Brain-damaged sibling not made bankrupt

16:00, Feb 03 2013

A High Court judge has declined to bankrupt an 80-year-old retiree suffering from brain injury amidst claims she was "roped in" to wasting hundreds of thousands of dollars on a long-running family legal feud.

Associate Judge David Gendall declined in the High Court in Napier to bankrupt retirement village resident Winipera Eva Mauger, despite ruling she owed $85,000 in costs after being unsuccessfully sued by her brother, Kenneth Apatu.

Justice Gendall said in his ruling that Mauger was incapacitated by a brain injury in the time leading up to the costs award, and agreed with her counsel that she had been "roped in" to spend nearly $300,000 on lawyers.

Lawyers acting for Mauger submitted she was the victim of another brother - her partner in litigation, Ashley Apatu.

The roots of the debt date back to the death of the family's patriarch Wirihana Apatu in 1970, and a subsequent squabble over the administration of the family estate.

Mauger and Ashley Apatu filed claims in the High Court in 2007 alleging their brother, Kenneth, had misused his position as trustee.


Justice Gendall said just before this action was filed Mauger was involved in a serious car accident and sustained a "severe head injury" after hitting her head on the steering wheel.

Mauger later advanced $200,000, at Ashley's request, to Auckland law firm Holmden Horrocks to prosecute the case.

The court heard Mauger owed Holmden Horrocks an additional $96,000 for work on the case, and as a result one of her properties had been mortgaged by the law firm.

In 2010, during a two-week hearing before Judge Joseph Williams, the court heard how the family dispute included paintings being uplifted from properties and physical tussles over property deed documents.

Justice Williams dismissed all the claims brought by Mauger and Ashley and ordered the pair pay Kenneth's costs of $85,000.

In the pursuit of these costs Kenneth bankrupted his brother Ashley in May, and pressed throughout 2012 to do the same to Mauger.

Justice Gendall declined to rule Mauger bankrupt, noting that even after paying her own considerable legal bills, she had enough assets to settle the remaining $85,000 bill.

In his ruling Justice Gendall raised concerns at how Mauger had, while suffering the effects of a frontal lobe syndrome, run up such a large legal bill.

"There also does seem to be some possibly serious irregularities in the various payments made by [Mauger] to Holmden Horrocks," he said in his ruling.

Justice Gendall noted the sums requested by Ashley to cover the legal expenses were greater than the amounts the firm had invoiced for legal work.

Justice Gendall said the excess was apparently held on account for Ashley, who was paid out $31,300 by the firm.

He said it was suggested these payments may have been in part for work Ashley said he undertook on this case, or even on earlier unrelated litigation involving the same firm.

"It certainly appears that, even though Ashley was the main instigator and driver of this litigation against [Kenneth], he made no contribution to its costs."

The Dominion Post