IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY
CIV 2012-404-5188 [2013] NZHC 1670
UNDER the Family Protection Act 1955 and the
Law Reform (Testamentary Promises) Act
1949
BETWEEN HELEN MARGARET FARQUHAR Plaintiff
ANDVIKKI JANE NUNNS and HOLLY REBECCA CLARKE as trustees and executors of the estate of ROGER GORDON CLARKE (Deceased) First Defendants
SHIRLEY FLORENCE JEFFERY Second Defendant
Hearing: 21 June 2013
Counsel: R D C Hindle for Plaintiff
B P C Carter for First Defendants (in personal capacity)
K A Muir for First Defendants (as executors and trustees) Appearance on behalf of Second Defendant excused
Judgment: 3 July 2013
JUDGMENT OF HEATH J
This judgment was delivered by me on 3 July 2013 at 4.00pm pursuant to Rule 11.5 of the High Court Rules
Registrar/Deputy Registrar
FARQUHAR v NUNNS [2013] NZHC 1670 [3 July 2013]
The application
[1] Ms Farquhar applies to remove Ms Nunns and Ms Clarke as executors and trustees (the administrators)1 of the estate of her late husband, Roger Gordon Clarke. She contends that there is a clear conflict between their roles as executors and trustees (on the one hand) and their personal financial interest as beneficiaries of the estate (on the other). Public Trust is put forward as an independent substitute.
Background
[2] Mr Clarke died at Auckland on 10 December 2011. He had married Ms Farquhar in February 2004. They remained married at the time of his death. Although they had been married for almost nine years, Ms Farquhar received nothing of substance from his estate; at least, in the context of an estate having a net
value of something in the vicinity of $1,700,000.2
[3] In his last Will made on 26 April 2010, Mr Clarke appointed his two daughters from an earlier marriage, Ms Nunns and Ms Clarke, as executors and trustees of his estate. Probate was granted in their favour, on 21 December 2011.
[4] Under the Will, Ms Farquhar was released from liability in respect of loans, said to have been made to her by her husband. In proceedings issued in the District Court of Queensland, Ms Farquhar retorts that the sum in issue was $100,000 and it was a gift. Mr Clarke also assigned her a debt owed to him by Instant Interiors Gold Coast Pty Ltd, but no specific mention of that debt is made in the statement of assets and liabilities of the estate filed in this proceeding. Ms Farquhar was also given a right to occupy the former family home in Queensland for one year, on condition that she pay all outgoings.
[5] The residue of the late Mr Clarke’s estate was left to his daughters, Ms Nunns and Ms Clarke. That being so, for all practical purposes they are the only
beneficiaries of the estate.
1 For convenience, I use the term “administrators” even though there is a clear difference between
the roles of executor and trustee.
2 Although the statement of assets and liabilities of the estate, set out in Ms Clarke’s affidavit…
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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AGLC
Farquhar v Nunns [2013] NZHC 1670
Case
[2013] NZHC 1670
Decision Date
CaseChat Overview and Summary
Helen Margaret Farquhar, the widow of the deceased, Roger Gordon Clarke, has applied for the removal of Vikki Jane Nunns and Holly Rebecca Clarke, the executors and trustees of the estate of her late husband, due to a perceived conflict of interest between their roles as administrators and their personal financial interests as beneficiaries. Public Trust has been proposed as a substitute. The court must determine whether the removal of the executors and trustees is expedient under the Administration Act 1969 and the Trustee Act 1956. The primary concern is whether the administrators' actions demonstrate a conflict of interest that would hinder the proper administration of the estate and execution of the trust.
The court found that the administrators had not demonstrated any misconduct or hostility towards Ms Farquhar. While there was a conflict of interest between their roles as administrators and beneficiaries, it was not enough to warrant their removal. The court emphasised the importance of respecting the deceased's choice of executors and trustees and the need to exercise the removal jurisdiction cautiously. The court concluded that the administrators had undertaken their task competently and that their actions did not prevent the proper execution of the Will. The application for the removal of the executors and trustees was dismissed.
The court reserved questions of costs, which will be dealt with by the trial judge after hearing evidence. The next event in the proceeding is an application to strike out the cause of action based in equity. The court also recommended the assignment of a judge to oversee the estimated trial duration and the provision of evidence for the substantive hearing.