Bronwyn van Roon's horse truck was just about to sell. She needed the money so she and her daughter could pay to upgrade to a new truck. They’d had the old one for two years, but they needed something bigger, gruntier.
“The money was this close to changing hands and all of a sudden, brakes are on,” Ms van Roon told Fair Go.
The buyer was getting finance and the finance company had spotted a problem. There was a security registered on the truck - a financing statement logged on the Personal Property Security Register, an online system the public can search that many do before they buy a car. It said that the seller from two years ago had owed money and the person they owed had staked a claim to the truck.
Ms van Roon was utterly perplexed – she’d paid cash. She’d also checked on the PPSR that there was nothing owing before they bought it. More puzzling, the claim had been registered 20 days after the sale went through.
She was told "they don't actually check the paperwork that's submitted".
That was one of many calls Ms van Roon would make to the Ministry for Business, Innovation and Employment (MBIE), which administers the system. Getting this straightened out would take time and money and, in Ms van Roon's case, the help of a lawyer.
"The PPSR is notice to all the world that you've got a security interest in a particular piece of personal property," Lizandra Bailey of law firm Turner Hopkins said.
"There may be money owed on it or some form of contractual right over that particular piece of property so it's a warning, It means you have a right to go and enforce your security interests if it's on-sold."
And yes, you do need to have a legal right to register an interest and usually, the consent of the person you are making the claim against, but none of that is checked when someone files a claim.
”It’s based on an honesty type policy so yes there is the ability for anyone to register a security interest," Ms Bailey said.
PPSR - MBIE - it was all alphabet soup for Ms van Roon, and it was leaving a bad taste. And who was this mysterious stranger anyway?
"Somewhere a guy was holding some sort of grudge ... we got caught up in it," Ms van Roon told Fair Go.
Turns out the previous owner had been in a relationship with a man named Rangi Whakaruru, a former advisor to the Māori King, Tuheitia, now awaiting sentence on fraud charges unrelated to the mess this had caused for Ms van Roon.
Mr Whakaruru didn’t own the truck, but there appeared to be a dispute with the previous owner. He wasn’t responding to messages from Ms van Roon nor from Fair Go, yet at the stroke of a pen or a keyboard, he could have lifted the statement.
Ms van Roon was despairing as calls to MBIE continued.
“If it had to go through the High Court - which they kept telling me it potentially could - it could take six months or more,” Ms van Roon told Fair Go.
By law, it can take just 10 days before the Companies Registrar is able to remove a record the register because it is “frivolous or vexatious” - but all up this took 30 days and Ms van Roon was very vexed - mostly by how she’d nearly lost the sale waiting for the bureaucrats to act.
“I was annoyed at the guy, but these things happen. The system, however - there's no excuse for the system allowing these things to happen.”
MBIE defends its actions. It says there are 1.85 million statements registered on the PPSR and in the past five years, 86 have been discharged “as a result of the change demand process”.
In other words, it’s an open system and if officials had to check what is added, that would cost a lot more, meaning only big businesses could use it and benefit from it, whereas now anyone from a car dealer to someone supplying a large or expensive bit of equipment can safeguard their claim to a piece of property while the transaction goes through or the money is paid off.
MBIE says it is planning to clarify the process which members of the public can follow to have an improperly registered financing statement removed.
But with no fine or other penalty written into the law, the system could be open to abuse without consequences. Ms van Roon just hopes no one else gets caught up in it like she did.