Genet v Genet Trustee Limited

[2013] NZHC 2834

IN THE HIGH COURT OF NEW ZEALAND WELLINGTON REGISTRY

CIV-2012-485-2544 [2013] NZHC 2834

IN THE MATTER             of the estate of Peter James Genet

BETWEEN  MARGARET CLARE GENET Plaintiff

ANDGENET TRUSTEE LIMITED First Defendant

CHRISTOPHER JAMES GENET Second Defendant

Hearing:                   30 September 2013

Counsel:                  P S Davidson for Plaintiff

K P Sullivan for Defendants

Judgment:                30 September 2013

Reasons:                  29 October 2013

REASONS FOR JUDGMENT OF GODDARD J

This judgment was delivered by me on 29 October 2013 at 3.00 pm, pursuant to r 11.5 of the High Court Rules.

Registrar/Deputy Registrar

Solicitors:

Reginald Hedley Newell, Upper Hutt for Plaintiff

Wilson and Co, Wellington for Defendants

GENET v GENET TRUSTEE LIMITED [2013] NZHC 2834 [30 September 2013]

[1]      On 30 September 2013 I made the following orders by consent of the parties:

1        The plaintiff’s claim is resolved in accordance with a deed of family

arrangement executed on 23 September 2013.

2        Christopher James Genet is appointed administrator of the estate of

Peter James Genet.

3Administration is granted with the memorandum of wishes executed on 26 July 2011 annexed as a will.

4All of the estate of Peter James Genet passes to the Genet Family Trust except for chattels, the disposition of which has been agreed between the parties.

5These orders dispose of the claims of the plaintiff, the counterclaims of the defendants and the grant of administration.

6        Costs lie where they fall.

[2]      As is evident, the making of these orders followed the execution of a deed of family arrangement between the plaintiff, Michelle Genet (a daughter of Peter Genet and a beneficiary under the Genet Family Trust (the Trust)) and the defendants.

[3]      The orders were made at the conclusion of a hearing convened at the parties’ joint request to advise and update the Court.  Out of an abundance of caution, the defendants and counsel wished to ensure that the orders made by the Court were justifiable on the evidence and made on fair notice to Amanda Genet, the other daughter of the late Peter Genet.  Michelle and Amanda Genet are daughters from the first marriage of Peter Genet.   Amanda Genet’s lawyer filed an affidavit acknowledging service of the proceedings on Amanda and Amanda has taken no further steps.

[4]      The plaintiff is the widow of the late Peter Genet and the second defendant is Peter Genet’s son from a previous marriage (a marriage subsequent to that of Peter Genet and the mother of Michelle and Amanda Genet).

[5]      The deed of family arrangement has resulted in full and final settlement of both the plaintiff’s and Michelle Genet’s interests in the estate of the late Peter Genet and in the Trust.

[6]      Essentially, the Court’s decision is directed to s 14 of the Wills Act 2007, which provides that the High Court may make an order declaring a document valid if the Court is satisfied the document expresses the deceased person’s testamentary intentions.  For s 14 to apply, the document must appear to be a will, to not comply with the provision of the Wills Act for a valid will, and to have come into existence in or out of New Zealand.

[7]      The document with which this case is concerned is a memorandum of wishes originally signed in 2006 and updated by Peter Genet in 2011.

[8]      A brief background to and the context in which the memorandum of wishes was entered into, and ultimately the deed of family arrangement executed, is as follows.

[9]      Peter Genet was reputedly a meticulous man who set out his testamentary intentions clearly during his lifetime and with the benefit of specialist legal advice. However, unaccountably, following his marriage to the plaintiff in 2008, he did not update his existing will.

[10]     That will was made in 2006.   At the same time, Peter Genet’s Trust was resettled into a new Trust.  Both the 2006 will and the terms of the resettled Trust were designed to dovetail and provide for asset protection.  The will confirmed that Peter Genet’s estate, after payment out of debts, funeral and trustee expenses, would pass to the Trust and any outstanding debt owed back from the Trust was to be forgiven on his death.  The Trust assets were an undivided half-share of a property at

12 Ardal Grove, the house in which Peter Genet resided, and Peter Genet’s managed funds portfolio.   The other half-share in the house was already bequeathed to the second defendant as his entitlement under his mother’s will.   An asset protection questionnaire completed by Peter Genet at the time records the Trust was resettled because he wished to protect his assets against future partners and to protect his children’s inheritance against those partners.

[11]     The  original  Trust  had  not  specified  the  entitlement  of  the  primary

beneficiaries upon Peter Genet’s death but this was recorded in the memorandum of

wishes which accompanied it.  The memorandum recorded that the second defendant was to receive 93 per cent of the residue of Trust assets and Michelle seven per cent.

[12]     In contemplation of their marriage in 2008, the plaintiff and Peter Genet executed a contracting out agreement.   However, as recorded, Peter Genet did not update his will on marrying and thus it became invalid.

[13]     On 26 July 2011, Peter Genet executed a deed of variation of trust and signed a new accompanying memorandum of wishes.   Under the new deed of trust, the plaintiff was granted the right to occupy the Trust’s half-share in the Ardal Grove property, free of rent subject to payment of certain outgoings, until her death, remarriage or entrance into a civil union or de facto relationship.  A further right vested in the plaintiff was the right to have the first defendant as trustee of the Trust to ensure that the plaintiff enjoys the lifestyle to which, in the opinion of the first defendant, she was accustomed, until her death, remarriage or entrance into a civil union or de facto relationship.

[14] The accompanying memorandum of wishes, which was signed contemporaneously by Peter Genet in the presence of his legal advisor, recorded inter alia as follows:

2.4As part of my asset protection plan my will provides that upon my death my estate will pass to the Trust, and that it is to be dealt with in accordance with this Memorandum of Wishes.

2.5This Trust has been formed as part of my asset protection plan for the following purposes:

ato create and protect assets for the present and future benefit of the Primary Beneficiaries named in the Trust.

bTo ensure that the Primary Beneficiaries are able to benefit from the Trust in a manner which gives them maximum protection against claims by others.

...

3.2Following  my  death  or  earlier  mental  incapacity  please  supply copies of this memorandum of wishes to the Primary Beneficiaries of the Trust and the Protector.

[15]     Peter Genet died suddenly from a heart attack on 15 August 2011 at the age of 69 years.  This was less than three weeks after the Trust was varied and the new memorandum of wishes signed.

Applicable law

[16]     Section 14 of the Wills Act 2007 provides that the High Court may make an order declaring a document valid if it is satisfied that the document expresses the deceased person’s testamentary intentions.

[17]     In determining whether the document is a will, the Court may consider the document, consider evidence in relation to the signing and witnessing of the document, evidence relating to the deceased person’s testamentary intentions and evidence of statements made by the deceased person.

[18]     In  his  helpful  submissions  provided  for  the  guidance  of  the  Court, Mr Sullivan referred to the following statement by MacKenzie J in his presentation to the New Zealand Law Society Seminar “Death and the Law” in 2012:1

The task of the Court is to evaluate the relevant circumstances and reach conclusion.  The Court, following some Australian decisions, has held that the standard is the ordinary civil balance of probabilities.   Because of the importance  of  a  declaration  that  a  will  is  valid,  there  must  be  cogent evidence to support any finding that  the document reflects the deceased person’s testamentary intentions in accordance with s 14(2).

[19]     As Mr Sullivan submitted, the issue for this Court’s consideration is therefore whether a memorandum of wishes in the above form, with the assistance of the now invalidated terms of Peter Genet’s 2006 will and the deed of trust, can, on the balance of probabilities, have the appearance of a will.

[20]     Reference  was  made  to  case  law  supporting  a  determination  that  a memorandum of wishes can constitute a will.  In Estate of Rejouis, Mallon J found

that a memorandum of wishes constituted a valid will under s 14 of the Wills Act

1      Alan MacKenzie “Immediate post death – the Wills Act 2007” (paper presented to New Zealand

Law Society Conference, Wellington and Auckland, May 2012).

because it expressed the deceased’s testamentary intentions and was consistent with

other statements he had made.2

Discussion

[21]     While the evidence does not disclose why Peter Genet did not update his will, it appears this may have been an oversight by legal advisers.  However, it is a clear inference that if Peter Genet had updated his will, the terms of that will would have been identical to the terms of his 2006 will, in relation to the bequeathing of his chattels to the estate and the writing off of any debt back to the Trust.

[22]     I accept Mr Sullivan’s submission that the position is made explicitly clear in the memorandum of wishes as updated in 2011.   Those wishes are expressed in similar terms to the 2006 version while also recording the plaintiff ’s interest in the Trust.

[23]     The key clause of the memorandum of wishes is 2.4, as set out in paragraph

[14] above:

2.4As part of my asset protection plan my will provides that upon my death my estate will pass to the Trust, and that it is to be dealt with in accordance with this Memorandum of Wishes.

[24]     The terms of the memorandum of wishes therefore clearly provide for the estate to pass to the Trust and the memorandum references the 2006 will as if it were still effective.   Thus, the memorandum mirrors the Trust deed in setting out Peter Genet’s testamentary intentions, which were that his estate would pass to the Trust and be distributed in accordance with the memorandum.

[25]     While the memorandum does not record specifically that it is to replace the

2006 will, nor declares in the usual form that the estate is to pass to the Trust and any debt back be forgiven, the express reference to the terms of the 2006 will and to Peter Genet’s asset protection plan, providing for Peter Genet’s estate to pass to the Trust and be dealt with in accordance with the memorandum of wishes, is cogent

evidence  that  supports  the  finding  that  the  document  reflects  Peter  Genet’s

2      Estate of Rejouis HC Nelson CIV-2010-442-156, 23 June 2010.

testamentary intentions in accordance with s 14(2) of the Wills Act.  There is also independent  evidence of the signing and  witnessing of these documents  and  of statements Peter Genet made in relation to the disposition of his estate.

[26]   Thus, it can safely be found on the balance of probabilities that the memorandum  of wishes  correctly expresses  the  testamentary intentions  of Peter Genet.

Conclusion

[27]     I am satisfied on the balance of probabilities that the memorandum of wishes in its form, with the assistance of the now invalidated terms of the 2006 will and the deed of Trust, has the appearance of a will and thus should be declared to be a valid will for the purposes of s 14 of the Wills Act 2007.

Result

[28]     Orders were made accordingly on 30 September 2013 as set out in [1] above.

Goddard J