Brothers fail to halt development on family-owned Stoke land

Tuesday, 29 October 2019

Further residential development on Marsden Valley Road will continue after an injunction application was declined.

A family dispute over land in Stoke has escalated to the High Court, where a bid to stop development on the land was not successful.

Brothers Mark and Andrew McLaughlin sought a court injunction to prevent their other brother, John McLaughlin, developing part of a property held in trust known as the Homestead Block.

The four brothers Mark, Andrew, John and Brett McLaughlin are beneficiaries of the Ashley Trust, set up by their parents Jim and Edna McLaughlin. John McLaughlin is a trustee. Another trustee was the law firm Glasgow Harley, which is retiring from the trust and is yet to be replaced.

Plaintiffs Mark and Andrew wanted a temporary stop put on the development while a separate court proceeding went ahead.

* Young family gutted after their affordable home dream dies

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The Ashley Trust land is in Marsden Valley.

In the separate proceeding, Mark and Andrew were seeking the removal of Glasgow Harley, and also wanted damages from John and Glasgow Harley for alleged breaches of their duties as trustees.

These proceedings were ongoing after a different part of the property held in the trust, called Chings Block in Marsden Valley, was developed and sold at what the plaintiffs believe to be a loss on what the land alone would have sold for.

Justice Rachel Dunningham declined the injunction, despite saying that the plaintiffs had 'genuine concerns'.

In his affidavit Mark McLaughlin said the application was not about 'the substance of the proposed development', but about the 'process and propriety of decision-making'.

The plaintiffs were also concerned that the development progressing would lock all the trustees into a course of action for several years.

The contested land was put into a trust for the four siblings by their parents. Jim has since died.

Jim and Edna bought the property as farmland in the 1960s, with the view of developing it later. John McLaughlin and his wife purchased some of the land, began the process of rezoning and applying for consents, and helped Jim and Edna do the same for some of their remaining farmland.

The farmland was eventually put into the trust before any development started. This was prompted by Jim McLaughlin's declining health, 'to keep the land safe for the family and to ensure that Jim's subdivision wishes would be carried through', according to Edna McLaughlin.

Dunningham said she was satisfied that there was a 'serious question' about whether current trustees were in breach of their duties, but did not accept that that meant an injunction was necessary.

'I accept that allegations of financial mismanagement have been levelled against the trustees. However, they relate to the Chings Block development and are strongly contested, with supporting evidence. Granting the injunction would not alter that and the present actions of the trustees have been taken with the advice of well-qualified independent consultants.'

Dunningham said many of the allegations made by the plaintiffs had bearing on the substantive and ongoing proceedings, but not on the decision to make an injunction against further work.

She also said that any potential negative consequences from the development of the Homestead Block could be addressed by the payment of damages, and an injunction would have adverse consequences on people employed on the development.

'There is nothing in these submissions which overrides my view that, having regard to the balance of convenience and the interests of all beneficiaries, the application for interim injunction should be declined.'

*John McLaughlin is the sole trustee of the Ashley Trust. His brothers Mark, Andrew and Brett are beneficiaries. A former story incorrectly said all the brothers were trustees.