The house where an Auckland woman lived rent-free for more than 30 years.

An Auckland woman has been ordered to pay her brother more than $273,000 and move out of the $2 million home she has lived in for 36 years after the siblings fell out over ownership of the property.



The dispute simmered for decades but came to a head in a series of hearings at the High Court at Auckland this year, which laid bare what Justice Christine Gordon, in her recently released judgment, called "an unhappy case between a sister and brother both now in their 60s".

The sister, Virginia Woolf, had lived in the house in Epsom for 36 years, for most of the time paying no rent. The owner was her brother, Alwyn Kaye, who has lived and worked in Canada since he left New Zealand in 1982, months after the purchase of the property.

Woolf claimed the property was purchased as a family project by all four members of her immediate family – her parents Violet and Noel Woolf who were both now deceased, her brother and herself. However, Kaye – whose name was the only one on the property title as owner – rejected that, saying he was the sole owner.

READ MORE:

* Family spat ends up in court

* Developer can't retract offer for lifestyle block

* $4.4m estate subject of legal battle

In her judgment, Justice Gordon said that Kaye had in his 20s, through "thrift and careful investment of money", managed to accumulate savings.

In November 1981, Kaye agreed to buy the property, a three-bedroom house, for $89,500, paying a deposit of $5000. Its latest Auckland Council valuation is $2 million.

Most of the purchase price was made up of a first and second mortgage totalling $45,000. The siblings' father, Noel Woolf, provided mortgage securities worth $3500.

A total of $25,340 was paid in cash, which Kaye said he provided on his own, although his sister said some had come from their parents, who she said had contributed a total of $14,000 to the purchase price.

Kaye said the $3500 was a gift rather than a contribution by his parents which would give them an interest in the property.

Woolf said that she did not make any initial contribution to the purchase of the property but said she signed a guarantee in relation to the second mortgage, as a result of which she thought she had an ownership interest in the property.

In early March 1982, Woolf moved into the property with two flatmates, who each paid $45 a week. Woolf paid $55 a week.

Woolf's position was that her payments were a contribution towards her equity interest in the property. Kaye said she was a tenant, paying rent.

Kaye did not live at the property, and in July 1982, he went to Canada where he lived and worked ever since.

The flatmates' payments of rent and Woolf's payments were not enough to cover the mortgage payments. Kaye left what he said was very close to every last dollar of uncommitted funds in the "house accounts". He also remitted money from Canada on an ongoing basis.

Woolf said that when her brother went to Canada, he left behind a briefcase which contained papers relating to the property. In 1983 or 1984, she discovered from those papers that Kaye's was the only name on the title of the property.

LAWRENCE SMITH/STUFF Justice Christine Gordon delivered her judgment in the High Court at Auckland.

She said she was shocked and concerned at this discovery, and she raised it with her mother, and spoke to a lawyer from the firm that had acted for Kaye on the purchase of the property.

The lawyer wrote to Kaye in January 1985, suggesting a gifting of shares in the property to Woolf and their mother.

"This was the first of a number of communications by various solicitors on behalf of Ms Woolf over the years in which she made changing claims in relation to the property on different bases," the judge said.

By 1988 Kaye had paid off the mortgages on the property, and Woolf stopped having flatmates in the property and making "rental" payments herself.

"Accordingly, Ms Woolf has lived in the property 'rent free' for 30 years to the present date," the judge said.

However, Woolf said she continued to make contributions towards the property.

The siblings' mother died in 2006. Woolf and Kaye were the sole beneficiaries and benefited equally under her will. No claim was ever made by their mother or her executor in relation to any interest she might have in the property, and there was no mention of the property in her will.

In August 2006, Woolf lodged a caveat on the title of the property claiming a beneficial interest.

In September 2006, she went to the United Kingdom to teach, returning in April 2008. She did not arrange for the property to be tenanted in her absence. Nor did she tell Kaye that she was going overseas and that the property would be empty.

123RF Alwyn Kaye took out two mortgages to buy the property. (File photo)

In August 2014, their father died. Woolf was appointed executor under her father's will and she was the sole beneficiary under the will. During his lifetime, the father did not make any claim for an interest in the property. There was no mention of the property in the father's will. As executor, Woolf did not call in the father's claimed interest in the property.

In March 2015 Kaye took steps to lapse Woolf's caveat. Woolf in turn took court action claiming breach of trust, on both her behalf and as executor of her father's estate. Kaye counterclaimed, seeking payment from Woolf for her occupation of the property.

Woolf claimed she and her father's estate were co-owners of the property and had a combined interest of at least 50 per cent. She was seeking an order that the property be sold.

Kaye said there was no family agreement to purchase the property. He alleged that it was never the intention that all four family members would be co-owners as it was always his property.

"In a nutshell, Mr Kaye says that his generosity towards Ms Woolf, allowing her to remain in the property rent free, has now backfired, given that Ms Woolf, because of her own financial position, is trying to take advantage of him by claiming an interest in the property," the judgment said.

"He says he was, at times over the years, prepared to consider an interest for Ms Woolf, provided he received a full accounting of contributions from all parties. But, despite his requests for such information and supporting documentation, that was never sent to him."

The judge assessed what Woolf's contributions to the property had been, and whether her contributions had "manifestly" exceeded any benefits she derived from the arrangement.

"It is here where Ms Woolf's claim fails and it fails by a very wide margin."



The road the house is on was described as a quiet cul-de-sac, opposite the Epsom Teachers Training College.

"The property lies within a central Epsom location with public transport, schools and suburban shopping within walking distance, and the southern motorway access in Gillies Avenue is within a distance of two kilometres. It is within the zoning for Auckland Grammar School.



"Ms Woolf has lived in this area on a 'rent-free' basis for 30 years."

When asked what benefit Woolf had received, her lawyer referred the court to the $45 a week the flatmates had paid, which over 30 years would come to $70,200.

The judge described that claim as "completely unrealistic", with an expert witness telling the court the market rent for the property would have been more than $650,000.

"It is well-accepted, however, that where a person has wrongfully been in possession of another's land, the owner is entitled to recover damages or mesne profits."

The judge ruled Woolf would have to pay her brother $273,165.01, and would have to vacate the house within two months of the judgment.