Marriage break ups are messy. You don’t usually need to scratch much below the surface to find that out. Who said what unbelievable thing. Who did what unbelievable thing. Who slept with a party outside of the union. We’ve all seen it / read about it (maybe talked a bit more about it than we should). Messy stuff. What about when there is a trust or increasingly, trusts involved?
While the court may not be that interested in scratching the surface of the hurt and disappointment, where the legal form of property ownership takes the form or one or more trusts, does the court need to “… go beneath the skin of the legal form of the transaction.” ? See Shaw v Haven Trustee Limited at para 15), where the quick answer is – yes it does.
Shaw v Haven Trustee Limited is a good example of thinking it all through before heading to court. The case features a partnership of trusts (again increasingly common) that owned the family home (and some other stuff). When the marriage hit the rocks the disenchanted former spouse endeavoured to utlise s. 339 of the Property Law Act 2007 to force the sale of the property owned by a partnership of trusts. Occupation rent was also sought. Although this strategy can suceed it did not in Shaw v Haven Trustee Limited as the court was not satisfied that there were no remedies available under the Property (Relationships) Act 1976 (s 44) or s 182 of the Family Proceedings Act 1980. Distinguishing Dyas v Elliot where an application was made under s 339 because in that case there were no relationship property proceedings on foot.
It is unlikley to be useful to further consider whether or not an application that should be available on the legal form is not when there is a failed relationship in the background. However, it is useful to take note of Shaw v Haven Trustee Limited when considering how best to proceed when partners in property ownership have ceased to be bedmates.
- Shaw v Haven Trustee Limited  NZHC 2961
- Dyas v Elliott (2010) 3 NZTR ¶20-012 (access available through cch.co.nz by subscription)