Maori Trustee v Phillips [2012] NZHC 3299 (7 December 2012)

Last Updated: 12 December 2012

IN THE HIGH COURT OF NEW ZEALAND WHANGAREI REGISTRY

CIV 2012-488-467 [2012] NZHC 3299

BETWEEN THE MAORI TRUSTEE Applicant

AND PHILIP THOMAS PHILLIPS Respondent

Hearing: 6 December 2012

Counsel: B Arapere for Applicant

Mr P T Phillips, Respondent in person

Judgment: 7 December 2012

_{JUDGMENT OF HEATH J}

This judgment was delivered by me on 7 December 2012 at 9.30am pursuant to Rule

11.5 of the High Court Rules

Registrar/Deputy Registrar

Solicitors:

Wackrow Williams & Davies Ltd, PO Box 461, Shortland Street, Auckland

Counsel:

_{Mr P T Phillips, Respondent in person}

THE MAORI TRUSTEE V PHILLIPS HC WHA CIV 2012-488-467 [7 December 2012]

[1] The Maori Trustee is the registered proprietor of land contained and described in Certificate of Title NA38D/714 (North Auckland Registry). The land is situated at 738 Whangaruru North Road, Bland Bay.

[2] By memorandum of lease, dated 11 January 2002, the property was leased to Mr Phillips. One of the terms of the lease was that Mr Phillips would duly and punctually pay the rent by half yearly instalments in advance, on the first day of September and March in each and every year of the lease term. By agreement, invoices were rendered in December and June in each and every year of the lease term.

[3] Mr Phillips also promised to pay all rates, taxes, charges and assessments payable in respect of the land and to maintain and keep in good order and condition and repair all buildings, fences, gates, drains, culverts and improvements.

[4] On 17 July 2012, the Maori Trustee issued this proceeding to obtain an order cancelling the lease. He alleged that Mr Phillips was in breach of the covenant to pay rental and that $7141.56 was outstanding at the date of issue of the proceeding.

[5] Evidence was led from the Regional Manager of the Tai Tokerau Office of the Maori Trustee, Mr Paraone, that Mr Phillips had also breached other covenants of the lease relating to his obligation to maintain and keep the property in good order and condition. That allegation was supported by an inspection report completed by Mr Topp.

[6] The proceeding was served on Mr Phillips on 2 August 2012 at 8.30am. No steps were taken. After the time for filing a notice of opposition to the application had expired, the Maori Trustee sought a formal proof hearing. That was allocated for yesterday.

[7] Mr Phillips was sent notice of the formal proof hearing at the address shown in the intitulment to the originating application. Although he had taken no steps to defend the proceeding to that time, Mr Phillips attended at Court yesterday in person.

[8] I gave Mr Phillips an opportunity indicate his position. I told him that the Maori Trustee was entitled to proceed to judgment if other arrangements were not possible. Ms Arapere, for the Maori Trustee, indicated that Mr Paraone, who was present in Court, did not consider further discussion would be fruitful. Mr Phillips indicated that he wished to embark upon arbitration or mediation and also contended I had no jurisdiction to make any orders.

[9] Mr Phillips confirmed that he has not paid the rent. I infer from what he told me that he is unable to do so at this time. Having heard from Mr Phillips and received an affidavit from Mr Paraone, I reserved my decision, indicating that it would be given in writing today.

[10] A lessor is entitled to cancel a lease because of breach of the covenant to pay rent in the circumstances to which s 245(1) of the Property Law Act 2007 (the Act) refers. That states:

245 Cancellation of lease for breach of covenant to pay rent

(1) A lessor may exercise a right to cancel a lease because of a breach of the covenant to pay rent under the lease only if—

(a) the rent has been in arrears for not less than 10 working days; and

(b) the lessor has served on the lessee a notice of intention to cancel the lease; and

(c) at the expiry of the period specified in the notice, the breach has not been remedied.

....

[11] I am satisfied that the conditions precedent to a valid cancellation of the lease have been met.

[12] The Maori Trustee seeks an order for possession of the land under s 244(1) of the Act. Section 244 provides:

244 Cancellation of lease for breach of covenant or condition: general

(1) A lessor who wishes to exercise a right to cancel a lease because of a breach by the lessee of a covenant or condition of the lease may—

(a) apply to a court for an order for possession of the land; or

(b) re-enter the land peaceably (and without committing forcible entry under section 91 of the Crimes Act 1961).

(2) However, subsection (1) is subject to sections 245 and 246.

(3) If the lessor applies to a court for an order for possession of land for the purpose of cancelling a lease, the cancellation takes effect—

(a) on the making of the order; or

(b) on any later date that is specified in the order.

[13] While Mr Paraone has given evidence of breach of covenants other than the promise to pay rent, I prefer to deal with the application solely on the basis of the uncontested allegation that rent of $7186.20 remains due and owing.

[14] The Maori Trustee having complied with s 245(1) of the Act, is entitled to an order for possession under s 244(1)(a).

[15] In my view, there are no discretionary considerations that would justify withholding relief. During the hearing, I understood Mr Phillips to tell me that another Government agency had refused him the right to erect a dwelling on the land, and that was causing problems. I do not know the precise basis on which any refusal of permission was based. In any event, I do not consider that that is sufficient to deny relief to the Maori Trustee given the length of time that rent has been outstanding, since 1 December 2009. Therefore, I do not consider that my

discretionary power to refuse to make an order should be exercised.[1]

[16] I am satisfied that the Maori Trustee is entitled to the relief set out in the originating application. I make the following orders:

(a) Declaring that the lease has been cancelled and possession has been ordered in favour of the Maori Trustee of all that land contained in Certificate of Title NA38A/962 (North Auckland Registry) being Whangaruru Whakaturia No 4, Lot 37 DP 82226 (738 Whangaruru

_{North Road, Bland Bay).}

(b) Requiring Mr Phillips to pay all rent arrears, interest on all rent arrears, recovery costs pertinent to all rent arrears and rates due, up to the date of cancellation or any later date on which Mr Phillips yields up possession.

(c) Awarding costs in favour of the Maori Trustee on a 2B basis together with reasonable disbursements, both to be fixed by the Registrar.

[17] I am not prepared to make an order for compensation to be paid to the Maori Trustee to return the land to the state that it was in when the lease commenced. The sum involved has not, in my view, been adequately proved. The Maori Trustee may sue in other proceedings to recover any actual expenditure in that regard.

[18] At the conclusion of the hearing Mr Phillips asked two questions. The first was why the press were not present. I said I did not know. The second was whether he could obtain a copy of the transcript of what had been said in open Court. I direct

_{the Registrar to make a copy of the transcript available to Mr Phillips.}

P R Heath J

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[1] See Grant v Hannay [2010] NZHC 325; (2010) 11 NZCPR 283 (HC) at para [51] and [54] (Ellis J).