Property Law Act 2007 – order for sale – division of sale proceeds – Swanson v Norris  NZHC 3342 – reimbursement – procedure formal proof
Walter Earnest Swanson v Amanda Eileen Norris  NZHC 1666.
Tewiremu Napia Swanson appointed his brother, Walter Swanson, a solicitor in Rotorua, as sole executor and trustee of his will. Tewiremu Swanson’s estate included a house he owned with his ex-wife, Amanda Norris, as tenants in common in equal shares.
The property was subject to a mortgage to ANZ. Norris moved into the house following Tewiremu Swanson’s death, but did not pay the mortgage or any of the other outgoings and caused damage to the property. ANZ required Norris’ overdraft to be cleared from the sale proceeds.
Walter Swanson obtained orders, by formal proof, under ss 339 and 343 of the Property Law Act 2007 (PLA) in respect of the property in December 2021. Norris had failed to take any steps in the proceedings. The orders included for Norris to vacate the property, for Swanson to sell it, the court registrar to sign the necessary documents, Swanson to distribute the proceeds of sale according to a further court order, and for various costs to be deducted from Norris’ share of the proceeds in accordance with a further order of the court.
Despite being notified of the order to vacate the property, Norris did not leave. Swanson obtained a possession order and Norris moved out in June 2022. Swanson arranged for the property to be cleaned and repaired, and Tewiremu Swanson’s son spent 28 days working on the property. It sold in October 2022.
After the sale, Swanson applied to facilitate the division and distribution of the sale proceeds. Norris failed to take steps and the application was dealt with on the papers by way of formal poof.
Applicable principles: one owner can obtain division of property – order binds all owners – s 339 used to enable sale – formal proof evidence must be conclusive – Ferreira v Stockinger  NZHC 216 – costs against defendant recoverable under PLA – s 339 gives court wide discretion – Bayly v Hicks  NZCA 589 – decision must be just and practical – Minehan v Mcguigan  1686.
Held: Walter Swanson obtained an order for the division and distribution of the sale proceeds of a property in his brother’s estate. But he had not provided enough evidence for some of the expenses claimed by the estate against Norris. He was to file a supplementary affidavit in respect of these expenses to satisfy the court.
The order to distribute the sale proceeds was as follows:
- Before the sale proceeds were divided, Swanson was to be reimbursed for costs incurred personally;
- the balance of the proceeds of sale were to be divided equally between the estate and Norris. Deductions amounting to Norris’ overdraft and the additional costs caused by her, including court costs, were to be made from her share of the sale proceeds to reimburse Swanson, the estate and Tewiremu Swanson’s son; and
the proven deductions could be made immediately but the balance of Norris’ share was to be held in trust until the deduction amounts to be addressed in Swanson’s supplementary affidavit were finalised by the court.