Freeman v Freeman - [2016] NZHC 2100

IN THE HIGH COURT OF NEW ZEALAND NELSON REGISTRY

CIV-2016-442-54 [2016] NZHC 2100

UNDER the Trustee Act 1956, section 64A

IN THE MATTER

of the E R Freeman Family Trust

BETWEEN

DOREEN JOYCE FREEMAN, ALAN RUSSELL FREEMAN, WARWICK STEPHEN FREEMAN AND ROBERT BRUCE FREEMAN AS TRUSTEES OF THE E R FREEMAN FAMILY TRUST First Plaintiffs

ERIC RUSSELL FREEMAN Second Plaintiff

AND

DOREEN JOYCE FREEMAN First Defendant

ALAN RUSSELL FREEMAN Second Defendant

WARWICK STEPHEN FREEMAN Third Defendant

ROBERT BRUCE FREEMAN Fourth Defendant

BROOKE NICOLE FREEMAN Fifth Defendant

MEG ESTHER ADEANE FREEMAN Sixth Defendant

LEONIE ROSE LOUIE ADEANE FREEMAN

Seventh Defendant

GRACE ELLEN ADEANE FREEMAN Eighth Defendant

MOLLY ADEANE FREEMAN Ninth Defendant

DOREEN JOYCE FREEMAN, ALAN RUSSELL FREEMAN, WARWICK STEPHEN FREEMAN AND ROBERT BRUCE FREEMAN AS TRUSTEES OF THE E R FREEMAN FAMILY TRUST v DOREEN JOYCE FREEMAN [2016] NZHC 2100 [5 September 2016]

READE ERIC FREEMAN Tenth Defendant

SOFIA LOUISA FREEMAN Eleventh Defendant

CIV-2016-442-55

UNDER the Trustee Act 1956, section 64A IN THE MATTER of the D J Freeman Family Trust
BETWEEN ERIC RUSSELL FREEMAN, ALAN RUSSELL FREEMAN, WARWICK STEPHEN FREEMAN AND ROBERT BRUCE FREEMAN AS TRUSTEES OF THE D J FREEMAN FAMILY TRUST First Plaintiffs

DOREEN JOYCE FREEMAN Second Plaintiff

ANDERIC RUSSELL FREEMAN First Defendant

ALAN RUSSELL FREEMAN Second Defendant

WARWICK STEPHEN FREEMAN Third Defendant

ROBERT BRUCE FREEMAN Fourth Defendant

BROOKE NICOLE FREEMAN Fifth Defendant

MEG ESTHER ADEANE FREEMAN Sixth Defendant

LEONIE ROSE LOUIE ADEANE FREEMAN
Seventh Defendant

GRACE ELLEN ADEANE FREEMAN Eighth Defendant

MOLLY ADEANE FREEMAN Ninth Defendant

READE ERIC FREEMAN Tenth Defendant

SOFIE LOUISA FREEMAN Eleventh Defendant

On the papers

Counsel:

G J Harley for Plaintiffs and Defendants
C R Carruthers QC for contingent beneficiaries

Judgment:

5 September 2016

DIRECTIONS AND JUDGMENT OF CLIFFORD J

[1] In these proceedings, the plaintiffs seek consent of the Court under s 64A of the Trustee Act 1956 for amendments to two family trusts: the D J Freeman Family Trust and the E R Freeman Family Trust (the Family Trusts). The Court’s consent is sought on behalf of unborn and contingent beneficiaries, namely possible future children of the second to fourth defendants, Alan Russell Freeman, Warwick Stephen Freeman and Robert Bruce Freeman.

[2] The Family Trusts are mirror trusts. They were established in 1986 by Doreen and Eric Freeman. Eric Freeman is the life beneficiary of the trust established by Doreen Freeman, and Doreen Freeman is the life beneficiary of the trust established by Eric Freeman. As relevant, the Family Trusts each provide for the vesting of the trust property in the “final beneficiaries” upon the death of the relevant life beneficiary. The final beneficiaries are Doreen and Eric Freeman’s three sons: Alan Russell Freeman, Warwick Stephen Freeman and Robert Bruce Freeman and their children, currently Brooke Nicole Freeman, Meg Esther Adeane Freeman, Leonie Rose Louie Adeane Freeman, Grace Ellen Adeane Freeman, Molly Adeane Freeman, Reade Eric Freeman and Sofia Louisa Freeman (the second to eleventh defendants respectively).

[3] Mr Eric Freeman has recently been diagnosed with a terminal illness. He and…

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.

Continue reading Freeman v Freeman

Details

AGLC: Freeman v Freeman [2016] NZHC 2100
Case: [2016] NZHC 2100
Decision Date: 5 September 2016

CaseChat Overview and Summary

This case involved proceedings in the High Court of New Zealand where the plaintiffs, trustees of two family trusts, sought consent from the Court for amendments to the D J Freeman Family Trust and the E R Freeman Family Trust under section 64A of the Trustee Act 1956. The trusts, established by Doreen and Eric Freeman in 1986, were designed to vest in their three sons and their children upon the death of the respective life beneficiaries. The application sought to extend the vesting period to avoid immediate vesting due to the terminal illness of Eric Freeman and the family's desire to maintain the business structure. The legal issues revolved around whether the Court should approve the amendment of the trusts on behalf of the unborn and contingent beneficiaries, specifically any potential grandchildren of the trustees.

The Court considered the interests of the contingent beneficiaries, concluding that they were aligned with those of the existing grandchildren. The family's unified consent and the representation by Mr. Colin Carruthers QC, who supported the variation, were pivotal in the Court's decision. The advanced ages of Eric and Doreen Freeman and Eric's health condition further underscored the urgency of the requested changes. After reviewing the claims, applications, affidavits, and the terms of the trusts and the deed of variation, the Court determined that approving the amendments was in the best interest of all beneficiaries.

The Court granted the directions and orders as sought by the plaintiffs, allowing the amendments to the family trusts under section 64A of the Trustee Act 1956. The decision was made on behalf of all unborn children who could be beneficiaries of the trusts, ensuring that the family business would remain under the control of the current structure for the foreseeable future. This outcome aimed to preserve the successful business model and maintain the status quo for the benefit of all family members involved.

Orders