Clement v Lucas - [2018] NZHC 1799

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

I TE KŌTI MATUA O AOTEAROA TĀMAKI MAKAURAU ROHE

CIV-2015-404-1620

[2018] NZHC 1799

IN THE MATTER of the CLEMENT FAMILY TRUST and the Estate of NOLA VALERIE CLEMENT

BETWEEN

KEITH TREVOR CLEMENT as beneficiary of the CLEMENT FAMILY TRUST and Administrator of the Estate of NOLA VALERIE CLEMENT

Plaintiff

AND

COLIN JAMES LUCAS AND SAMUEL MICHAEL WILLIAM BASSETT as

Trustees of the CLEMENT FAMILY TRUST First Defendants

Continued next page

Hearing: On the papers

Appearances:

G Stringer for Plaintiff

S Robertson QC for First Defendants R Latton for Second Defendant

N Woods for Third Defendant

Judgment:

19 July 2018

COSTS JUDGMENT OF VAN BOHEMEN J

This judgment was delivered by me on 19 July 2018 at 4.00 pm, pursuant to Rule 11.5 of the High Court Rules.

Registrar/Deputy Registrar Date: ………………………….

Solicitors:Davenports Harbour Lawyers, North Harbour Inder Lynch, Papakura
Lee Judd Law, Auckland Rice Craig, Papakura

CLEMENT v LUCAS [2018] NZHC 1799 [19 July 2018]

AND BRIAN CAMPBELL CLEMENT as
beneficiary of the CLEMENT FAMILY TRUST and Administrator of the Estate of NOLA VALERIE CLEMENT
Second Defendant
DERENE WENDY CLEMENT as
beneficiary of the CLEMENT FAMILY TRUST and Administrator of the Estate of NOLA VALERIE CLEMENT
Third Defendant

Introduction

[1] The parties apply for costs following my judgment given on 21 December 2017.1

[2] The proceeding began in July 2015 when Keith Clement made an application to appoint himself and a solicitor as trustees of the Clement Family Trust in place of Walter and Nola Clement, the settlors of the Trust, who had died, and the independent trustee, who had retired. Keith’s application also sought approval of his proposed distribution of the Trust assets. Keith’s application was opposed by his siblings, Brian and Derene, the other beneficiaries of the Trust.

[3] The parties consented to the appointment of two different and independent trustees. No decision was taken on Keith’s proposed distribution, which was opposed by Brian and Derene. The proceeding was not discontinued. By Minute dated 19 May 2016 Associate Judge Doogue reserved costs.

[4] In October 2016, the trustees decided to sell the Trust assets and signalled an intention to distribute the assets equally among the three beneficiaries after they had been unable to secure agreement from the three beneficiaries on any other option for the distribution of Trust assets. Keith and Derene supported the trustees’ proposed distribution.

[5] On 7 December 2016, Brian revived the proceeding by bringing a claim against the trustees challenging their decisions to sell the Trust assets and distribute the proceeds equally among the beneficiaries on the basis the trustees had failed to consider the purposes of the Trust and the intentions of the settlors. The trustees, Keith and Derene opposed Brian’s application. All parties took an active part in the hearing in October 2017.

[6] On 21 December 2017, I issued judgment on Brian’s claim. I found that the trustees had not considered that one of the purposes of the Trust and the wishes…

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.

Continue reading Clement v Lucas

Details

AGLC: Clement v Lucas [2018] NZHC 1799
Case: [2018] NZHC 1799
Decision Date: 19 July 2018

CaseChat Overview and Summary

In Clement v Lucas, the parties applied for costs following the court's judgment on 21 December 2017. The proceeding began in July 2015 when Keith Clement sought to be appointed as a trustee of the Clement Family Trust. The other beneficiaries, Brian and Derene, opposed Keith's application. The proceeding was not discontinued, and the court reserved costs. In October 2016, the trustees decided to sell the trust assets and distribute the proceeds equally among the beneficiaries. On 7 December 2016, Brian revived the proceeding by bringing a claim against the trustees challenging their decisions to sell the trust assets and distribute the proceeds equally among the beneficiaries. The court found that the trustees had not considered the purposes of the trust and the settlors' intentions and had failed to take pre-trust distributions of family property into account. The court ordered that the trustees' decisions be set aside and that the trustees reconsider their decision on the disposal of the trust assets, having regard to the purposes of the trust and the intentions of the settlors.

The legal issues the court was required to decide included whether the proceeding fell within the second or the third of the Buckton categories, who was successful in the proceeding, who should pay Brian's costs, and on what basis. The court found that the proceeding fell into the third Buckton category, that Brian was the successful party, and that Brian's costs should be met by Keith and Derene personally on a 2B basis. The court also found that the trustees' costs should be met from the trust fund, subject to any reduction to take account of the trustees' breach of their duties. The court made the following costs order: the costs of the parties for the first phase of the proceeding leading to the appointment of the new trustees were to be met from the Clement Family Trust fund; Brian Clement was entitled to costs on a 2B basis against Keith Clement, Derene Clement, and the trustees of the Clement Family Trust; Keith Clement and Derene Clement were each personally responsible for one-third of Brian Clement's costs; the trustees' one-third share of Brian Clement's costs was to be met from the Clement Family Trust fund; the trustees' legal costs were to be paid on an indemnity basis from the Clement Family Trust fund; and Keith Clement and Derene Clement were to bear their own costs.

Orders