Delaney

[2017] NZHC 2276

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

I TE KŌTI MATUA O AOTEAROA TĀMAKI MAKAURAU ROHE

CIV-2017-404-2094 [2017] NZHC 2276

UNDER THE	TRUSTEE ACT 1956
IN THE MATTER OF	THE WHITIANGA TRUST
BETWEEN	NIGEL GRAHAM DELANEY, BARBARA DELANEY AND AJLP TRUSTEES LIMITED Applicants
AND

Hearing:	13 September 2017
Counsel:	D Gray and A Jones for Applicants
Judgment:	20 September 2017

JUDGMENT OF WHATA J

This judgment was delivered by me on 20 September 2017 at 3.00 pm, pursuant to Rule 11.5 of the High Court Rules.

Registrar/Deputy Registrar

Date: ………………………….

Solicitors:           Alan Jones Law Limited, Auckland

NIGEL GRAHAM DELANEY, BARBARA DELANEY AND AJLP TRUSTEES LIMITED [2017] NZHC 2276 [20 September 2017]

Introduction

[1]      This matter came before me as part of the Duty List.   It is an application made without notice for vesting orders. As I indicated in a minute, I am satisfied the orders should be made. This judgment records my reasons.

Background

[2]      The Whitianga Trust was established by deeds of trust dated 25 July 2005. The original trustees were Bruce Graham Delaney, Barbara Delaney and their son, Nigel Graham Delaney.  The present trustees are the applicants: Barbara, Nigel, and AJLP Trustees Ltd.

[3]      The main asset in the trust is a property at 89 Centennial Drive, Whitianga. Bruce remained living at the Centennial Drive property until his health deteriorated. From April 2017, he has resided at the Whitianga Continuing Care Facility under full-time hospital care.   On 29 June 2017, Dr Schmendi concluded that Bruce is mentally incapable as he is no longer capable of safely making and communicating decisions about his personal care, welfare or property.  Dr Schmendi observes Bruce has experienced a “cognitive decline in keeping with an evolving dementia, resulting in limited or no insight, impaired judgment, problem solving deficits, unsafe wandering, inability to manage finances and vulnerability to exploitation.”   It is evident, therefore, that Bruce has not been capable of making decisions for some time and the two continuing trustees, Nigel and Barbara, have been unable to effectively manage the Trust. Clauses 15 and 16 of the Trust allow the appointers to appoint and remove trustees, however, the appointers are defined as Bruce and Nigel, and Nigel is unable to exercise those powers alone.

[4]      Accordingly,  by a  deed  dated  5  September  2017,  Nigel  and  Barbara,  as continuing trustees exercise a statutory power under s 43 of the Trustee Act 1956, appointed AJLP Trustees Ltd as trustee in place of Bruce.

[5]      Now Barbara, who is 79 years of age and in poor health herself, no longer wishes to continue in her role as trustee and intends to resign, if the High Court makes the vesting order sought.

[6]      The trustees put Centennial Drive on the market and upon its sale intending to repay a mortgage secured by ASB Bank Ltd and the funds advanced by Nigel. The balance will be made available as a fund with which to meet Bruce’s needs, as determined by the trustees in the exercise of their discretion.

[7]      Discretionary   beneficiaries   of   the   Trust   include   Gaynor   McEnaney (“Gaynor”) who is Bruce and Barbara’s daughter.  Gaynor has been diagnosed with metastatic breast cancer.   She has no assets, rents her accommodation is not able to work. The trustees would also like to provide financial assistance to her.

[8]      A conditional agreement for the sale of Centennial Drive was signed on 5

September 2017.The trustees are unable to deal with Centennial Drive while Bruce remains on the title, and accordingly they seek a vesting order under s 52 of the Trustee Act.

Assessment

[9]      Section 52(1) subs (a) and (h)state:

52       Vesting orders of land

(1)      Subject to the provisions of subsections (2) and (3), in any of the following cases, namely—

(a)       where the court appoints or has appointed a trustee of any land or interest therein, or where a trustee of any land or interest therein has been appointed out of court under any statutory or express power:

…

(h)      where land or any interest therein is vested in a trustee whether by way of mortgage or otherwise, and it appears to the court to be expedient—

the court may make an order (in this Act called a vesting order) vesting the land or interest therein in any such person in any such manner and for any such estate or interest as the court may direct, or releasing or disposing of the contingent right to such person as the court may direct.

[10]     I am satisfied that the AJLP Trustees Ltd has been appointed pursuant to s 43 of the Trustee Act to act as a trustee in place of Bruce.   Given the background

circumstances, and in particular Bruce’s mental capacity, it is expedient that an order be made vesting of land subject to this application in the names of Nigel Graham Delaney, Barbara Delaney and AJLP Trustees Ltd.

[11]    I am also satisfied that all persons interested in this application are not prejudiced by the grant given the background I have set out above.

Orders

[12]     Accordingly, I grant leave to make the application by way of originating application and there shall be the following order:

(a)      Vesting the land situated at 89 Centennial Drive, Whitianga, being all the land comprised and described in certificate of title identifier SA18B/1265 (South Auckland Land Registration District), which is currently registered in the names of Bruce Graham Delaney, Nigel Graham Delaney and Barbara Delaney, in the names of Nigel Graham Delaney of Whitianga builder, Barbara Delaney of Whitianga retired, and AJLP Trustees Limited of Auckland, being the present trustees of Whitianga Trust.