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Chambers v S R Hamilton Corporate Trustee Ltd

Chambers v S R Hamilton Corporate Trustee Ltd

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IN THE COURT OF APPEAL OF NEW ZEALAND

CA358/2016
[2017] NZCA 131

BETWEEN

JOCELYN ZELPHA CHAMBERS
Appellant

AND

S R HAMILTON CORPORATE TRUSTEE LIMITED AND LAMB TRUST SERVICES LIMITEDFirst Respondents

STEPHEN WHITE
Second Respondent

MAUREEN EDITH PARSONS
Third Respondent

Hearing:	23 February 2017
Court:	Asher, Simon France and Peters JJ
Counsel:	C T Gudsell QC and R F Karalus for Appellant E J Hudson for First Respondents R J Connell and P J Clark for Second and Third Respondents
Judgment:	26 April 2017 at 10.30 am

JUDGMENT OF THE COURT

AThe application for leave to introduce further evidence is granted.
BWe allow the appeal in part.
CWe quash the High Court order directing a sale at a purchase price of $1,725,000 plus GST if any, and in substitution we make the order set out at [55].
D In all other respects we dismiss the appeal.
EAny orders required to implement the order at [55] are to be dealt with in the High Court.
FThe appellant must pay the second and third respondents one set of costs for a standard appeal on a band A basis and usual disbursements. We certify for two counsel.
GMr Hudson acted for the first respondents, and it is agreed by all parties that his fees should be paid by the estate. We so direct.
HThe issue of costs in the High Court must be determined in the High Court in light of the High Court decisions and the decision by this Court.

____________________________________________________________________

REASONS OF THE COURT

(Given by Asher J)

Introduction

This appeal concerns whether orders made in the High Court giving directions to the trustees of a family trust were properly made.[1] The appellant Dr Jocelyn Chambers, a beneficiary, contends that the Judge went too far in giving directions that he thought were appropriate, rather than limiting himself to making or refusing to make the specific orders sought by the trustees. She seeks remittance back to the High Court, or for this Court to make the directions she supported in the High Court.

Background

[1]S R Hamilton Corporate Trustee Ltd v White [2016] NZHC 1408.

The first respondents S R Hamilton Corporate Trustee Limited and Lamb Trust Services Limited (the Trustees) are trustees of a trust settled on 7 November 2003 by Mr White Senior and his wife Zelpha. It is unnecessary to trace the history since 2003 that has led to the change of name and the appointment of the current trustees. Suffice to say that the Trustees are companies linked respectively to Mr White Senior’s long term solicitor and his accountant. The final beneficiaries of the trust are the Whites’ three children, Mr Stephen White (Mr White), Ms Maureen Parsons and Dr Chambers.
Mrs Zelpha White died on 29 April 2006. In the years after her death Mr White Senior executed two memoranda of guidance intended to provide some direction to the Trustees about how they should deal with the Trust’s assets after his death and, as…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

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Details

Case: [2017] NZCA 131
Decision Date: 26 April 2017 at 10.30 am

CaseChat Overview and Summary

The appeal was brought by Dr Jocelyn Chambers, a beneficiary of a family trust, against orders made in the High Court that gave directions to the trustees of the trust. The trust, settled by Mr White Senior and his wife Zelpha, had three beneficiaries: Mr Stephen White, Ms Maureen Parsons, and Dr Chambers. The trust's significant asset was a modern home in Mt Maunganui, close to the beach. The Trustees, S R Hamilton Corporate Trustee Limited and Lamb Trust Services Limited, sought directions from the Court to sell the property to one of the beneficiaries at a specific price. Dr Chambers accepted the offer, but Mr White and Ms Parsons declined, leading to the current dispute. The appeal concerned whether the Judge's rejection of the Trustees' request for specific directions and the order directing a sale at a purchase price of $1,725,000 plus GST was proper.

The Court of Appeal considered the nature and extent of the jurisdiction under s 66 of the Trustee Act 1956, and whether the Judge erred in not properly considering the directions sought by the Trustees and making an allegedly different direction not sought by the Trustees. The Court found that the Trustees had surrendered their discretion to the Court by seeking directions for orders that they act in a certain specified way. The Court concluded that the Judge did not err in making the orders, as he considered the Trustees' desired option of the sale to Dr Chambers for $945,000 and rejected it for reasons that were explained and correct.

The relief to be granted was to offer the home at 4 Grace Avenue, Mt Maunganui to each of the three beneficiaries at a price of $2,025,000 including GST (if any) on standard reasonable terms. If more than one beneficiary wishes to exercise the option there will be no binding contract. If none of the beneficiaries exercises the option or more than one exercises the option, the property is to be placed on the market for sale on reasonable standard terms. The net proceeds will be divided equally between the three beneficiaries. The appeal was allowed in part, and the order of the High Court directing a sale at a purchase price of $1,725,000 plus GST was quashed, being substituted with the new order. In all other respects, the appeal against Heath J's orders was dismissed. The appellant must pay the second and third respondents one set of costs for a standard appeal on a band A basis and usual disbursements.

Orders