Estate of Wilson

[2024] NZHC 2015

IN THE HIGH COURT OF NEW ZEALAND HAMILTON REGISTRY

I TE KŌTI MATUA O AOTEAROA KIRIKIRIROA ROHE

CIV-2024-419-176

[2024] NZHC 2015

UNDER

Section 136 of the Trusts Act 2019

IN THE MATTER OF

Distribution of missing beneficiary’s share

BETWEEN

CHRISTINA JANE NGAKAHIKATEA

WILSON as trustee and executor of the ESTATE OF RUSSELL THOMAS WILSON

Applicant

Hearing:	On the papers
Counsel:	S J Rawcliffe for Applicant
Judgment:	23 July 2024

JUDGMENT OF O’GORMAN J

This judgment was delivered by me on 23 July 2024 at 12.30 pm pursuant to r 11.5 of the High Court Rules 2016.

Registrar/Deputy Registrar

…………………………………

Solicitors:
Harkness Henry, Hamilton

Re ESTATE OF RUSSELL THOMAS WILSON [2024] NZHC 2015 [23 JULY 2024]

[1]    This is an application for orders under s 136 of the Trusts Act 2019 (Act). The applicant is the trustee and executor  of  the  Estate  of  Russell  Thomas  Wilson  (the Estate). The application seeks an order authorising the trustee to distribute a missing beneficiary’s share in the Estate’s property (approximately $17,000).

[2]    As the name and location of the missing beneficiary is unknown, the applicant also seeks leave for the originating application to be determined on a without notice basis in accordance with r 7.23 of the High Court Rules 2016.

Background facts

[3]    Russell Thomas Wilson died  on  26  January  2023,  leaving  a  will  dated  19 October 2004 and a codicil dated 20 December 2012. The will provides a gift of residue of the Estate equally among his four children living at his death. If any child is to die before him, then the gift that child would have been entitled to is to be taken equally by their children who are living at his death. The present issue arises under the gift over provision for one of the deceased’s children, Tony Ralph Wilson, who died on 9 January 2019.

[4]    The executor of the Estate is Tony’s sister. According to Tony Wilson’s death certificate, he had three daughters and three sons:

(a)Four of Tony’s children are known and have made contact with the Estate.

(b)One of Tony’s daughters was adopted out in 1997 and is not entitled to Tony’s share of the residue.

(c)Enquiries have been made by the applicant to try to locate the other child (a female, thought to be born around 1999). Before the death certificate came to light, the applicant was unaware that Tony had another daughter.

[5]    On 5 December 2023, an application was made to Te Tari Taiwhenua | the Department of Internal Affairs for a Status of Children search. No records were found.

[6]    The only information available is from Tony telling a few people about the child’s existence, with little other detail (no one recalls any name):

(a)Joanne Wilson, Tony’s sister, is aware that he had another child, but her understanding is that Tony had no contact with the daughter. Tony told her that the missing beneficiary’s mother may have moved them to Australia when the daughter was young. Joanne guessed the approximate age of the daughter on the death certificate.

(b)One of Tony’s ex-partners is aware that Tony had another child, but she was never informed of the child’s name or gender.

(c)Tony’s de facto partner at the time of his death is unsure of the missing beneficiary’s name but is aware she exists.

(d)Tony’s other children do not know who the missing beneficiary is.

[7]    Without details of the missing beneficiary’s name, date of birth, location, or even her mother’s name or family name, it is not possible to search for the missing beneficiary on social media.

[8]    An advertisement was placed in the New Zealand Herald on 18 March 2024, and The Australian on 20 March 2024. No contact was made by any potential beneficiary.

Legal principles

[9]    When beneficiaries are missing, the Court may, on the application of the trustee, make an order that authorises the trustee to distribute the trust property as if a

potential beneficiary or a class of potential beneficiaries does not exist or never existed, or has died before a date or an event specified.1

[10]To make such an order, the Court must be satisfied that:

(a)reasonable measures have been taken to bring to the notice of the potential beneficiary or beneficiaries their potential beneficial interest or interests;2

(b)at least 60 days have passed since the last of those measures was taken;3 and

(c)no potential beneficiary with respect to whom an order is sought has come to the attention of the trustee as a result of those measures, or the claim of any such beneficiary may be disregarded in the circumstances.4

[11]   Section 136 of the Act replaced s 76 of the Trustee Act 1956, but the authorities on s 76 remain relevant.5 Section 76 of the Trustee Act required the trustee to publish advertisements, whereas s 136 of the Act is non-prescriptive and requires “reasonable measures” to inform the potential beneficiary of their interest in the estate. The size of the estate affects what constitutes an appropriate inquiry.6 In Hodgson v Hodgson, the inquiries undertaken included an active search targeting social media, official databases, government departments, and friends and family.7

[12]   A trustee who incurs costs in respect of inquiries made to ascertain the existence and identity of beneficiaries is entitled to pay the expense directly from the trust property or to be reimbursed from it.8

1      Trusts Act 2019, s 136; and Dr Lindsay Breach Laws of New Zealand Trusts (online ed) at [253].

2      Section 136(2)(a).

3      Section 136(2)(b).

4      Section 136(2)(c).

5      Tyson v Beaver [2024] NZHC 278 at [9].

6      At [11], referencing Re Holland [2019] NZHC 1146 at [13]; and Re  Doak  [2022] NZHC  3111 at [10].

7      Hodgson v Hodgson [2023] NZHC 2025 at [18], the Court two years earlier having directed that social media searches be undertaken: Hodgson v Hodgson [2021] NZHC 906 at [16].

8      Trusts Act, s 81.

Analysis

[13]   I am satisfied that the applicant has taken reasonable measures to bring the interest in the Estate to the notice of the missing beneficiary. Those searches have included making inquiries of friends and family, government departments and placing advertising in New Zealand and Australia. I accept that searches on social media are not practical given the paucity of information. Further searches are not justified given they would further erode the modest sums involved.

[14]   For the same reasons, this application cannot be served on the missing beneficiary as the affected person, so I grant leave for the application to be determined on a without notice basis under r 7.23 of the High Court Rules.

[15]   I am satisfied that all of the requirements in subss 136(2)(a), (b) and (c) of the Act have been met and I grant the application.

Result

[16]   I make an order under subs 136(1)(a) of the Trusts Act authorising the applicant to distribute the missing beneficiary’s share in the Estate’s property equally between Tony Wilson’s four children as named in para 1(a) of the originating application.

O’Gorman J