IN THE MAORI LAND COURT OF NEW ZEALAND WAIKATO-MANIAPOTO DISTRICT 34 Waikato Maniapoto MB 111 (34 WMN 111) A20110003431 UNDER Section 135, Te Ture Whenua Maori Act 1993 IN THE MATTER OF an application for change of status from Maori Freehold Land to General Land by Status Order with respect to TE PUNA PARISH 154D5A1 BLOCK BETWEEN MABEL NGATAI Applicant Hearing: 14 September 2011 (Heard at Tauranga) Appearances: Mabel Ngatai Judgment: 23 January 2012 RESERVED JUDGMENT OF JUDGE GD CARTER Copy to: Mabel Ngatai, 4 Raropua Place, Te Puna, Tauranga 3176 NGATAI MLC 34 Waikato Maniapoto MB 111 23 January 2012
The Application [1] Application has been made by Mabel Ngatai for change of status of Parish of Te Puna 154D5A1 ( the land ) from Māori freehold land to General land under s 135 of Te Ture Whenua Māori Act 1993 ( the Act ). Mabel Ngatai presented the application and was accompanied by her husband Kihi Ngatai. No one appeared to oppose the application in response to public notices placed in the Bay of Plenty Times in accordance with directions issued by the Court. The Land [2] Parish of Te Puna 154D5A1 is solely owned by Mabel Ngatai and comprises 1.94938 ha. It has a computer freehold title which is recorded in the Land Transfer Register as SA29D/138. [3] The Māori Land Court title in the name of Mabel Ngatai was created by partition order on 13 November 1981 at 42 Tauranga MB 176-179. An order under s 133 of the Act changing the status of the land from General land to Māori freehold land was made on 6 November 2003 at 77 Tauranga MB 69-71. The current status of the land is Māori freehold land. I comment on the change of status in the next part of the decision. [4] In presenting her case Mrs Ngatai told the Court that there were two houses on the block, one being occupied by her husband and her as their family home and the other belonging to one of her sons. The remainder of the block was used for production of kiwifruit and avocadoes. Change of status in 2003 [5] On 31 March 2003 Mabel Ngatai applied to change the status of the land from General land to Māori freehold land. Her application stated: Status changed to General land so could use for collateral. Now wish to change back to Māori Freehold. 34 Waikato Maniapoto MB 112
[6] An order was duly made under s 133(1) of the Act changing the status of the land from General land to Māori freehold land on 6 November 2003. [7] In the search notes to the present application were minutes and a copy of an order changing the status of land from General land to Māori freehold land. In perusing them during the course of writing this decision I noted that they referred to an order in respect of other land (another Te Puna Block) and not Te Puna 154D5A1. I therefore asked Court staff to provide me with the correct details of the order changing the status of Te Puna 154D5A1 from Māori freehold land to General land. [8] After an intensive search of the record I was informed that no such order had been made; that the land, from the date of partition, and at the time of the order in 2003, has always been Māori freehold land. It would appear that the applicant, in 2003, when she applied for the change of status to Māori freehold land was under the misunderstanding that the land was General land. This may have been because of her ability under the 1953 Act to borrow against Māori freehold land without any of the limiting factors that now occur under the 1993 Act. The reason is that under the 1953 Act, if land was sold by execution under a mortgage the purchaser acquired title as General land, whereas under the 1993 Act the land remains Māori freehold land until a change of status is made by order of the Court. Consequently lending institutions, prior to the passing of the 1993 Act, did not regard the status of Māori freehold land as placing limitations on the value of that land for security purposes. [9] The Māori Land Court record shows that the land has continued to be maintained in the record as if it were Māori freehold land from the partition order in 1983. Copies of mortgages, when executed, were filed in the Court in accordance with the provisions of s 233 of the 1953 Act and entered in the Memorial Schedule for the land. While an order changing status was made at the behest of the applicant in 2003 the land at that time was, in fact, Māori freehold land so that the order was of no effect. [10] The applicant referred to the 2003 change of status as indicative of her desire to eventually change the status of the land back to Māori freehold land if this application is granted. 34 Waikato Maniapoto MB 113
[11] As I have said, the status of the land did not change. The question as to whether the 2003 application to change the status of the land has any bearing on my consideration of the present application is a matter for me to determine later in this decision. [12] I cannot rule out the possibility that the applicant did obtain an order changing the status of the land some time after the partition order in 1953 despite the recent search of the Court records. If she or her solicitor has a record of such an order they should notify the Court as to the details so that the Court records may be updated. [13] In normal circumstances I would have notified the applicant as to these findings so that she could respond before I proceeded to complete my decision. However I am mindful that the decision is overdue, having been delayed because of my ill-health. I therefore proceed to a decision. Legislative provisions [14] Section 135 of the Act provides jurisdiction for the Court to make an order changing the status of Māori freehold land to General land but goes on to say that the Court shall not make an order unless satisfied that the order may be made in accordance with s 136. Section 136 provides: The Maori Land Court may make a status order under section 135 of this Act where it is satisfied that (a) (b) (c) (d) (e) The land is beneficially owned by not more than 10 persons as tenants in common; and Neither the land nor any interest is subject to any trust (other than a trust imposed by section 250(4) of this Act); and The title to the land is registered under the Land Transfer Act 1952 or is capable of being so registered; and The land can be managed or utilised more effectively as General land; and The owners have had adequate opportunity to consider the proposed change of status and a sufficient proportion of the owners agree to it. 34 Waikato Maniapoto MB 114
[15] A change of status sees land no longer retained as Māori freehold land. Section 2 of the Act deals with interpretation of the Act and refers specifically to retention of Māori land. Subsections (1) and (2) state: (1) It is the intention of Parliament that the provisions of this Act shall be interpreted in a manner that best furthers the principles set out in the Preamble. (2) Without limiting the generality of subsection (1), it is the intention of Parliament that powers, duties, and discretions conferred by this Act shall be exercised, as far as possible, in a manner that facilitates and promotes the retention, use, development, and control of Maori land as taonga tuku iho by Maori owners, their whanau, their hapu, and their descendants, and that protects wahi tapu. Judicial interpretation [16] Under ss 135 and 136 the Court has a discretion as to whether or not to make an order changing the status of the land. Normally, in a situation where conditions have to be satisfied before the Court can exercise its discretion, an applicant can expect an order to be made if he or she can satisfy those conditions. [17] However in an application for change of status the Court s discretion is tempered by the requirement under s 2(2) above to exercise its powers and discretions, as far as possible, in a manner that facilitates and promotes the retention, use and development of Māori land for the benefit of its owners, their whānau, their hapū and their descendants. [18] There have been a number of decisions in the Māori Appellate Court which have commented upon various aspects of applications for change of status. I see no need in this decision to refer to those decisions or repeat the various comments that are often cited. [19] I do, however, refer to the Māori Appellate Court decision in 2011 Manning - Kirikiri Pawhaoa B2A1. 1 In that decision the Appellate Court considered earlier decisions in Cleave Orokawa 3B 2, White - Maketu A2A 3, Craig v Kira - Wainui 1 (2011) 2011 Māori Appellate Court MB 215 (2011 APPEAL 215). 2 (1995) 4 Taitokerau Appellate MB 95 (4 APWH 95). 3 (1999) 1 Waiariki Appellate MB 116 (1 AP 116). 34 Waikato Maniapoto MB 115
2F4D 4, and Property Ventures Ltd v Parata Ngarara West B3B 5 in coming to a determination as to how to approach the issues which arise on change of status. [20] At paragraph 76 [2011 Māori Appellate Court MB 230] the Māori Appellate Court concluded: 6 [76] After considering these decisions it is our view that in an application for status change the Court must first determine whether or not the threshold under section 136 has been reached. If so it must then balance the merits of any objection by the PCA s and the principles or kaupapa of the Act with the merits of the application. Generally an order should not be made unless there are distinctive reasons for so doing. We now consider the particulars of the case before us. [21] In keeping with the principles expressed in that decision I proceed to consider the merits of the application before me. Has the threshold under section 136 been reached? [22] The land is solely owned by the applicant. Title is registered in the Land Transfer Office under SA29D/138. These facts satisfy the Court as to the requirements set out in ss 136(1)(a), (b), (c) and (e) of the Act. Only s 136(1)(d) remains that the land can be managed or utilised more effectively as General land. [23] Title to this land was created by partition order on 13 November 1981 at 42 Tauranga MB 176-179. The Memorial Schedule for the block reveals substantial mortgage borrowing over the years from 1984 to 1998 from the Rural Bank, the Iwi Transition Agency, the ANZ Bank and the Housing Corporation. [24] In a written statement accompanying her application Mabel Ngatai writes: I seek the court's approval to change the status of my whenua from Maori freehold title to General title. I have attached all details to this application. The court will note that this block has been used a number of times in the past as security to support my whanau, particularly children and mokopuna to build business and provide homes for their whanau. The court will also note that once mortgage free the whenua has reverted back to Maori title. 4 (2006) 7 Taitokerau Appellate MB 1 (7 APWH 1). 5 (2007) 16 Whanganui Appellate MB 1 (16 WGAP 1). 6 (2011) 2011 Māori Appellate Court MB 215 (2011 APPEAL 215) at [76]. 34 Waikato Maniapoto MB 116
[25] In her statement Mabel Ngatai went on to explain that the opportunity had arisen to purchase shares from extended whānau members in another whānau block situated on the Matapihi Peninsula. This block was of huge significance to her, her husband and children as this was where her family was raised. She needed to raise finance from ANZ Banking Group and sought change of status so that she could use the land as collateral. The applicant confirmed her intention to change the status back to Māori freehold title once she was in a position to do so. [26] The application was filed on 1 April 2011. At the hearing on 14 September 2011 Mrs Ngatai told the Court that the proposed purchase of the Matapihi land had been completed as she had been able to raise the necessary finance from General land owned by her husband and her. She asked that the application be considered on the basis that she wished to use the land as collateral so that she could now assist her grandchildren in the same manner as she had assisted her children. [27] The applicant has changed her reasons for the application from a specific proposition, namely, purchase of Māori land interests, to the general proposal that she wishes to be able to use the land as a source of finance for the advancement and benefit of her children and grandchildren. Normally where finance is involved the Court will require the applicant to make exhaustive inquiries as to the availability of finance before it will contemplate a change of status. [28] The ANZ Bank, in a letter dated 13 July 2011 addressed to the applicant s solicitors, Cooney Lees Morgan of Tauranga outlined, in general terms its lending policy on Māori land. It stated: In general terms, the policy approach taken by the Bank has regard to the technical complications of ascertaining the type of title, statutory requirements, the complexity in securing mortgages, the impact of the cultural significance of the land, the subsequent impact on saleability and therefore value of the security taken. If Maori freehold land is offered as sole security for new lending, it may not be considered to be satisfactory security for the Bank as dealings in Maori freehold land are subject to certain statutory requirements, complexity in some cases in ascertaining certainty of title ownership, and the likelihood of the land being of high cultural significance. The result may be restricted saleability and in extreme cases non-saleability which cannot necessarily be pre-determined. As a consequence, the security value which the Bank attaches to Maori freehold land is generally less than the security value for similar land carrying the status of general land. 34 Waikato Maniapoto MB 117
[29] Title to the subject land is solely held by Mabel Ngatai under Land Transfer title SA29D/138 which was issued in 1983. Consequently the title position is uncomplicated and most of the complexities outlined in the excerpt above will not apply to this land. However, the fact remains that since the Mangatu case 7 it has been accepted that the mere status of land being Māori freehold land means that it has a lower valuation than if it were general land. This can affect the ability to borrow, terms of lending and the security value of the land. [30] As I have said, the issue in this case is no longer a matter of obtaining finance for a specific proposition. It is a matter of the applicant being able to access a source of finance from time to time to assist her children and grandchildren as and when a proposition of which she approves arises. She has indicated that she has helped her children in the past both with housing and business ventures. While she has not given specific details as to that assistance the borrowing against the title is consistent with her evidence. I have no reason to doubt her and I accept that her wish to change status is now motivated by a desire to further assist the betterment and advancement in life of her children and grandchildren. [31] Mabel Ngatai wishes to manage and utilise the land as a source of finance for the purpose outlined above. She has a good relationship with the ANZ Bank and change of status will free her from the limitations placed on Māori land thus enabling her to obtain better access to finance and a higher margin of lending. I am therefore satisfied, having regard to the specific requirements as to finance in this case, that the land can be better managed and utilised as General land. Consideration of application [32] As mentioned earlier there are no objections to the application. The Court therefore must balance the principles or kaupapa of the Act against the merits of the application. [33] The applicant seeks a change of status to facilitate borrowing against the land to assist the betterment and advancement in life of her children and grandchildren. 7 Valuer General v Mangatu Inc [1997] 3 NZLR 641. 34 Waikato Maniapoto MB 118
The purpose of the applicant is laudable and her whānau are fortunate to have a grandparent who is willing and in a position to provide such assistance. [34] She has made a strong case for change of status. The question is whether it is strong enough to influence the Court to exercise its discretion after taking due account of the requirement to promote the retention of Māori land in s 2(2) of the Act. [35] There are a number of points in her favour. First, she has in the past, while the 1953 Act applied, been able to raise finance against the land to assist her children in housing and also in business affairs. She now wishes to continue this assistance and broaden its scope to include her grandchildren. [36] Secondly the amount of land is relatively small, being less than 2 hectares. The size of the land is not in itself a reason to grant change of status but may be a factor to be taken into account. In Craig v Kira Wainui 2F4D 8 the applicant sought a change of status so that she could better sell her land and thus provide for herself in her later life. The Māori Appellate Court referred the case back to the lower Court for rehearing on the basis that a part of the land which was sufficient for the appellant s purpose might be changed in status and the rest retained as Māori land. [37] Thirdly, the land contains the family home of the applicant and her husband and the home of one of her sons. It is also used as a kiwifruit and avocado orchard. The use of this land for these purposes is indicative of the fact that the applicant and her family would wish to retain this land and the application is not a ploy to better effect a sale of the land. [38] Fourthly, the application to change status to Māori land in 2003, although brought about by a mistake as to the then existing status of the land, is evidence as to the applicant s desire to retain the land as Māori land for her family. It gives credence to her statement that she intends to change the status back to Māori land once the programme of assistance to her whānau is completed and she is in a position to seek that change. 8 (2006) 7 Taitokerau Appellate MB 1 (7 APWH 1). 34 Waikato Maniapoto MB 119
[39] Fifthly are provisions in the Act relating to retention of land. The land is used for housing and as an orchard. That use will continue if the status is changed. The only change will be that the land will be further used to provide finance for the benefit of the applicant s family. I am satisfied that a change of status, if granted, will see the land retained by the applicant and used for her benefit and that of her whānau. [40] Section 2 (1) states: It is the intention of Parliament that the provisions of this Act shall be interpreted in a manner that best furthers the principles set out in the Preamble to this Act. [41] The Preamble to the Act includes: And whereas it is desirable to recognise that land is a taonga tuku iho of special significance to Maori people and, for that reason, to promote the retention of that land in the hands of its owners, their whanau, and their hapu, and to protect wahi tapu: and to facilitate the occupation, development, and utilisation of that land for the benefit of its owners, their whanau, and their hapu: [42] Section 17(1) states- (1) In exercising its jurisdiction and powers under this Act, the primary objective of the Court shall be to promote and assist in (a) (b) The retention of Maori land and General land owned by Maori in the hands of the owners; and The effective use, management, and development, by or on behalf of the owners, of Maori land and General land owned by Maori. [43] The Preamble and s 17(1) refer to retention of land by Māori. Under s 2(1) retention is a principle of the Act. Under s 17(1) it is an objective of the Court. These provisions apply equally to General land as they do to Māori land. It is only in s 2(2) that the reference is solely to Māori land being retained by Māori. [44] Thus, aside from the emphasis on the retention of Māori land in s 2(2), the Act contains as a principle and objective the retention of any land held by Māori and the occupation, use and development of that land for the benefit of its owners their whānau and their hapū. 34 Waikato Maniapoto MB 120
[45] This is the position in respect of the applicant s land. Mrs Ngatai seeks to retain the land and to change the status of the land so as to maximise the benefits from it for her whānau. In doing so she would comply with a principle of the Act under s 2(1) and an objective of the Act under s17(1). [46] Retention of land, even as General land, is in the principles and objectives of the Act. The facts and circumstances surrounding the incidence of retention are factors to be taken into account and considered in the exercise of discretion under s 135. These facts and circumstances do not counter the specific reference to retention of Māori land in s 2(2) and the Court must, in considering this application give due weight to that requirement. Decision [47] Factors which influence me towards a decision in favour of the applicant are: (a) The applicant wishes to change the status of the land to obtain finance for the betterment and advancement in life of her children and grandchildren; (b) The applicant has previously used the land to obtain finance to assist her children and has thus showed that she is able and willing to use the land for this purpose; (c) That a change of status from Māori freehold land to General land will facilitate the obtaining of finance through using the land as security; (d) That the present use of the land to provide a family home for the applicant and her husband and a home for one of her sons and as a kiwifruit and avocado orchard and the proposed use to provide security to obtain finance for the benefit of the applicant s children and grandchildren are indicative of the applicant s intention to retain the land; 34 Waikato Maniapoto MB 121
(e) That the area of land is relatively small; (f) The inclusion, as principles and objectives of the Act, of the retention and utilisation of land for the benefit of the owners and their whānau. [48] I am satisfied that the applicant has made a case for change of status and that the factors outlined above are sufficiently distinctive to allow an order to be made. Order [49] There is an order under s 135 declaring that the status of Te Puna Parish 154D5A1 Block comprised in CFR SA 29D/137 shall cease to be Māori freehold land and shall become General land. Pronounced in open Court at 3.20 pm in Hamilton on this 23rd day of January 2012. G D Carter JUDGE 34 Waikato Maniapoto MB 122