IN THE HIGH COURT OF NEW ZEALAND PALMERSTON NORTH REGISTRY
CIV-2014-454-90 [2014] NZHC 1924
IN THE MATTER of the J H MATHIESON TRUST BETWEEN
COLIN PAUL BLUMENTHAL Plaintiff
AND
BRUCE ANTHONY STEWART Defendant
Hearing: 1 August 2014 Counsel:
H A Cull QC for Plaintiff
J M Morrison for DefendantJudgment:
15 August 2014
JUDGMENT OF WILLIAMS J
I direct that the delivery time of this judgment is
11.00 am on the 15th day of August 2014.
Solicitors: McIntosh & Signal, Feilding, for plaintiff
Rainey Collins, Wellington, for defendant
BLUMENTHAL v STEWART [2014] NZHC 1924 [15 August 2014]
Introduction
[1] John Hawthorn Mathieson died on 1 February this year leaving an estate valued at just over $486,000 and a three acre semi-rural property in Manawatu vested in the J H Mathieson Trust (the Trust) of which the deceased was settlor, co- trustee and contingent beneficiary. The Trust property is now the subject of a sale and purchase agreement to a third party in the sum of $520,000. The net assets of the Trust are valued at something under $470,000, the difference being the result of a debt to the estate because the deceased had not forgiven the Trust all of the purchase price by the time of his death.
[2] The surviving trustee of the Trust is Bruce Stewart, Mr Mathieson’s former solicitor.
[3] The plaintiff, Paul Blumenthal, has brought proceedings against both the estate and the Trust. His mother lived in a de facto relationship with the deceased for some 22 years until her death and Mr Blumenthal says that as John Mathieson’s stepson, he is entitled to the three acre Trust property and a share in the estate.
[4] The primary beneficiary under Mr Mathieson’s 1981 will is the New Zealand Neurological Foundation. The Foundation is also a named beneficiary under the Trust Deed. Mr Blumenthal is not a named beneficiary under either instrument.
[5] The substantive proceeding is in two parts: causes of action under the Family Protection Act 1955 and Law Reform (Testamentary Promises) Act 1949 against the estate; and in constructive trust and unconscionable bargain against the Trust asset.
[6] In the meantime Mr Blumenthal has lodged a caveat against the title of the Trust property and now applies for an interim injunction to prevent completion of the property sale. Mr Stewart responded with an application under s 143 of the Land Transfer Act 1952 to remove the caveat. Mr Blumenthal filed a notice of opposition. The focus therefore in the applications before me is the Trust and its property.
[7] Mr Stewart has also applied for security for costs but the parties are now agreed that issue can be adjourned pending resolution of the applications for interim orders and in relation to the caveat. I set that matter to one side accordingly.
The Facts
[8] In the time that has been available to me and in light of the issues I am required to address, I set out the facts in brief outline only.
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