LW300 Property Law

Question 1 (20 marks)

James and Mary are married and have lived together for 40 years as husband and wife, near the Emalus USP Campus. They have children, Paul aged 23 years, Lara, 18, and Matthew, 15. Three years ago, in 2018, James borrowed from the Bank of South Pacific (BSP-Vanuatu) 2,000,000 Vatu to improve his cattle farm. James and Mary transferred their jointly owned yacht, at the downtown Port Vila marina, to BSP as collateral. In 2019, James and Mary separated because of James' continuous extra marital affairs. This as a result affected the loan repayment a default on loan repayment was evident. Two days ago BSP seized the yacht to sell to recover the amount of the unpaid loan. Mary claimed she only transferred the yacht to BSP as collateral because James forced her, further the BSP did not fully explain the effect of the transfer documents. Following the separation, Paul stayed with his father and both Lara and Matthew stayed with their mother. James and Mary agreed that they would give their family home to one of their children. As a result, they told Paul: "Here is the key to our family house which is yours if you marry a Fijian woman." Two months ago, Paul married his longtime girlfriend whose ancestors on her mother's side were from New Zealand, but whose father is a German of German ancestry. Mary recently discovered that Lara is into smoking and drinking alcohol. Mary was disappointed but as an incentive to stop Lara she told her: "You can have all of the furniture in the house if you promise to stop smoking and drinking alcohol." Lara agreed and took the key to the house to get the furniture. Mary was also worried that Matthew would decide to stay with James after turning 18. Thus, last week, she told Matthew: "Here is the key to my car. You can have it if you promise not to visit or stay with your father." Matthew took the key but still continued to visit James. Last month James agreed to sell 100 calves from his farm to his friend Tupou for 300,000 Vatu. Both agreed that they would jointly select the calves, but Tupou travelled overseas and the selection was postponed. James was desperate to get additional funds to finance his cocoa business. Therefore, he borrowed 300,000 Vatu from WestPac Bank which was secured against all the cattle on his farm. Last week, however, James was declared bankrupt.

Discuss the property interests of James, Mary, their children, BSP and the Westpac Bank.

USE FIJI JURISDICTION