Everiss v Long

[2025] NZHC 1165

IN THE HIGH COURT OF NEW ZEALAND WELLINGTON REGISTRY

I TE KŌTI MATUA O AOTEAROA TE WHANGANUI-A-TARA ROHE

CIV-2024-485-586

[2025] NZHC 1165

UNDER

the Trusts Act 2019 and Part 18 of the High Court Rules 2016

IN THE MATTER OF

an application to review of trustee decisions and to remove trustees from office and appoint replacement, and claim in knowing receipt

BETWEEN

JAMES WILLIAM EVERISS

Plaintiff

AND

WILLIAM BRUCE LONG, SHAUN BRENT EVERISS, and STEPHEN JOHN GRAVES

First Defendants

JOHN ARNOLD EVERISS
Second Defendant

SHAUN BRENT EVERISS
First Third Party

WILLIAM BRUCE LONG and KERYN ANN LONG

Interested Party

MATTHEW WILLIAM LONG, STEVEN JAMES LONG, and AMANDA JANE LONG

Interested Party

Hearing:

13 May 2025

Counsel:

J Pietras for Plaintiff

T Braun and J Perry for Defendant William Bruce Long and William Bruce Long and Keryn Ann Long (Interested Party)

M Martin for Defendant Stephen John Graves C Bell for Second Defendant

H Dempsey and M Leach for M W Long, S J Long, and A J Long (Interested Party)

EVERISS v LONG [2025] NZHC 1165 [14 May 2025]

S Connolly for M Everiss (Interested Party)

No appearance for B Everiss (Interested Party)

Judgment:

14 May 2025

JUDGMENT OF GRAU J

[Application to adjourn trial]

[1]                 This proceeding involves a dispute over the Everiss Family Trust (the Trust). A three-day fixture is scheduled on 28–30 July 2025. The second defendant and the interested party, William (Bill) and Keryn Long (the Longs), have applied to adjourn the fixture.

[2]                 The Trust was settled by deed in 1992. The Settlor was John Everiss, who is the grandfather of the plaintiff, James Everiss. John and his wife Barbara’s children, Brent Everiss (James’ father) and Keryn Long, were (with their spouses) discretionary beneficiaries. Other discretionary beneficiaries included Barbara, the grandchildren and their spouses, and great-grandchildren. In late 2023, the trustees agreed to wind up the Trust via a Deed of Distribution and Family Arrangement (DDFA), under which the assets were divided equally between the two sides of the family; the Everiss side and the Long side. The DDFA was signed and has been partly performed.

[3]                 James is one of John’s grandchildren and thus is a beneficiary of the trust. He commenced proceedings on 10 September 2024 alleging that the Trustees had breached their duties in a number of ways by making ultra vires distributions (including to John who was never a beneficiary) and by failing to consider the interests of discretionary beneficiaries who were not parties to the DDFA. He sought the removal of the Trustees, the appointment of a replacement independent trustee and various orders including to set aside distributions, and to rescind the DDFA.

[4]                 The proceedings, as initially commenced, were only between James and the trustees of the Trust, being Bill, Shaun Everiss (Shaun) and Stephen Graves (Stephen). Stephen was an independent trustee, while Bill (John’s son-in-law) and Shaun (John’s grandson) were also beneficiaries. James filed an amended statement of claim in

December 2024. At that stage, the proceeding still only involved James and the Trustees.

[5]However, a number of developments occurred in March 2025:

(a)On 14 March 2025, James filed a second amended statement of claim, which added a third cause of action against his Grandfather John, seeking to recover distributions made to John between 2011 and 2023, on the basis that he was not a beneficiary of the Trust.

(b)On 19 March 2025, Shaun, one of the defendant trustees, indicated that he no longer opposed the application, and he agreed that certain trustee decisions had in fact been ultra vires. According to James, both Shaun and Stephen (the independent trustee) will give evidence in support of James’ claim.

(c)After a case management conference on 25 March 2025:1

(i)John was joined to the proceeding as the second defendant as a result of the filing of the second amended statement of claim. His counsel indicated an application to adjourn the trial was likely.

(ii)Shaun no longer wished to defend the proceeding and instead supported some of the relief sought by James. Stephen had retired as trustee and abided the decision of the Court. The third trustee, Bill, confirmed he would abide the decision of the Court and not take active steps.

(iii)Service was directed to be made on the discretionary beneficiaries and interested parties who had been originally served.

1      Minute of Associate Judge Skelton [case management conference], 26 March 2025.

(iv)A litigation guardian was appointed for Barbara.

(v)Timetabling orders were made in advance of the scheduled hearing date of 28 July 2025.

(d)On 1 May 2025, Bill and Keryn Long, in their capacity as interested parties, filed a statement of defence and counterclaim against James and a statement of cross-claim against the trustees.

(e)On 8 May 2025, Bill and Keryn Long filed an application for particular discovery, seeking legally privileged correspondence and documents.

[6]                 Prior to these developments, it had also been agreed amongst the parties that Bill and Shaun should be removed as trustees, due to the hostility between them and their general inability to work together.

[7]                 On 1 May 2025, John filed an application to adjourn the July fixture, on the basis that there is insufficient time for him to prepare for trial, and there is real risk of injustice if the matter was to proceed to trial on the current date. Bill and Keryn Long also filed an application for adjournment on 1 May on the basis of insufficient time to prepare. They were also of the view that the three-day fixture gave insufficient time to deal with all the relevant matters to be considered.

[8]                 James opposes the adjournment applications. His position is that that the first cause of action against the trustees is urgent, there is a feasible alternative to adjournment (being a split trial), he would suffer significant prejudice if the adjournment was granted, and that overall it is in the interests of justice for the application to be dismissed.

[9]                 Enquiries with the registry suggest that a new fixture would be after March 2026.

Background

[10]As above, the Trust was settled by deed on 13 October 1992.

[11]             Clause 7.5 of the Trust Deed provided that where the settlor or one of the discretionary beneficiaries happen to be the sole trustee, or when two or more of the discretionary beneficiaries are trustees, the Trust enters into a “Restricted Period”. During such a period, the trustees cannot appropriate any moneys, property or interest in property, or any income derived from the Trust fund, to any discretionary beneficiaries.

[12]             As at 31 March 2023, the Trust capital was approximately $7,136,757, including $534,086 owed by Hyde Park Village, two commercial properties, the sale proceeds from 6 Riverbank Road, and heavy equipment and machinery valued at approximately $4,818,642. The Trust was also the sole shareholder of Everiss Contractors Ltd and Everiss Civil Ltd.

[13]             John appointed Brent as a trustee on 17 January 2017, and Shaun Everiss on 26 August 2022.

[14]             On 4 November 2022, John entered into a deed of retirement of trustee, leaving Brent, Shaun and Bill as the remaining trustees. As a result of John’s retirement, the Trust entered into Restricted Period.

[15]             On 22 April 2023, Brent passed away, leaving Shaun and Bill as continuing trustees.

[16]             James alleges that from 2011 to 2019, John had taken distributions or drawings from the Trust, recorded against Barbara’s beneficiary current account, which collectively amount to $1,370,694, which the Trust later forgave in March 2019.

[17]             It is also alleged that during the financial year ending 31 March 2023, while the Trust was in the Restricted Period, the trustees made distributions to Barbara, Bill, Keryn, Brent and Marie Everiss. James also claims that further payments were made to John between 2020 and 2023.

[18]             Further advances are alleged to have been made to Barbara and Marie respectively in the financial year ending 31 January 2024. Allegations are also made

that in 2023, Shaun and Bill took possession of the heavy equipment and vehicles owned by the Trust and failed to account for it.

[19]             In late 2023, the Trustees and some of the discretionary beneficiaries agreed to wind up the Trust and divide the assets into two equal shares, with the Long side of the family  taking  half  and  the  Everiss  side  taking  the  other  half.  On  around  18 December 2023, Shaun’s solicitor, Mr McHardy, circulated a draft Deed of Distribution and Family Arrangement (DDFA) to some of the discretionary beneficiaries. Under the DDFA, Keryn would receive 50 per cent of the assets and assumed liability, James 16.67 per cent, and Shaun 33.33 per cent, with the Trust’s shareholding in Everiss Civil transferred to Bill and his two sons.2 While James was provided with the draft DDFA, he did not receive a copy of all the schedules to the Deed, which included the details of how the Trust’s assets were to be divided.

[20]             On 21 December 2023, the DDFA was signed by  all  of  the  parties.  Stephen Graves was also appointed as an independent trustee, bringing the Restricted Period to an end.

[21]After signing the DDFA, James reportedly received a vacant gravel yard worth

$900,000, some “faulty equipment” and a $150,000 cash payment from Shaun, which would need to be deducted from James’ 16.67 per cent share. Shaun is said to have received a commercial site worth around $1,690,000 and some depreciated heavy equipment, while Bill acquired the Everiss Contractors’ earthmoving business, the main commercial premises worth at least $2,446,000, most of the heavy equipment, and other intangibles.

[22]             According to James, by around early 2024, he realised he needed to take a closer look at the Trust and the DDFA, and so engaged counsel. After making requests for and receiving various documents from the trustees, he decided to file proceedings to seek a review of the various decisions of the trustees.

2      In financial terms, this would amount to $5,581,427.71 to Bill and Keryn, $4,186,141.09 to Shaun, and $1,396,100 to the plaintiff, James.

[23]             On or around 4 April 2024, Shaun also commenced proceedings against Bill seeking disclosure of various documents concerning the financial affairs of the Trust, Everiss Contractors and Everiss Civil.

[24]             As above, on 10 September 2024, James filed his first statement of claim in this proceeding against the trustees.

The law

[25]             Rule 10.2 of the High Court Rules 2016 (HCR) provides that the Court may, before or at trial, postpone or adjourn the trial for any time, to any place and upon any terms it thinks just, if it is in the interests of justice to do so.

[26]             I gratefully adopt the summary of principles by Isac J in Poutama Kaitiaki Charitable Trust v Taranaki Regional Council:3

[11]              [Rule 10.2] confers a broad discretion on the Court.4 Nevertheless, the following principles inform its application:

(a)The interests of justice require consideration of not only the interests of the parties before the Court, but also of those awaiting a hearing who will suffer delay to their own cases should an adjournment be granted. This reflects the public interest in the efficient use of court resources.5

(b)As between the parties, the decision to grant or decline an adjournment is essentially a balancing exercise. It involves a consideration of the prejudice that will accrue to the applicant, as well as the harm to the respondent if an adjournment is granted or denied.6

(c)A further relevant factor is whether the applicant has acted reasonably and done everything practical to avoid the need for an adjournment.7

(d)The strength of the reasons in support of the application, and the prejudice said to follow from continuing with the trial, is a

3      Poutama Kaitiaki Charitable Trust v Taranaki Regional Council [2022] NZHC 628 at [39].

4      McGechan on Procedure (online ed, Thomson Reuters) at [HR 10.2.03].

5      Cygnet Farms Ltd v ANZ Bank New Zealand Ltd [2016] NZHC 1945 at [8], approving

Commissioner of Inland Revenue v Patel [2013] NZHC 477.

6      O’Malley v Southern Lakes Helicopters Ltd HC Christchurch CP513/89, 4 December 1990 at 1–2.

7      Shanghai Neuhof Trade Co Ltd v Zespri International Ltd [2019] NZHC 3479 at [15]. See also

Gray v Thorn [1997] NZFLR 328.

material factor.8 So too is the prejudice of an offer by the applicant to pay the wasted costs of the respondent should an adjournment be granted. An adjournment may be granted on conditions, including a requirement to pay the wasted costs of the other party.

(e)Also relevant is the right of the parties to a fair trial and the need for resolution of the proceedings, including the likely impact of further delay on the quality of the evidence and the difficulties of reorganising witnesses for a later trial date.9

Submissions

Second defendant’s submissions

[27]             Mr Bell on behalf of John submits that it is in the interests of justice for the trial to be adjourned as:

(a)John has insufficient time to prepare for trial, as by July 2025 he would have only had a few months to prepare and defend his claim. John, who is 86, struggles to understand and comprehend the proceedings and therefore he needs more time than would ordinarily be expected. Since the claim against him is broad and historic, he needs to go through decades of transactions. Accounts will need to be produced so that he can address the transactions that relate to allegations of payments made to him.

(b)The trial should not proceed until an independent trustee is appointed and is given time to assess the situation. There are benefits of appointing an independent trustee now as it may assist the family to agree to a resolution.

(c)While James pleads prejudice in the event the trial is adjourned, no specific prejudice is detailed in James’ affidavit of 2 May 2025, and any prejudice of proceeding therefore “far outweighs” the prejudice of

8      See Feasey v Dominion Leasing Corp Ltd [1974] 1 NZLR 539 (SC) at 595–596; Hamilton v Papakura District Council (1997) 11 PRNZ 43 (HC).

9      Shanghai Neuhof Trade Co Ltd, above n 7, at [15].

adjourning.    A trial in July would take place absent any formal discovery in relation to the claims against John.

[28]             Mr Bell also notes that, although James has agreed that the proceedings relating to John can be adjourned and proceed separately from the other causes of action, no application for a split trial has been made. He says the Court should not be persuaded to make such an order in the context of an application for adjournment. However, if the Court is minded not to grant the adjournment, then the proceedings relating to John should be adjourned and proceed separately at a later date.

Interested parties’ submissions

[29]             Counsel for Bill and Keryn Long, Mr Braun, submits that the interests of justice are best served by adjourning the trial, due to the fact that:

(a)matters in issue and the parties to the proceeding have evolved considerably since the trial was set down, the time to trial and the three days scheduled is not sufficient, and a split trial is not appropriate when the proceeding involves complex and interlinked issues;

(b)there is little prejudice to James if the trial is adjourned, because the trustees can be replaced by consent, whereas the Longs would suffer very real prejudice as the trial proceeding would be to the detriment of a “considered process”;

(c)while James say the Longs have been on notice since September 2024, the circumstances have changed, and this is not a case where there has been litigation for a number of years; and

(d)the reasons for granting the adjournment outweigh the reasons for the fixture to be maintained, given the prejudice to the Longs and John, and that an independent trustee would most likely be able to address a number of the matters currently before the Court.

[30]             Mr Braun says the parties should be directed to liaise regarding appropriate timetabling directions, such as in respect of discovery and trial length, before seeking directions from the Court by joint memorandum if such matters can be agreed.

Plaintiff ’s submissions

[31]Mr Pietras for James submits that:

(a)the interests of justice favour the trial proceeding as scheduled, as although the defendants and some interested parties claim the landscape of the proceeding has significantly changed, the first cause of action remains the same—requiring the same evidence and defences—and Bill and Keryn’s third party claim is merely a “last-minute attempt to create as much noise and confusion as possible”;

(b)there would be no prejudice to the defendants or interested parties if the trial proceeds, as the legal issue of the DDFA remains the same, the Longs and their children were served with the proceedings in September 2024, and the Longs children had been granted an indulgence in joining the proceeding, particularly given they have adopted the same position as their parents;

(c)there would be real prejudice to James and other discretionary beneficiaries if the trial is adjourned, as a trial of similar length is unlikely to be available until next year, and further delay will place immense financial and emotional pressure on the plaintiff and his family;

(d)the parties seeking adjournment did not do anything to avoid an adjournment, as they could have addressed the changing landscape concerns by agreeing to a split trial, but instead the Longs pursued extensive discovery applications; and

(e)the appointment of an independent trustee will not resolve the issues, as this is not possible until there is certainty around the status of the DDFA, which requires a judicial ruling.

[32]             James proposes that the July fixture proceed, and that a split trial be ordered to deal with all issues relating to the alleged ultra vires payments from the Trust. He says this will ensure the hearing time in July is not wasted, and the critical issue over the validity of the DDFA can be determined without undue delay. However, if an adjournment is granted, he says no costs should be awarded against him, noting the general rule is that costs are awarded against the party seeking an adjournment, whether that party is at fault or not.

Analysis

[33]             It seems to be agreed in general that the three-day fixture would not be sufficient to hear all of the matters now before the Court, namely the claims concerning the DDFA, the actions of the Trustees and the claims against John. There is also the discovery application made by Bill and Keryn that would need to be dealt with in advance of the hearing.

[34]             But even if the currently scheduled three days would be sufficient, I agree that John would not have sufficient time to prepare a defence to the claims against him which were only pleaded on 14 March 2025. James’ opposition to the adjournment therefore appears to be dependent on the feasibility of directing a split hearing, in the absence of any application for such.

[35]             Rule 10.4 of the High Court Rules 2016 (HCR) provides that the Court may “when justice requires” order separate trials of causes of action, direct the sequence of the separate trials and make any supplementary order that is just. The relevant factors to consider include:10

(a)whether the matters to be traversed in each trial will substantially overlap;

10     Goodship v Minister of Fisheries (2000) 15 PRNZ 256 (HC) at [13]; and Clear Communication Ltd v Telecom Corporation of New Zealand Ltd (1998) 12 PRNZ 333 (HC) at 335.

(b)the issues of res judicata or conflicting findings resulting from the trials; and

(c)substantially more court time being taken by separate trials.

[36]             James’ first cause of action, in relation to the alleged ultra vires distributions, includes “the Trustees’ decision to pay distributions to John”. James claims such distributions were “ultra vires of the Trust Deed” and “a breach of the Trustees’ fiduciary duties to the Discretionary Beneficiaries”. One of the orders sought under that cause of action is for “an order setting aside all distributions made to John as a non-beneficiary” and “an order requiring Bill to reimburse the Trust for all distributions made to John”. James’ third cause of action against John is that since 2011, John had received Trust funds for his own benefit, at all material times knew he was not a beneficiary of the Trust, and that Trust funds were transferred to him or used for his benefit in breach of trust.

[37]             It is difficult to see how these two causes of action can be split without there being issues as to conflicting findings and wasting Court time by having separate trials. I am also of the view that there will be substantial overlap in the matters traversed in each trial.

[38]             Even if a split trial was feasible, I still consider there is clear prejudice to John and the interested parties Bill and Keryn Long if the July fixture proceeds. Given they were joined very late in the proceeding (26 March and 1 May 2025 respectively), and it appears the first defendant (the trustees of the Trust) will no longer present a defence, the claim is now being opposed by parties who have only been part of these proceedings for a number of months.

[39]             It is acknowledged that Bill was a party at the start of the proceeding in his capacity as trustee, and he has retained his counsel since the start of the proceeding. But John has not, and although he would have been served with the proceeding, he could not have anticipated he would need to prepare a defence at short notice. I agree that recent developments have meant the landscape of this proceeding has fundamentally changed, despite the fact the primary cause of action, in relation to ultra

vires distributions and the DDFA, remains largely the same as when it was originally pleaded in September 2024. Although James considers that Bill has made late applications as a delaying tactic, Bill, whose position in this litigation has recently changed, is entitled to make such applications as he considers appropriate.

[40]             In terms of the prejudice to the plaintiff, I acknowledge James’ position that the proceedings have had a financial and emotional effect, and the pressure it has placed on his family, with him expressing his desire to move on with his life. It is also clear, as noted above, that a new hearing date will not be available until after March next year.

[41]             There is force in James’ submission that the appointment of an independent trustee in the interim, before any new hearing date, would do little to resolve the issues regarding the Trust, so as to justify an adjournment, given the legality of the DDFA is a matter only a Judge can resolve. On the other hand, there is also force in the submission that an independent trustee can now be appointed and make their own enquiries and form a view on the matters at issue which may assist this family to avoid the need for costly Court proceedings. Furthermore, I agree that a trial in July that was only concerned with rescinding the DDFA could have significant and possibly unforeseen consequences when it has been partly performed.

[42]             It is also possible that the three days currently scheduled may be insufficient. Accordingly, even if the trial was split, I consider the matter would still be finely balanced, with prejudice to both sides. However, given the prejudice to one side involves fair trial rights, whereas the other’s prejudice concerns relatively vague financial and emotional concerns, on balance, I consider that there will be greater prejudice to John and the interested parties, Bill and Keryn, for the matter to proceed to trial on 28–30 July 2025, than if it were adjourned.

[43]             I also take into account that the proceedings have only been on foot since September 2024, thus it is not a case where proceedings have been ongoing for years. The impact of delay is therefore less serious here than in other, more prolonged cases. Nor is this a late adjournment request that would likely result in prejudice to others who are waiting for their case to be heard.

[44]Accordingly, I am satisfied the proceeding should be adjourned.

[45]             The parties have agreed to timetabling directions in respect of the outstanding discovery application which may now be set down for a hearing.

[46]             Counsel should also give prompt and careful thought to the length of trial required, to enable a new fixture to be allocated.

Result

[47]I grant the applications for adjournment.

[48]             I make no order for costs at this stage. Costs should be reserved pending the outcome of the trial.

Grau J

Solicitors:

Duncan Cotterill, Wellington for Plaintiff

Cullinane Steele Limited, Wellington for Second Defendant Livingston & Livingston, Wellington for First Third Party Braun Bond & Lomas Ltd, Hamilton for Interested Party

cc:        S Connolly, Wellington