Kusabs v Staite [2022] NZCA 270 (28 June 2022)

Last Updated: 7 July 2022

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

CA652/2017 [2022] NZCA 270

	BETWEEN	ANDREW MARUTUEHU KUSABS AND ORS AS TRUSTEES OF THE TUMUNUI LANDS TRUST Appellants
	AND	PETER DANIEL STAITE AND ORS AS TRUSTEES OF THE WHAOA NO 1 LANDS TRUST Respondents

Hearing:	5 August 2021
Court:	Cooper, Brown and Williams JJ
Counsel:	M S McKechnie and A F S Vane for Appellants D G Chesterman, J P Koning and R P Nolan for Respondents
Judgment:	28 June 2022 at 10.30 am

JUDGMENT OF THE COURT

An order is made for recall of the judgment Kusabs v Staite [2019] NZCA 420.
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REASONS OF THE COURT

(Given by Brown J)

• [1] The respondents, the trustees of the Whaoa No 1 Lands Trust (Whaoa) apply for an order recalling and reopening the judgment of this Court delivered on 9 September 2019^[1] allowing an appeal from the High Court and setting aside that Court’s order for rectification of a lease.^[2] The application is opposed by the appellants, the trustees of the Tumunui Lands Trust (Tumunui).
• [2] Notwithstanding that Whaoa did not challenge the High Court’s rejection of rescission as a remedy, Whaoa contends that this Court’s decision left Whaoa without a remedy by omitting to address the issue whether Mr Moke was conflicted and in breach of his fiduciary duty of loyalty and, if he was, to consider whether some alternative relief to rectification should have been ordered. Absent the considerations to which we next refer, we would not have considered that the circumstances of this case satisfied the third category of Horowhenua County.
• [3] However in a judgment dated 18 February 2020 declining Whaoa leave to appeal, the Supreme Court provided a clear signal as to the desirability of this Court re-engaging with the dispute, stating:^[3]

[14] Taking the latter aspect first, Mr Chesterman for the applicants points out that the trustees of the Tumunui Trust in their amended notice of appeal in the Court of Appeal put both the finding of breach of fiduciary duty and the appropriateness of granting rescission in issue. In light of that indication, we did canvas with Mr Chesterman whether consideration had been given to seeking a recall of the Court of Appeal’s judgment on the ground these issues were live.

[15] For present purposes, the relevance of the fact that these questions were not addressed in the Court of Appeal is that this Court would effectively be dealing with them as a court of first instance. There are practical and other difficulties in our doing so. For example, in terms of equitable damages, the parties do not agree as to whether or not further evidence would be required. Nor, if leave was granted, would we have the benefit of the views of the Court of Appeal on these questions.

[16] Given these constraints on the prospective appeal, we do not consider it is necessary in the interests of justice for the matter to be heard in this Court. The application for leave to appeal is accordingly dismissed. But we do so on the basis that leave is reserved to the applicants to make a further application for leave to appeal to this Court if an application is made to the Court of Appeal asking that Court to re-visit the matter but without success.

• [4] In these particular circumstances we grant the application for recall of our judgment.
• [5] The parties are in agreement that should the recall application be granted the following issues arise for determination:

(i) Whether there was a breach of fiduciary duty by Mr Moke in light of Tumunui’s proposed limited interest exception;

(ii) If there was a breach, is a remedy warranted and, if so, which remedy: equitable damages or rescission?

(iii) Whether a hearing is required to determine remedy and, if so, whether in the High Court or the Court of Appeal.

Solicitors:
Le Pine & Co, Taupo for Appellants
Koning Webster, Papamoa for Respondents

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^[1] Kusabs v Staite [2019] NZCA 420.

^[2] Staite v Kusabs [2017] NZHC 416.

^[3] Staite v Kusabs [2020] NZSC 6.