gift is a gratuitous transfer of property between living persons, donor and donee, and not by the donor in expectation of death. A gift is a one-way transfer of value, often made in recognition of intangible values such as love and affection, or charitable concerns. A bargain, by contrast, is a self-interested transaction, a free exchange of value between parties who are assumed to be able to act in their own best interests.
[20] Being gratuitous, equity’s suspicion is aroused. That is, except where a presumption of advancement arises, the donee must prove that an apparent gift was intended as such. A presumption of advancement arose, as relevant here, to apparent gifts between husband and wife. Section 4(3) of the Property (Relationships) Act 1976 abolished the presumption of advancement, as well as the presumption of resulting trust between spouses, civil union partners and de facto partners. Given the dissolution of Ms Noland and Mr Hurlimann’s marriage, no such presumption could in any event arise between them. Ms Noland must therefore first satisfy the Court the apparent gift of the $250,000 was indeed intended as such.
[21] If the status of the payment of the $250,000 as a gift is established, Mr Hurlimann can nevertheless claim its return on two bases:

• (a) First, that it was a conditional gift, and the condition failed. That was the argument Brewer J considered at [49] and following of his judgment. That is, was the gift conditional on a permanent reconciliation being achieved?
• (b) Secondly, that although an unconditional gift, it had been only been made because Ms Noland had unduly influenced Mr Hurlimann. As The Laws of New Zealand summarises:^[9]

59. Fraud and undue influence. Donors, even though sui juris, are entitled to set aside their gifts if induced by fraud, coercion or undue influence, for the donee must not profit by his or her own wrong. The influence arising from relations existing between the parties must not be abused ... Where there is a relationship of trust and confidence, and inexplicably large gifts are made, the presumption of undue influence will be rebuttable only by proof of full, free and informed thought on the part of the donor.

[22] Whilst being cross-examined in the High Court, Mr Hurlimann in fact made both of those claims:

• (a) To the proposition he had made it very clear he was giving the money to Ms Noland, and that he did not expect it to be paid back, Mr Hurlimann replied:

I was expecting, I was expecting to reconcile with your client, Mr Stewart [counsel for Ms Noland], hence the reason why I transferred the money from my account to her account, as an act of good faith and I also say in the transcript, and it’s on the audio recording, “I’d rather have the girl than the money”. But now I can’t have the girl so I’ll have my money back thanks.

(b) To the proposition that he had willingly given the money, Mr Hurlimann responded:

You must understand my position was very, very vulnerable, okay? Your client had all the power. If your client had said to me, “I will only consider reconciling with you if you set yourself on fire,” I would’ve done it, just to prove how earnest I was. ...

At the time, Mr Stewart, I was in a vulnerable position and your client could’ve asked me to do anything and I would’ve done it. Your client knew that, she knew I was vulnerable and I was fragile.

A gift?

[23] We are satisfied that Brewer J was right when he concluded the payment was intended as a gift. It was made gratuitously: that is it was not made to procure an exchange of valuable consideration. It was made in the context of a loving relationship, albeit one that had broken down. It was made to clear away the mutually understood bad feeling that had arisen on Ms Noland’s part because of the claim Mr Hurlimann had made to the matrimonial home, and the way in which that claim had been pursued. Mr Hurlimann hoped it would lead to a reconciliation with Ms Noland and the re-establishment of a permanent relationship.

A conditional gift?

[24] Certain gifts have traditionally been regarded as presumptively conditional. One such category was gifts given in contemplation of marriage. Such gifts were to be returned if the marriage did not eventuate. Although contracts of marriage are no longer possible, certain aspects of the old law survive. Thus s 8 of the Domestic Actions Act 1975 now provides:^[10]

8 Property disputes arising out of agreements to marry

(1) Where the termination of an agreement to marry gives rise to any question between the parties to the agreement, or between 1 or both of the parties to the agreement and a third party, concerning the title to or possession or disposition of any property, any such party may, in the course of any proceedings or on application made for the purpose, apply to the court for an order under this section.

...

(3) Subject to subsection (6), on any such application the court shall make such orders as it thinks necessary to restore each party to the agreement, and any third party, as closely as practicable to the position that party would have occupied if the agreement had never been made.

[25] This Court in its 1987 decision of Oliver v Bradley described the Domestic Actions Act as providing, where an agreement to marriage is terminated, an alternative remedy to that under the law of constructive trusts.^[11] As recently as 2014 s 8 of the Domestic Actions Act was relied on to order the repayment of the value of gifts given in contemplation of marriage by a prospective husband to a prospective wife.^[12]
[26] But the common law drew a sharp distinction between hopeful romantic gifts and those given in expectation of marriage. In a 1944 decision the High (then Supreme) Court cited a very old case to illustrate that principle:^[13]

... the defendant cannot have back any, if any, gift made to the plaintiff in order to recommend himself to her, to help on his courtship, and to induce her to agree to marry him. These, as Lord Hardwicke put it in Robinson v Cumming, are the gifts of “an adventurer” who “if he will run risks and loses by the attempt, he must take it for his pains.” If his adventure never prospers at all, because the lady never accepts him, such gifts are not recoverable. Neither are gifts made at this early “adventuring” stage recoverable if, although the donor thereafter emerges from the status of mere adventurer and attains the status of an accepted suitor, he ultimately does not attain the status of husband. Neither can he recover back gifts made after the engagement if they were purely personal gifts, not subject to any express or implied condition. But as to gifts made in anticipation of marriage — that is to say, which both parties knew were being made and received in the expectation that they would continue to enjoy such gifts jointly after their marriage — then, in my opinion, when the marriage fails for such reasons as this marriage has failed, such gifts must be given back.

[27] Thus here it might be said Mr Hurlimann could be seen as returning the $250,000 to Ms Noland in contemplation of reconciliation and ultimate (re)marriage. Mr Perese did not suggest there was here a mutual contemplation of marriage. On the evidence, he could not. But this was, he suggested, the “area” we were in.
[28] To an extent, we agree. That is, we do not think it would be appropriate here to place Mr Hurlimann in the position of the hopeful “mere adventurer”. That is, and as we have already analysed in upholding the Judge’s conclusion the payment was made by way of gift, it was paid and received as part of a shared understanding that it might open the parties to a reconciliation. To that extent, it could be said to be conditional. That is, if having received the money Ms Noland had then said to Mr Hurlimann she was going to have nothing more to do with him, and had not — as she clearly was — been prepared to try and re-establish a relationship, Mr Hurlimann would have been on stronger ground to say that the condition on which the gift was made had failed. But that is not the factual position here. Ms Noland honoured the understanding on which the gift was made. It did help her to put aside her hurt at the terms on which the relationship property settlement had been made, including as involving the need for her parents to borrow money they could ill afford, and enabled her to make the necessary payment to avoid the matrimonial home being sold. But we think it is also clear that Mr Hurlimann did not condition the gift on a reconciliation being achieved. In our view, he knew that was not guaranteed; he made the payment in the hope that would occur. Thus, to the extent the gift might be said to be conditional, the condition did not fail.

A conditional gift made because of undue influence?

[29] Through the doctrine of undue influence equity intervenes to protect the weak against the strong as a matter of public policy in the context of relationships which, by their very nature, are seen as providing an occasion for undue influence.
[30] Undue influence may be actual or presumed. Presumed undue influence arises out of a relationship between two parties where one person has acquired over another a measure of influence, or ascendency, of which the ascendant person then takes unfair advantage. The typical case is where one person places trust in another to look after her affairs and interests, and the latter betrays that trust by preferring her own interests. It is clear that the relationship between Mr Hurlimann and Ms Noland at the time of the payment was not one which gave rise to a presumption of undue influence.
[31] Actual undue influence does not depend upon a pre-existing relationship between the two parties, though it is most commonly associated with and derived from such a relationship. The party who alleges actual undue influence must prove affirmatively that she entered into the impugned transaction, here a gift, not of her own will but as a result of actual undue influence asserted against her. She must show that the other party to the transaction had the capacity to influence her, that the influence was exercised, that its exercise was undue and brought about the transaction, and that, in the result, she had been taken advantage of.^[14] Domination is not necessary.
[32] Whether actual undue influence was exercised is a question of fact.^[15] To the extent where it is established one of the parties to the relevant relationship was mentally impaired in a way which materially affected their behaviour, that may well be relevant for the Court’s assessment whether or not to set aside the impugned transaction.
[33] The proposition that Mr Hurlimann was unduly influenced by Ms Noland when he made the gift of $250,000 conditional on Ms Noland’s willingness to try to re-establish their failed relationship best summarises what we understood to be Mr Perese’s basic argument in this appeal. When considering the relevance of Mr Hurlimann’s mental health issues as recognised by Brewer J, that proposition also reflects Mr Perese’s submission of unconscionability.
[34] Those mental health issues were, in the High Court, relied on in Mr Hurlimann’s unconscionable bargain cause of action. We infer that approach was adopted given the role the concept of disadvantage plays in the doctrine of unconscionable bargain. The vulnerable party’s inability to advance their own best interests — demonstrated by the imbalance of the bargain agreed to — reflects what is termed a “disadvantage”.
[35] The decision to do so may also reflect that the relationship between Mr Hurlimann and Ms Noland in September 2016 is not of the type which traditionally features in undue influence cases.
[36] The Judge was prepared to proceed on the basis that the doctrine of unconscionable bargain applies to gifts as well as bargains.^[16] That is not the view this Court has traditionally taken. In Contractors Bonding Ltd v Snee the traditional view was described thus:^[17]

Judges and commentators have drawn attention to the close relationship between the equitable principles relating to undue influence and unconscionable bargains, but the doctrines are separate and distinct: a plea of undue influence attacks the sufficiency of consent; a plea that a bargain is unconscionable invokes relief against an unfair advantage gained by an unconscientious use of power by a stronger party against a weaker.

[37] We agree. That distinction is based on the underlying differences between a payment made as consideration for a bargain, and a gift. A gift is, after all, a one-way transfer of value, often made in recognition of intangible values such as love and affection, or charitable concerns. A bargain is a self-interested transaction, a free exchange of value between parties who are assumed to be able to act in their own best interest. The concept of disadvantage disrupts the contractual theory. The concept of undue influence disrupts the theory of voluntary, selfless giving. Having said that, we also think in many instances it may be a legal distinction which does not give rise to an actual difference in outcome.
[38] The evidence here, particularly of the texts, emails and transcribed conversations, in our view shows the vulnerability that individuals in the position of Mr Hurlimann and Ms Noland have to each other when a relationship of marriage or its equivalent has broken down. The sense of loss, disappointment and hurt pride need only to be stated to be recognised. That vulnerability is not unlike the similar vulnerability that can exist in the early stages of a relationship, where one party has high hopes before any shared expectation of permanence has arisen. That aspect of human relationships is in our view the explanation for the reasonably robust approach the law takes, to use the somewhat outdated description of Lord Hardwicke, to the gifts of an adventurer. The phrase “all is fair in love (and war)” springs to mind.
[39] Here, however, Mr Hurlimann says he suffered from the additional effects and disadvantages of his mental health issues. That illness, Mr Perese submitted, made Mr Hurlimann likely to make impulsive and irrational decisions: Ms Noland knew that and exploited it. That is, the argument on appeal is Ms Noland’s influence was undue because of Mr Hurlimann’s vulnerability as the party hoping for a reconciliation, and because of his tendency caused by his mental illness, said to be known to Ms Noland, to make impulsive and irrational decisions to his disadvantage.
[40] So the question is was the Judge wrong not to find that Ms Noland in fact exercised actual undue influence?
[41] By our assessment, the evidence, in particular the evidence of the texts, transcribed voice messages and recorded conversations as set out extensively in the High Court’s decision, does not support a conclusion that Ms Noland was doing so.
[42] That evidence does show in reasonably graphic terms the dynamic of the relationship between the two: particularly, and by Mr Hurlimann’s own admission, because of the impact of his discovered relationship with another woman when, from Ms Noland’s perspective, they were still endeavouring to reconcile; likewise because, as also recognised by Mr Hurlimann, of the impact on Ms Noland of the claim he made for a share in the family home, notwithstanding his acknowledgement prior to the marriage that (taken at its highest) he would never make such a claim; and because of the way that claim was pursued.
[43] We accept the genuineness of Ms Noland’s reaction to Mr Hurlimann’s relationship property claim. As the Law Commissions’ review of the Property (Relationships) Act noted, one of the key issues raised during the public consultation was the ongoing acceptability of the requirement for partners to share pre‑relationship property “simply because it is used by them as the family home”.^[18] Ms Noland’s upset reflects that concern. Notwithstanding, a number of matters need to be borne in mind.
[44] Some 12 years had passed since the parties had commenced their relationship. They had lived in the home throughout that time. It is difficult to be certain as to precisely what Mr Hurlimann might have said, or the circumstances in which that communication took place. The requirements of the Property (Relationships) Act for contracting out of its property dispositions or settling claims for those dispositions reflect, as the Law Commission recently observed, “social legislation aimed at ensuring a just division of property between partners who may be in unequal bargaining positions”.^[19]
[45] It could fairly be said that if Ms Noland wished to ensure Mr Hurlimann could not make a claim on the house, she needed to enter into a relationship property agreement. To be enforceable, such an agreement would have had to have been in writing, signed, witnessed by a lawyer, and independent legal advice would have had to be given to both parties. In the absence of such an agreement Mr Hurlimann was, as a result of the relationship, entitled to an equal share of the relationship property, including the family home.
[46] Following the end of their relationship, he and Ms Noland entered into a settlement agreement regarding that entitlement, each having received independent legal advice. The terms of the agreement were clear. It was expressed to be binding on the parties in all circumstances including “separation (whether on one or more occasions) [or] reconciliation”. The parties acknowledged that its provisions were “just, fair and reasonable”.
[47] Seen in that light, Mr Hurlimann’s decision, just a week after he had received the proceeds of that settlement, to return the larger portion of it to Ms Noland is, at least, surprising. Objectively, it can be said to have been foolish. It reflects his vulnerability as the party wishing, against Ms Noland’s resistance, to revive the relationship. In the relationship property legislation, New Zealand law today recognises that vulnerability in the way it mandates equal sharing and structures the decision-making required for a different approach. That distinguishes Mr Hurlimann’s position from that of the “adventurer” recognised in the old cases.
[48] But, and having said that, in our view Ms Noland’s evidence confirms her reluctance, after the marriage dissolution, to re-engage with Mr Hurlimann. As regards the payment, and as we have already said, the most she can be seen to have done is to have acknowledged that it would go a way to restoring the balance between them, and to preparing the way for her to agree to engage positively with Mr Hurlimann with a view to a possible reconciliation. We acknowledge there was emotional weight in the way Ms Noland conveyed her upset with Mr Hurlimann for claiming what she had later accepted he was legally entitled to. That weight did, in our view, bear on him and the decision he made. By the same token, when faced with his demand for the return of the payment, Ms Nolan was no doubt also mindful that she had, as she had said she would, embarked on a process of reconciliation possibly leading to a renewed, permanent, relationship. Taken overall, in that context, and absent any question of specific vulnerability because of mental illness, Ms Noland’s actions did not constitute undue influence or an unconscionable retention of the returned monies.
[49] We therefore turn to the significance of the evidence of Mr Hurlimann’s mental health issues.
[50] There were two main sources of that evidence:

• (a) Medical notes going back to 2002.
• (b) A report provided by Dr Finucane, a psychiatrist, based primarily on Mr Hurlimann’s self-reporting to Dr Finucane during a one-hour examination. That report concludes with the following opinion:

In my opinion, there are sufficient features of brain injury present to indicate there has probably been personality change due to the combination of solvent exposure [from Mr Hurlimann’s work as a automotive spray painter for 10 years after leaving school at the age of 16] and repeated (cumulative) mild TBI [traumatic brain injuries suffered as a kickboxer], and that as a result Mr Hurlimann has become impulsive, with impaired judgement and poor planning.

[51] In his evidence-in-chief, Dr Finucane acknowledged the difficulty he had in drawing any firm conclusions, however, as to the significance of those possible brain injuries in September 2015. In cross-examination, Dr Finucane also acknowledged that the same problem existed as regards determining the significance, if any, of the behaviours he diagnosed in 2017 relative to Mr Hurlimann’s condition in September 2015.
[52] In these circumstances, it is difficult for us to go further than recording our assessment that Dr Finucane’s opinion provides little support for Mr Hurlimann’s claim that a material mental impairment adversely affected his decision‑making function in September 2015.
[53] Mr Perese did, on Mr Hurlimann’s behalf, urge us to review the evidence found in the medical notes. Noting that we have not had expert evidence to assist us in interpreting those notes, we have however done as requested. Those notes provide evidence, understandable to a layperson, that Mr Hurlimann had been suffering from, and had been treated for, depression and anxiety in the years preceding the breakup of his relationship with Ms Noland. Little more can be said, in the absence of expert assistance, as to the significance of those conditions for the decision Mr Hurlimann made to give the $250,000 back to Ms Noland.
[54] We are not persuaded, therefore, the Judge erred in the way Mr Hurlimann said he had.

Result

[55] We dismiss Mr Hurlimann’s appeal accordingly. Costs will be payable by Mr Hurlimann to Ms Noland on a band A basis for a standard appeal and usual disbursements.

Solicitors:
Saseve Solicitors, Auckland for Appellant
Simpson Western, Auckland for Respondent

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^[1] Hurlimann v Noland [2018] NZHC 2251.

^[2] We draw this summary from Brewer J’s decision, noting that the Judge’s narrative was not challenged in any material way on appeal.

^[3] Although Mr Hurlimann said he could not recall doing so, he acknowledged in cross-examination it was “highly probable” he had done so, and that he had to agree he had because Ms Noland had recorded his assurance in a diary note. Brewer J found as a fact that Mr Hampton had given that assurance: at [5].

^[4] Hurlimann v Noland, above n 1, at [50]–[51].

^[5] At [51]–[54].

^[6] At [57].

^[7] At [68]–[69].

^[8] At [72].
^[9] Tim Blennerhassett Laws of New Zealand Gifts (online ed) (footnotes omitted).

^[10] The principal purpose of the Domestic Actions Act 1975 was to abolish contracts to marry: s 5.

^[11] Oliver v Bradley [1987] NZCA 70; [1987] 1 NZLR 586 (CA) at 590.

^[12] Zhao v Huang [2014] NZHC 132, [2014] NZFLR 782.

^[13] Stone v Scaife (No 2) [1944] NZGazLawRp 79; [1944] NZLR 704 (SC) at 708; quoting Robinson v Cumming [1742] EngR 121; (1742) 2 Atk 409, 26 ER 646 (Ch).

^[14] J Stephen Kós “Undue Influence” in Andrew Butler (ed) Equity and Trusts in New Zealand (2nd ed, Thomson Reuters, Wellington, 2009) 679 at 681.

^[15] See Halsbury’s Laws of England (5th ed, 2014, online ed) vol 77 Equitable Jurisdiction at [19].

^[16] Hurlimann v Noland, above n 1, at [67].

^[17] Contractors Bonding Ltd v Snee [1992] 2 NZLR 157 (CA) at 165 (citation omitted).

^[18] Law Commission Review of the Property (Relationships) Act 1976 (NZLC R143, 2019) at [3.22].

^[19] At [13.3].