Dilworth Old Boys Benevolent Trust - [2022] NZHC 2755

IN THE HIGH COURT OF NEW ZEALAND

` REGISTRY

I TE KŌTI MATUA O AOTEAROA TĀMAKI MAKAURAU ROHE

CIV-2022-404-1578

[2022] NZHC 2755

UNDER

AND
Part 3 of the Charitable Trusts Act 1957

IN THE MATTER OF

the DILWORTH OLD BOYS

BENEVOLENT TRUST a registered charitable trust having its registered office at 45 Fordyce Avenue, Sunny Hills, Auckland Applicant

Hearing: 12 October 2022

Counsel:

S McNulty for Applicant

Judgment:

25 October 2022

JUDGMENT OF WOOLFORD J

(Variation of trust)

This judgment was delivered by me on Tuesday, 25 October 2022 at 12:30 pm pursuant to r 11.5 of the High Court Rules.

Registrar/Deputy Registrar

Solicitors / Counsel: Jackson Russell (S McNulty), Auckland

Re DILWORTH OLD BOYS BENEVOLENT TRUST [2022] NZHC 2755 [25 October 2022]

[1] This is an application by the Dilworth Old Boys Benevolent Trust (the Trust) for an order under the Charitable Trusts Act 1957 (the Act) approving a scheme to vary the power of the trustees and varying the mode of administration of the assets of the Trust.

[2]In addition to the application itself, the applicant has filed:

(a)Draft scheme of variation;

(b)Affidavit of Bruce Bayford Owen in support dated 30 August 2022;

(c)Report of the Attorney-General dated 20 July 2022 (report);

(d)Affidavit of Alicia Anne McCabe as to advertising dated 30 September 2022; and

(e)Memorandum of counsel.

Background to Scheme

[3] The Dilworth Old Boys Association (DOBA) is an association of past pupils of the Dilworth School in Auckland. DOBA aims to support old boys in establishing themselves in their chosen careers by maintaining a strong network of past pupils.

[4] The Trust was established in October 1971 as a result of DOBA recognising that members of the old boy community may have certain financial needs over their lifetimes. The Trust Deed describes the core purposes of the Trust as providing financial and other assistance to Dilworth old boys, their widows and children as well as members of DOBA, who justify assistance by virtue of their distressed or straitened circumstances.

[5] The original Trust Deed uses outdated language and does not cater to the modern requirements and rules for the proper administration of a charitable trust.

[6] Paragraph 25 of the affidavit of Bruce Owen sworn on 30 August 2022 sets out what the effects would be if the proposed scheme was approved. The scheme being proposed in this application:

(a)Amends the charitable objects of the Trust by expanding the class of potential beneficiaries as close as is reasonably possible to those in the original Trust Deed. For example, it allows de facto partners and not just spouses of deceased old boys to be included as potential beneficiaries of the Trust;

(b)Amends and simplifies clauses and rules relating to trustee powers; and

(c)Amends certain rules relating to the administration and management of the Trust. These amendments can be made under the existing Trust Deed but have been included in the scheme so that there is a single scheme document to replace the Trust Deed.

Procedural requirements

The…

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: [2022] NZHC 2755
Decision Date: 25 October 2022

CaseChat Overview and Summary

The Dilworth Old Boys Benevolent Trust, a charitable trust established to support members of the Dilworth School alumni community in need, sought to amend its Trust Deed to modernize its language and better align with current charitable trust administration standards. The Trust's application aimed to expand the class of potential beneficiaries, simplify trustee powers, and update administrative rules. The application included a draft scheme of variation, affidavits, and a report from the Attorney-General, who endorsed the proposed amendments with the exception of a proposed clause that would have allowed the trustees to alter the trust's charitable purpose without judicial oversight.

The court considered whether the proposed scheme met the statutory requirements under the Charitable Trusts Act 1957, specifically sections 32 and 33, which permit the variation of trust purposes and administration. The Attorney-General's report indicated that while most of the proposed changes were appropriate, the suggested clause that would have allowed trustees to vary the trust's purpose without judicial approval was impermissible. In response, the Trust amended the proposed clause to limit the trustees' powers to altering administrative provisions only. The court found that the amended scheme met the statutory criteria and approved the application, directing the costs of the Attorney-General to be paid from the trust's assets.

Orders